20120109 1816 FCPO EOD Daily Chart Study.

FCPO closed : 3215, changed : +4 point, volume : lower.
Bollinger band reading : pullback correction upside biased.
MACD Histrogram : weakening, buyer taking profit.
Support : 3200, 3150, 3100, 3070 level.
Resistance : 3250, 3270, 3300, 3350 level.
Comment :
FCPO closed recorded tiny gain with shrinking volume changed hand. Soy oil price rebounding higher after last Friday closed losing substantially while crude oil price trading between gains and losses staying firmed above 100 per barrel level.
News wise, Indonesia agriculture ministry reported lower crude palm oil export of 5% to 19.4 million tonnes for the year of 2011 and forecast 2012 production to increase by 14% to 25.71 million tonnes.
Daily chart formed a small up bar candle with little lower shadow closed in between upper and middle Bollinger band level after market opened lower, rebounded upward into positive zone and fall lower tested new intraday low before edge upward slowly back to recording gain and closed near the high of the day.
Chart reading remained suggesting a pullback correction upside biased market development.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistant or strength with quick cut loss and profit target.

20120109 1759 FKLI EOD Daily Chart Study.

FKLI closed : 1524.5, changed : +1 points, volume : lower.
Bollinger band reading : pullback correction upside biased.
MACD Histrogram : turned lower, buyer taking profit.
Support : 1515, 1505, 1500, 1494 level.
Resistance : 1530, 1540, 1550, 1565 level.
Comment :
FKLI closed slightly higher with decreasing volume transacted doing 2.5 points premium compare to cash market that closed recorded gain. Last Friday U.S. market closed lower and today Asia markets ended mixed while European markets trading mostly lower.
Global market traded mixed ahead of Germany and France leader meeting while news on increased China lending and money supply resulted some Asia market to trade higher.
Daily chart formed a small up bar candle closed below upper Bollinger band level after market opened lower, edge upwards and moved side ways until the end to closed near the high of the day.
Chart study remained suggesting a pullback correction upside biased market development testing support and resistance level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistance or strength with quick cut loss and profit target.

20120109 1741 Regional Markets EOD Daily Chart Study.

 DJIA chart reading :  little upside biased.

 Hang Seng chart reading : side way range bound.

KLCI chart reading : upside biased.

20120109 1638 Global Market & Commodities Related News.

FOREX-Euro hits 16-mth low vs dollar, 11-yr low vs yen
SINGAPORE, Jan 9 (Reuters) - The euro hit a 16-month low versus the dollar hurt by negative news from the euro zone over the weekend, with the risks of further declines seen in coming months.  

The euro hit its lowest level since September 2010 of  $1.2666 on trading platform EBS at one point. Against the yen, the euro hit an 11-year low of 97.28 yen, its lowest level since December 2000.
Corn, soy up on Argentine crop concerns; wheat rises
SINGAPORE, Jan 9 (Reuters) - U.S. corn rose 0.7 percent, while soybeans recovered after two straight sessions of losses with harsh hot and dry weather threatening to curb crop-yields in Argentina, a top global supplier of grains and oilseeds.
"We are looking at sideways trade because of the USDA report this week with an upside bias on weather concerns in South America," said Lynette Tan, analyst with Phillip Futures in Singapore.

S.America soy crop seen shrinking; US exports eyed
CHICAGO, Jan 6 (Reuters) - Analysts expect few major shifts in U.S. soy stockpiles when the U.S. Department of Agriculture issues its January crop reports next week but dry weather should prompt downgrades in USDA's South American crop forecasts.
Such a drop would tighten world soy supplies and could eventually bolster flagging U.S. soybean exports, especially in the upcoming 2012/13 crop year.

US wheat acres seen rising after disappointing crop
CHICAGO, Jan 6 (Reuters) - A U.S. government report is expected to show that farmers last fall planted the most winter wheat in three years as some much-needed rain boosted crop prospects following a dry growing season in 2011, according to analysts surveyed by Reuters.
"The increase in wheat acres was no surprise," said Farm Futures magazine market analyst Arlan Suderman. "Unexpected fall moisture led Plains farmers to aggressively plant winter wheat to get a cover over their previously parched soils."
   
Corn supply to shrink as Argentine crop wilts
CHICAGO, Jan 6 (Reuters) - The U.S. Department of Agriculture (USDA) should trim its forecast for this year's ending supply of U.S. corn to a fresh 16-year low in a report next week, and more declines may occur if U.S. exports increase to compensate for Argentina's drought-hurt crop, analysts said.
"I think USDA may make a slight reduction but they won't be aggressive in this report. I recognize that additional reductions will probably be necessary, we'll know more in 30 days," said Shawn McCambridge, analyst for Jefferies Bache.

Indonesia palm oil exports fall 5 pct in 2011
JAKARTA, Jan 9 (Reuters) - Palm oil exports from Indonesia, the world's largest producer, dropped 5 percent to 19.4 million tonnes last year, the agriculture ministry said on Monday, highlighting rising domestic consumption and downstream investment.
The export fall came despite palm output rising 2.5 percent in 2011 from the previous year, to 22.51 million tonnes, the  ministry said in a statement.

Argentina says drought will reduce corn crop
BUENOS AIRES, Jan 6 (Reuters) - The drought that is drying out Argentina's farm areas will cut into the country's 2011/12 corn harvest, as crops struggle to flower under parched conditions, the government said in a weekly report on Friday.
The world's No. 2 corn producing country has been hit by  dryness related to the La Nina phenomenon just as corn and soy plants need water to help them develop.

Informa lowers South American corn, soy estimates
CHICAGO, Jan 6 (Reuters) - Analytical firm Informa Economics on Friday lowered its forecasts for corn and soybean production in South America, citing dry weather that has cut yield prospects.
The firm cut its estimate of 2011/12 corn production in Argentina, the world's No. 2 corn exporter after the United States, to 24.0 million tonnes from its December estimate of 27.0 million.

South Brazil set for brief respite from drought
SAO PAULO, Jan 6 (Reuters) - Rains will return to the drought-hit grain regions in southern Brazil by the middle of next week, a forecaster said on Friday, but will be too light and brief to neutralize the threat of more crop losses in the world's No. 2 soy and No. 3 corn producer.
"Between January 11 and 15, the weather pattern will change radically. A cold front will finally bring widespread rain to the south," local meteorologists Somar said.

EU clears 107,000 tonnes wheat exports this week
PARIS, Jan 6 (Reuters) - The European Union this week granted export licences for 107,000 tonnes of soft wheat, taking the total since the beginning of the 2011/12 (July-June) season to 7.4 million tonnes, official data showed on Friday.
The total so far this season remained well below the volume in 2010/11 when 11.2 million tonnes of export licences had been cleared by the same stage.

Brent steady near $113; Iran offsets weak euro zone
SINGAPORE, Jan 9 (Reuters) - Brent crude prices steadied around $113 a barrel as  weaker euro zone employment and retail sales data boosted the dollar and dented sentiment, but concerns over Iran's threat to shut a key oil-shipping route capped price falls.  
"I don't think there are big expectations from the meeting. They have met so many times and achieved nothing," said Ben Le Brun, Market Analyst at OptionsXpress in Sydney.

EU states consider delay on any Iran oil ban
BRUSSELS, Jan 6 (Reuters) - A European Union embargo on Iranian crude oil imports could take a few months to start because some EU capitals want a delay they say they need to shield their debt-stricken economies, diplomats said on Friday.  
EU states have agreed in principle to an embargo on Iranian oil, part of the latest Western effort to ratchet up pressure on Tehran over its nuclear programme.

Oil over $113, Iran counters growth concerns
LONDON, Jan 6 (Reuters) - Oil climbed above $113 a barrel on Friday as concern over any possible supply disruption due to mounting tensions between Iran and the West countered worries about Europe's economy and rising U.S. stockpiles.
Crude was set to rise more than 5 percent in the first week of 2012 after Iran threatened to shut the Strait of Hormuz, the world's most important oil route, in retaliation against tighter sanctions from the United States and a possible ban on its crude exports to Europe.

Copper drops as Europe troubles prompt shift to dollar
KUALA LUMPUR, Jan 9 (Reuters) - Copper fell, erasing gains in the previous session, as concerns over slowing growth in the euro zone strengthened the U.S. dollar, making commodities priced in the unit more expensive in other currencies.
"Across the commodity complex, gains were capped because of dollar strength," said Ong Yiling, an investment analyst at Phillip Futures in Singapore.

How Does $4 Gas at Pump Play With Record S&P as 10-Year Note Holds at 2%?
Rallies in stocks and gasoline will push prices toward the highest levels ever in 2012 even as U.S. Treasury yields hold near record lows. So say Douglass Kass of Seabreeze Partners Management Inc., Citigroup Inc.’s Edward L. Morse and Christopher Low of FTN Financial, forecasters whose predictions for equities, energy and bonds proved prescient in 2011. Repeating the feat with their calls for 2012 would require an unprecedented breakdown in price relationships across markets after correlations reached the tightest levels ever. “They can’t all be right,” Chad Morganlander, a Florham Park, New Jersey-based money manager at Stifel Nicolaus & Co., which oversees more than $107 billion in client assets, said in a telephone interview on Jan. 5. “Strategists provide a valuable role in the financial community, but flexibility of institutional and individual investors is paramount.”
Alcoa cuts capacity by 12 pct, sees Q4 charge
NEW YORK, Jan 5 (Reuters) - Alcoa Inc , the largest U.S. producer of aluminum, said it will slash its global smelting capacity by 12 percent, becoming the first producer to take direct action to cut costs amid a steep drop in metal prices.
The move will result in a restructuring charge in the fourth quarter that will push the U.S. producer into its first loss in nine quarters.
     
Indonesia will not introduce tin export tax -govt
JAKARTA, Jan 6 (Reuters) - Indonesia, the world's top refined tin exporter, will not impose export taxes on the base metal this year, a trade ministry official said on Friday.
Late last year, Indonesia's Industry Minister said it was looking to introduce export taxes for coal and base metals in 2012, as it tries to encourage more investment in its mining sector.

Spot copper premiums to China steady, demand to rise
HONG KONG, Jan 6 (Reuters) - Spot copper premiums to China were steady at the start of the year on hopes that demand will pick up next month after the Lunar New Year break, traders said on Friday.
Bonded stocks, arrived in Shanghai and not yet assessed for China's 17 percent value-added tax, and imports due to arrive in the city in less than two weeks traded at premiums of about $120 to $140 a tonne over cash London Metal Exchange copper  prices, compared to about $130 two weeks earlier, traders said.

China daily steel output slips in late Dec - CISA data
SHANGHAI, Jan 9 (Reuters) - China's daily crude steel output declined to 1.626 million tonnes in the last 11 days of December, down 2.4 percent from the preceding ten days, data from the China Iron & Steel Association (CISA) showed on Monday.  CISA figures showed that daily average output in the world's largest steel-producing country stood at 1.654 million tonnes in December, down 0.5 percent from November.

China lead, zinc prices seen low to 2014 -Antaike
SHANGHAI, Jan 9 (Reuters) - Chinese demand of lead and zinc will slow over the next three years, weighing on prices, as growth in the automotive and e-bike sectors tops out and construction sector demand for zinc steadies, a senior researcher at state-backed firm Antaike said.
This is expected to keep domestic prices for battery material lead in a range of 14,500-16,500 yuan a tonne ($2,300-$2,615) in 2012, slightly firmer than prices for zinc, used to galvanise steel, which are seen in a 14,000-16,500 yuan range.

Gold eases on firm dollar, euro zone fear
SINGAPORE, Jan 9 (Reuters) - Gold prices lost more than half a percent, after the momentum that pushed prices up 3 percent last week fizzled as the dollar firmed with growing worries about the euro zone debt crisis.
"There is a somewhat weaker trend across the commodities, as the strength of the dollar is playing a role in limiting appetite," said Nick Trevethan, senior commodity strategist at ANZ in Singapore.

Analysts expect gold to hit record high in 2012-survey
LONDON, Jan 6 (Reuters) - Precious metals analysts expect gold prices to rise for a 12th year in a row and to reach a record high in 2012, but are less optimistic for silver and platinum, according to a survey by the London Bullion Market Association.
The LBMA's survey of 26 contributors showed all but 3 participants expected gold to hit an all-time high in 2012, with a majority of 19 of them forecasting gold to reach a high above $2,000 an ounce.

METALS-Copper drops as Europe troubles prompt shift to dollar
KUALA LUMPUR, Jan 9 (Reuters) - Copper fell erasing gains in the previous session, as concerns over slowing growth in the euro zone strengthened the U.S. dollar, making commodities priced in the unit more expensive in other currencies.
Three-month copper on the London Metal Exchange  lost 1.2 percent to $7,488 a tonne by 0321 GMT, after an increase of 0.5 percent on Friday.

PRECIOUS-Gold eases on firm dollar, euro zone fear
SINGAPORE, Jan 9 (Reuters) - Gold prices lost more than half a percent after the momentum that pushed prices up 3 percent last week fizzled as the dollar firmed with growing worries about the euro zone debt crisis.
Concerns about the debt crisis overshadowed upbeat data out of the United States which showed unemployment rate fell to a near three-year low, evidence that economic growth is gaining steam.

20120109 1235 Global Market & Commodities Related News.

Asian Stocks Decline a Third Day as Bullard Says New Fed Buying Unlikely (Bloomberg)
Asian stocks (MXAPJ) outside of Japan dropped for a third day after Federal Bank of St. Louis President James Bullard said the Fed probably won’t begin a new round of bond purchases amid “encouraging” U.S. economic data. Samsung Electronics Co. (005930), the world’s second-biggest maker of mobile phones by sales, decreased 2.1 percent in Seoul. Hutchison Whampoa Ltd., the utilities company and port operator that gets more than half of revenue from Europe, fell 1.3 percent in Hong Kong after European economic confidence and German factory orders plunged. HTC Corp. dropped 3.8 percent in Taipei as the maker of smartphones posted its first drop in quarterly profit in two years. “An improving U.S. economy doesn’t necessarily mean we’re firmly in a recovery,” said Lee King Fuei, a Singapore-based fund manager at Schroders Plc, which oversees about $326 billion of assets globally. “The question is how sustainable that will be. Europe remains a risk. We’ll probably see more pain before we see a resolution.”

GLOBAL MARKETS-Euro, stocks down as debt jitters trump U.S. data
SINGAPORE, Jan 9 (Reuters) - The euro sank against the dollar and the yen and Asian stocks stalled on Monday, as renewed gloom about the fallout from the European sovereign debt crisis overshadowed signs of vigour in the U.S. economy.
"Despite the positive U.S. employment data, investor focus remains largely on Europe, especially after the downgrade of Hungary's credit rating," said Lim Tae-geun, an analyst at Daewoo Securities in Seoul.

COMMODITIES-Up in 1st week of year though Europe fears stay
NEW YORK, Jan 6 (Reuters) - Commodities ended little changed on  Friday, retaining most of the week's strong gains despite a resurgent dollar that reflected investor fears about Europe's debt crisis.
"This sovereign debt crisis will still be the overarching theme in the near-term," Credit Suisse analyst Stefan Graber said, adding that any gains in commodities would be limited given funding stress at European banks.

Brent crude edges up on Iran, supply worries
NEW YORK, Jan 6 (Reuters) - Brent crude prices edged up on Friday and gained more than 5 percent for the week as anxiety over Iran and potential supply disruptions countered the dollar's strength on better-than-expected U.S. jobs growth and concerns about Europe's economy.
"It was a the tug-of-war between concerns about Iran, Nigeria and signs of an improving U.S. economy supporting oil, and the stronger dollar and worry about the euro zone economy on the other side," said Richard Ilczyszyn, chief market strategist and founder of iitrader.com in Chicago.

NYMEX-Natural gas gains 3 pct on wintry weather outlook
NEW YORK, Jan 6 (Reuters) - U.S. natural gas futures rose nearly 3 percent on Friday, rising back above $3 per million British thermal units as some long-term weather forecasts called for more winter-like weather after a very mild start to the heating season.
MDA EarthSat forecasters called for a shot of cold late in the six to 10-day outlook, noting models were on track for a storm system to bring a shot of much below readings south and east in its wake, followed by high pressure.

Euro Coal-Prices rise 50c/T on short-covering
LONDON, Jan 6 (Reuters) - Prompt physical coal prices rose by 50-75 U.S. cents a tonne on Friday as players covered short positions and Indian buying showed signs of picking up after several months of a lull.
"Every rupee, every paisa counts for the consumers, even more now than before they want the lowest prices and they are looking at a variety of coals, South African, Australian, American," one major Indian trade buyer said.

20120109 1206 Global Economic Related News.

Asian Stocks Rise for Third Week on Improved China, U.S. Economic Data
Asian stocks rose for a third week, its longest streak of weekly advances since July, as manufacturing growth  from China to the U.S. stoked optimism the global economy will withstand Europe’s sovereign-debt crisis. (Bloomberg)

Thailand: To tap lenders, central bank to service 1997 debt
Thailand is set to raise fees on commercial banks as the government prepares to tap collections from lenders and central bank profits for USD2bn in annual interest payments on bailout debt from 1997. A government decree will shift responsibility to repay the THB1.1trn (USD35bn) debt to a central bank agency while keeping the principal on the finance ministry’s books, according to Attaporn Jarujinda, secretary-general of the Council of State, the government’s legal advisory body. While repayments can draw on central bank profits, they won’t involve foreign reserves or prompt it to print money, he said. (Bloomberg)

China: December lending, money supply signal easing conditions
China’s December lending and money supply growth exceeded economists’ estimates, signaling monetary conditions may be easing as the nation’s central banker said it must be prepared for possible shocks from the US and Europe. New loans totaled CNY640.5bn (USD101bn) for the month, exceeding the estimates of all 18 economists surveyed by Bloomberg. M2, a measure of money supply, rose 13.6%, compared with the 12.9% median of 18 estimates. People’s Bank of China Governor Zhou Xiaochuan said the nation must be ready to combat possible shocks from Europe’s debt crisis and an uncertain US economic outlook. (Bloomberg)

India: Singh says economy will grow about 7% this fiscal year
Prime Minister Manmohan Singh said India’s economy will grow about 7% in the year ending Mac 31, less than his December prediction of 7.5%. However, he said that the government hopes to bring back the rhythm of our growth processes to sustain an annual growth rate of 9% to 10% in the medium-term. (Bloomberg)

Taiwan: Presidential candidates vow taxes to contain prices
Taiwan’s presidential candidates have vowed to rein in property prices by imposing new taxes, making surging housing values a key political issue. President Ma Ying-jeou, the Kuomintang party chairman who is seeking re-election on 14 Jan, and opposition Democratic Progressive Party chairwoman Tsai Ing-wen both said they would introduce a capital gains tax on transactions of properties to curb speculative buying. Tsai plans to draft the law within a year. The new taxes will add to Ma’s earlier efforts to fight real-estate speculation that led housing prices in the capital Taipei to more than double since 2000 and reach a record high in September. (Bloomberg)

New Zealand: Trade deficit widens on imports as exports rise
New Zealand’s trade deficit widened in November as crude oil and fertilizer purchases bolstered imports. Exports gained for a third month. Imports exceeded exports by NZD308mn (USD240mn), from a revised NZD228mn deficit in October, Statistics New Zealand said in Wellington. Rising imports add to signs of improving domestic demand before an expected acceleration in the second half this year led by rebuilding of earthquake-devastated Christchurch. Exports are increasing as the New Zealand dollar’s 6.8% decline the past six months offsets the effect of weaker global commodity prices. (Bloomberg)

EU: Hungary’s Orban receives warning from European People’s Party
Hungarian Prime Minister Viktor Orban’s ruling Fidesz group was warned that the European People’s Party will back the European Commission in a dispute over domestic legislation that prompted a breakdown in financial aid talks. The Commission and the International Monetary Fund suspended bailout negotiations with Hungary in December, saying that a newly passed central bank law may curb monetary policy independence. Orban rejected a written request from European Commission President Jose Manuel Barroso to withdraw the central bank bill and a law on financial stability. (Bloomberg)

U.K. Stocks Gain as U.S. Data Boosts Confidence; Vodafone, ITV Shares Rise
U.K. stocks climbed, snapping a two- day selloff, as a U.S. report showed unemployment fell to a near threeyear low, boosting confidence in the recovery of the world’s largest economy. The benchmark FTSE 100 Index  gained 25.42, or 0.5 percent, to 5,649.68 at the close in London, extending this week’s increase to 1.4 percent.  The broader FTSE All-Share Index rallied 0.5 percent, while Ireland’s ISEQ Index was unchanged. (Bloomberg)

Belgium Freezes $1.7 Billion of Spending After EU Warns of Deficit Overrun
Belgium froze 1.3 billion euros ($1.7 billion) in spending after the European Union warned that a weaker-thanprojected economy would push the deficit above the new government’s targets. Belgium, saddled with Europe’s  fifth-highest debt, is battling to prevent a surge in borrowing costs amid domestic economic hardships and  investors’ broader skepticism about the euro area’s response to the two-year-old debt crisis. (Bloomberg)

US: Obama re-election odds may rise as unemployment falls
President Barack Obama called last Friday’s jobs report a sign the US economy is on the rebound. The drop in the unemployment rate in December to 8.5%, showed the job market gaining momentum heading into a presidential election campaign that will be shaped by the state of the economy. The Labor Department figures cap four months of declines in the unemployment rate and six consecutive months of jobs gains of 100,000 or more. Employers expanded payrolls by 200,000 in December. For all of 2011, 1.64 million positions were created, the most since 2006, after a 940,000 increase in 2010. (Bloomberg)

U.S. Stocks Rise as S&P 500 Index Posts Its Second-Best Start Since 2006
U.S. stocks rose last week, sending the Standard & Poor’s 500 Index to its second-best start of a year since  2006, as reports on manufacturing from America to China bolstered optimism about the global economy.  The S&P 500 climbed 1.6 percent to 1,277.81 in the first four trading days of the year, the second-best start in  the past six years after a 2.4 percent gain in 2010, according to data compiled by Bloomberg. The Dow added  1.2 percent, or 142.36 points, to 12,359.92 for the week.  (Bloomberg)

U.S. Unemployment Falls to 8.5% as Jobs Gain
Payroll growth in the U.S. beat forecasts in December and the unemployment rate dropped to the lowest level  in almost three years as the economy gained strength heading into 2012. The 200,000 increase followed a  revised 100,000 gain in November that was smaller than first estimated, Labor Department figures showed  today in Washington. The jobless rate unexpectedly fell to 8.5 percent, while hours worked and earnings  climbed. (Bloomberg)

IMF: To make ‘substantial’ cut in global economic forecast
Olivier Blanchard, the IMF’s chief economist said IMF will make a “fairly substantial” cut to its forecast for global economic growth this year. In September, the Washington-based fund lowered its forecast for global growth to 4% in 2012 and warned of “severe” repercussions if Europe failed to contain its sovereign debt crisis. Blanchard also said overall world growth will probably be “not very far” from 3% to 4%, adding Europe is “very close to zero at this point” while the U.S. is in better shape than many other nations. (Bloomberg)

IEA: Has no immediate plan to release oil stockpiles on Iran
The International Energy Agency, the adviser to U.S., Germany and Japan, isn’t planning an immediate release of emergency oil stockpiles in response to the tension in the Middle East. The organization said as there is no specific supply disruption is under way, they are not actively considering any action at the present time. Crude oil gained over the last three weeks, partly on concern that Iran may close the Strait of Hormuz at the mouth of the Persian Gulf. The waterway carries about 17 m barrels of oil a day, according to the U.S. Energy Department. That’s about 19% of global consumption. (Bloomberg)

20120109 1043 Malaysia Corporate Related News.

Maybank: Going big into retail stockbroking
Maybank Investment Bank, unit of Maybank (MAY MK, Buy, TP: RM9.15) said it is aggressively building up its current remisier base of 150 people. Its CEO, Tengku Datuk Zafrul Tengku Aziz said retail equities is the focus for Maybank IB now as their recent acquisition, Kim Eng is very strong in retail equities. He also added that they plan to strengthen the Malaysian office’s retail stockbroking segment and go into a bank broking model where customers can walk into any branch to open an account and trade online. (Starbiz)

DRB-Hicom: Confirms bids for Proton
DRB-HICOM Bhd, the country's biggest publicly-traded automotive company, has submitted a proposal to acquire Khazanah Nasional Bhd's 42.7% stake in. DRB-HICOM, a unit controlled by billionaire Tan Sri Syed Mokthar Al Bukhary, is awaiting a decision from the government. DRB-Hicom‘s MD Datuk Seri Mohd Kamil Jamil said the proposal was submitted to Proton for purchase of shares in the middle of last year. He added that the bid was a standalone one and did not involve any strategic partner. (Sunbiz)

Proton: Confirms talks with GM
Proton confirmed that talks with General Motors Corp (GM) are only at a preliminary stage but did not reveal further details. The national car maker said should there be further developments that warrant an announcement, Proton would make the necessary disclosure accordingly. Meanwhile, Proton also maintained that Datuk Seri Mohd Nadzmi Mohd Salleh's bid for Proton is a bid in his own personal capacity as an individual. (Business Times)

Proton: More suitors for the national carmakers?
It is learnt that Tan Sri Arumugam Apavoo Packiri and Gerald Lopez of Genii Capital are looking to put in a joint bid for Khazanah Nasional Berhad’s stake in Proton. Sources familiar with the company say the two had already made some overtures to Khazanah. It is said that the plan involves Lopez taking over the Proton’s asset, Lotus Group International Ltd and Lotus Group Plc while Tan Sri Arumugam will end up with a controlling stake in Proton. (The Edge Weekly)

MAS: Increases frequencies to regional, long haul network from Mac 25
MAS is increasing its weekly frequencies to several ASEAN destinations as well as to Beijing, Taipei and Los Angeles effective March 25, 2012 to cater for the anticipated capacity demand in the northern summer season. The selected ASEAN destinations are Phnom Penh, Manila, Jakarta, Medan and Bangkok. MAS's flight frequency expansion is in line with the airline's Business Plan revealed on Dec 7, 2011 where the national carrier's network focus going forward is on the core ASEAN region where its presence is the strongest. (Bernama)

Felda: PM urges settlers to support listing
Prime Minister Datuk Seri Najib Tun Razak urges the Felda community to place full confidence in the listing of Felda Global Ventures Holdings Sdn Bhd (FGVH), saying it will ensure them a more secure future and, perhaps, even a windfall in 4 to 5 months. He promised to personally take an interest in the venture. He added that the listing would take the settlers on their second quantum leap of becoming shareholders of a global company reaping high dividends. (Business Times)

KHSB: To be privatized by Kumpulan Perangsang Selangor?
Kumpulan Perangsang Selangor (KPS) is looking to restructure the group with a possible eye on privatizing its subsidiary Kumpulan Hartanah Selangor Bhd (KHSB). Sources said that KPS has been given the mandate by its majority shareholder, Kumpulan Darul Ehsan Bhd to look into a restructuring exercise. (The Edge Weekly)

Sime Darby: Subsidiary files application to intervene in judicial review against SC
Sime Darby’s subsidiary Sime Darby Nominees Sdn Bhd (SD Nominees) has filed an application to intervene in the judicial review sought by Michael Chow Keat Thye against the SC, on the grounds that it would be a party whose legal and commercial interest will be directly affected by the judicial review proceedings and should therefore be afforded the opportunity to be heard in such proceedings. (Financial Daily)

Media Prima: Eyes 2m viewers per match for Euro 2012
Media Prima expects one to 2m viewers for each of its live 2012 UEFA European Football Championship (Euro 2012) football matches, similar to the corresponding tournament in 2008. Chief Operating Officer (Television Networks) Ahmad Izham Omar said during Euro 2008, the free-to-air television channel attracted one to two million viewers for each of its live football matches. He said TV3, a channel under the Media Prima umbrella, will be broadcasting 16 live matches from the 32-match tournament. "NTV7 will be airing three delayed telecast matches in the prime time slot. He added that other channels and platforms under the Media Prima stable will also be supporting Euro 2012 with a line-up of local and international programmes starting January to July. (Bernama)

Harvest Court: Exits designated status
Bursa Malaysia is removing the trading curbs on Harvest Court’s shares and warrants with effect from Monday, nearly eight weeks after they were imposed on Nov 16. The exchange said with the removal of the designated securities status on Harvest Court securities, they would be traded on a ready basis. However, the exchange said it would continue to monitor the trading activities of the shares and warrants and where trading concerns are noted, the exchange may take appropriate regulatory actions. (Financial Daily)

Muhibbah Engineering: CIMB Bank picks PwC as receivers over Asia Petroleum Hub
CIMB Bank, which is the financier of the Asia Petroleum Hub Sdn Bhd (APH) project, has appointed PricewaterhouseCoopers (PwC) as receivers and managers over APH to facilitate a restructuring exercise. Muhibbah Engineering said in a statement to Bursa Malaysia on Friday that the APH project was viable and it was working with various financiers, including CIMB, and other relevant parties towards an amicable solution. To recap, APH had awarded an RM820m contract for Muhibbah to undertake marine piling and jetty works where payments later stalled and about RM371m was outstanding. Investors were understandably concerned whether Muhibbah would be able to collect RM371m owed to it by APH. (Financial Daily)

Can-One, Kian Joo: Acquisition allowed by Federal Court, likely to set up SPV
Can-One has won the legal tussle to acquire the 146.13m Kian Joo’s shares held by Kian Joo Holdings Sdn Bhd after a Federal Court ruled in its favour on Thursday. The apex court had allowed its appeal to proceed with the completion of the acquisition of the 32.9% stake for RM241.11m. Sources said CAN-One will likely set up a special purpose vehicle (SPV) to merge the company with Kian Joo with a similar structure to that of the Kencana Petroleum Bhd- Sapura Crest Bhd merger. Under the deal, Can-One shares will be valued above the RM2 mark each, while the shares of Kian Joo will be valued slightly higher. This is because Can- One's annualised profit is poised to soar after taking into account the annualised profit of its 32.9% block in Kian Joo. (Business Times)

Automotive: Commercial vehicle to lead
The commercial vehicle segment is expected to see a bigger rise in sales compared with passenger vehicle this year, as demand is likely to be buoyed by rising commercial activity and healthy construction sector growth. Frost & Sullivan expects the commercial vehicle segment to grow by 3.4% to 67,400 units in 2012 from a projected 65,200 in 2011 while the passenger vehicle segment is predicted to expand marginally by 0.9% to 544,600 units from a forecast 539,800 units in 2011. (Business Times)

Transport: Cargo volume to grow 10.1% in 2012
Frost & Sullivan said Malaysia's total cargo volume is expected to grow 10.1% to 545.13m tonnes this year as compared to 495.29m tonnes in 2011. It’s VP for transportation and logistics practice, Asia Pacific, R. Gopal, said sea freight is currently the most favoured mode of transport for cargoes in Malaysia, handling more than 90% of total freight in 2011. He added that Port Klang, Malaysia's busiest container port, contributed 39.2% of total sea throughput in 2011 while Port of Tanjung Pelepas contributed 22.7%. He also said that cargo volume by rail is expected to increase to 6.2m tonnes this year as compared to 5.9m tonnes in 2011 while cargo volume by air to grow 3.9% to 925,000 tonnes in 2012, driven by steady growth in the economy and external trade. He said that air cargo volumes should aim to cross the 1m tonne mark to ensure the infrastructure facilities and supporting supply chain functions are fully leveraged. (Bernama)

Insurance: Gradual revision of motor tariff premiums from Jan 16
Bank Negara announced that the gradual revision in the motor tariff premium rates will be implemented effective Jan 16. The central bank said the premium adjustment was in small quantum and to be implemented over a period of 4 years. For third-party cover, motorcycles of 110cc will experience a premium increase of between RM1.00-RM3.50 per year over the next 4 years. For a private car of 1,100cc, the premium adjustment will be between RM6.00- RM34.00 per year over the same period. For commercial vehicles such as outstation taxis and buses, the impact of the premium adjustment on the passengers will be minimal, at less than 10 sen per passenger per trip. (Financial Daily)


PLUS issues world’s largest sukuk worth RM30.6bn
Project Lebuhraya Usahasama (PLUS) is set to issue RM30.6bn sukuk – the largest global sukuk and Malaysia’s single largest bond issuance to date. The sukuk, issuance, scheduled for 12 Jan, follows the privatization of PLUS Expressways Berhad (PEB) and the restructuring of the toll concessions under PEB and Penang Bridge SB (PBSB). (Financial Daily)

Logistics industry ‘will focus on sustainability, healthcare’
Sustainability and healthcare will be the focus areas for logistics industry in the country for this year, Frost & Sullivan vice president and country head Gopal R said last Friday. He said logistics service providers must emphasize and coordinate sustainable logistics’ practices that meet customer requirements at minimum cost such as transport modal shift to lower CO2 (carbon dioxide) emission and utilize warehouse rooftop areas to install solar panels under the feed-in tariff scheme implemented by the government. (Malaysian Reserve)

Motor tariff premium rates revised
A revision in motor tariff premium rates in Malaysia will take effect from 16 Jan on a gradual basis over the next four years. Bank Negara said at a briefing that the premium adjustment, which would be implemented in small amounts over a measured pace, was expected to have only a marginal impact on the public and businesses. For example, in respect of third-party cover, motorcycles of 100cc would experience a premium increase of between RM1 and RM3.50 per year over the next four years. For a private car of 1,400cc, the premium adjustment would be in the range of RM6 to RM34 per year over the next four years. (StarBizWeek)

HSBC cuts GDP forecast for Malaysia
HSBC Bank Malaysia has reduced its 2012 gross domestic product (GDP) forecast for Malaysia to 3.7% from 5.0% due to slower global growth, which will continue to dampen exports. HSBC said it, however, expected the domestic demand to hold up relatively well, supported by a solid employment outlook and monetary and fiscal stimulus as well as more projects would commence under the Economic Transformation Programme, and help to shore up the economic growth. It said the global cooling should help reduce inflationary pressure by slowing growth and reining in international commodity price inflation. (Malaysian Reserve)

20120109 1027 Global Market Related News.

Asian Stocks Drop for Third Day as Bullard Says New Fed Buying Is Unlikely (Source: Bloomberg)
Asian stocks (MXAPJ) outside of Japan dropped for a third day after Federal Bank of St. Louis President James Bullard said the Fed probably won’t begin a new round of bond purchases amid “encouraging” U.S. economic data. Samsung Electronics Co., the world’s second-biggest maker of mobile phones by sales, fell 2 percent in Seoul after retail sales in Europe fell more than estimated last month. James Hardie Industries SE (JHX), a building materials supplier that gets about 68 percent of sales from the U.S., slid 1.5 percent. David Jones Ltd. led Australian retailers lower after the nation’s retail sales unexpectedly stalled. “An improving U.S. economy doesn’t necessarily mean we’re firmly in a recovery,” said Lee King Fuei, a Singapore-based fund manager at Schroders Plc, which oversees about $326 billion of assets globally. “The question is how sustainable that will be. Europe remains a risk. We’ll probably see more pain before we see a resolution.”

U.S. Stocks Rise as S&P 500 Index Posts Its Second-Best Start Since 2006 (Source: Bloomberg)
U.S. stocks (SPX) rose this week, sending the Standard & Poor’s 500 Index to its second-best start of a year since 2006, as reports on manufacturing from America to China bolstered optimism about the global economy. Equities fell on the last day of the week after growth in U.S. jobs failed to lift the S&P 500 above its October high. Bank of America Corp. (BAC) and Microsoft Corp. (MSFT) jumped more than 8.3 percent to lead advances in the Dow Jones Industrial Average (INDU) during the holiday-shortened week. Netflix Inc. (NFLX) soared 25 percent after reporting online viewing that surpassed an estimate from BTIG LLC. Sears Holdings Corp. (SHLD) and AutoNation Inc. (AN) fell more than 8.1 percent to pace declines among retailers. The S&P 500 climbed 1.6 percent to 1,277.81 in the first four trading days of the year, the second-best start in the past six years after a 2.4 percent gain in 2010, according to data compiled by Bloomberg. The Dow added 1.2 percent, or 142.36 points, to 12,359.92 for the week.

European Stocks Advance for First Week of 2012 as Reports Boost Optimism (Source: Bloomberg)
European stocks (SXXP) advanced in the first week of 2012 as economic reports from around the world added to optimism that the global economy can weather the fallout from the euro area’s sovereign-debt crisis. Eurasian Natural Resources Corp. and Fiat SpA led gains in mining companies and carmakers, both climbing at least 11 percent. Banks limited gains as UniCredit SpA slumped 38 percent, its largest drop since at least 1989, after announcing that it will hold its planned rights offer at a discount. The benchmark Stoxx Europe 600 Index (SXXP) rose 1.2 percent to 247.53 in the first five trading days of 2012, for the benchmark measure’s third-consecutive week of gains. The gauge has advanced 5.9 percent (SXXP) since Dec. 16 as U.S. reports from manufacturing activity to durable-goods orders showed the economic recovery is gathering pace.

Retail Sales Probably Rose in December: U.S. Economy Preview (Source: Bloomberg)
Sales (RSTAMOM) at U.S. retailers probably rose in December as Americans bought discounted holiday items, a sign the economy picked up heading into 2012, economists said before a report this week. The projected 0.3 percent gain in purchases would follow a 0.2 percent advance in November, according to the median (RSTAMOM) forecast of 56 economists surveyed by Bloomberg News ahead of Commerce Department figures on Jan. 12. Other data may show consumer confidence rose this month. Retailers like Macy’s Inc. (M) spurred demand by cutting prices and extending hours to ensure consumers, strapped by falling home prices and stagnant wages, shopped for holiday gifts. A report last week showed unemployment fell to an almost three- year low and hiring accelerated, indicating an improving job market will give workers the means to sustain purchases.

Bullard Says New Quantitative Easing Unlikely (Source: Bloomberg)
Federal Reserve Bank of St. Louis President James Bullard said the Fed probably won’t begin a new round of bond purchases following “encouraging” data showing the U.S. economy gained 200,000 payroll jobs in December. “Hopefully, we will keep this momentum going in 2012,” Bullard told reporters yesterday after a speech in Chicago. “The tone of the data has been very strong” and the central bank “probably could wait and see for now” before deciding whether there is a need for more accommodation, he said. Policy makers are divided over whether they should see if the economy deteriorates before taking additional steps to try cutting borrowing costs and boosting job creation. The U.S. economy is growing moderately amid “apparent slowing” in global growth, with “some improvement in overall labor market conditions,” Fed officials said last month. The unemployment rate fell to 8.5 percent from 8.7 percent in November, figures from the Labor Department showed last week.

Jobs Report in U.S. ‘Encouraging,’ New Fed Buying Unlikely, Bullard Says (Source: Bloomberg)
Federal Reserve Bank of St. Louis President James Bullard said data showing the economy gained 200,000 payroll jobs in December is “encouraging” and the Fed probably won’t begin a new round of bond purchases. “Hopefully, we will keep this momentum going in 2012,” Bullard told reporters today after a speech in Chicago. “The tone of the data has been very strong” and the central bank “probably could wait and see for now” before deciding whether there is a need for more accommodation, he said. Policy makers are divided over whether they should see if the economy deteriorates before taking additional steps to try cutting borrowing costs and boosting job creation. The U.S. economy is growing moderately amid “apparent slowing” in global growth, with “some improvement in overall labor market conditions,” Fed officials said last month. The unemployment rate fell to 8.5 percent from 8.7 percent in November, figures from the Labor Department showed yesterday.

Fed’s Monetary Policy Is Effective Even With Rates Near Zero, Bullard Says (Source: Bloomberg)
Federal Reserve Bank of St. Louis President James Bullard said monetary policy has influenced inflation and price expectations, even with the benchmark interest rate near zero since December 2008. “Stabilization policy should be left to the monetary authority, which can operate effectively” with interest rates near zero, Bullard said today in a speech in Chicago. By contrast, the use of tax and spending changes to respond to shocks in the economy over the short run “has run its course.”
Fed officials are divided over whether the central bank should wait to see if the economy deteriorates before taking additional steps to try cutting borrowing costs and boosting job creation. The U.S. economy is growing moderately amid “apparent slowing” in global growth, with “some improvement in overall labor market conditions,” Fed officials said last month. The economy gained 200,000 payroll jobs in December and the unemployment rate fell to 8.5 percent from 8.7 percent in November, figures from the Labor Department showed yesterday.

Economy Brightening in 2012 Initial Data From U.S. Belying Grim Investors (Source: Bloomberg)
The U.S. economy is beginning 2012 on a brighter note in a sign investors may be too pessimistic. Payrolls rose 200,000 in December, double the gain in November, a Labor Department report showed yesterday. A weekly measure of consumer confidence ended 2011 at a five-month high. And manufacturers reported their business in December grew at the fastest pace in six months. The combination indicates the world’s largest economy has enough staying power to withstand a recession in Europe and a slowdown in China. “Markets are absolutely preoccupied about the risks from Europe and the U.S. housing market,” said John Herrmann, senior fixed-income strategist at State Street Global Markets in Boston, and the second most-accurate U.S. economic forecaster based on data from the last two years compiled by Bloomberg. “Yet we’re finding the economy continues to hold together fairly resiliently. We’re getting a good handoff from the fourth quarter.”

Corporate Profit Growth Hits a Two-Year Low as U.S. Feels Drag From Europe (Source: Bloomberg)
U.S. corporations ended 2011 with the slowest profit growth in two years as the mending economy that lifted Macy’s Inc. (M) was met by a European slump that vexed companies more tied to global sales, such as Cisco Systems Inc. Standard & Poor’s 500 Index companies may have earned $24.74 a share (SPX) in the fourth quarter, according to analysts’ estimates compiled by Bloomberg as of Jan. 6. The projected 6 percent gain is the smallest against a year-earlier quarter (SPWPPRCT) since September 2009, just after the U.S. recovery began. “Slowing global growth, some impairment of export activity to Europe and perhaps even the rise of the dollar collectively have begun to sort of work against the multinational story,” said Mark Luschini, chief investment strategist at Philadelphia- based Janney Montgomery Scott LLC, which manages $54 billion. While growth is still “subpar,” he said he intends to invest more in the U.S. to avoid higher international risk.

Obama Odds May Rise as Unemployment Falls (Source: Bloomberg)
President Barack Obama called yesterday’s jobs report a sign the U.S. economy is on the rebound. His prospects for re-election may depend on it. The drop in the unemployment rate (USURTOT) in December to 8.5 percent, a three-year low, showed the job market gaining momentum heading into a presidential election campaign that will be shaped by the state of the economy. The Labor Department figures cap four months of declines in the unemployment rate and six consecutive months of jobs gains of 100,000 or more. Employers expanded payrolls by 200,000 in December, exceeding a median estimate of 155,000 in a Bloomberg News survey. For all of 2011, 1.64 million positions were created, the most since 2006, after a 940,000 increase in 2010.

U.S. Stocks Funds Have Second-Worst Year as Clients Pull Out (Source: Bloomberg)
U.S. stock mutual funds that invest in domestic equities had their second-biggest redemptions last year as record market swings sent investors to the perceived safety of bond funds. Investors pulled an estimated $132 billion from mutual funds that invest in U.S. stocks, the fifth straight year of withdrawals for domestic funds, according to preliminary data from the Investment Company Institute, a Washington-based trade group whose numbers go back to 1984. Withdrawals reached $147 billion in 2008 when the Standard & Poor’s 500 Index fell 37 percent, including dividends. Withdrawals accelerated in May and June amid concern that weaker European economies would not be able to repay their debts. They peaked in July as Congress debated whether to lift the nation’s debt ceiling.
Those events, as well as lingering memories of the 2008 selloff and a subpar U.S. economic recovery, may all have contributed to investor discontent, said Russel Kinnel, director of mutual fund research at Chicago-based Morningstar Inc. interview.

China Money Supply Growth Exceed Estimates (Source: Bloomberg)
China’s December lending and money supply growth exceeded economists’ estimates, signaling monetary conditions may be easing as the nation’s central bank said it must be prepared for possible shocks from the U.S. and Europe. New loans (CNLNNEW) totaled 640.5 billion yuan ($101 billion) for the month, exceeding the estimates of all 18 economists surveyed by Bloomberg. M2, a measure of money supply (CNMS2YOY), rose 13.6 percent, compared with the 12.9 percent median of 18 estimates. People’s Bank of China Governor Zhou Xiaochuan said yesterday the nation must be ready to combat possible shocks from Europe’s debt crisis and an uncertain U.S. economic outlook, echoing comments by Premier Wen Jiabao. China last month cut the reserve requirement for banks for the first time since 2008 as Europe’s debt crisis eroded demand for its exports and consumer prices moderated to the slowest pace in 14 months.

Shrinking China Surplus May Help Wen on Yuan (Source: Bloomberg)
China’s trade surplus may narrow to an eight-year low in 2012 as slowing external demand undermines exports, a shift that may help the nation rebuff overseas criticism for maintaining an undervalued exchange rate. Bank of America Corp., Credit Agricole CIB and Haitong Securities Co. estimate the surplus (CNFRBAL$) this year will slip below $102 billion. For December, the excess shrank to $9.45 billion, according to the median of 18 estimates in a Bloomberg News survey, indicating an annual surplus of $147.9 billion. The latest monthly figures are due tomorrow, before the arrival in Beijing of U.S. Treasury Secretary Timothy F. Geithner, who said last year that China’s yuan hadn’t risen fast enough. With a prolonged crisis in Europe, the biggest Chinese trading partner, Premier Wen Jiabao may have little appetite to accommodate Geithner’s request, analysts said.

No Consensus on China Stocks After Plunge (Source: Bloomberg)
Even after a two-year bear market wiped 33 percent from China’s benchmark stock index (SHCOMP), there’s no consensus on the direction in equity prices this year among the nation’s biggest and most accurate brokerage firms. The Shanghai Composite Index (SHCOMP) will gain 36 percent because slowing inflation will let policy makers cut interest rates and bank reserves, according to Zhang Han, a strategist at Guotai Junan Securities Co., the only major brokerage to foresee the slump. China International Capital Corp., led by the son of a former premier, forecasts a “slight” drop since the economy isn’t slowing enough to permit “aggressive” reductions in borrowing costs, said Hao Hong, CICC’s global equity strategist.
While China avoided the global recession in 2009 and is growing more than twice as fast as the world economy, the index has been the worst among the 10 biggest markets in the past two years, according to data compiled by Bloomberg. The central bank boosted rates and reserve requirements to curb property prices and inflation that reached a three-year high in July. Premier Wen Jiabao said on Jan. 3 that business conditions may be “relatively difficult” this quarter and monetary policy will be adjusted.

Hong Kong Says 2 Dead Birds Positive For Bird Flu (Source: CME)
The Hong Kong government said that two dead birds found in the New Territories earlier this week have tested positive for a lethal strain of bird flu, the latest development in the global resurgence of the deadly virus. The two black-headed gulls, a common winter visitor in Hong Kong, were found in separate parts of Hong Kong's rural hinterland. The government reiterated its pledge to conduct inspections of poultry farms to ensure proper precautions are made against bird flu. Renewed fears over the spread of the disease in Hong Kong came as Chinese authorities confirmed that the virus strain in a Shenzhen man--whose death Saturday was the first human case of bird flu in China in 18 months--was very similar to that found before the holidays on a dead bird.
Bird flu, also known as avian influenza, remains a threat primarily to poultry, not humans, among whom it is poorly transmitted. Nonetheless, scientists warn that mutations in the H5N1 strain of the disease could allow human-to-human spread and potentially create a global pandemic. Hong Kong has occasionally detected bird flu in poultry, but there have been no major outbreaks in the city since 1997, when the virus killed six people and led to the slaughter of 1.5 million birds in the territory.

20120109 1026 Soy Oil & Palm Oil Related News.

Indonesia 2011 Crude Palm Oil export down 5% to 19.4 million tonnes : Indonesia Agriculture Ministry
Indonesia 2012 Crude Palm Oil output sees up 14% to 25.71 million tonnes : Indonesia Agriculture Ministry

Soybeans (Source: CME)
US soybean futures end lower, hitting a 1-week low as the market lacked fundamental support to justify higher prices. The market doesn't have overtly bullish news to sustain advances, says ebottrading's John Kleist. He adds the market has no strong demand, dire crop consequences in South America or global supply tightness. Today's declines were accelerated by technical selling as traders viewed the market as overbought with rains due to move into Argentina next week. CBOT March soybeans end down 12 1/2c at $11.96 1/2 a bushel.

Soybean Meal/Oil (Source: CME)
Soy-product futures finished lower, retreating in unison with soybeans. Soyoil futures slid to a 2-week low, fueled by investment-fund selling amid the absence of fresh fundamental news to support prices, analysts say. Soymeal ended lower, but garnered mild support from traders liquidating long soyoil/short soymeal spreads. CBOT March soyoil dropped 0.94c to 51.12c/pound while March soymeal fell 80c to $312.40/short ton.

Soybeans Falls on ‘Gloomy’ Economic Outlook; Corn Futures Post Weekly Drop (Source: Bloomberg)
Soybeans fell, capping the biggest two-day drop in six weeks, on speculation that a faltering global economy will damp prospects for commodity consumption. Corn recorded a weekly decline. Christine Lagarde, the managing director of the International Monetary Fund, said today that the global economic outlook “is quite gloomy” amid Europe’s “escalating” debt woes. Soybeans posted the first weekly drop since in a month, partly on signs that weather conditions will improve in Brazil and Argentina, bolstering crops. “Demand is weak,” Anne Frick, the senior oilseed analyst at Jefferies Bache Commodities LLC in New York, said in a telephone interview. “There’s still time for rain to improve crop yields in South America” after dry weather in the past month threatened to reduce yields, she said.

Clock ticking for rains to save Argentine soy crop
BUENOS AIRES, Jan 5 (Reuters) - Unrelenting sun in Argentina has scorched as much as a fifth of its corn crop and the drought will start biting into the country's vast soy harvest unless rains come to the rescue this month or next.
Benchmark Chicago corn and soybean prices have both rallied more than 10 percent in the past three weeks as a hot, dry southern hemisphere summer has roasted grain fields across Argentina's legendary Pampas farm and cattle region.

Palm oil extends losses as Europe woes weigh
SINGAPORE, Jan 6 (Reuters) - Malaysian crude palm oil futures extended losses as renewed worries on the euro zone debt crisis dampened investor sentiment, but losses were capped by prospects of erratic weather hurting production.
"We are lacking a new catalyst. The traders will most probably just play within the range while keeping an eye on the CBOT," said a dealer with a foreign commodities brokerage in Kuala Lumpur.

20120109 1027 Global Commodities Related News.

Corn (Source: CME)
US corn futures close flat to slightly lower under pressure from soybeans and uncertainty about South America's crop prospects. A wetter forecast for Argentina has put the brakes on a recent rally, but traders are uncertain about how the forecast could shift over the weekend. Crops there badly need soaking rains, analysts say. Traders also wary of next week's January USDA reports, which have been huge market-movers in recent years. A late swoon in soybeans and pressure from a stronger US dollar also kept a lid on corn, traders say. CBOT March corn ends flat at $6.43 1/2 a bushel, down 3c on the week. Other contracts close lower.

Wheat (Source: CME)
US wheat futures fell, with Minneapolis spring wheat tumbling to multi-month lows. Investors saw little incentive to buy wheat amid sluggish export demand, ample global wheat supplies and improved winter wheat crop conditions, analysts say. There is no threatening weather for wheat crops and with much better moisture for winter wheat crops in the U.S. southern plains, traders view wheat futures as overpriced, analysts say. CBOT March wheat ends down 4 1/2c at $6.24 3/4 while MGEX March wheat slides 2.1% to $8.01 and KCBT March wheat dropped 6c to $6.80.

Rice (Source: CME)
US soybean futures end lower, hitting a 1-week low as the market lacked fundamental support to justify higher prices. The market doesn't have overtly bullish news to sustain advances, says ebottrading's John Kleist. He adds the market has no strong demand, dire crop consequences in South America or global supply tightness. Today's declines were accelerated by technical selling as traders viewed the market as overbought with rains due to move into Argentina next week. CBOT March soybeans end down 12 1/2c at $11.96 1/2 a bushel.

Corn, soy steady; Argentine rain forecast weighs
SINGAPORE, Jan 6 (Reuters) - U.S. corn and soybean futures were little changed, after last session's heavy losses, as forecasts of rain across parched farms in Argentina continued to weigh on sentiment.  
"Rain for Monday and Tuesday looks certain for Argentina, but overall they are still below average," said Adam Davis, a senior commodity analyst at Merricks Capital in Melbourne.

Warm weather threatens to extend U.S. drought
Jan 5 (Reuters) - A New Year's Eve "heat wave" melted away welcomed winter snow that had brought some drought relief to the U.S. Plains, reviving fears that harmfully warm and dry conditions will persist into 2012, U.S. climatologists said in a report issued Thursday.  
"The return of warm, dry weather to the nation's southern tier could be suggestive of an increasingly La Nina-driven atmospheric regime," said the U.S. Drought Monitor report, issued weekly by a team of national, state and academic climatology experts.

Snowless winter a worry for U.S. crops
CHICAGO, Jan 5 (Reuters) - It is early January, a time when farm fields in the U.S. Midwest should be blanketed with white snow.
Instead, the only color is brown. The soil lies uncovered missed by this season's snow storms and deprived of moisture needed to give crops a proper start this spring and during the hot summer growing season.

La Nina - herald of drought - may linger into spring
ORLANDO, Fla., Jan 5 (Reuters) - La Nina, the weather phenomenon blamed for searing drought in the southern United States and South America, may last longer than expected into the Northern Hemisphere spring and could spark another crop-killing dry spell, the U.S. Climate Prediction Center warned  on Thursday.
The CPC's monthly update said the latest sea-temperature data suggests La Nina "will be of weak-to-moderate strength this winter, and will continue thereafter as a weak event until it likely dissipates sometime between March and May".
 
Argentine corn, soy to get ample rains-exchange
BUENOS AIRES, Jan 5 (Reuters) - The Buenos Aires Grains exchange kept its estimate for Argentina's 2011/12 commercial corn area unchanged on Thursday, predicting that rains over the two weeks ahead will revive parched fields.
Farmers in grains exporting powerhouse Argentina have been worried about recent dry weather and a feared repetition of the devastating drought of 2009, which scorched grains fields and wiped out entire herds of cattle.

Drought dents hope for bumper Brazil soy, corn crop
SAO PAULO, Jan 5 (Reuters) - Two important Brazilian corn and soy producers Parana and Rio Grande do Sul made sharp cuts to crop forecasts on Thursday after weeks of harsh, dry weather dented prospects for a soy crop that as recently as this week some still expected to be a record.
Brazil's biggest soy state Mato Grosso which grows nearly a third of the crop has been spared weather havoc this year but traders are closely watching losses in other states and in Argentina. Markets grow more tense with each dry day.

Argentine farm areas seen dry until next week
BUENOS AIRES, Jan 5 (Reuters) - Grains-exporting powerhouse Argentina is expected to remain dry until next week, when showers are predicted for the main soy and corn producing province of Buenos Aires, a climatologist said on Thursday.
Dryness related to the La Nina phenomenon has prompted analysts to cut their 2011/12 corn output predictions while soy farmers hope that rains expected for late January and February will revive their parched fields.

Argentina Eases Wheat Export Restrictions In Nod To Farmers (Source: CME)
Argentina's federal government has formally agreed to ease restrictions on wheat exports, in a concession to farmers who say the outgoing permitting system forced them to sell their grain at a steep discount. "This mechanism protects the first 7 million [metric] tons that Argentina needs for domestic consumption. All of the rest is available to producers who can sell it as they see fit," Agriculture Minister Norberto Yauhar said in a press conference late Thursday afternoon. Argentina tightly regulates corn and wheat exports to keep local food prices low, with the government issuing export permits only when it decides that enough grain has been set aside to meet domestic demand. Argentina is the world's No. 2 corn exporter and a major supplier of wheat to neighboring Brazil. Yauhar said the new system is the product of negotiations between the government and farm groups. "An agreement was reached that satisfies everybody."
Under the new permitting system, the government will conduct a preliminary survey of wheat stocks Jan. 31 of each year, at which time it will authorize some exports. All excess stocks will be eligible for export once a final survey is completed in February. The Buenos Aires Cereals Exchange on Thursday raised its forecast for the 2011-12 wheat harvest to 14 million metric tons, an increase of 400,000 tons from its previous estimate. So far, farmers have finished about 93% of the harvest, which ends later this month. Exports of soybeans, corn, wheat and related products like soyoil are Argentina's main source of hard currency and a major source of taxes. Export taxes, mainly on grains, accounted for 10% of the federal government's 540 billion pesos ($125 billion) in total tax revenue in 2011. Farmers have long complained that the old system of issuing export permits in a handful of tranches throughout the year stifled competition between exporters and local buyers.
Critics say those regulations have also stunted the futures market and forced farmers to sell their crops on the spot market or bear the expense of storing the grains. President Cristina Kirchner, who was sworn in for a second term last month after winning re-election with 54% of the vote, went to great lengths to mend fences with farmers in the runup to the election. In 2008, Kirchner faced a rebellion by rich and poor farmers who blocked highways to protest her attempt to raise taxes on grain producers. High global prices for soy and grains have also helped to smooth over the lingering resentment between the Kirchner administration and farm groups.

Imperial Sugar 4Q Loss Widens On Charges, Lower Sales Volume (Source: CME)
Imperial Sugar Co.'s fiscal fourth-quarter loss widened, reflecting impairment charges and a 27% drop in the refined-sugar processor's sales volume. High raw sugar prices and competitive refined sugar pricing continue to weigh on Imperial Sugar. In November, the company decided to suspended its quarterly dividend amid margin and liquidity pressure. To improve its balance sheet, the company sold its 50% interest in the Mexican marketing venture Comercializadora Santos Imperial S. de R.L. de C.V. and sold its one-third stake in Louisiana Sugar Refining LLC. Imperial is also reviewing strategic alternatives for its 50% interest in Wholesome Sweeteners. For the quarter ended Sept. 30, Imperial reported a loss of $32.5 million, or $2.73 a share, compared with a loss of $2.31 million, or 19 cents, a year earlier. The most-recent quarter included impairment charges totaling $7.1 million. Sales dropped 12% to $231.4 million.
Analysts polled by Thomson Reuters had most recently forecast a loss of 79 cents on revenue of $219 million. Gross margin swung to negative 3.5% from positive 2.7%.

Sugar, arabicas consolidate after slide
LONDON, Jan 6 (Reuters) - ICE sugar and arabica coffee consolidated in early trade on Friday, after sharp slides on Thursday, while cocoa eased in thin volume pressured by abundant supplies from West Africa.
ICE benchmark raw sugar futures  firmed 0.25 cent or 1.1 percent to 23.38 cents a lb underpinned by a soft dollar at 0933 GMT, below a seven-week peak of 24.65 cents per lb touched on Wednesday.

Uganda's Dec coffee exports rise 2.3 pct yr/yr
KAMPALA, Jan 6 (Reuters) - Uganda's coffee exports rose 2.3 percent in December compared to the same month in the previous year, helped by favourable weather, a source at the Uganda Coffee Development Authority (UCDA) said on Friday.  
The east African country, which is on the cusp of becoming a top-50 crude oil producer, is one of Africa's leading exporters of the beans and earnings from the crop are a major source of foreign exchange.
 
India extends sugar export permit deadline to Feb 15
NEW DELHI, Jan 6 (Reuters) - India has extended the deadline for mills and factories to apply for sugar export permits, the government said on Friday, a move expected to boost sluggish exports from the world's second biggest producer.
Factories wishing to export from their own sugar stock can apply for the permit until Jan. 31, while those plan to export sugar bought from elsewhere can apply for the permit until Feb. 15, it said.

Ivory Coast targets 260,000 T of cotton in 2012/13
ABIDJAN, Jan 5 (Reuters) - Ivory Coast will grow at least 260,000 tonnes of cotton in the 2012/13 season versus an expected 240,000 tonnes in 2011/12, boosted by reforms in the sector, the executive secretary of the Ivorian ginners association said on Thursday.
Both forecasts are up on the West African state's 175,000-tonne output during the 2010/11 season.

Oil Trades Near One-Week Low as Europe Debt Concern Counters Iran Tension (Source: Bloomberg)
Oil fell for a third day in New York as bets that Europe’s debt crisis will worsen and curb fuel demand countered concern that tension with Iran may disrupt Middle East crude exports. Futures declined as much as 0.5 percent before German and French leaders meet in Berlin today as they seek to craft a plan for rescuing the euro over the next three months. The U.S. will act to reopen the Strait of Hormuz if Iran blocks the channel, Joint Chiefs of Staff chairman General Martin Dempsey said in an interview on the CBS “Face the Nation” program yesterday. Brent oil’s premium to West Texas Intermediate crude rose to the highest in almost two months. “It’s a matter of two factors for the market,” said Ric Spooner, a chief analyst at CMC Markets in Sydney. “We have concerns about potentially significantly reduced economic activity emanating from Europe, and Iran. Any potential disruptions have to be taken seriously because it won’t take much to put us into a supply problem.”

Brent steady at about $113 as growth concerns counter Iran
SINGAPORE, Jan 6 (Reuters) - Brent crude was flat at about $113 a barrel as unabated euro zone debt woes and a surprise build in U.S. oil stockpiles tempered gains from supply disruption fears on mounting tensions between Iran and the West.
"Oil could see-saw as the U.S. and Iran play brinkmanship," said Tony Nunan, a risk manager at Mitsubishi Corp, adding that the global oil demand outlook was murky as the euro zone crisis dragged on.

Japan crude stocks rise despite strong crude runs
TOKYO, Jan 6 (Reuters) - Japan's commercial crude inventories rose 1 percent last week, despite the highest weekly crude runs since March, implying that crude imports were robust in the final week of 2011, industry data showed on Friday.
Crude stocks in the world's third-biggest oil consumer increased by nearly 1 million barrels from the week before to 15.38 million kilolitres (96.7 million barrels) in the week to Dec. 31, the Petroleum Association of Japan (PAJ) said.

Euro Coal-Rises $1-2/t as buying picks up
LONDON, Jan 5 (Reuters) - South African physical prompt coal bids rose by around $1.00 a tonne percent on Thursday as buyers began to emerge after the end-year holiday hiatus.
Delays of two weeks to Colombian coal shipments by Drummond and Prodeco, two of the the country's biggest exporters, were a minor price-supporting factor which could turn into a more significant influence if the rains persist, traders and utilities said.

China's Nov coal output rises 4.4 pct to 321 mln T
SHANGHAI, Jan 4 (Reuters) - China's raw coal production in November rose 4.4 percent from a year ago to reach 321 million tonnes, while total output in the first 11 months of the year rose 11.6 percent to 3.46 billion tonnes, an industry website said on Wednesday.  Of the total year-to-date output, that from main state-owned coal mines reached 1.77 billion tonnes, up 12.1 percent from the same period last year, industry portal SXCOAL.com said, citing data from the China Coal Industry Association.

Iron Ore-Prices inch up but traders rule out big purchases
BEIJING, Jan 6 (Reuters) - Iron ore prices in China, the world's biggest market, inched up on Friday as customers sought to replenish stockpiles, but traders ruled out big purchases ahead of the lunar new year holiday later this month.
Offer prices for 61.5 percent Pilbara fines rose $1 to $139-141 per tonne including cost and freight on Friday, industry consultancy Umetal said, and they have now increased $3 since markets reopened on Wednesday.

China 2012 crude steel consumption seen at 700 mln T - CISA
BEIJING, Jan 5 (Reuters) - China's total apparent crude steel consumption is expected to rise about 4 percent to 700 million tonnes this year, the chairman of the China Iron and Steel Association said on Thursday.
Zhu Jimin, also head of Shougang Group, one of the country's biggest steelmakers, made the comments in a speech published on the association's website.

Spot Gold Declines for a Second Day, Dropping 0.2% to $1,615.20 an Ounce (Source: Bloomberg)
Gold for immediate delivery declined 0.2 percent to $1,615.20 an ounce, while bullion for February delivery in New York traded little changed at $1,616.40 an ounce. Silver for March delivery advanced 0.2 percent to $28.745 an ounce.

METALS-London copper rises as U.S. data improves outlook
KUALA LUMPUR, Jan 6 (Reuters) - London copper inched up on Friday, erasing declines from earlier this week, after jobs data pointed to a recovery in the U.S. economy which offset concerns that the euro zone crisis is dragging demand growth lower.
Asian buying also kept prices higher, with investors betting on an increase in demand in China as business activity expands in the world's second-largest economy.

PRECIOUS-Gold steady on Europe woes, dollar weighs
SINGAPORE, Jan 6 (Reuters) - Gold hovered around $1,620 an ounce on Friday as investors remained nervous over the euro zone debt crisis and sought safety in bullion, while a firm dollar weighed on sentiment.
The dollar hovered near a one-year high against a basket of currencies as worries about the euro zone's fiscal stability persisted.

Baltic index falls on weak freight demand
LONDON, Jan 5 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, continued a slide that began before Christmas due to weak demand for coal and iron ore freight and growing vessel supply.
The index, which gauges the cost of shipping commodities such as iron ore, cement, grain, coal and fertiliser, fell 126 points or 8.12 percent to 1,426 points.