20120910 0950 Global Commodities Related News.

Hedge Funds Lift Bets to 16-Month High Before Rally (Bloomberg)
Hedge funds raised bullish commodity bets to the highest in 16 months before speculation that policy makers in the U.S., China and Europe will revive global growth pushed prices higher for a sixth week. Money managers increased their net-long positions across 18 U.S. futures and options by 2.3 percent to 1.33 million contracts in the week ended Sept. 4, the highest since May 3, 2011, U.S. Commodity Futures Trading Commission data show. Wagers on a silver rally climbed for a sixth week and to the highest since Feb. 28, while those for cocoa jumped 57 percent to the most since May 2010.
U.S. unemployment stayed above 8 percent for a 43rd month in August, and the stagnating labor market means the Federal Reserve will move closer to adding fresh stimulus measures, according to Bill Gross, who runs the world’s biggest bond fund at Pacific Investment Management Co. European Central Bank President Mario Draghi announced a bond-buying program Sept. 6 and China’s government approved plans for 1,254 miles of roads, subway projects in 18 cities and other infrastructure projects. “The European fears have calmed to an extent, and China may see a bottoming over the next two quarters,” said James Paulsen, the Minneapolis-based chief investment strategist at Wells Capital Management, which oversees about $325 billion. “Commodities have probably turned a corner, and optimism about easing in the U.S. is putting a bid under prices.”

DTN Closing Grain Comments 09/07 14:51 (CME)
Wheat Steals the Show Again. All three wheat markets posted solid double-digit gains for a second straight day, pulling corn to a slightly higher close. A late round of sell orders pulled soybeans to solid losses to close out the holiday-shortened week.(CME)

Pro Farmer: After the Bell Wheat Recap  (CME)
Wheat futures posted double-digit gains in the first several contract months in Chicago and Kansas City. Minneapolis wheat posted slightly lesser gains. Wheat futures also posted gains for the week. USDA will update its wheat Supply & Demand table next Wednesday, but there will not be an updated wheat production estimate -- that will come in the Small Grains Summary on Sept. 28.

Wheat Market Recap Report (CME)
December Wheat finished up 13 1/4 at 905, 7 1/2 off the high and 20 1/4 up from the low. March Wheat closed up 11 3/4 at 915 1/2. This was 19 1/2 up from the low and 6 1/4 off the high. December Chicago wheat traded sharply higher on the day and closed near the high end of the daily range. Kansas City and Minneapolis wheat traded higher as well. Spillover buying from yesterday's explosive trade offered support, along with a sharply lower US Dollar. Unfavorable weather in Australia and Argentina were also supporting factors to finish the week. Australia remains dry over the next 2 weeks and recent rainfall in Argentina has now raised fears that wheat fields could be flooded. Exports sales for the week ending August 30th were in line with trade estimates. Total sales were reported at 573,000 tonnes and the current sales pace for the 2012/13 marketing year is now 35% of the USDA forecast vs. the 5 year average of 45% for this time of the year.
Some traders believe that the recent slide in Black Sea production, along with an expected slowdown in their export sales pace, could mean better demand for US wheat in the second half of the crop year. December Oats closed down 1/2 at 390 1/2. This was 3 1/2 up from the low and 4 1/4 off the high.

Pro Farmer: After the Bell Corn Recap (CME)
Corn futures ended about steady to slightly higher compared with last week's close to remain within the boundaries of the sideways trading range. Upside potential was limited by a lack of fresh news this week, while pressure was limited by tight supplies. Traders expect next week's USDA Crop Production Report to show a smaller crop, but USDA will lower demand if supplies tighten.

Corn Market Recap for 9/7/2012 (CME)
December Corn finished up 1 at 799 1/2, 5 1/4 off the high and 7 1/4 up from the low. March Corn closed up 1 at 802 1/2. This was 7 up from the low and 4 3/4 off the high. December corn finished the day slightly lower but traded both sides of the unchanged. Corn saw support today from a sharply higher wheat market and also on thoughts that next week's USDA report will show a drop in the 2012/13 corn yield. The lower trade in soybeans kept prices gains in check. A closely followed market analyst reported their US corn yield to 119.8 bushels per acre vs. prior estimates of 120.7 but they also feel that eventually the final yield could be 126.5 which was down from 131 previously. The analyst also cut their production estimate to 10.310 billion bushels vs. their previous forecast of 10.338. The firm released a second final production number, much like the yield, at 11 billion bushels vs. prior estimates of 11.224. Export sales for the week ending August 30th were disappointing with total sales reported at just 25,000 tonnes vs. trade estimates of 200-350,000. The current sales pace for 2012/13 is just 25% of the USDA estimates vs. the 5 year average of 29%. The sharp drop in the US dollar provided support to commodities throughout the session as traders look ahead to next week's FOMC meeting. November Rice finished up 0.33 at 14.955, equal to the high and 0.375 up from the low.

GRAINS: Chicago soybean futures fell to pull further away from a record high hit earlier this week as rains improved harvest prospects in parts of the U.S. Midwest that has been scorched by the worst drought in 56 years. Wheat was little changed after rallying in the previous session on expectations that major producer Russia could soon run short of exportable supply after a drought-hit harvest, prompting importers to turn to a more abundant U.S. wheat crop. (Reuters)

Russia sees grain output at 120-125 mln T in 2020 (Reuters)
Russia will boost its annual grain output to 120-125 million tonnes by 2020, of which 35-40 million tonnes would be available for export, President Vladimir Putin said on Friday

China Q4 rapeseed imports seen up 86 pct on year -think-tank (Reuters)
China, the world's top soy importer, has increased imports of rapeseed to bridge a shortage of soybeans expected in coming months after severe drought cut supplies from the United States, an official think-tank estimated on Friday.

India's monsoon splashes into drought-hit states (Reuters)
India's monsoon has splashed back into life, lifting the threat of prolonged drought in the major rice and sugar producer with a second consecutive week of heavier-than-normal rains that could revive yields of summer crops and enable early winter planting.

Brazil govt holds coffee crop forecast at 50.5 mln bags (Reuters)
Brazil's 2012/13 coffee crop will turn out a record 50.5 million 60-kg bags, government crop supply agency Conab said on Thursday, holding to the forecast it gave in May.

SOFTS: ICE cocoa futures edged up towards the prior session's 10-month high while raw sugar rebounded from a two-year low, supported by gains in many financial markets linked to European Central Bank moves to support the region's economy. Arabica coffee futures on ICE also rose in early trade. (Reuters)

Oil Trades Near One-Week High Amid Economic Stimulus Speculation (Bloomberg)
Oil traded near the highest level in a week in New York amid speculation that countries from the U.S. to Asia may add stimulus to their economies, boosting demand for fuel. Futures were little changed after rising a third day on Sept. 7. The U.S., the world’s biggest crude user, holds a Federal Reserve meeting to discuss monetary policy this week, after the European Central Bank last week agreed on unlimited bond purchases to ease the euro-region’s debt crisis. Industrial production in China, the world’s second-biggest oil consumer, rose at the slowest pace in three years in August, data from the National Bureau of Statistics showed yesterday. “The economy is the key thing that people are watching,” Robin Mills, the head of consulting at Dubai-based Manaar Energy Consulting and Project Management, said by telephone Sept. 9. “There’s some optimism about developments in the euro zone last week, though markets are more concerned about what looks like could be a slowdown in the economy in China.”
Oil for October delivery was at $96.30 a barrel, down 12 cents, in electronic trading on the New York Mercantile Exchange at 9:46 a.m. Sydney time. The contract climbed 0.9 percent to $96.42 on Sept. 7, the highest close since Aug. 31. Front-month prices are 2.6 percent lower this year. Brent oil for October settlement climbed 15 cents to $114.40 a barrel on the London-based ICE Futures Europe exchange. The European benchmark grade’s premium to West Texas Intermediate was at $18.10, from $17.83 on Sept. 7.

Fields of Green a Theme for U.S. Oil Refining Future (CME)
A "Pesto" Cocktail for Eco-Friendly Gasoline?
Amid a recent surge in gasoline prices and Hurricane Isaac forcing the temporary shutdown of several oil refineries at the Gulf of Mexico, along with most crude oil and natural gas production from the region, it's clear the lack of refinery capacity in the U.S. is still a major issue that simply won't go away, energy consultant John Licata said. As a result, Americans are "hostage to rising gasoline prices at the pump now more than ever," Licata said in a recent report. With more stringent government fuel requirements coming and older refineries incapable of breaking down crude to more eco-friendly gasoline, it is possible to see pump prices run even higher. Despite a recent short-term rise in refiner "crack spreads," the margin from breaking down a barrel of crude into gasoline and diesel, the "golden age" of refiners seems largely of the past. So what's next? Refiners may need to focus on "greener" pastures in light of government mandates to produce cleaner-burning fuels.
"This has me thinking refiners are going to be forced to add biogas to their business models in a big way to sustain revenue growth," according to Licata, founder of Blue Phoenix Inc., an independent research firm. "We could soon witness crack spreads being replaced by ‘pesto' spreads, representing a new paradigm for refiners to create green fuel, or the ‘green sauce' for making fuel."

OIL-Oil gains ahead of U.S. jobs data
LONDON, Sept 7 (Reuters) - Oil prices rose ahead of a U.S. jobs report which could point to a stronger economic outlook for the world's largest oil consumer.
"Oil demand continues to be hurt by high prices, it's difficult to buy at these levels because you are buying demand destruction," said Olivier Jakob, at Petromatrix in Zug, Switzerland.

White House consults experts as it mulls tapping oil reserve
WASHINGTON, Sept 6 (Reuters) - Obama administration officials met with a handful of oil market experts on Thursday as the White House considers the merits of another release of emergency oil reserves - potentially one much larger than the last.
The meeting, originally scheduled for August but delayed by summer vacations, did not center entirely on the Strategic Petroleum Reserve (SPR), according to non-government sources who attended the meeting.

Copper Trade Most Bullish Since October on Stimulus: Commodities (Bloomberg)
Copper traders are the most bullish in almost 11 months on mounting speculation central banks will do more to bolster growth, strengthening demand for metals. Twenty-one analysts surveyed by Bloomberg said they expect prices to gain next week and five were bearish. A further four were neutral, making the proportion of bulls the highest since Oct. 14. Hedge funds are betting on higher prices for the first time since May and stockpiles in warehouses monitored by the London Metal Exchange, the largest metals bourse, dropped to the lowest level in almost four years.
Commodities, which entered a bull market last month, may rise another 10 percent, Jeffrey Currie, the head of commodities research at Goldman Sachs Group Inc., said in an interview. The European Central Bank yesterday held interest rates at a record low and President Mario Draghi said policy makers agreed to an unlimited bond-purchase program. Federal Reserve Chairman Ben S. Bernanke pledged in an Aug. 31 speech to promote growth with “additional policy accommodation as needed.” “It’s really expectations of what the next round of initiatives will do for global growth,” said Carole Ferguson, an analyst at Fairfax IS in London. “It’s a good indicator of industrial activity. If there’s any recovery in demand, copper should go up quite a lot.”