Commodities Head for Biggest Quarterly Drop Since 2008 on Economy’s Woes (Source: Bloomberg)
Commodities fell, heading for the biggest quarterly slump since 2008, as Europe’s sovereign-debt crisis threatened to derail the global economy, slashing raw- material demand. The Standard & Poor’s GSCI index of 24 raw materials slid 2.7 percent to settle at 603.55 at 3:46 p.m. New York time. Since June 30, the gauge has slumped 9.8 percent, the most since the last quarter of 2008 during the most-severe recession since the 1930s. Copper closed at the lowest price in 13 months, and crude oil fell almost 4 percent. The MSCI World (MXWO) Index of equities fell for the first time in four sessions amid increasing concern that European leaders are divided on handling the region’s debt woes. A report tomorrow may confirm European consumer confidence dropped to a two-year low in September. Last week, an index of purchasing managers in China indicated that manufacturing contracted.
Corn (Source: CME)
US corn futures finish sharply lower as renewed economic concerns fuel fresh liquidation by commodity funds. Traders estimate funds sold an estimated 17,000 contracts, a hefty amount. Prices have pulled back almost 18% since late August, with the slide expected to attract grain users to the market. They see the decline as a buying opportunity amid lingering concerns about low corn inventories. "We've certainly got commodity values down to where I think they're undervalued," says Mike Krueger of The Money Farm. CBOT December corn loses 21 1/2c to $6.30 3/4 a bushel.
Wheat (Source: CME)
US wheat futures close lower as fund selling and weakness in external markets pressure prices. The selloff "had to be more fund liquidation" because supply-and-demand factors didn't shift dramatically today, says Mike Krueger of The Money Farm. Funds sold an estimated 4,000 contracts at the CBOT, a moderate amount. Traders will see Thursday whether the decline was enough to win business from Egypt, the world's top wheat importer. It has been buying low-cost Russian wheat recently. CBOT December wheat sinks 19 1/2c to $6.38 3/4 a bushel, KCBT December loses 26 1/4c to $7.26 3/4 and MGEX December drops 8c to $8.61 1/4.
Rice (Source: CME)
US rice futures slump as renewed concerns about the global economy sink a range of commodities. Rice prices tumble with metals and other grains, including wheat, corn and soybeans. Yet, rice still trades within Tuesday's range, avoiding a steep fall after approaching a two-month low Monday. CBOT November rice ends down 7c at $16.28/hundredweight.
U.S. grains decline on slow growth, dollar's gain
SINGAPORE, Sept 28 (Reuters) - U.S. grain futures fell, giving back gains from the previous day, as concern that global economic growth will slow and doubts over Europe's commitment to its debt plan prompted investors to shift to the U.S. dollar.
"There are expectations that the USDA may report a larger-than-expected supply on corn," said Lynette Tan, a grains analyst at Phillip Futures in Singapore.
Philippines puts typhoon crop damage at $13 mln
MANILA, Sept 28 (Reuters) - The Philippine Agriculture Department said on Wednesday its initial estimate was that rice and corn crops valued at 569.4 million pesos ($13 million) were lost due to damage from Typhoon Nesat.
Estimated crop damage included 33,890 tonnes of rice from 56,421 hectares affected in five regions, including the key rice growing regions of Cagayan Valley and Central Luzon, the department said.
Punjab, Haryana's 2011 paddy procurement seen up 7.7 pct
CHANDIGARH, India, Sept 28 (Reuters) - Paddy procurement by Punjab and Haryana in 2011 is likely to rise 7.7 percent over last year, government officials said, as the country is expected to harvest a record crop.
The two northern states, which are India's major paddy producers, are expected to buy 16.8 million tonnes from domestic farmers, against 15.6 million tonnes a year ago, officials said.
Philippines counts cost as Typhoon Nesat departs
MANILA, Sept 28 (Reuters) - The Philippines began on Wednesday the clean-up of flooded areas and assessments of damage, including to the key rice crop, a day after Typhoon Nesat left behind at least 18 dead.
Financial markets, government offices and some schools reopened after being closed by the typhoon, and train services resumed after power supplies were restored in the capital.
USDA seen lowering US spring, all-wheat production
CHICAGO, Sept. 27 (Reuters) - Poor yields in the northern U.S. spring wheat belt should prompt the U.S. Department of Agriculture to cut its estimate of overall 2011 U.S. wheat production to the lowest level since 2006, analysts said.
Spring wheat production could drop to its lowest level since 2007, and if it does, ending stocks of the high quality wheat could tumble to the second-lowest on record.
Corn supply at 8-year low, down less than expected
CHICAGO, Sept 27 (Reuters) - U.S. corn stockpiles likely declined over the summer but by slightly less than the government has estimated, giving the tight market marginally more breathing room before consumers enter an even leaner year.
Inventories at the end of the 2010/11 marketing year are expected to fall to 964 million bushels, down 44 percent from 1.708 billion a year ago and the smallest supply in eight years, according to analysts polled by Reuters ahead of the U.S. Agriculture Department's quarterly stock report on Friday.
S.Africa cuts maize output forecast, wheat seen up
JOHANNESBURG, Sept 27 (Reuters) - South Africa slightly cut its May 2010-April 2011 season maize output forecast on Tuesday, citing a lower pace of deliveries to silos, while the 2011 wheat output is seen up on the back of better yields.
In its final forecast, the government's Crop Estimates Committee (CEC) said Africa's largest maize producer is expected to harvest 10.608 million tonnes of the crop, compared with 10.679 million tonnes in the previous forecast.
ICE sugar extends rebound, cocoa slips
LONDON, Sept 28 (Reuters) - ICE sugar futures extended their correction higher in early trade, bouncing after the commodity sell-off, while cocoa eased, under pressure from ample supplies.
Raw sugar futures on ICE climbed, supported by bullish market technicals based on historical price charts, after dealers said the market had become oversold.
India sugar producers' body foresees surplus
NEW DELHI, Sept 27 (Reuters) - India is heading for a sugar surplus in 2011/12, and the government should help producers by allowing 4 million tonnes of exports -- more than double this year's overseas sales, the head of a producers' body said on Tuesday.
Output for the world's second-biggest producer after Brazil could rise to 26.5 million tonnes in 2011/12, Jayantilal B. Patel, president of the National Federation of Cooperative Sugar Factories Ltd (NFCSF), told an industry meeting.
Colombia's top coffee region output lags -farmers
BOGOTA, Sept 27 (Reuters) - Leading Colombian coffee-growing province Antioquia is seen producing fewer beans during its main harvest than in the same period a year ago after torrential rains hit plantations, growers said.
Coffee growers in the northwestern province that accounts for 16 percent of Colombia's total output said progress was slower than normal.
Brazil coffee area seen dry until mid-Ocober
BRASILIA, Sept 27 (Reuters) - Brazil's key coffee zones could stay dry until mid October, delaying the start of crop-fixing flowering, but the long dry spell does not yet spell disaster for the next crop, agronomists said on Tuesday.
The coffee market is relying on a good on-year harvest next year from the world's top grower to pump supplies into a market facing chronic shortages of some bean types. The shortages have sustained high prices since mid 2010.
Brazil CS sugar output down 8 pct - Unica
SAO PAULO, Sept 27 (Reuters) - Sugar production from Brazil's center-south cane crop this season is lagging last year by 8 percent, but output was up in recent weeks, the cane industry association Unica said on Tuesday.
From the beginning of the season in April through Sept. 16, sugar output totaled 23.1 million tonnes, 2 million tonnes less than the same period in 2010.
ICoast 2011/12 cocoa output seen 1.4 mln T -finmin source
ABIDJAN, Sept 27 (Reuters) - Ivory Coast's finance ministry expects the world's top grower to produce 1.4 million tonnes of cocoa next season, slightly down on this year's record of around 1.5 million tonnes, a ministry source told Reuters on Tuesday.
"The weather is still favourable and the plantations have been treated much more than in past years. All of that will maintain production at 1.4 million tonnes for 2012," the source said, citing an internal ministry forecast.
India trying for consensus on 2011/12 sugar output forecast
NEW DELHI, Sept 27 (Reuters) - India's government is trying to reach a consensus over how much sugar the country is likely to produce in 2011/12, Food Minister K.V. Thomas said on Tuesday after his forecast varied from that of the farm minister.
"I am aware there is some difference on preliminary estimates of sugar production, and efforts are on to reconcile the figures," Thomas told a conference.
India should allow 4 mln T sugar exports in 2011/12-industry body
NEW DELHI, Sept 27 (Reuters) - India should allow 4 million tonnes of unrestricted sugar exports in the new season from October to help trim bulging stocks and arrest slipping local prices, the chief of a producers' body said on Tuesday.
The federal government should also buy 2 million tonnes of sugar from the local market to help cut stocks with mills as 2011/12 output is expected to be 26.5 million tonnes, Jayantilal B. Patel, president of the National Federation of Cooperative Sugar Factories Ltd (NFCSF), told an industry meeting.
Ivorian cocoa arrivals up 22 pct yr/yr
ABIDJAN, Sept 27 (Reuters) - Cocoa arrivals at ports in top grower Ivory Coast reached a fresh record 1,449,320 tonnes by Sept. 18 since the start of the season in October, up from 1,184,195 tonnes in the same period a year ago, according to data from the Bourse du Cafe et Cacao (BCC) obtained by Reuters on Tuesday.
The West African state is on track to register nearly 1.5 million tonnes of cocoa, a record tally driven by ideal weather conditions and achieved despite a brief civil war earlier in the year that forced many planters into hiding.
Russia Starts Sugar Exports For First Time In 12 Years-Industry (Source: CME)
Russia is exporting sugar to the world market for the first time in more than a decade, industry sources said, marking a sea change for one of the world's largest sugar importers of recent decades. An official at the sugar producers' association Soyuzrossakhar said the first contracts to export to Tajikistan and Kyrgyzstan were signed at the end of August, and with prices at their current levels Russian sugar could also find its way to Ukraine, Moldova and other Central Asian countries. "This is the first time in 12 years that Russia has produced sugar cheaply enough to sell to the world market," said the official, adding that the government has put together a working group to help support exporters. Good weather and a rise in plantings have swung Russia from the major importer it has become since the Soviet Union's collapse in the early 1990s.
Soyuzrossakhar now expects producers to harvest a record 5.3 million metric tons of sugar in 2011-12, as average yields this season have reached as high as 40 tons a hectare. "Russia, the world's undisputed leading importer until the middle of the last decade, is not expected to be even among the 10 largest importers in 2011-12," said the International Sugar Organization. For refiners, however, the influx of sugar has caused headaches. Domestic white sugar prices slumped 26% during August reaching $710 a ton by mid-September--making Russian supplies competitive compared with $784.60/ton offered in London--and forecasters say they may fall further in October and November as the local market struggles to absorb the supplies. A person in major sugar producer Rusagro said the government may even be forced to resort to intervention purchases to stabilize the market.
Yet poor infrastructure could still hinder Russia's exporting prospects. Russia hasn't built a new sugar-processing plant in the last 25 years, and 60% of the processing equipment is worn out, according to the U.S. Department of Agriculture's Moscow attache. Already refiners are struggling to process the huge harvest. The person at Rusagro said the company's seven refineries are producing 45,000-50,000 a month but still can't cope with the excess sugar from the fields. Meanwhile, ongoing reforms of the state-run railway authority RZhD had led to a severe shortage of specialized railway cars to move the sugar to sea ports and land border crossings. The Raevsky sugar refinery has already been forced to stop processing the new harvest due to a backlog of supplies. And although Soyuzrossakhar has appealed to the federal anti-monopoly authority to help combat the shortage, so far nothing has been done.
Coffee Falls in Robusta Rout While Starbucks Cup Costs $1.50: Commodities (Source: Bloomberg)
Farmers from Vietnam to Brazil will supply a record robusta crop in the marketing year that begins next month, extending a slump in coffee futures that spurred Kraft Foods Inc. (KFT) and J.M. Smucker Co. to cut prices. Production will rise 5.4 percent to 3.29 million metric tons (54.9 million 60-kilogram bags) in the 2011-12 season, the U.S. Department of Agriculture estimates. Vietnam and Brazil, the biggest producers, will reap the most beans ever. Robusta traded on the NYSE Liffe exchange in London fell 26 percent since March, and will drop another 5 percent to $1,884 a metric ton by Dec. 31, according to the mean in a Bloomberg survey of 16 brokers, traders and analysts.
Robusta, the second most-consumed coffee after arabica, is reversing a rally that more than doubled prices in the 12 months ended in March as shortages emerged. That was part of a global surge in food prices that the United Nations estimates reached a record in February. U.S. food-price inflation will be as much as 3.5 percent next year, compared with as much as 4 percent this year, the USDA estimates.
US Ethanol Plants Invest In Corn Oil As Industry Matures (Source: CME)
U.S. ethanol producers faced with slowing growth in demand are turning to a fledgling market for corn oil to help boost revenues. Several of the nation's largest ethanol companies, including Green Plains Renewable Energy and Valero Energy Corp., have invested in equipment to produce the oil. Extracted during the production of ethanol, corn oil is mainly used to make animal feed and biodiesel, but also can be produced for cooking. The volumes ethanol producers plan to make are expected to be small compared to the 2-billion-gallon U.S. market for soybean oil, which is nearly interchangeable. Still, the new product adds an important revenue stream for ethanol makers who face flattening demand, historically high corn prices and volatile energy markets.
Ethanol production has been profitable throughout 2011, with the Renewable Fuels Association projecting production at a record 13.7 billion gallons. Still, the rapid gains in demand are seen slowing. The industry is nearing 15 billion gallons, the amount federal law requires refiners to blend into gasoline by 2015. Further gains past the federal mandate are hampered by weakening support in Congress, concerns over the effects that increased ethanol use would have on older engines, and changes that gas stations would have to make to their pumps. Ethanol producers are "going to have to be creative in ways to generate more profit," said Jason Ward, an analyst with Northstar Commodity in Minneapolis. Demand "really can't go much higher," Ward said. Green Plains Renewable, after making a $20 million investment in 2010 to produce corn oil, projects between $30 million and $40 million in new, annual revenue from the liquid. Producing corn oil is "low-hanging fruit," the company's Chief Executive Todd Becker said.
In the quarter ended June 30, corn oil accounted for $6.4 million in operating income, up from zero the prior year. Operating profit was $11.6 million for ethanol production. Other large companies, including Iowa-based Poet, the world's largest ethanol producer, and Valero are adding similar equipment to their existing plants. The investments are a natural progression for the industry, said Jeff Lautt, Poet's president, whose company is in the midst of an effort to diversify revenue. "You look at any other industry that's developed over the last 100 years, once they mature they start to broaden out, and ways to create new revenue or bottom-line margin," Lautt said. The new supply of corn oil from ethanol plants is not food grade, although Lautt said Poet may try making food-grade corn oil eventually.
A spokesman for Valero, which entered the ethanol business in 2009 after buying plants from bankrupt Verasun Energy Corp., said the decisions to invest in corn oil reflects the relative health of the industry as it puts money back into the business. Ethanol plants have a ready buyer in the biodiesel industry, which can use either corn oil or soybean oil in production. And corn oil right now sells at a discount to soybean oil, said Sander Cohan, an analyst at ESAI Inc. Although increased corn oil production provides added competition for soybean oil makers, it isn't likely to saturate the market, industry officials said. Even if all producers adopted the technology this year, total output would be under 270 million gallons, said Becker of Green Plains. Corn oil is a byproduct of the ethanol production, a fermentation process in which the starch is separated from the kernel and turned into sugar. The technology employed by most ethanol plants extracts corn oil in fermentation process.
USDA Pays Out $80 Million To Biofuels Companies (Source: CME)
The U.S. Department of Agriculture announced Tuesday it is giving out about $80 million this year to 163 companies that produce biofuel from alternative sources like animal fats and wood chips. The payments this year go to companies like Ever Cat Fuels in Isanti, Minn., which makes biodiesel from plant oils and animal fat. Ever Cat will get a check for $98,507, but other companies will get a lot more, according to the USDA. The amount is based on how much biofuel the company produces from sources other than corn. Pennsylvania-based Smarter Fuel, Inc., will get about $4.8 million because it produces fuel from waste products and Kansas-based Ese Alcohol will get about $81,000 because it uses leftover seed to make ethanol.
"The payments I am announcing today represent the continuing commitment of the Obama administration to work with producers to provide the biofuel necessary to reduce our nation's dependence on foreign energy sources," said U.S. Department of Agriculture Secretary Tom Vilsack. "The payments support America's growing advanced biofuel industry." The $80 million worth of payments announced Tuesday are the fiscal year 2010 installment for the "Advanced Biofuel Producer Payments" program and the USDA is already evaluating companies for FY 2011 payments, a spokesman said. The payments are authorized in the 2008 farm bill by Congress, according to the National Biodiesel Board, and meant to "ensure an expanding supply of domestic energy." "These payments will create jobs and economic activity while helping the biodiesel industry advance new technologies and improve efficiency," said Anne Steckel, a vice president for the biodiesel group.
Most of the biofuel produced in the U.S. now is corn-based ethanol, a heavily subsidized fuel that consumes about 40% of the corn grown in the U.S. Ethanol producers are expected to use about 5 billion bushels of corn this year to make the fuel. The U.S. spends about $6 billion per year subsidizing ethanol-blended gasoline with a tax credit of 45 cents per gallon. There is also a tax of 54 cents per gallon on imported ethanol
Euro Coal-Oct S.Africa prices dip, Indians delay
LONDON, Sept 27 (Reuters) - Prompt physical coal prices for October South African cargoes dipped again on Tuesday as suppliers scrambled to find homes for shipments soon due to load, but further forward prices saw slight gains."Apart from the very prompt month, prices are generally a little stronger in line with everything else," one trader said.
Stocks on the world's major exchanges were headed on Tuesday for their largest daily gain in 16 months and commodities jumped. Oil rose 2 percent as euro zone efforts to solve the region's debt crisis lifted markets.
India 2011/12 coal import needs may jump to 114 mln T
NEW DELHI, Sept 27 (Reuters) - India could import about 114 million tonnes of coal in 2011/12, up by over a third from the previous year, mainly from Indonesia and South Africa to help prevent power stations and factories in Asia's third-largest economy from slowing down.
Coal Minister Sriprakash Jaiswal said on Tuesday India's coal demand was seen at 696 million tonnes in 2011/12 against an expected local output of 554 million tonnes. State-run Coal India , the world's largest coal miner, has stocks of about 28 million tonnes, reducing the overall shortfall.
India 2011/12 coal demand seen at 696 mln T
NEW DELHI, Sept 27 (Reuters) - India's coal demand is seen at 696 million tonnes in 2011/12 against an expected local production of 554 million tonnes, Coal Secretary Alok Perti said on Tuesday, widening the gap by 5.2 percent from a previous estimate.
Earlier estimates have suggested Asia's third-largest economy is likely to import about 135 million tonnes in the year ending March 31, 2012.
Brent slips as euro zone doubts resurface
LONDON, Sept 28 (Reuters) - Brent crude fell below $107 per barrel on Wednesday as worries about details of a euro zone debt bailout fund prompted investor caution after a sharp gain the previous session.
"The headline-reading trading machines cannot understand the complexity of Europe, so big up moves (are) followed by big down moves as they are unable to have a proper trading read on Europe," he said.
Shell says fire at Singapore refining complex
SINGAPORE, Sept 28 (Reuters) - A fire broke out at Royal Dutch Shell's petroleum complex offshore Singapore on Wednesday, the company said.
"We confirm that a fire in the Pulau Bukom Manufacturing Site occurred today at approximately 1.15pm. Emergency responders are on the scene and the fire is contained. No injuries have been reported and the rest of the site's operations are unaffected," a spokesman said.
Oil Declines for Second Day on Concern Over European Debt, U.S. Stockpiles (Source: Bloomberg)
Oil declined for a second day in New York, heading for the biggest quarterly drop since 2008, as investors speculated that fuel demand will falter as U.S. crude stockpiles increase and Europe’s debt crisis lingers. Futures slipped as much as 1.7 percent after German Chancellor Angela Merkel said policy makers may review Greece’s second bailout after inspectors rule on whether the country is meeting the terms of its current package. Crude supplies rose 1.92 million barrels to 341 million last week, the U.S. Energy Department said yesterday. Crude for November delivery dropped as much as $1.35 to $79.86 a barrel in electronic trading on the New York Mercantile Exchange and was at $79.96 at 9 a.m. Sydney time. The contract yesterday fell $3.24, or 3.8 percent, to $81.21. Futures are down 10 percent this month and 13 percent this year. Prices have dropped 16 percent since the end of June, the biggest quarterly loss since the last three months of 2008.
Iron Ore-Spot prices at 2-1/2-month lows as buying thins
SINGAPORE, Sept 28 (Reuters) - Spot iron ore prices fell to their lowest since early July on slow buying from Chinese mills, and more losses may be ahead with Shanghai steel futures falling on Wednesday for the fourth time in the past five sessions.
Steel producers in China, the world's biggest iron ore buyer, continued to step back from the iron ore market, worried about slowing steel demand and the uncertainty facing the global economy.
China steel output, iron ore pricing in focus at summit
SINGAPORE, Sept 27 (Reuters) - Whether China can sustain its rapid pace of steel production while developed economies are on shaky ground and how tight supplies will continue to buoy iron ore prices are questions on the agenda for China's biggest industry gathering this week.
Chinese steel mills are also expected to use the occasion to push for a more favourable iron ore pricing scheme as elevated spot prices cut into profits, ahead of a plan by industry group CISA to launch China's version of a reference index next month to gain more pricing power.
Gold Tumbles as Rout in Stocks, Commodities Forces Some Investors to Sell (Source: Bloomberg)
Gold fell for a second day, paring a 12th quarterly gain, as concern European leaders may not stem the region’s debt crisis hurt stocks and commodities, forcing some investors to sell the metal to cover losses elsewhere. Immediate-delivery gold lost as much as 1.5 percent to $1,584.38 an ounce, and traded at $1,593.35 at 8:27 a.m. in Singapore. December-delivery bullion lost as much as 2 percent to $1,586.20 an ounce in New York. Gold has fallen on “traders needing cash for margin calls on weak equity prices and newfound strength in the U.S. dollar,” Jonathan Barratt, managing director at Commodity Broking Services Pty., wrote in a report. “The turmoil in Europe only seems to be getting worse.”
Tiger Group to bet big on containerships
SINGAPORE, Sept 28 (Reuters) - Maritime investment firm Tiger Group could "very easily" buy as many as 50 large containerships in the next two years, betting that the box ship industry will see the most growth in traditional freight markets, the firm's managing director said.
The Hong Kong-based firm, with assets of more than $10 billion, looks to raise as much as $6 billion to invest in shipping over the next few years through its companies, said Tiger Group's Managing Director Julian Proctor.
Baltic index turns negative, outlook volatile
LONDON, Sept 27 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, turned negative on Tuesday with mounting vessel supply and freight derivatives contract selling knocking sentiment.
Brokers said growing vessel supply, which was outpacing commodity demand, was set to cap dry bulk freight rate gains in the coming months with growing challenges to the world economy adding to headwinds.
Private equity, bonds to drive ship finance amid credit crunch
SINGAPORE, Sept 27 (Reuters) - Global shipping firms must look to private equity funds and corporate bond markets to obtain capital to expand their operations as traditional bank financing dries up in the West, industry executives said on Tuesday.
European banks, traditionally the top lenders to global shipping companies, have tightened credit lines as the region's sovereign debt crisis spills over to financial institutions.
Thursday, September 29, 2011
20110929 1004 Soy Oil 7 Palm Oil Related News.
Soybeans (Source: CME)
US soybean futures tumble to a 10-month low, fueled by investment-fund selling in the face of global economic fears and seasonal harvest weakness. Traders are cautious of risk amid slowing economic growth, with worries of slumping demand sparking another round of broad-based commodity selling, analysts say. Investment funds were estimated net sellers of 12,000 soybeans contracts today, a large amount. Harvest pressure added to the lower theme, with traders also concerned that the market is failing to generate export business despite a more than $2/bushel slide the past month. CBOT November soy ends down 3.1% at $12.23 1/2.
Soybean Meal/Oil (Source: CME)
Soy-product futures fall in unison with soybeans, driven lower by broad-based commodity selling. Global economic uncertainty is making traders nervous about holding riskier assets on fear of slower demand, analysts say. CBOT December soymeal finishes down 3.2% at $319.90/short ton while soyoil slides 1.9% to 51.76c/pound.
U.S. soybean exports primed for a boost: Gavin Maguire
--Gavin Maguire is a Reuters market analyst. The views expressed are his own. To get his real-time views on the market, please join the Global Ags Forum. --
CHICAGO, Sep 28 (Reuters) - The sharp decline across commodity markets has reset global soybean prices and should help make U.S. soy exports more competitive in coming months.
For much of 2011, U.S. soybeans tended to trade at a premium to crops in other regions, keeping U.S. soy exports in check. But with U.S values much more closely aligned with those of South America, U.S. exporters should see a notable pick-up in export activity over the remainder of 2011.
Palm oil slips 2 percent on euro zone concerns
JAKARTA, Sept 28 (Reuters) - Malaysian palm oil futures fell by as much as 2 percent, weighed down by losses in other edible oils and investor worries about the ability of European leaders to tackle a debt crisis threatening the global financial system.
"The euro zone problems are still uncertain -- there doesn't seem to be a consensus," said a Kuala Lumpur-based trader.
Rapeseed area dips in Germany, rises in France, UK
LONDON, Sept 27 (Reuters) - Rains look to have reduced the area drilled with rapeseed in Germany but high prices have boosted sowings in both France and Britain, where crops have made good early progress, crop analysts said on Tuesday.
Farmers in Germany were still harvesting wheat earlier this month following repeated rain delays when they would like to have been drilling rapeseed. The wheat harvest is normally completed in August.
Dryness threatens Brazil's soybean crop -Oil World
HAMBURG, Sept 27 (Reuters) - Dryness is threatening the soybean crop in Brazil, the world's second largest producer of the oilseed, as sowings in the country face delays, Hamburg-based analysts Oil World said on Tuesday.
"Crop prospects for early 2012 are in jeopardy," Oil World said. "The threat of declining yields has increased."
Indonesia will delay the implementation of a regulation on industrial forests that would have allowed planters, especially those growing palm oil, to cultivate areas reserved for timber and other domestic raw materials. The delay is aimed at making improvements to the proposed rule to make it consistent with previous decrees, and the government will issue the revised regulation as soon as possible, forestry minister Zulkifli Hasan said. (BT)
US soybean futures tumble to a 10-month low, fueled by investment-fund selling in the face of global economic fears and seasonal harvest weakness. Traders are cautious of risk amid slowing economic growth, with worries of slumping demand sparking another round of broad-based commodity selling, analysts say. Investment funds were estimated net sellers of 12,000 soybeans contracts today, a large amount. Harvest pressure added to the lower theme, with traders also concerned that the market is failing to generate export business despite a more than $2/bushel slide the past month. CBOT November soy ends down 3.1% at $12.23 1/2.
Soybean Meal/Oil (Source: CME)
Soy-product futures fall in unison with soybeans, driven lower by broad-based commodity selling. Global economic uncertainty is making traders nervous about holding riskier assets on fear of slower demand, analysts say. CBOT December soymeal finishes down 3.2% at $319.90/short ton while soyoil slides 1.9% to 51.76c/pound.
U.S. soybean exports primed for a boost: Gavin Maguire
--Gavin Maguire is a Reuters market analyst. The views expressed are his own. To get his real-time views on the market, please join the Global Ags Forum. --
CHICAGO, Sep 28 (Reuters) - The sharp decline across commodity markets has reset global soybean prices and should help make U.S. soy exports more competitive in coming months.
For much of 2011, U.S. soybeans tended to trade at a premium to crops in other regions, keeping U.S. soy exports in check. But with U.S values much more closely aligned with those of South America, U.S. exporters should see a notable pick-up in export activity over the remainder of 2011.
Palm oil slips 2 percent on euro zone concerns
JAKARTA, Sept 28 (Reuters) - Malaysian palm oil futures fell by as much as 2 percent, weighed down by losses in other edible oils and investor worries about the ability of European leaders to tackle a debt crisis threatening the global financial system.
"The euro zone problems are still uncertain -- there doesn't seem to be a consensus," said a Kuala Lumpur-based trader.
Rapeseed area dips in Germany, rises in France, UK
LONDON, Sept 27 (Reuters) - Rains look to have reduced the area drilled with rapeseed in Germany but high prices have boosted sowings in both France and Britain, where crops have made good early progress, crop analysts said on Tuesday.
Farmers in Germany were still harvesting wheat earlier this month following repeated rain delays when they would like to have been drilling rapeseed. The wheat harvest is normally completed in August.
Dryness threatens Brazil's soybean crop -Oil World
HAMBURG, Sept 27 (Reuters) - Dryness is threatening the soybean crop in Brazil, the world's second largest producer of the oilseed, as sowings in the country face delays, Hamburg-based analysts Oil World said on Tuesday.
"Crop prospects for early 2012 are in jeopardy," Oil World said. "The threat of declining yields has increased."
Indonesia will delay the implementation of a regulation on industrial forests that would have allowed planters, especially those growing palm oil, to cultivate areas reserved for timber and other domestic raw materials. The delay is aimed at making improvements to the proposed rule to make it consistent with previous decrees, and the government will issue the revised regulation as soon as possible, forestry minister Zulkifli Hasan said. (BT)
Wednesday, September 28, 2011
20110928 1810 FCPO EOD Daily Chart Study.
Bollinger band reading : downside biased with possible pullback correction.
MACD Histrogram : falling lower, seller in control.
Support : 2900, 2850, 2800, 2770 level.
Resistance : 2920, 2950, 2970, 3020 level.
Comment :
FCPO closed recorded loss with better volume transacted. Overnight soy oil ended higher and currently trading little higher(mostly in negative from morning session) while crude oil currenty heading south.
Lower soy oil and crude oil pressure FCPO price to trade in negative territory throught out the day.
Daily chart formed a down doji bar candle with long lower shadow closed below lower Bollinger band level after market opened lower (near the high of the day) and moved side ways within 39 points range bound market through out the day.
Chart reading suggesting a downside biased market development with possbile pullback correction 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 resistant or strength with quick cut loss and profit target.
20110928 1744 FKLI EOD Daily Chart Study.
Bollinger band reading : pullback correction downside biased.
MACD Histrogram : recovering, seller taking profit.
Support : 1360, 1350, 1345, 1337 level.
Resistance : 1375, 1385, 1395, 1405 level.
Comment :
FKLI closed recorded gain with declined volume changed hand doin5.5 points discount compare to cash market that closed higher. Overnight U.S. market continue to climb higher and Asia markets ended mixed while European markets currently trading lower.
Global markets reacted mixed on the latest news that some euro-area countries are demanding private creditors to accept a bigger writedown on their Greek bond holdings. World news reported that Shanghai closes 13 subway stations, after crash Injures 271 (second crash).
Daily chart formed an up doji bar candle with long lower shadow positioned above lower Bollinger band level after market opened little higher, dip 20 points lower within first 30 minutes and climb upwards slowly into positive territory to closed near the high of the day.
Technical reading still suggesting a pullback correction downside 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 moderate cut loss and profit target.
20110928 1712 Regional Markets EOD Daily Chart Study.
DJIA chart reading : side way range bound little downside biased.
Hang Seng chart reading : pullback correction downside biased.
KLCI chart reading : pullback correction downside biased.
20110928 1602 Malaysia Corporate Related News.
The Government is looking into the proposal to split Tenaga Nasional (TNB) into the three units of power distribution, generation and transmission. Speaking on the sidelines of a conference, Energy, Green Technology and Water Ministry secretary-general Datuk Loo Took Gee confirmed that the matter was “under study”. She declined to elaborate. “I think we need to be quiet and do our work well to present it to the market when we're ready,” Loo said when asked to comment on the matter. (Starbiz)
Market is abuzz with talk that SP Setia will be the next privatisation target of governmentlinked funds. According to unconfirmed sources, the property developer may be taken private near the current price of RM3.50 per share. Market observers speculate that one possible reason for taking SP Setia private is for PNB to use the developer as its main vehicle to consolidate its investments in various property companies. (Financial Daily)
Tun Dr Mahathir Mohamad threw his weight behind the controversial share swap deal between AirAsia and Malaysia Airlines (MAS) despite strong opposition from the rightwing Malay ground and MAS staff against Tan Sri Tony Fernandes’ involvement. The former prime minister said he was ‘fed up’ with MAS’ management over the years. The government had supported MAS with funds and protection but MAS had never done well.
• In contrast, he observed that AirAsia being a “newcomer” into the aviation industry had defied the odds and grown from a two-plane operation covering four routes into Asia’s biggest budget carrier. Dr Mahathir wants to see AirAsia’s management playing a role, indirectly or directly in the management of MAS. (Malaysian Insider)
In a departure from its earlier plans, MAS’ unit Firefly will be transformed into a short-haul premium airline while its domestic turboprop operations will run as usual, according to sources. Plans to set up a new airline dubbed Sapphire Air have been shelved against the backdrop of rising criticisms and protests. There will be two clear distinctions at MAS: longhaul premium and short-haul premium.
• The move to set up Sapphire Air received protests as some view it as ‘killing’ competition posed by Firefly especially after the airline ate into AirAsia’s market share. Even more so, it is understood that 80% of the national carrier’s workforce that may be transferred to Sapphire Air will not likely be represented by a union. (Financial Daily)
The acquisition of Menara Multi-Purpose from MPHB by the Malaysian Chinese Association (MCA) is a long-term investment for the party, said president Datuk Seri Chua Soi Lek. • He added that the MCA has "no more money to go for any other acquisitions".
• The MCA will have no problem funding the acquisition as the party has been the beneficiary of the dividends from Star Publications which is 42.4% owned by the MCA. (Financial Daily)
Telekom Malaysia launched its web-based map application, SmartMap, to the SME market. SmartMap, the first of its kind in Malaysia, combines TM's digital map with valuable business data which allows customers to perform geo-spatial analysis to support business decision-making. (Bernama)
Crude palm oil (CPO) futures on Bursa Malaysia Derivatives rebounded to close higher after falling to its lowest level in almost one year at RM2,905 per tonne on Monday. The benchmark CPO futures contract for December firmed RM47 to settle at RM2,982, November contracts rose RM41 to RM2,949 and October contracts added RM43 to RM2,948 per tonne respectively yesterday.
• In the short term, a trader said that prices would be supported by the widening CPO price discount of about US$250 to US$300 per tonne compared with soybean oil and rapeseed oil. “The current high CPO price discount will make it a more attractive alternative oil to purchase,” he said. (Starbiz)
India's infrastructure giant GMR will dispose of 30% of its Singapore energy unit GMR Energy (Singapore) Pte Ltd (GMRE) to Petronas International Corporation Ltd. The value of the transaction was not disclosed. GMRE is developing an 800MW combined cycle gas turbine power plant on Jurong Island for an estimated US$1bn. The plant is slated for commercial operations in 2013.
• "This acquisition marks Petronas's maiden foray into the international power market and is a major step in its effort to extend its existing integrated presence further along the energy value chain," said Datuk Anuar Ahmad, Executive Vice-President of Petronas Gas and power business. (Bernama)
The Court of Appeal upheld the decision of the High Court which had declared OSK Trustees Berhad as trustee for Sunway Real Estate Investment Trust (Sunreit) the legal owner of the commercial complex Putra Place. The court ordered Metroplex to pay RM200,000 in legal costs to OSK Trustees Berhad and Sunway Reit Management Sdn Bhd. The High Court also ordered Metroplex to deliver possession of Putra Place within 72 hours of the court order. (Bernama, The Star)
AMMB Holdings has signed a MoU with Australia and New Zealand Banking Group to introduce ANZ’s Signature Priority Banking service to AmBank and AmIslamic Bank’s affluent retail banking customers which is expected to be launched in the fourth quarter of 2011. (Financial Daily)
RHB Capital had RM5.9bn worth of shares changing hands in an off-market trade. Some 545.8m shares in the Malaysian lender traded at RM10.80 each. (Bloomberg)
Berjaya Corp’s application to list Bermaz Motor on Bursa Malaysia has been rejected by the SC due to a deficit in Bermaz’s net operating cashflows. BCorp said it will deliberate on the next course of action. Meanwhile, Tan Sri Vincent Tan has backtracked from asking for an exemption from the SC from an obligation to take BCorp private. (BT)
Bandar Raya Developments (BRDB) has received three offers from institutional investors for its key assets after its major shareholder had offered to buy them, company officials said. BRDB will call for a tender by the end of this year or early next year. "We can't disclose who the interested parties are as these are confidential matters.
• They are parties who invest in assets and securities," one of the officials said. BRDB on Monday announced that it had decided to scrap a deal to sell four key assets and related liabilities to a major shareholder, Ambang Sehati, for RM914m, and call for a tender instead. (BT)
Tune Hotels Group plans to invest about US$450m (RM1.42bn) over the next five years to establish 18 Tune Hotels in the country and 72 overseas. The Group is looking at Thailand, the Philippines and Indonesia and also targeting the United Kingdom, India, Australia and Europe. (Star Biz)
DHL International GmbH is exploring the possibility of using Proton's to-be-launched electric vehicle (EV) as its medium of transportation in Malaysia. DHL Asia Pacific business development vice-president Christopher Ong said the company has already initiated talks with the national carmarker. "We are still in discussion with them and hopefully we will be able to test one of their electrical vehicles, maybe early next year," he said. (Bernama, Financial Daily)
PLUS has received a request from the parties seeking to buy its assets for an extension of one month for them to complete the takeover. The extension request related to the finalisation of a revised concession agreement between the joint offerors and the Government. (Star Biz)
Yinson Holdings is looking to secure another FSO facility charter or a FPSO facility with the added capability of offshore oil production in another two to three years. Its first FSO will be delivered end of next year or early 2013.
• PTSC South East Asia Pte Ltd, the incorporated JV between Yinson (49%) and PetroVietnam Technical Services Corp (51%) signed two loan facility agreements with UOB Group and OCBC for a total loan of US$105m with a repayment period of seven years. (Financial Daily)
Market is abuzz with talk that SP Setia will be the next privatisation target of governmentlinked funds. According to unconfirmed sources, the property developer may be taken private near the current price of RM3.50 per share. Market observers speculate that one possible reason for taking SP Setia private is for PNB to use the developer as its main vehicle to consolidate its investments in various property companies. (Financial Daily)
Tun Dr Mahathir Mohamad threw his weight behind the controversial share swap deal between AirAsia and Malaysia Airlines (MAS) despite strong opposition from the rightwing Malay ground and MAS staff against Tan Sri Tony Fernandes’ involvement. The former prime minister said he was ‘fed up’ with MAS’ management over the years. The government had supported MAS with funds and protection but MAS had never done well.
• In contrast, he observed that AirAsia being a “newcomer” into the aviation industry had defied the odds and grown from a two-plane operation covering four routes into Asia’s biggest budget carrier. Dr Mahathir wants to see AirAsia’s management playing a role, indirectly or directly in the management of MAS. (Malaysian Insider)
In a departure from its earlier plans, MAS’ unit Firefly will be transformed into a short-haul premium airline while its domestic turboprop operations will run as usual, according to sources. Plans to set up a new airline dubbed Sapphire Air have been shelved against the backdrop of rising criticisms and protests. There will be two clear distinctions at MAS: longhaul premium and short-haul premium.
• The move to set up Sapphire Air received protests as some view it as ‘killing’ competition posed by Firefly especially after the airline ate into AirAsia’s market share. Even more so, it is understood that 80% of the national carrier’s workforce that may be transferred to Sapphire Air will not likely be represented by a union. (Financial Daily)
The acquisition of Menara Multi-Purpose from MPHB by the Malaysian Chinese Association (MCA) is a long-term investment for the party, said president Datuk Seri Chua Soi Lek. • He added that the MCA has "no more money to go for any other acquisitions".
• The MCA will have no problem funding the acquisition as the party has been the beneficiary of the dividends from Star Publications which is 42.4% owned by the MCA. (Financial Daily)
Telekom Malaysia launched its web-based map application, SmartMap, to the SME market. SmartMap, the first of its kind in Malaysia, combines TM's digital map with valuable business data which allows customers to perform geo-spatial analysis to support business decision-making. (Bernama)
Crude palm oil (CPO) futures on Bursa Malaysia Derivatives rebounded to close higher after falling to its lowest level in almost one year at RM2,905 per tonne on Monday. The benchmark CPO futures contract for December firmed RM47 to settle at RM2,982, November contracts rose RM41 to RM2,949 and October contracts added RM43 to RM2,948 per tonne respectively yesterday.
• In the short term, a trader said that prices would be supported by the widening CPO price discount of about US$250 to US$300 per tonne compared with soybean oil and rapeseed oil. “The current high CPO price discount will make it a more attractive alternative oil to purchase,” he said. (Starbiz)
India's infrastructure giant GMR will dispose of 30% of its Singapore energy unit GMR Energy (Singapore) Pte Ltd (GMRE) to Petronas International Corporation Ltd. The value of the transaction was not disclosed. GMRE is developing an 800MW combined cycle gas turbine power plant on Jurong Island for an estimated US$1bn. The plant is slated for commercial operations in 2013.
• "This acquisition marks Petronas's maiden foray into the international power market and is a major step in its effort to extend its existing integrated presence further along the energy value chain," said Datuk Anuar Ahmad, Executive Vice-President of Petronas Gas and power business. (Bernama)
The Court of Appeal upheld the decision of the High Court which had declared OSK Trustees Berhad as trustee for Sunway Real Estate Investment Trust (Sunreit) the legal owner of the commercial complex Putra Place. The court ordered Metroplex to pay RM200,000 in legal costs to OSK Trustees Berhad and Sunway Reit Management Sdn Bhd. The High Court also ordered Metroplex to deliver possession of Putra Place within 72 hours of the court order. (Bernama, The Star)
AMMB Holdings has signed a MoU with Australia and New Zealand Banking Group to introduce ANZ’s Signature Priority Banking service to AmBank and AmIslamic Bank’s affluent retail banking customers which is expected to be launched in the fourth quarter of 2011. (Financial Daily)
RHB Capital had RM5.9bn worth of shares changing hands in an off-market trade. Some 545.8m shares in the Malaysian lender traded at RM10.80 each. (Bloomberg)
Berjaya Corp’s application to list Bermaz Motor on Bursa Malaysia has been rejected by the SC due to a deficit in Bermaz’s net operating cashflows. BCorp said it will deliberate on the next course of action. Meanwhile, Tan Sri Vincent Tan has backtracked from asking for an exemption from the SC from an obligation to take BCorp private. (BT)
Bandar Raya Developments (BRDB) has received three offers from institutional investors for its key assets after its major shareholder had offered to buy them, company officials said. BRDB will call for a tender by the end of this year or early next year. "We can't disclose who the interested parties are as these are confidential matters.
• They are parties who invest in assets and securities," one of the officials said. BRDB on Monday announced that it had decided to scrap a deal to sell four key assets and related liabilities to a major shareholder, Ambang Sehati, for RM914m, and call for a tender instead. (BT)
Tune Hotels Group plans to invest about US$450m (RM1.42bn) over the next five years to establish 18 Tune Hotels in the country and 72 overseas. The Group is looking at Thailand, the Philippines and Indonesia and also targeting the United Kingdom, India, Australia and Europe. (Star Biz)
DHL International GmbH is exploring the possibility of using Proton's to-be-launched electric vehicle (EV) as its medium of transportation in Malaysia. DHL Asia Pacific business development vice-president Christopher Ong said the company has already initiated talks with the national carmarker. "We are still in discussion with them and hopefully we will be able to test one of their electrical vehicles, maybe early next year," he said. (Bernama, Financial Daily)
PLUS has received a request from the parties seeking to buy its assets for an extension of one month for them to complete the takeover. The extension request related to the finalisation of a revised concession agreement between the joint offerors and the Government. (Star Biz)
Yinson Holdings is looking to secure another FSO facility charter or a FPSO facility with the added capability of offshore oil production in another two to three years. Its first FSO will be delivered end of next year or early 2013.
• PTSC South East Asia Pte Ltd, the incorporated JV between Yinson (49%) and PetroVietnam Technical Services Corp (51%) signed two loan facility agreements with UOB Group and OCBC for a total loan of US$105m with a repayment period of seven years. (Financial Daily)
20110928 1601 Local & Global Market Related News.
The government has agreed to set a minimum retirement age for the private sector but has yet to decide on a specific age, despite reports that it would be 60 years, Human Resource Minister Datuk Dr S. Subramaniam said. He agreed with the unions and the Malaysian Employers’ Federation (MEF) that the retirement age had to be raised as people now lived longer and needed money for the remaining 20 to 30 years of their life.
• He also said they would take all views into account before deciding on the most feasible minimum retirement age, adding that the new Minimum Retirement for Private Sector Bill could be tabled in the next Parliament session. (The Star)
Malaysia has maintained its third ranking in the 2011 Asian Sustainability Rating (ASR) albeit registering a lower average score this year (39% vs. 42% in 2010). The inclusion of new and poorly-performing companies held back Malaysia's score and was enough to result in a decline in the average for the country.
• However, with Bursa Malaysia expected to launch the Environment, Social and Government (ESG) Index by end-2012, this average is likely to improve.
• The ASR is a proprietary set of 100 sustainability indicators, covering disclosures on the main elements of ESG risk, comprising 750 companies from 10 Asian countries selected according to free float market capitalisiation.
• South Korean companies maintained its first position. Thailand ranked number two, while India fell two notches to number four, followed by Taiwan, Singapore, China, Indonesia, Hong Kong and the Philippines. (Bernama)
Trade between Vietnam and Malaysia is expected to hit US$6bn (RM18.9bn) by yearend (US$5bn or RM15.8bn in 2010), said Vu Van Canh, head trade counsellor at Vietnam’s embassy in Kuala Lumpur. In 1H11, the trade number had hit more than US$3bn (RM9.5bn). Crude oil, rice and steel products were Vietnam’s major exports to Malaysia, while its main imports were petroleum products, computers, electronics and spare parts. (BT)
U.S. home prices declined less than forecast in Jul from a year earlier, a sign bank delays in processing foreclosures may have temporarily slowed the slump in real-estate values. The S&P/Case-Shiller index of property values in 20 cities fell 4.1% yoy in Jul (-4.4% to Jun), the group said. Economists projected a 4.4% decline. On a seasonally adjusted mom basis, values were little changed in Jul, the same as in Jun. (Bloomberg)
U.S. consumer confidence stagnated in Sep near a two-year low as the share of households saying it was difficult to find a job climbed to the highest level in almost three decades. The Conference Board’s sentiment index increased to 45.4 in Sep, from a 45.2 reading in Aug that was the lowest since Apr 09, when the economy was in a recession, figures from the group showed. (Bloomberg)
Apple looks set next week to unveil its much-awaited new iPhone, which analysts say will have a bigger screen and work better with remote computing services. Apple on Tuesday invited media to a "special event" called "Let's talk iPhone" on October 4 at its Cupertino, California headquarters, an unusual location for a company that typically introduces major products at larger venues in San Francisco. (Reuters)
China: Industrial profits rise 28.2% for January-to-August
Chinese industrial companies’ profits rose 28.2% in the first eight months of 2011 from a year earlier, aiding the expansion of the world’s second- biggest economy. Net income climbed to CNY3.2trn (USD500bn), the National Bureau of Statistics said. The rise compared with a 28.3% increase from January through July. Rising profits may help support investment and sustain growth as the world’s largest exporting nation faces weakening demand because of Europe’s debt crisis and a faltering US recovery. (Bloomberg)
Germany: Cuts fourth-quarter debt plan as tax receipts surge
Germany cut its fourth-quarter debt-sale plan, the second quarterly reduction this year, after tax receipts boosted government coffers and reduced Chancellor Angela Merkel’s net new borrowing needs. The government will cut gross borrowing in the last three months of this year by EUR16bn (USD21.6bn), a 24% reduction from the initial amount, to EUR52bn, the Federal Finance Agency said. The cuts mean that Merkel’s government trimmed EUR27bn in debt sales this year from its original plan to EUR275bn. (Bloomberg)
India’s inflation rate remains above the level the central bank deems acceptable, Governor Duvvuri Subbarao indicated, underscoring that pressure remains for monetary tightening in Asia’s third-largest economy. “Inflation has been fairly stubborn,” Subbarao said. “Above a threshold, you can’t accept high inflation to have higher growth,” he said, adding that the price-rise limit is as much as 6% for the nation. (Bloomberg)
South Korea’s government plans to cut its fiscal deficit next year as the European sovereign debt crisis underscored the need for global policy makers to control their borrowing. Total spending will rise 5.5% to KRW326.1tr (US$273bn), while tax revenue will gain 9.5% to KRW344.1tr, the Ministry of Strategy and Finance said in its budget proposal for 2012 released. The government’s deficit will shrink to KRW14.3tr, or 1% of gross domestic product in 2012, from KRW25tr, or 2% this year, according to its calculations. (Bloomberg)
Indonesia's central bank signaled on Tuesday it may cut interest rates as Europe's debt crisis drives down the rupiah, stirs volatility in stock prices and takes a toll on Southeast Asia's biggest economy. (Reuters)
Chinese industrial profits rose 28.2% yoy in 8M11 (vs 28.3% in 7M11) to Rmb 3.2tr (US$500bn). (Bloomberg)
Vietnam’s government said it will limit credit growth to a maximum of 17% while cutting money supply growth to no higher than 13% this year to curb inflation. (Bloomberg)
India's infrastructure sector output grew 3.5% yoy in Aug (7.5% in Jul). The infrastructure sector accounts for 37.9% of India's industrial output. (Reuters)
Thailand, the world’s largest rice exporter, cut its estimate for output from the main harvest by 2.4% after floods damaged farmland, a state agency said. Production, which accounts for about 70% of total output, may reach 24.5m tons, from an earlier estimate of 25.1m tons. Thailand’s government will spend THB7.2bn (US$232m) to assist farmers affected by flooding. (Bloomberg)
• He also said they would take all views into account before deciding on the most feasible minimum retirement age, adding that the new Minimum Retirement for Private Sector Bill could be tabled in the next Parliament session. (The Star)
Malaysia has maintained its third ranking in the 2011 Asian Sustainability Rating (ASR) albeit registering a lower average score this year (39% vs. 42% in 2010). The inclusion of new and poorly-performing companies held back Malaysia's score and was enough to result in a decline in the average for the country.
• However, with Bursa Malaysia expected to launch the Environment, Social and Government (ESG) Index by end-2012, this average is likely to improve.
• The ASR is a proprietary set of 100 sustainability indicators, covering disclosures on the main elements of ESG risk, comprising 750 companies from 10 Asian countries selected according to free float market capitalisiation.
• South Korean companies maintained its first position. Thailand ranked number two, while India fell two notches to number four, followed by Taiwan, Singapore, China, Indonesia, Hong Kong and the Philippines. (Bernama)
Trade between Vietnam and Malaysia is expected to hit US$6bn (RM18.9bn) by yearend (US$5bn or RM15.8bn in 2010), said Vu Van Canh, head trade counsellor at Vietnam’s embassy in Kuala Lumpur. In 1H11, the trade number had hit more than US$3bn (RM9.5bn). Crude oil, rice and steel products were Vietnam’s major exports to Malaysia, while its main imports were petroleum products, computers, electronics and spare parts. (BT)
U.S. home prices declined less than forecast in Jul from a year earlier, a sign bank delays in processing foreclosures may have temporarily slowed the slump in real-estate values. The S&P/Case-Shiller index of property values in 20 cities fell 4.1% yoy in Jul (-4.4% to Jun), the group said. Economists projected a 4.4% decline. On a seasonally adjusted mom basis, values were little changed in Jul, the same as in Jun. (Bloomberg)
U.S. consumer confidence stagnated in Sep near a two-year low as the share of households saying it was difficult to find a job climbed to the highest level in almost three decades. The Conference Board’s sentiment index increased to 45.4 in Sep, from a 45.2 reading in Aug that was the lowest since Apr 09, when the economy was in a recession, figures from the group showed. (Bloomberg)
Apple looks set next week to unveil its much-awaited new iPhone, which analysts say will have a bigger screen and work better with remote computing services. Apple on Tuesday invited media to a "special event" called "Let's talk iPhone" on October 4 at its Cupertino, California headquarters, an unusual location for a company that typically introduces major products at larger venues in San Francisco. (Reuters)
China: Industrial profits rise 28.2% for January-to-August
Chinese industrial companies’ profits rose 28.2% in the first eight months of 2011 from a year earlier, aiding the expansion of the world’s second- biggest economy. Net income climbed to CNY3.2trn (USD500bn), the National Bureau of Statistics said. The rise compared with a 28.3% increase from January through July. Rising profits may help support investment and sustain growth as the world’s largest exporting nation faces weakening demand because of Europe’s debt crisis and a faltering US recovery. (Bloomberg)
Germany: Cuts fourth-quarter debt plan as tax receipts surge
Germany cut its fourth-quarter debt-sale plan, the second quarterly reduction this year, after tax receipts boosted government coffers and reduced Chancellor Angela Merkel’s net new borrowing needs. The government will cut gross borrowing in the last three months of this year by EUR16bn (USD21.6bn), a 24% reduction from the initial amount, to EUR52bn, the Federal Finance Agency said. The cuts mean that Merkel’s government trimmed EUR27bn in debt sales this year from its original plan to EUR275bn. (Bloomberg)
India’s inflation rate remains above the level the central bank deems acceptable, Governor Duvvuri Subbarao indicated, underscoring that pressure remains for monetary tightening in Asia’s third-largest economy. “Inflation has been fairly stubborn,” Subbarao said. “Above a threshold, you can’t accept high inflation to have higher growth,” he said, adding that the price-rise limit is as much as 6% for the nation. (Bloomberg)
South Korea’s government plans to cut its fiscal deficit next year as the European sovereign debt crisis underscored the need for global policy makers to control their borrowing. Total spending will rise 5.5% to KRW326.1tr (US$273bn), while tax revenue will gain 9.5% to KRW344.1tr, the Ministry of Strategy and Finance said in its budget proposal for 2012 released. The government’s deficit will shrink to KRW14.3tr, or 1% of gross domestic product in 2012, from KRW25tr, or 2% this year, according to its calculations. (Bloomberg)
Indonesia's central bank signaled on Tuesday it may cut interest rates as Europe's debt crisis drives down the rupiah, stirs volatility in stock prices and takes a toll on Southeast Asia's biggest economy. (Reuters)
Chinese industrial profits rose 28.2% yoy in 8M11 (vs 28.3% in 7M11) to Rmb 3.2tr (US$500bn). (Bloomberg)
Vietnam’s government said it will limit credit growth to a maximum of 17% while cutting money supply growth to no higher than 13% this year to curb inflation. (Bloomberg)
India's infrastructure sector output grew 3.5% yoy in Aug (7.5% in Jul). The infrastructure sector accounts for 37.9% of India's industrial output. (Reuters)
Thailand, the world’s largest rice exporter, cut its estimate for output from the main harvest by 2.4% after floods damaged farmland, a state agency said. Production, which accounts for about 70% of total output, may reach 24.5m tons, from an earlier estimate of 25.1m tons. Thailand’s government will spend THB7.2bn (US$232m) to assist farmers affected by flooding. (Bloomberg)
20110928 1546 Global Market Related News.
Stocks edge up, euro stalls as caution prevails
SINGAPORE, Sept 28 (Reuters) - Asian stocks edged higher and a rally in the euro stalled, as investors looked for more signs that European leaders were tackling a debt crisis that threatens the financial system before committing bolder market bets.
"Investors think, isn't the European situation better? But we have no way of knowing for sure at this point, and until they're more confident, we probably won't see major buying," said Hiroichi Nishi, equity division manager at SMBC Nikko Securities Inc in Tokyo.
GLOBAL MARKETS-Stocks edge up, euro down as caution prevails
SINGAPORE, Sept 28 (Reuters) - Asian stocks crawled higher and a rally in the euro stalled on Wednesday, as investors looked for more signs of progress from European leaders on tackling a debt crisis that threatens the financial system before committing bolder market bets.
"Today's rebound could easily give way at some point," ANZ Bank said in a research note.
Obama’s Jobs Plan Prevents Election-Year Recession in Survey of Economists (Source: Bloomberg)
President Barack Obama’s $447 billion jobs plan would help avoid a return to recession by maintaining growth and pushing down the unemployment rate next year, according to economists surveyed by Bloomberg News. The legislation, submitted to Congress this month, would increase gross domestic product by 0.6 percent next year and add or keep 275,000 workers on payrolls, the median estimates in the survey of 34 economists showed. The program would also lower the jobless rate by 0.2 percentage point in 2012, economists said. Economists in the survey are less optimistic than Treasury Secretary Timothy F. Geithner, who has cited estimates for a 1.5 percent boost to gross domestic product. Even so, the program may bolster Obama’s re-election prospects by lowering a jobless rate that has stayed near 9 percent or more since April 2009.
Euro Crisis Makes Fed Lender of Only Resort (Source: Bloomberg)
The Federal Reserve, chastised by Congress for lending money to foreign institutions such as the Central Bank of Libya, is once again the lender of last resort for banks around the world it knows little about. Three years after the collapse of Lehman Brothers Holdings Inc., money-market borrowing rates for dollars are rising, leading the Fed and European Central Bank to make the currency available to Europe’s institutions for as many as three months. U.S. prime money-market funds cut their exposure to euro-zone bank deposits and commercial paper, or short-term IOUs, to $214 billion in August from $391 billion at the end of last year, according to JPMorgan Chase & Co. data.
The failure of regulators worldwide to address European banks’ fragile dependence on short-term funding is “putting the Fed in a really awkward position,” said Karen Shaw Petrou, managing partner at Federal Financial Analytics, a Washington regulatory research firm whose clients include the biggest U.S. banks. The swaps with Europe “are an extremely advantageous political football” for critics of the Fed, she said.
U.S. Economic Stimulus Needs Housing Effort, New York Fed’s Tracy Says (Source: Bloomberg)
Any success for government efforts to stimulate the economy will be limited unless policies are combined with steps to aid the housing market, according to Federal Reserve Bank of New York economist Joseph Tracy. “We need to fold in some pretty serious housing policies at the same time, not just to get housing going, but to get the full benefit of all these policies,” Tracy said today at a conference hosted by the New York State Society of Certified Public Accountants. “That would be very complementary.” The housing market is still a drag on the economy even as the Fed has kept its target rate for overnight loans between banks at a record low since December 2008 and plans to extend the maturities of its $2.64 trillion of securities holdings to tamp down longer-term borrowing costs. President Barack Obama has proposed a $447 billion plan that includes infrastructure spending and payroll tax cuts to reduce the 9.1 percent unemployment rate.
U.S. Senate Approves Bill to Avoid Government Shutdown, Fund Disaster Aid (Source: Bloomberg)
The U.S. Senate reached a bipartisan deal on stopgap spending designed to avoid a government shutdown and defuse a fight over aid to victims of hurricanes, tornadoes and other natural disasters. Senators approved legislation yesterday, 79-12, to finance the government through Nov. 18, a measure including $2.65 billion for federal disaster assistance. With the expectation that the House would consent, senators also passed on a voice vote a measure to tide the government over through Oct. 4 so that the House, in recess this week, can consider the longer funding measure. The 2011 fiscal year ends on Sept. 30, and the House can approve the short-term bill by unanimous consent without bringing members back to Washington.
Consumer Confidence Stagnates at Two-Year Low (Source: Bloomberg)
Confidence among U.S. consumers stagnated in September near a two-year low as the share of households saying it was difficult to find a job climbed to the highest level in almost three decades. The Conference Board’s sentiment index increased to 45.4 from a revised 45.2 reading in August that was the lowest since April 2009, when the economy was in a recession, figures from the New York-based private research group showed today. A report on home prices showed values dropped less than forecast in the year ended July. The confidence reading signals hiring hasn’t improved after the world’s largest economy failed to create jobs in August and the unemployment rate held at 9.1 percent. Plunging stock prices and concern the crisis in Europe will undermine the global recovery may also be shaking Americans’ resolve, raising the risk that spending will cool during the holiday shopping season.
Roubini: U.S. in Throes of Economic Contraction (Source: Bloomberg)
Most advanced economies are lapsing back into recession while the U.S. is already in the throes of an economic contraction, according to Nouriel Roubini, co- founder and chairman of Roubini Global Economics LLC. “The way I see the global economy, I think we’re entering into a recession again in most advanced economies,” Roubini said in a panel discussion today at the Bloomberg Dealmakers Summit in New York. “I think we’re already into one in the U.S. based on the hard and soft data -- same with most of the euro zone, same with the United Kingdom.” The Conference Board today said that confidence among U.S. consumers stagnated in September near a two-year low as the share of households saying it was difficult to find a job climbed to the highest level in almost three decades. European leaders over the weekend faced pressure at the annual meetings of the International Monetary Fund to solve a debt crisis already spilling over into other parts of the world.
Home Prices in U.S. Cities Fall 4.1% (Source: Bloomberg)
Home prices in the U.S. declined less than forecast in July from a year earlier, a sign bank delays in processing foreclosures may have temporarily slowed the slump in real-estate values. The S&P/Case-Shiller index of property values in 20 cities fell 4.1 percent from July 2010, after a revised 4.4 percent drop in the 12 months to June, the group said today in New York. The median forecast of 28 economists surveyed by Bloomberg News projected a 4.4 percent decline. Values were little changed in July from the prior month after adjusting for seasonal changes, the same as in June. Investigations into bank foreclosure practices led to delays in processing that may have helped stabilize prices in recent months. Values may soon resume their slide as the holdups dissipate, putting more houses on to the market and pushing back any recovery in the industry that precipitated the last recession.
Treasury Bonds Advance on Concern Major Economies Will Fall into Recession (Source: Bloomberg)
Treasury 30-year bonds rose for the first time in four days on speculation European efforts to solve the region’s debt crisis won’t stave off a recession in developed economies. The difference between U.S. five- and 30-year yields narrowed to 2.11 percentage points from this year’s high of 2.88 percentage points in July. The spread shrank to 1.97 percentage points on Sept. 23, the least since January 2010. The U.S. plans to sell $35 billion of five-year debt today, the second of three note auctions this week. The 10-year yield declined to a record low of 1.6714 percent on Sept. 23. “I can’t say the bond rally is over,” said Tsutomu Komiya, who helps oversee the equivalent of $120.9 billion as an investor in Tokyo at Daiwa Asset Management Co., a unit of Japan’s second-biggest brokerage by market value. “Globally, the business cycle is fragile.”
U.S. Stocks Rise, Paring Gains in Final Hour, as Investors Focus on Greece (Source: Bloomberg)
U.S. stocks rose, with benchmark indexes weathering a final-hour selloff, after Greece made progress in meeting requirements for more international aid and Germany vowed continued support for the country. All 10 groups in the Standard & Poor’s 500 Index rose as gains were led by commodity and industrial shares. Dow Chemical Co. (DOW) and United Technologies Corp. (UTX) climbed at least 2.2 percent to pace a rally in companies most-tied to the economy. Financial stocks pared gains as the Financial Times reported that some euro-area countries are demanding private creditors take bigger writedowns on their Greek bond holdings. Bank of America Corp. (BAC) reversed a 3.8 percent advance, falling 1.8 percent. The S&P 500 increased 1.1 percent to 1,175.38 at 4 p.m. New York time, rising 4.1 percent in three days, the biggest gain over that same period since Aug. 30. The Dow Jones Industrial Average rose 146.83 points, or 1.3 percent, to 11,190.69 today.
China’s Stocks Drop to 14-Month Low, as Property, Railway Companies Sink (Source: Bloomberg)
China’s stocks fell, sending the benchmark index to its lowest level since July 2010, on concern government measures to tame inflation and a faltering global economy will hurt earnings growth. China Vanke Co. and Poly Real Estate Group Co. led losses by developers amid speculation funding costs will rise at the same time as sales slow. Railcar makers CSR Corp. and China CNR Corp. sank after a train collision in Shanghai’s metro injured 271 people. The Shanghai Composite Index dropped 24.61 points, or 1 percent, to 2,390.45 as of 2:50 p.m. local time, erasing an earlier 0.6 percent gain. The CSI 300 Index (SHSZ300) declined 1 percent to 2,611.38. The country’s markets will be shut all next week for holidays.
Hacking Group Anonymous Targets Chinese Agriculture Firm (Source: CME)
Fresh from its attacks on the Iranian government, Bank of America Corp. and Sony Corp., hacker group Anonymous has now set its sights on a Chinese fruit and vegetable producer it claims is one of the Hong Kong stock Exchange's "largest, and longest running frauds." According to a document released on the website of Anonymous Analytics, a new offshoot of the "hacktivist" group, dedicated to exposing corporate fraud, Chaoda Modern Agriculture (Holdings) Ltd. has been engaging in 11 years of "deceit and corporate fraud." But its first target isn't exactly a bombshell reminiscent of Muddy Waters LLC's muck-raking of Sino-Forest Corp. Chaoda hasbeen under scrutiny for some time. Most recently, Hong Kong-based Next Magazine wrote in May that the company had overstated the size of its farmland in China, among other allegations. Chaoda has denied the report.
In an emailed response to The Wall Street Journal, Anonymous Analytics said it had chosen Chaoda as its first target, despite it already being the subject of much controversy, because "it was an easy project for us to get our feet wet in this arena. The evidence was everywhere." In the report, peppered with Internet memes and quotes from TV shows "The Simpsons" and "Seinfeld," the group says Chaoda "has an extensive history of deceiving investors and shareholders" since going public in 2000, and has consistently overstated its cash balance and falsified its books. It calculates Chaoda's fair value to be HK$0.60 per share, though it believes Chaoda's end-game is a delisting from the Hong Kong Stock Exchange as it "will not be able to survive scrutiny." Anonymous Analytics also accuses Hong Kong regulators of sleeping at the wheel, allowing an "obvious fraud" to operate for so long.
Perhaps of more interest than the content of the Sept. 26 report is its timing. That Monday morning in Hong Kong, media reports said the company was being investigated by the government for market misconduct, sending shares down 27%, and 81% year-to-date at HK$1.10. The company was suspended from trading at midday. When asked about the timing, Anonymous Analytics said: "After 11 years, the government decided to announce proceedings hours before we released our report. We will let your readers do the math." According to the government's Market Misconduct Tribunal website, a preliminary hearing for Chaoda's case was held Sept. 6. A second hearing is scheduled for Wednesday. Hong Kong's Securities and Futures Commission declined to comment. A spokesman for Chaoda said the company is preparing a statement in response to the Anonymous Analytics report. The Market Misconduct Tribunal declined further comment on details of the case.
Anonymous Analytics states in a disclaimer in the report that while it doesn't hold a direct position in Chaoda, it stands to gain from any fall in the share price through an indirect interest in short positions held by parties associated with its investigation. In short, it's not, as it says on its Twitter page, merely "taking down corporations for the lulz" (or laughs).
Japan Ruling Party Proposes Tax Hikes, Japan Tobacco Stake Sale to Rebuild (Source: Bloomberg)
Japan’s ruling party proposed a 9.2 trillion yen ($120 billion) temporary tax increase and selling the government’s stake in Japan Tobacco Inc. (2914) to fund rebuilding from the March 11 earthquake and nuclear disaster. The Democratic Party of Japan yesterday also agreed on a third post-quake stimulus package of about 12 trillion yen, party policy chief Seiji Maehara told reporters last night. Prime Minister Yoshihiko Noda’s government must now negotiate with opposition lawmakers to get the plans approved. “We need to explain sincerely to the public that tax increases are needed to support reconstruction,” Maehara said yesterday. “These are temporary measures. We want to avoid a negative impact on the economy.”
Nikkei 225 Pares Gains as Stalled French GDP Reignites Europe Concern (Source: Bloomberg)
Japan’s Nikkei 225 (NKY) Stock Average pared gains in the final minutes of trading after a report showed France’s gross domestic product failed to grow last quarter, sparking concern Europe’s debt crisis is damping growth in one of Asia’s biggest markets. The Nikkei 225 rose 0.1 percent to 8,615.65 as of 3 p.m. close in Tokyo, paring earlier gains of as much as 0.7 percent. The gauge advanced for a second day from its lowest level since April 2009. The broader Topix gained 0.7 percent to 754.07 today after German Chancellor Angela Merkel signaled support for Greece, saying, “Germany is ready to offer all kinds of help that is needed.” “Investors have no idea whether Greece’s debt problem will really be solved,” said Hisakazu Amano, who helps oversee the equivalent of $29 billion at Tokyo-based T&D Asset Management Co. “The European Union as a whole supports measures to help Greece, but voters in Germany and other countries may not want to put money into it.”
Mortgage Rates Drop to Lowest in Two Years as Economy Slows: Japan Credit (Source: Bloomberg)
Japan’s home-mortgage costs are dropping, with rates at the lowest since 2009, as a recession deters borrowers and keeps benchmark government bond rates low. The 10-year fixed-mortgage rate is 3.75 percent at Bank of Tokyo-Mitsubishi UFJ Ltd., a unit of Japan’s biggest listed bank, compared with more than 4 percent in May, according to data compiled by Bloomberg. Home-loan costs fell in September, tracking a drop to record levels in the U.S., as Japan’s 10-year sovereign yields slid for a sixth-straight month. “Government bond yields should hover at low levels,” said Kenro Kawano, head of Japan interest-rate strategy at Credit Suisse Group AG in Tokyo, one of the 25 primary dealers obligated to bid at the government’s debt sales. “The mortgage rate could go lower as banks struggle to find borrowers. There’s no need to rush to buy a house.”
Greek Leaders Appeal for Support as U.S. Presses for EU Faster Debt Action (Source: Bloomberg)
Greek leaders appealed for support at home and abroad to avert default before key legislative votes as the U.S. criticized European leaders for moving too slowly to stem the debt crisis. Prime Minister George Papandreou traveled to Berlin two days before German lawmakers ratify an overhaul of the euro rescue fund, pledging success in a struggle to restore budget balance. Finance Minister Evangelos Venizelos promised “superhuman” efforts hours before a vote in Athens on an unpopular property tax needed to avoid default. President Barack Obama underscored the urgency late yesterday when he said European governments are “trying to take responsible actions, but those actions haven’t been quite as quick as they need to be.” His treasury secretary, Timothy F. Geithner, said Europe has “not very much time” to act.
Papandreou Wins Vote on Property Tax (Source: Bloomberg)
Greek Prime Minister George Papandreou won parliamentary backing for a property tax to meet deficit-reduction targets required to avoid default. Papandreou’s Socialist Pasok party won the vote in Athens late yesterday by 155 to 142 after Finance Minister Evangelos Venizelos told Greeks they face economic collapse if they don’t plug a budget gap that is exceeding the target set in a bailout, putting an 8 billion-euro ($11 billion) aid payment due next month at risk. “Implementation of the measures is the biggest challenge for the government as the trade unions and parts of the civil service will mount significant resistance, raising the risk of inertia and inaction,” Wolfango Piccoli, an analyst in London at Eurasia Group, said before the vote.
Spanish Central Government Budget Deficit Narrows to 2.8% of GDP From 3.3% (Source: Bloomberg)
Spain’s central government budget deficit narrowed in the eight months through August, bolstering the nation’s chances of meeting its deficit goal even as regional administrations fall behind their targets. The central government reported a 30.9 billion-euro ($40.5 billion) deficit, or 2.83 percent of gross domestic product, compared with 3.28 percent a year earlier, the Finance Ministry in Madrid said today. For the full year, the central government aims to reduce the gap to 4.8 percent of GDP, as part of the goal to cut the overall public-sector shortfall to 6 percent from 9.2 percent in 2010, when it was the third-biggest in the euro region.
German Bonds Rise Before Inflation Report, Snapping 3-Day Drop (Source: Bloomberg)
German 10-year bonds rose, snapping a three-day decline, before a report that economists said will show the nation’s consumer prices dropped in September. Two-year notes, perceived to be among Europe’s safest securities, gained for the first time in three days after Bild reported that Germany’s government privately anticipates a default by Greece as early as this year. The 10-year bund yield dropped three basis points to 1.93 percent at 7:19 a.m. in London. The yield has climbed from a record low 1.636 percent on Sept. 23. The 2.25 percent security due September 2021 gained 0.285, or 2.85 euros per 1,000-euro ($1,358) face amount, to 102.860. Two-year yields fell one basis point to 0.52 percent.
European Stock-Index Futures Decline Amid EU Moves to Contain Greek Debt (Source: Bloomberg)
European stock-index futures fell after a report that some countries are demanding private creditors take bigger writedowns on Greek bonds. Asian shares and U.S. futures were little changed. PSA Peugeot Citroen, Europe’s second-largest carmaker, may decline after Goldman Sachs Group Inc. advised selling the shares. Telefonica SA (TEF) may be active after Fitch Ratings cut its long-term issuer default rating. Futures on the Euro Stoxx 50 Index, a benchmark for the euro region, fell 0.8 percent to 2,160 at 7:12 a.m. in London, while FTSE 100 Index (UKX) futures slid 0.9 percent. Contracts on the Standard & Poor’s 500 Index declined 0.1 percent, while the MSCI Asia Pacific Index advanced 0.2 percent.
SINGAPORE, Sept 28 (Reuters) - Asian stocks edged higher and a rally in the euro stalled, as investors looked for more signs that European leaders were tackling a debt crisis that threatens the financial system before committing bolder market bets.
"Investors think, isn't the European situation better? But we have no way of knowing for sure at this point, and until they're more confident, we probably won't see major buying," said Hiroichi Nishi, equity division manager at SMBC Nikko Securities Inc in Tokyo.
GLOBAL MARKETS-Stocks edge up, euro down as caution prevails
SINGAPORE, Sept 28 (Reuters) - Asian stocks crawled higher and a rally in the euro stalled on Wednesday, as investors looked for more signs of progress from European leaders on tackling a debt crisis that threatens the financial system before committing bolder market bets.
"Today's rebound could easily give way at some point," ANZ Bank said in a research note.
Obama’s Jobs Plan Prevents Election-Year Recession in Survey of Economists (Source: Bloomberg)
President Barack Obama’s $447 billion jobs plan would help avoid a return to recession by maintaining growth and pushing down the unemployment rate next year, according to economists surveyed by Bloomberg News. The legislation, submitted to Congress this month, would increase gross domestic product by 0.6 percent next year and add or keep 275,000 workers on payrolls, the median estimates in the survey of 34 economists showed. The program would also lower the jobless rate by 0.2 percentage point in 2012, economists said. Economists in the survey are less optimistic than Treasury Secretary Timothy F. Geithner, who has cited estimates for a 1.5 percent boost to gross domestic product. Even so, the program may bolster Obama’s re-election prospects by lowering a jobless rate that has stayed near 9 percent or more since April 2009.
Euro Crisis Makes Fed Lender of Only Resort (Source: Bloomberg)
The Federal Reserve, chastised by Congress for lending money to foreign institutions such as the Central Bank of Libya, is once again the lender of last resort for banks around the world it knows little about. Three years after the collapse of Lehman Brothers Holdings Inc., money-market borrowing rates for dollars are rising, leading the Fed and European Central Bank to make the currency available to Europe’s institutions for as many as three months. U.S. prime money-market funds cut their exposure to euro-zone bank deposits and commercial paper, or short-term IOUs, to $214 billion in August from $391 billion at the end of last year, according to JPMorgan Chase & Co. data.
The failure of regulators worldwide to address European banks’ fragile dependence on short-term funding is “putting the Fed in a really awkward position,” said Karen Shaw Petrou, managing partner at Federal Financial Analytics, a Washington regulatory research firm whose clients include the biggest U.S. banks. The swaps with Europe “are an extremely advantageous political football” for critics of the Fed, she said.
U.S. Economic Stimulus Needs Housing Effort, New York Fed’s Tracy Says (Source: Bloomberg)
Any success for government efforts to stimulate the economy will be limited unless policies are combined with steps to aid the housing market, according to Federal Reserve Bank of New York economist Joseph Tracy. “We need to fold in some pretty serious housing policies at the same time, not just to get housing going, but to get the full benefit of all these policies,” Tracy said today at a conference hosted by the New York State Society of Certified Public Accountants. “That would be very complementary.” The housing market is still a drag on the economy even as the Fed has kept its target rate for overnight loans between banks at a record low since December 2008 and plans to extend the maturities of its $2.64 trillion of securities holdings to tamp down longer-term borrowing costs. President Barack Obama has proposed a $447 billion plan that includes infrastructure spending and payroll tax cuts to reduce the 9.1 percent unemployment rate.
U.S. Senate Approves Bill to Avoid Government Shutdown, Fund Disaster Aid (Source: Bloomberg)
The U.S. Senate reached a bipartisan deal on stopgap spending designed to avoid a government shutdown and defuse a fight over aid to victims of hurricanes, tornadoes and other natural disasters. Senators approved legislation yesterday, 79-12, to finance the government through Nov. 18, a measure including $2.65 billion for federal disaster assistance. With the expectation that the House would consent, senators also passed on a voice vote a measure to tide the government over through Oct. 4 so that the House, in recess this week, can consider the longer funding measure. The 2011 fiscal year ends on Sept. 30, and the House can approve the short-term bill by unanimous consent without bringing members back to Washington.
Consumer Confidence Stagnates at Two-Year Low (Source: Bloomberg)
Confidence among U.S. consumers stagnated in September near a two-year low as the share of households saying it was difficult to find a job climbed to the highest level in almost three decades. The Conference Board’s sentiment index increased to 45.4 from a revised 45.2 reading in August that was the lowest since April 2009, when the economy was in a recession, figures from the New York-based private research group showed today. A report on home prices showed values dropped less than forecast in the year ended July. The confidence reading signals hiring hasn’t improved after the world’s largest economy failed to create jobs in August and the unemployment rate held at 9.1 percent. Plunging stock prices and concern the crisis in Europe will undermine the global recovery may also be shaking Americans’ resolve, raising the risk that spending will cool during the holiday shopping season.
Roubini: U.S. in Throes of Economic Contraction (Source: Bloomberg)
Most advanced economies are lapsing back into recession while the U.S. is already in the throes of an economic contraction, according to Nouriel Roubini, co- founder and chairman of Roubini Global Economics LLC. “The way I see the global economy, I think we’re entering into a recession again in most advanced economies,” Roubini said in a panel discussion today at the Bloomberg Dealmakers Summit in New York. “I think we’re already into one in the U.S. based on the hard and soft data -- same with most of the euro zone, same with the United Kingdom.” The Conference Board today said that confidence among U.S. consumers stagnated in September near a two-year low as the share of households saying it was difficult to find a job climbed to the highest level in almost three decades. European leaders over the weekend faced pressure at the annual meetings of the International Monetary Fund to solve a debt crisis already spilling over into other parts of the world.
Home Prices in U.S. Cities Fall 4.1% (Source: Bloomberg)
Home prices in the U.S. declined less than forecast in July from a year earlier, a sign bank delays in processing foreclosures may have temporarily slowed the slump in real-estate values. The S&P/Case-Shiller index of property values in 20 cities fell 4.1 percent from July 2010, after a revised 4.4 percent drop in the 12 months to June, the group said today in New York. The median forecast of 28 economists surveyed by Bloomberg News projected a 4.4 percent decline. Values were little changed in July from the prior month after adjusting for seasonal changes, the same as in June. Investigations into bank foreclosure practices led to delays in processing that may have helped stabilize prices in recent months. Values may soon resume their slide as the holdups dissipate, putting more houses on to the market and pushing back any recovery in the industry that precipitated the last recession.
Treasury Bonds Advance on Concern Major Economies Will Fall into Recession (Source: Bloomberg)
Treasury 30-year bonds rose for the first time in four days on speculation European efforts to solve the region’s debt crisis won’t stave off a recession in developed economies. The difference between U.S. five- and 30-year yields narrowed to 2.11 percentage points from this year’s high of 2.88 percentage points in July. The spread shrank to 1.97 percentage points on Sept. 23, the least since January 2010. The U.S. plans to sell $35 billion of five-year debt today, the second of three note auctions this week. The 10-year yield declined to a record low of 1.6714 percent on Sept. 23. “I can’t say the bond rally is over,” said Tsutomu Komiya, who helps oversee the equivalent of $120.9 billion as an investor in Tokyo at Daiwa Asset Management Co., a unit of Japan’s second-biggest brokerage by market value. “Globally, the business cycle is fragile.”
U.S. Stocks Rise, Paring Gains in Final Hour, as Investors Focus on Greece (Source: Bloomberg)
U.S. stocks rose, with benchmark indexes weathering a final-hour selloff, after Greece made progress in meeting requirements for more international aid and Germany vowed continued support for the country. All 10 groups in the Standard & Poor’s 500 Index rose as gains were led by commodity and industrial shares. Dow Chemical Co. (DOW) and United Technologies Corp. (UTX) climbed at least 2.2 percent to pace a rally in companies most-tied to the economy. Financial stocks pared gains as the Financial Times reported that some euro-area countries are demanding private creditors take bigger writedowns on their Greek bond holdings. Bank of America Corp. (BAC) reversed a 3.8 percent advance, falling 1.8 percent. The S&P 500 increased 1.1 percent to 1,175.38 at 4 p.m. New York time, rising 4.1 percent in three days, the biggest gain over that same period since Aug. 30. The Dow Jones Industrial Average rose 146.83 points, or 1.3 percent, to 11,190.69 today.
China’s Stocks Drop to 14-Month Low, as Property, Railway Companies Sink (Source: Bloomberg)
China’s stocks fell, sending the benchmark index to its lowest level since July 2010, on concern government measures to tame inflation and a faltering global economy will hurt earnings growth. China Vanke Co. and Poly Real Estate Group Co. led losses by developers amid speculation funding costs will rise at the same time as sales slow. Railcar makers CSR Corp. and China CNR Corp. sank after a train collision in Shanghai’s metro injured 271 people. The Shanghai Composite Index dropped 24.61 points, or 1 percent, to 2,390.45 as of 2:50 p.m. local time, erasing an earlier 0.6 percent gain. The CSI 300 Index (SHSZ300) declined 1 percent to 2,611.38. The country’s markets will be shut all next week for holidays.
Hacking Group Anonymous Targets Chinese Agriculture Firm (Source: CME)
Fresh from its attacks on the Iranian government, Bank of America Corp. and Sony Corp., hacker group Anonymous has now set its sights on a Chinese fruit and vegetable producer it claims is one of the Hong Kong stock Exchange's "largest, and longest running frauds." According to a document released on the website of Anonymous Analytics, a new offshoot of the "hacktivist" group, dedicated to exposing corporate fraud, Chaoda Modern Agriculture (Holdings) Ltd. has been engaging in 11 years of "deceit and corporate fraud." But its first target isn't exactly a bombshell reminiscent of Muddy Waters LLC's muck-raking of Sino-Forest Corp. Chaoda hasbeen under scrutiny for some time. Most recently, Hong Kong-based Next Magazine wrote in May that the company had overstated the size of its farmland in China, among other allegations. Chaoda has denied the report.
In an emailed response to The Wall Street Journal, Anonymous Analytics said it had chosen Chaoda as its first target, despite it already being the subject of much controversy, because "it was an easy project for us to get our feet wet in this arena. The evidence was everywhere." In the report, peppered with Internet memes and quotes from TV shows "The Simpsons" and "Seinfeld," the group says Chaoda "has an extensive history of deceiving investors and shareholders" since going public in 2000, and has consistently overstated its cash balance and falsified its books. It calculates Chaoda's fair value to be HK$0.60 per share, though it believes Chaoda's end-game is a delisting from the Hong Kong Stock Exchange as it "will not be able to survive scrutiny." Anonymous Analytics also accuses Hong Kong regulators of sleeping at the wheel, allowing an "obvious fraud" to operate for so long.
Perhaps of more interest than the content of the Sept. 26 report is its timing. That Monday morning in Hong Kong, media reports said the company was being investigated by the government for market misconduct, sending shares down 27%, and 81% year-to-date at HK$1.10. The company was suspended from trading at midday. When asked about the timing, Anonymous Analytics said: "After 11 years, the government decided to announce proceedings hours before we released our report. We will let your readers do the math." According to the government's Market Misconduct Tribunal website, a preliminary hearing for Chaoda's case was held Sept. 6. A second hearing is scheduled for Wednesday. Hong Kong's Securities and Futures Commission declined to comment. A spokesman for Chaoda said the company is preparing a statement in response to the Anonymous Analytics report. The Market Misconduct Tribunal declined further comment on details of the case.
Anonymous Analytics states in a disclaimer in the report that while it doesn't hold a direct position in Chaoda, it stands to gain from any fall in the share price through an indirect interest in short positions held by parties associated with its investigation. In short, it's not, as it says on its Twitter page, merely "taking down corporations for the lulz" (or laughs).
Japan Ruling Party Proposes Tax Hikes, Japan Tobacco Stake Sale to Rebuild (Source: Bloomberg)
Japan’s ruling party proposed a 9.2 trillion yen ($120 billion) temporary tax increase and selling the government’s stake in Japan Tobacco Inc. (2914) to fund rebuilding from the March 11 earthquake and nuclear disaster. The Democratic Party of Japan yesterday also agreed on a third post-quake stimulus package of about 12 trillion yen, party policy chief Seiji Maehara told reporters last night. Prime Minister Yoshihiko Noda’s government must now negotiate with opposition lawmakers to get the plans approved. “We need to explain sincerely to the public that tax increases are needed to support reconstruction,” Maehara said yesterday. “These are temporary measures. We want to avoid a negative impact on the economy.”
Nikkei 225 Pares Gains as Stalled French GDP Reignites Europe Concern (Source: Bloomberg)
Japan’s Nikkei 225 (NKY) Stock Average pared gains in the final minutes of trading after a report showed France’s gross domestic product failed to grow last quarter, sparking concern Europe’s debt crisis is damping growth in one of Asia’s biggest markets. The Nikkei 225 rose 0.1 percent to 8,615.65 as of 3 p.m. close in Tokyo, paring earlier gains of as much as 0.7 percent. The gauge advanced for a second day from its lowest level since April 2009. The broader Topix gained 0.7 percent to 754.07 today after German Chancellor Angela Merkel signaled support for Greece, saying, “Germany is ready to offer all kinds of help that is needed.” “Investors have no idea whether Greece’s debt problem will really be solved,” said Hisakazu Amano, who helps oversee the equivalent of $29 billion at Tokyo-based T&D Asset Management Co. “The European Union as a whole supports measures to help Greece, but voters in Germany and other countries may not want to put money into it.”
Mortgage Rates Drop to Lowest in Two Years as Economy Slows: Japan Credit (Source: Bloomberg)
Japan’s home-mortgage costs are dropping, with rates at the lowest since 2009, as a recession deters borrowers and keeps benchmark government bond rates low. The 10-year fixed-mortgage rate is 3.75 percent at Bank of Tokyo-Mitsubishi UFJ Ltd., a unit of Japan’s biggest listed bank, compared with more than 4 percent in May, according to data compiled by Bloomberg. Home-loan costs fell in September, tracking a drop to record levels in the U.S., as Japan’s 10-year sovereign yields slid for a sixth-straight month. “Government bond yields should hover at low levels,” said Kenro Kawano, head of Japan interest-rate strategy at Credit Suisse Group AG in Tokyo, one of the 25 primary dealers obligated to bid at the government’s debt sales. “The mortgage rate could go lower as banks struggle to find borrowers. There’s no need to rush to buy a house.”
Greek Leaders Appeal for Support as U.S. Presses for EU Faster Debt Action (Source: Bloomberg)
Greek leaders appealed for support at home and abroad to avert default before key legislative votes as the U.S. criticized European leaders for moving too slowly to stem the debt crisis. Prime Minister George Papandreou traveled to Berlin two days before German lawmakers ratify an overhaul of the euro rescue fund, pledging success in a struggle to restore budget balance. Finance Minister Evangelos Venizelos promised “superhuman” efforts hours before a vote in Athens on an unpopular property tax needed to avoid default. President Barack Obama underscored the urgency late yesterday when he said European governments are “trying to take responsible actions, but those actions haven’t been quite as quick as they need to be.” His treasury secretary, Timothy F. Geithner, said Europe has “not very much time” to act.
Papandreou Wins Vote on Property Tax (Source: Bloomberg)
Greek Prime Minister George Papandreou won parliamentary backing for a property tax to meet deficit-reduction targets required to avoid default. Papandreou’s Socialist Pasok party won the vote in Athens late yesterday by 155 to 142 after Finance Minister Evangelos Venizelos told Greeks they face economic collapse if they don’t plug a budget gap that is exceeding the target set in a bailout, putting an 8 billion-euro ($11 billion) aid payment due next month at risk. “Implementation of the measures is the biggest challenge for the government as the trade unions and parts of the civil service will mount significant resistance, raising the risk of inertia and inaction,” Wolfango Piccoli, an analyst in London at Eurasia Group, said before the vote.
Spanish Central Government Budget Deficit Narrows to 2.8% of GDP From 3.3% (Source: Bloomberg)
Spain’s central government budget deficit narrowed in the eight months through August, bolstering the nation’s chances of meeting its deficit goal even as regional administrations fall behind their targets. The central government reported a 30.9 billion-euro ($40.5 billion) deficit, or 2.83 percent of gross domestic product, compared with 3.28 percent a year earlier, the Finance Ministry in Madrid said today. For the full year, the central government aims to reduce the gap to 4.8 percent of GDP, as part of the goal to cut the overall public-sector shortfall to 6 percent from 9.2 percent in 2010, when it was the third-biggest in the euro region.
German Bonds Rise Before Inflation Report, Snapping 3-Day Drop (Source: Bloomberg)
German 10-year bonds rose, snapping a three-day decline, before a report that economists said will show the nation’s consumer prices dropped in September. Two-year notes, perceived to be among Europe’s safest securities, gained for the first time in three days after Bild reported that Germany’s government privately anticipates a default by Greece as early as this year. The 10-year bund yield dropped three basis points to 1.93 percent at 7:19 a.m. in London. The yield has climbed from a record low 1.636 percent on Sept. 23. The 2.25 percent security due September 2021 gained 0.285, or 2.85 euros per 1,000-euro ($1,358) face amount, to 102.860. Two-year yields fell one basis point to 0.52 percent.
European Stock-Index Futures Decline Amid EU Moves to Contain Greek Debt (Source: Bloomberg)
European stock-index futures fell after a report that some countries are demanding private creditors take bigger writedowns on Greek bonds. Asian shares and U.S. futures were little changed. PSA Peugeot Citroen, Europe’s second-largest carmaker, may decline after Goldman Sachs Group Inc. advised selling the shares. Telefonica SA (TEF) may be active after Fitch Ratings cut its long-term issuer default rating. Futures on the Euro Stoxx 50 Index, a benchmark for the euro region, fell 0.8 percent to 2,160 at 7:12 a.m. in London, while FTSE 100 Index (UKX) futures slid 0.9 percent. Contracts on the Standard & Poor’s 500 Index declined 0.1 percent, while the MSCI Asia Pacific Index advanced 0.2 percent.
20110928 1545 Global Commodities Related News.
COMMODITIES-Markets broadly higher on European promises
NEW YORK, Sept 27 (Reuters) - Commodities markets finished the day broadly higher on Tuesday, buoyed by expectations that European officials would fortify the region's bailout fund as they struggle to contain the debt crisis.
"The market had been pricing in the possibility of a recession, so the news that we could possibly get some kind of resolution in Europe is very positive," said Jerry Harris, president of asset management at Sterne Agee in Birmingham, Alabama.
Commodities Drop on Growth Risk, Deepening Worst Quarterly Loss Since 2008 (Source: Bloomberg)
Commodities fell, widening their second quarterly loss, as Europe’s sovereign-debt crisis threatened to slow global growth and reduce raw-material demand. The Standard & Poor’s GSCI Spot Index slid as much as 1.4 percent 611.43 and was at 613.87 at 2:18 p.m. in Singapore. The gauge headed for a quarterly decline of 8.2 percent, the worst since 2008. The measure rose 3.3 percent yesterday, the most in more than four months. Crude oil fell 1.5 percent in New York while copper retreated 3.5 percent and gold shed 0.4 percent. Commerce Department data today may show U.S. durable goods orders fell and a separate report may confirm European consumer confidence dropped to a two-year low in September. As many as seven of the 17 nations using the euro believe private creditors should absorb bigger losses, a division that may threaten an agreement reached with investors in July, the Financial Times reported today, citing unidentified European officials.
Olam's long-term commods outlook bullish; cautious on cocoa
SINGAPORE, Sept 26 (Reuters) - Singapore-listed Olam International said on Monday the long-term outlook for most agricultural commodities was still bright despite the threat of a slowdown in demand triggered by economic woes, but weak fundamentals could work against cocoa.
Gold and copper suffered their biggest slump since the 2008 financial crisis as another brutal sell-off hit commodities on growing doubts Europe may be unable to prevent its debt crisis from dragging down the global economy.
Corn (Source: CME)
US corn futures post decent gains as the market continues to recover from recent steep losses. Strength in external markets and weakness in the dollar helped lift grain prices after commodities tumbled last week on economic jitters. Yet, prices finished off intraday highs as traders remain nervous about the risk for more selling ahead of quarter-end. They worry the USDA, in a crop report Friday, could estimate corn supplies were larger than expected at the start of September. CBOT December corn rose 4 1/4c to $6.52 1/4 a bushel.
Wheat (Source: CME)
US wheat futures finish firmer on increasing concerns about dryness hurting crops in key growing areas. The southern Plains and Ukraine need rain to encourage planting, while Argentina needs rain ahead of the upcoming harvest. Expectations for increasing demand add support following last week's decline in prices, traders note. South Korea bought optional-origin wheat, with traders saying it was likely the first significant purchase by South Korean feedmillers since June. CBOT December wheat jumps 10c to $6.58 1/4 a bushel and KCBT December rises 9c to $7.53 but MGEX December slips 3/4c to $8.69 1/4 after Monday's surge.
Rice (Source: CME)
US rice futures settle higher as advances in crude oil and equities fuel a recovery from last week's declines. The market gets additional support from weakness in the dollar, which makes US grains more attractive to foreign buyers. Traders note gains in rice mirror rebounds from last week's losses in wheat, corn and soybeans. CBOT November rice closes up 22 1/2c at $16.35/hundredweight.
USDA seen lowering US spring, all-wheat production
CHICAGO, Sept. 27 (Reuters) - Poor yields in the northern U.S. spring wheat belt should prompt the U.S. Department of Agriculture to cut its estimate of overall 2011 U.S. wheat production to the lowest level since 2006, analysts said.
Spring wheat production could drop to its lowest level since 2007, and if it does, ending stocks of the high quality wheat could tumble to the second-lowest on record.
Corn supply at 8-year low, down less than expected
CHICAGO, Sept 27 (Reuters) - U.S. corn stockpiles likely declined over the summer but by slightly less than the government has estimated, giving the tight market marginally more breathing room before consumers enter an even leaner year.
Inventories at the end of the 2010/11 marketing year are expected to fall to 964 million bushels, down 44 percent from 1.708 billion a year ago and the smallest supply in eight years, according to analysts polled by Reuters ahead of the U.S. Agriculture Department's quarterly stock report on Friday.
U.S. grains decline on slow growth, dollar's gain
SINGAPORE, Sept 28 (Reuters) - U.S. grain futures fell, giving back gains from the previous day, as concern that global economic growth will slow and doubts over Europe's commitment to its debt plan prompted investors to shift to the U.S. dollar.
"There are expectations that the USDA may report a larger-than-expected supply on corn," said Lynette Tan, a grains analyst at Phillip Futures in Singapore.
Colombia's top coffee region output lags -farmers
BOGOTA, Sept 27 (Reuters) - Leading Colombian coffee-growing province Antioquia is seen producing fewer beans during its main harvest than in the same period a year ago after torrential rains hit plantations, growers said.
Coffee growers in the northwestern province that accounts for 16 percent of Colombia's total output said progress was slower than normal. Theey were skeptical the country would meet its overall 2011 target of 9 million 60-kg bags.
Brazil coffee area seen dry until mid-Ocober
BRASILIA, Sept 27 (Reuters) - Brazil's key coffee zones could stay dry until mid October, delaying the start of crop-fixing flowering, but the long dry spell does not yet spell disaster for the next crop, agronomists said on Tuesday.
The coffee market is relying on a good on-year harvest next year from the world's top grower to pump supplies into a market facing chronic shortages of some bean types. The shortages have sustained high prices since mid 2010.
Brazil CS sugar output down 8 pct - Unica
SAO PAULO, Sept 27 (Reuters) - Sugar production from Brazil's center-south cane crop this season is lagging last year by 8 percent, but output was up in recent weeks, the cane industry association Unica said on Tuesday.
From the beginning of the season in April through Sept. 16, sugar output totaled 23.1 million tonnes, 2 million tonnes less than the same period in 2010.
India sugar producers' body foresees surplus
NEW DELHI, Sept 27 (Reuters) - India is heading for a sugar surplus in 2011/12, and the government should help producers by allowing 4 million tonnes of exports -- more than double this year's overseas sales, the head of a producers' body said on Tuesday.
Output for the world's second-biggest producer after Brazil could rise to 26.5 million tonnes in 2011/12, Jayantilal B. Patel, president of the National Federation of Cooperative Sugar Factories Ltd (NFCSF), told an industry meeting.
S.Africa cuts maize output forecast, wheat seen up
JOHANNESBURG, Sept 27 (Reuters) - South Africa slightly cut its May 2010-April 2011 season maize output forecast on Tuesday, citing a lower pace of deliveries to silos, while the 2011 wheat output is seen up on the back of better yields.
In its final forecast, the government's Crop Estimates Committee (CEC) said Africa's largest maize producer is expected to harvest 10.608 million tonnes of the crop, compared with 10.679 million tonnes in the previous forecast.
Wheat, corn up 1 pct on supply as drought persists
SINGAPORE, Sept 27 (Reuters) - U.S. wheat and corn futures rose more than 1 percent, extending gains amid support from a weaker dollar and forecasts for tightening supplies as drought affects planting.
"The drought that has existed in the U.S. in the past 12 months is hampering the seeding programme for wheat for 2012," said Luke Mathews, a commodity strategist at Commonwealth Bank of Australia in Sydney.
Romania 2011 maize crop seen at about 11 mln T-agmin
BUCHAREST, Sept 27 (Reuters) - Romania expects to reap 10.9 million tonnes of maize this year, up 21 percent on the year, and has so far harvested 3.6 million tonnes from 31 percent of the total area, the agriculture ministry said on Tuesday.
Romania, where around 25 percent of arable land is used to cultivate maize crops, produced the second largest harvest in the European Union after France with an output of 9 million tonnes last year.
Bumper crop seen boosting Kazakh grain exports
ALMATY, Sept 27 (Reuters) - A record post-independence grain harvest will allow Kazakhstan to ship a minimum of 2.5 million tonnes in the final three months of 2011 and hold its position as a major exporter into the next season, a senior industry official said on Tuesday.
Nurlan Tleubayev, president of the Grain Union of Kazakhstan, said the 2011 harvest would be sufficient to meet domestic demand and leave a "substantial" amount for export.
W.Canada harvest 84 pct done, ahead of norm
WINNIPEG, Manitoba, Sept 26 (Reuters) - Western Canadian farmers have harvested 84 percent of their crops overall, well ahead of normal, the Canadian Wheat Board said on Monday.
Progress is ahead of the usual pace of 78 percent finished at this time of year, but rain early last week held back some farmers, said Bruce Burnett, director of weather and market analysis for the Wheat Board.
Algeria's Jan-Aug grain imports up 37 percent
Sept 26 (Reuters) - Algeria's soft and durum wheat imports stood at 5.18 million tonnes during the first eight months of 2011, customs data showed, a 36.7 percent rise on the same period last year.
Soft wheat purchases rose to 4.1 million tonnes from 2.62 million tonnes in the January-August period of 2010, while durum wheat imports reached 1.28 million tonnes, up from 1.17 million tonnes.
No relief from drought for US Plains wheat
CHICAGO, Sept 26 (Reuters) - Only scattered and light showers were expected in the U.S. Plains hard red winter wheat region this week, with no relief from the drought seen anytime soon, an agricultural meteorologist said Monday.
"There will be a few light showers this week in Texas, 0.25 inch at the most, nothing significant that would change the drought situation," said Andy Karst, meteorologist for World Weather Inc.
Manila says to buy up to 500,000 T rice in 2012
MANILA, Sept 26 (Reuters) - The Philippines said on Monday its rice imports for 2012 will not exceed 500,000 tonnes, and it will not rush back into the market soon with expectations of a record domestic harvest this year barring weather disturbances.
Improved irrigation systems, good rainfall through the year, and higher-than-expected output in the central Iloilo province - part of a region that is the biggest rice producer - put the Southeast Asian country on track to post this year a record rice crop.
Eastern Australian Rains To Help Wheat Crops (Source: CME)
Widespread rainfall in eastern Australia, expected in the coming days, will improve the outlook for winter crops, including wheat, while Western Australia appears to be on the verge of a bumper harvest, Luke Mathews, Commonwealth Bank of Australia's agricultural commodities strategist, said. Farmers in the eastern states had been worried about the condition of crops this month due to scant rainfall and excessive heat. September and October are regarded as critical months for production of winter crops, ahead of harvest in November and December. "Thankfully, it does appear as though there's some excellent rain on the radar," with most forecasts for Wednesday and Thursday suggesting rainfall of 20-50 millimeters over many wheat-growing areas in Victoria and New South Wales states in Australia's southeast, Mathews said.
"Particularly for those southern crops, this late rain will very much help improve production prospects after a pretty tough month," as well as improving planting conditions for summer crops including cotton and sorghum, Mathews said. Commonwealth Bank has forecast national wheat production will hit 23.5 million metric tons in the crop year ending March 31. The most recent forecast by the government's Australian Bureau of Agricultural and Resource Economics and Sciences, on Sept. 13, was for output of 26.2 million tons, down from a record production of 26.3 million tons last year. After domestic consumption of around 6 million tons is met, the rest of Australia's wheat is available for export, making the country one of the top five global wheat exporters. Production from winter crops in Western Australia will comfortably reach an estimated 12 million tons, including about 8.4 million tons of wheat, Max Johnson, operations manager at Cooperative Bulk Handling Ltd., said.
CBH holds a near-monopoly over grain storage and export logistics in the state. "We're quite bullish. You could push over 12 million tons quite comfortably but at this stage we're sitting on 12 million tons." The weather over the past 10 days has been "outstanding," with good rains and cool weather, and this will drive production well above a longer-term annual average of 10.3 million tons, he said. "The cool damp weather at this time of the year is worth gold." Broadly, crops in CBH's northern Geraldton Port zone have had enough rain to take them through to harvest, while growers further south want more rain over the next three weeks, he said.
China Food Prices Rise On Week; Vegetables Lead -Ministry (Source: CME)
Food prices rose in the week to Sunday, continuing a broad inflationary trend with vegetable and fish prices up most sharply, the Ministry of Commerce said. Food items account for about a third of China's consumer-price index, and price movements in the sector are being closely watched as the government struggles to strike a balance between controlling prices and nurturing economic growth. The ministry's numbers suggest Beijing has some way to go in its efforts to tame inflation, despite signs that the price index's growth rate, which slowed to 6.2% in August from 6.5% in July, has peaked. Vegetable prices were up 4.2% compared with the preceding week, while fish prices rose 1.6%-2.2%, ministry data showed. The pace increased from 3.7% the previous week and 2.6% in the week before that. "Food has been a key factor in the rising consumer price index," said Rabobank Group analyst Chenjun Pan.
The ministry's data indicate vegetables may have replaced meat as a culprit behind inflation, with prices steadily pushing upward since Aug. 15. The price pressure on vegetables come at a time when the government appears to have tamped down pork prices, a key contributor to inflation in recent months. Meat prices last week were up 0.3%-1.3%, a relatively moderate pace compared with other major food categories, while pork fell 0.6%, snapping two months of increases. The government has sought to quell pork prices by releasing its stockpiles of the frozen meat and, as a longer-term remedy, using fiscal measures to encourage hog production. China typically faces higher price pressures during the autumn as the country celebrates the National Day holidays in October and the Mid-Autumn Festival in September, both of which are high-consumption periods. Edible oil prices rose 0.2%-0.3% in the week to Sunday, while egg prices rose 0.1%, the ministry said.
Nigeria To Be Self-Sufficient In Rice Production In 4 Years-Minister (Source: CME)
Nigeria plans to be self-sufficient in rice production within four years, Agriculture Minister Akinwumi Adesina said. Nigeria imports 2 million metric tons of rice a year at a cost of 350 billion naira, Adesina said in a speech at the Cocoa Research Institute of Nigeria, or CRIN, adding that the country imports 500,000 tons of brown rice. "We will reduce this to zero by 2013 and we will shift to domestically produced brown rice. This alone will save us 50 billion naira," he said. He said Nigeria would replace the current 1.5 million tons of imported parboiled finished rice with domestically produced finished rice, saving 200 billion naira. Adesina, an internationally renowned agriculture expert who came from abroad to become agriculture minister in July, said the country aims to produce 1 million tons of milled rice this year, saving 130 billion naira.
"Our rice transformation is made more urgent due to the fact that the price of rice is set to soar by over 30%, on the international market as Thailand moves to limit supply once again," he said. Nigeria currently imports varieties of rice from India, Thailand and Vietnam while low patronage of locally produced rice has discouraged local farmers. "I will not let this continue," Adesina said. "The administration of President Good Jonathan has decided to make agriculture a top priority for his transformation agenda."
UK Defra Ups 2010-11 Wheat Export Estimate To 2.66M Tons -HGCA (Source: CME)
The U.K's agricultural ministry increased its 2010-11 U.K. wheat export forecast by 215,000 metric tons, data from the Home Grown Cereals Authority showed. The Department for the Environment, Food and Rural Affairs now forecasts 2.66 million tons of wheat in its latest estimate, up from a May estimate of 2.44 million tons. Total wheat availability, which includes opening wheat stocks, production, and imports, was also revised upward to 17.91 million tons from a previous estimate of 17.79 million tons. The 2010-11 wheat production estimate was unchanged at 14.88 million tons, the opening stocks estimate increased 168,000 tons to 2.03 million tons and the import estimate was revised downward by 51,000 tons to 1.0 million tons.
UN Says Corn Falling for ‘Wrong Reasons’ as Morgan Stanley Predicts Gains (Source: Bloomberg)
A plunge in corn prices may mislead growers that world stockpiles have returned to normal, spurring farmers to cut acreage and exacerbating a shortage of the grain used in foods, fuels and animal feed, the United Nations said. “We’re seeing a downtrend in prices for the wrong reasons,” Abdolreza Abbassian, senior economist at the Food & Agriculture Organization, said in an interview. “The medium- term response would be a shortage, so prices will rise.” Corn shed 18 percent from this year’s high in June to yesterday’s close as investors sold commodities from metals to farm products on concern that the global recovery was faltering. The decline helped to ease near-record food prices, curbing inflationary pressures as governments seek to boost growth.
Russia Expands Ports to Become Second-Biggest Wheat Exporter: Freight (Source: Bloomberg)
Russia is poised to again become the world’s second-biggest wheat exporter as the nation’s largest grain-port overhaul raises shipping capacity by as much as 67 percent in four years. Government and private operators are spending $574 million to develop and add terminals on the Baltic Sea, the Black Sea and the nation’s rivers to end bottlenecks that keep trains waiting for weeks to unload. Supply is surging following an almost yearlong ban imposed by Prime Minister Vladimir Putin to conserve grain after the worst drought in half a century. Russia’s emergence as a leading supplier may reduce global grain prices, said Peter Biermann, a trader at Aston FFI in Lausanne, Switzerland.
Coffee Falls in Robusta Rout While Starbucks Cup Costs $1.50: Commodities (Source: Bloomberg)
Farmers from Vietnam to Brazil will supply a record robusta crop in the marketing year that begins next month, extending a slump in coffee futures that spurred Kraft Foods Inc. (KFT) and J.M. Smucker Co. to cut prices. Production will rise 5.4 percent to 3.29 million metric tons (54.9 million 60-kilogram bags) in the 2011-12 season, the U.S. Department of Agriculture estimates. Vietnam and Brazil, the biggest producers, will reap the most beans ever. Robusta traded on the NYSE Liffe exchange in London fell 26 percent since March, and will drop another 5 percent to $1,884 a metric ton by Dec. 31, according to the mean in a Bloomberg survey of 16 brokers, traders and analysts.
Robusta, the second most-consumed coffee after arabica, is reversing a rally that more than doubled prices in the 12 months ended in March as shortages emerged. That was part of a global surge in food prices that the United Nations estimates reached a record in February. U.S. food-price inflation will be as much as 3.5 percent next year, compared with as much as 4 percent this year, the USDA estimates.
Ukraine sugar output running much higher year/year
KIEV, Sept 27 (Reuters) - Ukrainian sugar refineries produced 300,000 tonnes of white sugar from sugar beet as of September 26 or 35 percent more than at the same date in 2010, Ukraine's sugar union Ukrtsukor said on Tuesday.
The union said in a report that 64 refineries had received about 4 million tonnes of sugar beet and processed 2.65 million tonnes.
Farmers, exporters upbeat on new I.Coast cocoa crop
ABIDJAN, Sept 26 (Reuters) - Weather conditions in Ivory Coast bode well for the 2011/2012 cocoa season, farmers and
exporters said on Monday, noting the the current state of the crop suggested output could even vie with this season's record
tally.
Their comments came as industry data showed the 2010-2011 season will close with output near 1.5 million tonnes and are the
latest sign that the world's top grower is set for another strong harvest next year.
Nigerian cocoa farmers upbeat on main crop outlook
Sept 26 (Reuters) - Cocoa farmers in Nigeria are hopeful the 2011/12 main crop will be bumper after the just-concluded
mid-crop was hit by a shortage of pesticides to curb disease outbreak, growers and analysts said on Monday.
The main crop officially starts in October and runs through to March, but this year's harvest began in August thanks to a good mix of rainfall and sunshine in the western and eastern growing region, the Cocoa Association of Nigeria (CAN) said.
I.Coast cocoa arrivals seen 1,468,000 T by Sept 25
ABIDJAN, Sept 26 (Reuters) - Cocoa arrivals at ports in top grower Ivory Coast reached around 1,468,000 tonnes by Sept 25
since the start of the season in October, exporters estimated on Monday, compared with 1,184,195 tonnes in the same period of
the previous season.
Exporters estimated around 19,000 tonnes of beans were delivered to the West African state's two ports between Sept 19 to Sept 25 down from 20,951 tonnes in the same week a year ago.
Oil up 3 pct on euro zone moves, refinery concerns
NEW YORK, Sept 27 (Reuters) - Oil jumped more than 3 percent on Tuesday, snapping a four-day losing streak on efforts to strengthen the euro zone rescue fund and concerns about U.S. fuel supplies.
"What we might be seeing is some end-of-the-quarter bookmarking," Gene McGillian, analyst for Tradition Energy in Stamford, Connecticut.
NYMEX-Natgas ends up for 2nd day on weather, firm cash
NEW YORK, Sept 27 (Reuters) - Front-month U.S. natural gas futures ended higher Tuesday for a second straight session as more heat in Texas and planned nuclear plant maintenance outages helped firm physical prices despite ample supplies.
"There's been some heat in Texas and some AC load (air conditioning) in the East. There's also some end-user buying with these attractive prices," a Pennsylvania trader said, noting temperatures later this week were expected to cool.
Euro Coal-Oct S.Africa prices dip, Indians delay
LONDON, Sept 27 (Reuters) - Prompt physical coal prices for October South African cargoes dipped again on Tuesday as suppliers scrambled to find homes for shipments soon due to load, but further forward prices saw slight gains.
"Apart from the very prompt month, prices are generally a little stronger in line with everything else," one trader said.
Oil Drops After Biggest Gain in 4 Months on Concern Global Economy to Slow (Source: Bloomberg)
Oil fell in New York, heading for the biggest quarterly decline since 2008, as investors speculated reports will show slowing global growth that may curb fuel demand amid rising U.S. supplies. Futures slipped as much as 1.9 percent, after the biggest gain in four months yesterday. U.S. gasoline stockpiles rose the most in five weeks, according to the American Petroleum Institute. Commerce Department data today may show U.S. durable goods orders fell and a report tomorrow may confirm European consumer confidence slid to a two-year low in September. Front- month Brent futures are poised to drop relative to longer-dated contracts, Citigroup Inc. said in a note. “We can’t see at this point the price of oil wanting to rally significantly higher than where it is on the back of the weak demand coming out of the U.S.,” said David Lennox, a resource analyst at Fat Prophets in Sydney. “Oil will probably trade between $80 and $90 for the near term.”
Brent crude falls below $107 on stronger dollar
SINGAPORE, Sept 28 (Reuters) - Brent crude fell below $107, after sharp gains a day earlier, weighed down by a stronger dollar as investors sought refuge in the greenback amid lingering concerns over a debt crisis in the euro zone.
"There are still a lot of fears over Europe, and after yesterday's round of short-covering the upside for oil is limited," said Ken Hasegawa, a commodities derivatives manager with Newedge Brokerage in Tokyo.
China's iron ore growth to be limited by quality-Baosteel
QINGDAO, Sept 28 (Reuters) - China's iron ore production growth will be limited due to a decline in quality and rising labour costs, a senior executive from Baosteel Group said on Wednesday.
However, Dai Zhihao, vice-president of Baosteel Group, said the current iron ore supply crunch could soon ease as more mines come onstream globally.
China steel output, iron ore pricing in focus at summit
SINGAPORE, Sept 27 (Reuters) - Whether China can sustain its rapid pace of steel production while developed economies are on shaky ground and how tight supplies will continue to buoy iron ore prices are questions on the agenda for China's biggest industry gathering this week.
Chinese steel mills are also expected to use the occasion to push for a more favourable iron ore pricing scheme as elevated spot prices cut into profits, ahead of a plan by industry group CISA to launch China's version of a reference index next month to gain more pricing power.
LME copper falls as rebound loses steam, dlr firms
SHANGHAI, Sept 28 (Reuters) - London copper fell 2.3 percent as a rebound in the previous session faltered over lingering worries about euro zone debt woes, a firmer dollar and arbitrage plays.
"The holiday is coming up and everyone is out to make a quick buck before that. The shorts are closing positions, locking in profits, while others are doing arbitrage plays - buying copper on Shanghai and selling on London," said CIFCO Futures analyst Zhou Jie.
Gold Declines as European Policy Makers Make Progress Tackling Debt Crisis (Source: Bloomberg)
Gold resumed a decline, trimming a 12th quarterly advance, as investors sold the metal for cash as commodities including oil and copper fell on concern European leaders may fail to contain the region’s debt crisis. Immediate-delivery gold dropped as much as 1.1 percent to $1,632.05 an ounce, and traded at $1,645.88 at 12:24 p.m. in Singapore. Bullion also fell before reports that economists say may show U.S. durable goods orders dropped, while European consumer confidence slumped to a two-year low in September. “The recent price declines have been because other markets are falling and some investors have to sell their gold to meet margin calls,” Dick Poon, precious metals trading manager at Heraeus Ltd., said by phone from Hong Kong. “The debt situation in Europe hasn’t changed and as that goes on, we continue to see strong demand for gold, which will keep prices supported.”
Gold falls 1 pct on dollar strength;investors cautious
SINGAPORE, Sept 28 (Reuters) - Gold slipped 1 percent in volatile trade as the U.S. dollar regained strength on doubts over the progress of Europe's efforts to tackle the region's debt crisis, while this week's brutal correction also kept investors at bay.
"After the freefall in prices, sentiments have been impacted and there could be some further downside. Investors are likely looking for prices to stabilise before they return to the market," said Ong Yi Ling, an analyst at Phillip Futures in Singapore.
METALS-LME copper falls as rebound loses steam, dlr firms
SHANGHAI, Sept 28 (Reuters) - London copper fell 2.3 percent as a rebound in the previous session faltered over lingering worries about euro zone debt woes, a firmer dollar and arbitrage plays.
"The holiday is coming up and everyone is out to make a quick buck before that. The shorts are closing positions, locking in profits, while others are doing arbitrage plays-buying copper on Shanghai and selling on London," said CIFCO Futures analyst Zhou Jie.
PRECIOUS-Gold falls 1 pct on dollar strength;investors cautious
SINGAPORE, Sept 28 (Reuters) - Gold slipped 1 percent in volatile trade as the U.S. dollar regained strength on doubts over the progress of Europe's efforts to tackle the region's debt crisis, while this week's brutal correction also kept investors at bay.
"After the freefall in prices, sentiments have been impacted and there could be some further downside. Investors are likely looking for prices to stabilise before they return to the market," said Ong Yi Ling, an analyst at Phillip Futures in Singapore.
NEW YORK, Sept 27 (Reuters) - Commodities markets finished the day broadly higher on Tuesday, buoyed by expectations that European officials would fortify the region's bailout fund as they struggle to contain the debt crisis.
"The market had been pricing in the possibility of a recession, so the news that we could possibly get some kind of resolution in Europe is very positive," said Jerry Harris, president of asset management at Sterne Agee in Birmingham, Alabama.
Commodities Drop on Growth Risk, Deepening Worst Quarterly Loss Since 2008 (Source: Bloomberg)
Commodities fell, widening their second quarterly loss, as Europe’s sovereign-debt crisis threatened to slow global growth and reduce raw-material demand. The Standard & Poor’s GSCI Spot Index slid as much as 1.4 percent 611.43 and was at 613.87 at 2:18 p.m. in Singapore. The gauge headed for a quarterly decline of 8.2 percent, the worst since 2008. The measure rose 3.3 percent yesterday, the most in more than four months. Crude oil fell 1.5 percent in New York while copper retreated 3.5 percent and gold shed 0.4 percent. Commerce Department data today may show U.S. durable goods orders fell and a separate report may confirm European consumer confidence dropped to a two-year low in September. As many as seven of the 17 nations using the euro believe private creditors should absorb bigger losses, a division that may threaten an agreement reached with investors in July, the Financial Times reported today, citing unidentified European officials.
Olam's long-term commods outlook bullish; cautious on cocoa
SINGAPORE, Sept 26 (Reuters) - Singapore-listed Olam International said on Monday the long-term outlook for most agricultural commodities was still bright despite the threat of a slowdown in demand triggered by economic woes, but weak fundamentals could work against cocoa.
Gold and copper suffered their biggest slump since the 2008 financial crisis as another brutal sell-off hit commodities on growing doubts Europe may be unable to prevent its debt crisis from dragging down the global economy.
Corn (Source: CME)
US corn futures post decent gains as the market continues to recover from recent steep losses. Strength in external markets and weakness in the dollar helped lift grain prices after commodities tumbled last week on economic jitters. Yet, prices finished off intraday highs as traders remain nervous about the risk for more selling ahead of quarter-end. They worry the USDA, in a crop report Friday, could estimate corn supplies were larger than expected at the start of September. CBOT December corn rose 4 1/4c to $6.52 1/4 a bushel.
Wheat (Source: CME)
US wheat futures finish firmer on increasing concerns about dryness hurting crops in key growing areas. The southern Plains and Ukraine need rain to encourage planting, while Argentina needs rain ahead of the upcoming harvest. Expectations for increasing demand add support following last week's decline in prices, traders note. South Korea bought optional-origin wheat, with traders saying it was likely the first significant purchase by South Korean feedmillers since June. CBOT December wheat jumps 10c to $6.58 1/4 a bushel and KCBT December rises 9c to $7.53 but MGEX December slips 3/4c to $8.69 1/4 after Monday's surge.
Rice (Source: CME)
US rice futures settle higher as advances in crude oil and equities fuel a recovery from last week's declines. The market gets additional support from weakness in the dollar, which makes US grains more attractive to foreign buyers. Traders note gains in rice mirror rebounds from last week's losses in wheat, corn and soybeans. CBOT November rice closes up 22 1/2c at $16.35/hundredweight.
USDA seen lowering US spring, all-wheat production
CHICAGO, Sept. 27 (Reuters) - Poor yields in the northern U.S. spring wheat belt should prompt the U.S. Department of Agriculture to cut its estimate of overall 2011 U.S. wheat production to the lowest level since 2006, analysts said.
Spring wheat production could drop to its lowest level since 2007, and if it does, ending stocks of the high quality wheat could tumble to the second-lowest on record.
Corn supply at 8-year low, down less than expected
CHICAGO, Sept 27 (Reuters) - U.S. corn stockpiles likely declined over the summer but by slightly less than the government has estimated, giving the tight market marginally more breathing room before consumers enter an even leaner year.
Inventories at the end of the 2010/11 marketing year are expected to fall to 964 million bushels, down 44 percent from 1.708 billion a year ago and the smallest supply in eight years, according to analysts polled by Reuters ahead of the U.S. Agriculture Department's quarterly stock report on Friday.
U.S. grains decline on slow growth, dollar's gain
SINGAPORE, Sept 28 (Reuters) - U.S. grain futures fell, giving back gains from the previous day, as concern that global economic growth will slow and doubts over Europe's commitment to its debt plan prompted investors to shift to the U.S. dollar.
"There are expectations that the USDA may report a larger-than-expected supply on corn," said Lynette Tan, a grains analyst at Phillip Futures in Singapore.
Colombia's top coffee region output lags -farmers
BOGOTA, Sept 27 (Reuters) - Leading Colombian coffee-growing province Antioquia is seen producing fewer beans during its main harvest than in the same period a year ago after torrential rains hit plantations, growers said.
Coffee growers in the northwestern province that accounts for 16 percent of Colombia's total output said progress was slower than normal. Theey were skeptical the country would meet its overall 2011 target of 9 million 60-kg bags.
Brazil coffee area seen dry until mid-Ocober
BRASILIA, Sept 27 (Reuters) - Brazil's key coffee zones could stay dry until mid October, delaying the start of crop-fixing flowering, but the long dry spell does not yet spell disaster for the next crop, agronomists said on Tuesday.
The coffee market is relying on a good on-year harvest next year from the world's top grower to pump supplies into a market facing chronic shortages of some bean types. The shortages have sustained high prices since mid 2010.
Brazil CS sugar output down 8 pct - Unica
SAO PAULO, Sept 27 (Reuters) - Sugar production from Brazil's center-south cane crop this season is lagging last year by 8 percent, but output was up in recent weeks, the cane industry association Unica said on Tuesday.
From the beginning of the season in April through Sept. 16, sugar output totaled 23.1 million tonnes, 2 million tonnes less than the same period in 2010.
India sugar producers' body foresees surplus
NEW DELHI, Sept 27 (Reuters) - India is heading for a sugar surplus in 2011/12, and the government should help producers by allowing 4 million tonnes of exports -- more than double this year's overseas sales, the head of a producers' body said on Tuesday.
Output for the world's second-biggest producer after Brazil could rise to 26.5 million tonnes in 2011/12, Jayantilal B. Patel, president of the National Federation of Cooperative Sugar Factories Ltd (NFCSF), told an industry meeting.
S.Africa cuts maize output forecast, wheat seen up
JOHANNESBURG, Sept 27 (Reuters) - South Africa slightly cut its May 2010-April 2011 season maize output forecast on Tuesday, citing a lower pace of deliveries to silos, while the 2011 wheat output is seen up on the back of better yields.
In its final forecast, the government's Crop Estimates Committee (CEC) said Africa's largest maize producer is expected to harvest 10.608 million tonnes of the crop, compared with 10.679 million tonnes in the previous forecast.
Wheat, corn up 1 pct on supply as drought persists
SINGAPORE, Sept 27 (Reuters) - U.S. wheat and corn futures rose more than 1 percent, extending gains amid support from a weaker dollar and forecasts for tightening supplies as drought affects planting.
"The drought that has existed in the U.S. in the past 12 months is hampering the seeding programme for wheat for 2012," said Luke Mathews, a commodity strategist at Commonwealth Bank of Australia in Sydney.
Romania 2011 maize crop seen at about 11 mln T-agmin
BUCHAREST, Sept 27 (Reuters) - Romania expects to reap 10.9 million tonnes of maize this year, up 21 percent on the year, and has so far harvested 3.6 million tonnes from 31 percent of the total area, the agriculture ministry said on Tuesday.
Romania, where around 25 percent of arable land is used to cultivate maize crops, produced the second largest harvest in the European Union after France with an output of 9 million tonnes last year.
Bumper crop seen boosting Kazakh grain exports
ALMATY, Sept 27 (Reuters) - A record post-independence grain harvest will allow Kazakhstan to ship a minimum of 2.5 million tonnes in the final three months of 2011 and hold its position as a major exporter into the next season, a senior industry official said on Tuesday.
Nurlan Tleubayev, president of the Grain Union of Kazakhstan, said the 2011 harvest would be sufficient to meet domestic demand and leave a "substantial" amount for export.
W.Canada harvest 84 pct done, ahead of norm
WINNIPEG, Manitoba, Sept 26 (Reuters) - Western Canadian farmers have harvested 84 percent of their crops overall, well ahead of normal, the Canadian Wheat Board said on Monday.
Progress is ahead of the usual pace of 78 percent finished at this time of year, but rain early last week held back some farmers, said Bruce Burnett, director of weather and market analysis for the Wheat Board.
Algeria's Jan-Aug grain imports up 37 percent
Sept 26 (Reuters) - Algeria's soft and durum wheat imports stood at 5.18 million tonnes during the first eight months of 2011, customs data showed, a 36.7 percent rise on the same period last year.
Soft wheat purchases rose to 4.1 million tonnes from 2.62 million tonnes in the January-August period of 2010, while durum wheat imports reached 1.28 million tonnes, up from 1.17 million tonnes.
No relief from drought for US Plains wheat
CHICAGO, Sept 26 (Reuters) - Only scattered and light showers were expected in the U.S. Plains hard red winter wheat region this week, with no relief from the drought seen anytime soon, an agricultural meteorologist said Monday.
"There will be a few light showers this week in Texas, 0.25 inch at the most, nothing significant that would change the drought situation," said Andy Karst, meteorologist for World Weather Inc.
Manila says to buy up to 500,000 T rice in 2012
MANILA, Sept 26 (Reuters) - The Philippines said on Monday its rice imports for 2012 will not exceed 500,000 tonnes, and it will not rush back into the market soon with expectations of a record domestic harvest this year barring weather disturbances.
Improved irrigation systems, good rainfall through the year, and higher-than-expected output in the central Iloilo province - part of a region that is the biggest rice producer - put the Southeast Asian country on track to post this year a record rice crop.
Eastern Australian Rains To Help Wheat Crops (Source: CME)
Widespread rainfall in eastern Australia, expected in the coming days, will improve the outlook for winter crops, including wheat, while Western Australia appears to be on the verge of a bumper harvest, Luke Mathews, Commonwealth Bank of Australia's agricultural commodities strategist, said. Farmers in the eastern states had been worried about the condition of crops this month due to scant rainfall and excessive heat. September and October are regarded as critical months for production of winter crops, ahead of harvest in November and December. "Thankfully, it does appear as though there's some excellent rain on the radar," with most forecasts for Wednesday and Thursday suggesting rainfall of 20-50 millimeters over many wheat-growing areas in Victoria and New South Wales states in Australia's southeast, Mathews said.
"Particularly for those southern crops, this late rain will very much help improve production prospects after a pretty tough month," as well as improving planting conditions for summer crops including cotton and sorghum, Mathews said. Commonwealth Bank has forecast national wheat production will hit 23.5 million metric tons in the crop year ending March 31. The most recent forecast by the government's Australian Bureau of Agricultural and Resource Economics and Sciences, on Sept. 13, was for output of 26.2 million tons, down from a record production of 26.3 million tons last year. After domestic consumption of around 6 million tons is met, the rest of Australia's wheat is available for export, making the country one of the top five global wheat exporters. Production from winter crops in Western Australia will comfortably reach an estimated 12 million tons, including about 8.4 million tons of wheat, Max Johnson, operations manager at Cooperative Bulk Handling Ltd., said.
CBH holds a near-monopoly over grain storage and export logistics in the state. "We're quite bullish. You could push over 12 million tons quite comfortably but at this stage we're sitting on 12 million tons." The weather over the past 10 days has been "outstanding," with good rains and cool weather, and this will drive production well above a longer-term annual average of 10.3 million tons, he said. "The cool damp weather at this time of the year is worth gold." Broadly, crops in CBH's northern Geraldton Port zone have had enough rain to take them through to harvest, while growers further south want more rain over the next three weeks, he said.
China Food Prices Rise On Week; Vegetables Lead -Ministry (Source: CME)
Food prices rose in the week to Sunday, continuing a broad inflationary trend with vegetable and fish prices up most sharply, the Ministry of Commerce said. Food items account for about a third of China's consumer-price index, and price movements in the sector are being closely watched as the government struggles to strike a balance between controlling prices and nurturing economic growth. The ministry's numbers suggest Beijing has some way to go in its efforts to tame inflation, despite signs that the price index's growth rate, which slowed to 6.2% in August from 6.5% in July, has peaked. Vegetable prices were up 4.2% compared with the preceding week, while fish prices rose 1.6%-2.2%, ministry data showed. The pace increased from 3.7% the previous week and 2.6% in the week before that. "Food has been a key factor in the rising consumer price index," said Rabobank Group analyst Chenjun Pan.
The ministry's data indicate vegetables may have replaced meat as a culprit behind inflation, with prices steadily pushing upward since Aug. 15. The price pressure on vegetables come at a time when the government appears to have tamped down pork prices, a key contributor to inflation in recent months. Meat prices last week were up 0.3%-1.3%, a relatively moderate pace compared with other major food categories, while pork fell 0.6%, snapping two months of increases. The government has sought to quell pork prices by releasing its stockpiles of the frozen meat and, as a longer-term remedy, using fiscal measures to encourage hog production. China typically faces higher price pressures during the autumn as the country celebrates the National Day holidays in October and the Mid-Autumn Festival in September, both of which are high-consumption periods. Edible oil prices rose 0.2%-0.3% in the week to Sunday, while egg prices rose 0.1%, the ministry said.
Nigeria To Be Self-Sufficient In Rice Production In 4 Years-Minister (Source: CME)
Nigeria plans to be self-sufficient in rice production within four years, Agriculture Minister Akinwumi Adesina said. Nigeria imports 2 million metric tons of rice a year at a cost of 350 billion naira, Adesina said in a speech at the Cocoa Research Institute of Nigeria, or CRIN, adding that the country imports 500,000 tons of brown rice. "We will reduce this to zero by 2013 and we will shift to domestically produced brown rice. This alone will save us 50 billion naira," he said. He said Nigeria would replace the current 1.5 million tons of imported parboiled finished rice with domestically produced finished rice, saving 200 billion naira. Adesina, an internationally renowned agriculture expert who came from abroad to become agriculture minister in July, said the country aims to produce 1 million tons of milled rice this year, saving 130 billion naira.
"Our rice transformation is made more urgent due to the fact that the price of rice is set to soar by over 30%, on the international market as Thailand moves to limit supply once again," he said. Nigeria currently imports varieties of rice from India, Thailand and Vietnam while low patronage of locally produced rice has discouraged local farmers. "I will not let this continue," Adesina said. "The administration of President Good Jonathan has decided to make agriculture a top priority for his transformation agenda."
UK Defra Ups 2010-11 Wheat Export Estimate To 2.66M Tons -HGCA (Source: CME)
The U.K's agricultural ministry increased its 2010-11 U.K. wheat export forecast by 215,000 metric tons, data from the Home Grown Cereals Authority showed. The Department for the Environment, Food and Rural Affairs now forecasts 2.66 million tons of wheat in its latest estimate, up from a May estimate of 2.44 million tons. Total wheat availability, which includes opening wheat stocks, production, and imports, was also revised upward to 17.91 million tons from a previous estimate of 17.79 million tons. The 2010-11 wheat production estimate was unchanged at 14.88 million tons, the opening stocks estimate increased 168,000 tons to 2.03 million tons and the import estimate was revised downward by 51,000 tons to 1.0 million tons.
UN Says Corn Falling for ‘Wrong Reasons’ as Morgan Stanley Predicts Gains (Source: Bloomberg)
A plunge in corn prices may mislead growers that world stockpiles have returned to normal, spurring farmers to cut acreage and exacerbating a shortage of the grain used in foods, fuels and animal feed, the United Nations said. “We’re seeing a downtrend in prices for the wrong reasons,” Abdolreza Abbassian, senior economist at the Food & Agriculture Organization, said in an interview. “The medium- term response would be a shortage, so prices will rise.” Corn shed 18 percent from this year’s high in June to yesterday’s close as investors sold commodities from metals to farm products on concern that the global recovery was faltering. The decline helped to ease near-record food prices, curbing inflationary pressures as governments seek to boost growth.
Russia Expands Ports to Become Second-Biggest Wheat Exporter: Freight (Source: Bloomberg)
Russia is poised to again become the world’s second-biggest wheat exporter as the nation’s largest grain-port overhaul raises shipping capacity by as much as 67 percent in four years. Government and private operators are spending $574 million to develop and add terminals on the Baltic Sea, the Black Sea and the nation’s rivers to end bottlenecks that keep trains waiting for weeks to unload. Supply is surging following an almost yearlong ban imposed by Prime Minister Vladimir Putin to conserve grain after the worst drought in half a century. Russia’s emergence as a leading supplier may reduce global grain prices, said Peter Biermann, a trader at Aston FFI in Lausanne, Switzerland.
Coffee Falls in Robusta Rout While Starbucks Cup Costs $1.50: Commodities (Source: Bloomberg)
Farmers from Vietnam to Brazil will supply a record robusta crop in the marketing year that begins next month, extending a slump in coffee futures that spurred Kraft Foods Inc. (KFT) and J.M. Smucker Co. to cut prices. Production will rise 5.4 percent to 3.29 million metric tons (54.9 million 60-kilogram bags) in the 2011-12 season, the U.S. Department of Agriculture estimates. Vietnam and Brazil, the biggest producers, will reap the most beans ever. Robusta traded on the NYSE Liffe exchange in London fell 26 percent since March, and will drop another 5 percent to $1,884 a metric ton by Dec. 31, according to the mean in a Bloomberg survey of 16 brokers, traders and analysts.
Robusta, the second most-consumed coffee after arabica, is reversing a rally that more than doubled prices in the 12 months ended in March as shortages emerged. That was part of a global surge in food prices that the United Nations estimates reached a record in February. U.S. food-price inflation will be as much as 3.5 percent next year, compared with as much as 4 percent this year, the USDA estimates.
Ukraine sugar output running much higher year/year
KIEV, Sept 27 (Reuters) - Ukrainian sugar refineries produced 300,000 tonnes of white sugar from sugar beet as of September 26 or 35 percent more than at the same date in 2010, Ukraine's sugar union Ukrtsukor said on Tuesday.
The union said in a report that 64 refineries had received about 4 million tonnes of sugar beet and processed 2.65 million tonnes.
Farmers, exporters upbeat on new I.Coast cocoa crop
ABIDJAN, Sept 26 (Reuters) - Weather conditions in Ivory Coast bode well for the 2011/2012 cocoa season, farmers and
exporters said on Monday, noting the the current state of the crop suggested output could even vie with this season's record
tally.
Their comments came as industry data showed the 2010-2011 season will close with output near 1.5 million tonnes and are the
latest sign that the world's top grower is set for another strong harvest next year.
Nigerian cocoa farmers upbeat on main crop outlook
Sept 26 (Reuters) - Cocoa farmers in Nigeria are hopeful the 2011/12 main crop will be bumper after the just-concluded
mid-crop was hit by a shortage of pesticides to curb disease outbreak, growers and analysts said on Monday.
The main crop officially starts in October and runs through to March, but this year's harvest began in August thanks to a good mix of rainfall and sunshine in the western and eastern growing region, the Cocoa Association of Nigeria (CAN) said.
I.Coast cocoa arrivals seen 1,468,000 T by Sept 25
ABIDJAN, Sept 26 (Reuters) - Cocoa arrivals at ports in top grower Ivory Coast reached around 1,468,000 tonnes by Sept 25
since the start of the season in October, exporters estimated on Monday, compared with 1,184,195 tonnes in the same period of
the previous season.
Exporters estimated around 19,000 tonnes of beans were delivered to the West African state's two ports between Sept 19 to Sept 25 down from 20,951 tonnes in the same week a year ago.
Oil up 3 pct on euro zone moves, refinery concerns
NEW YORK, Sept 27 (Reuters) - Oil jumped more than 3 percent on Tuesday, snapping a four-day losing streak on efforts to strengthen the euro zone rescue fund and concerns about U.S. fuel supplies.
"What we might be seeing is some end-of-the-quarter bookmarking," Gene McGillian, analyst for Tradition Energy in Stamford, Connecticut.
NYMEX-Natgas ends up for 2nd day on weather, firm cash
NEW YORK, Sept 27 (Reuters) - Front-month U.S. natural gas futures ended higher Tuesday for a second straight session as more heat in Texas and planned nuclear plant maintenance outages helped firm physical prices despite ample supplies.
"There's been some heat in Texas and some AC load (air conditioning) in the East. There's also some end-user buying with these attractive prices," a Pennsylvania trader said, noting temperatures later this week were expected to cool.
Euro Coal-Oct S.Africa prices dip, Indians delay
LONDON, Sept 27 (Reuters) - Prompt physical coal prices for October South African cargoes dipped again on Tuesday as suppliers scrambled to find homes for shipments soon due to load, but further forward prices saw slight gains.
"Apart from the very prompt month, prices are generally a little stronger in line with everything else," one trader said.
Oil Drops After Biggest Gain in 4 Months on Concern Global Economy to Slow (Source: Bloomberg)
Oil fell in New York, heading for the biggest quarterly decline since 2008, as investors speculated reports will show slowing global growth that may curb fuel demand amid rising U.S. supplies. Futures slipped as much as 1.9 percent, after the biggest gain in four months yesterday. U.S. gasoline stockpiles rose the most in five weeks, according to the American Petroleum Institute. Commerce Department data today may show U.S. durable goods orders fell and a report tomorrow may confirm European consumer confidence slid to a two-year low in September. Front- month Brent futures are poised to drop relative to longer-dated contracts, Citigroup Inc. said in a note. “We can’t see at this point the price of oil wanting to rally significantly higher than where it is on the back of the weak demand coming out of the U.S.,” said David Lennox, a resource analyst at Fat Prophets in Sydney. “Oil will probably trade between $80 and $90 for the near term.”
Brent crude falls below $107 on stronger dollar
SINGAPORE, Sept 28 (Reuters) - Brent crude fell below $107, after sharp gains a day earlier, weighed down by a stronger dollar as investors sought refuge in the greenback amid lingering concerns over a debt crisis in the euro zone.
"There are still a lot of fears over Europe, and after yesterday's round of short-covering the upside for oil is limited," said Ken Hasegawa, a commodities derivatives manager with Newedge Brokerage in Tokyo.
China's iron ore growth to be limited by quality-Baosteel
QINGDAO, Sept 28 (Reuters) - China's iron ore production growth will be limited due to a decline in quality and rising labour costs, a senior executive from Baosteel Group said on Wednesday.
However, Dai Zhihao, vice-president of Baosteel Group, said the current iron ore supply crunch could soon ease as more mines come onstream globally.
China steel output, iron ore pricing in focus at summit
SINGAPORE, Sept 27 (Reuters) - Whether China can sustain its rapid pace of steel production while developed economies are on shaky ground and how tight supplies will continue to buoy iron ore prices are questions on the agenda for China's biggest industry gathering this week.
Chinese steel mills are also expected to use the occasion to push for a more favourable iron ore pricing scheme as elevated spot prices cut into profits, ahead of a plan by industry group CISA to launch China's version of a reference index next month to gain more pricing power.
LME copper falls as rebound loses steam, dlr firms
SHANGHAI, Sept 28 (Reuters) - London copper fell 2.3 percent as a rebound in the previous session faltered over lingering worries about euro zone debt woes, a firmer dollar and arbitrage plays.
"The holiday is coming up and everyone is out to make a quick buck before that. The shorts are closing positions, locking in profits, while others are doing arbitrage plays - buying copper on Shanghai and selling on London," said CIFCO Futures analyst Zhou Jie.
Gold Declines as European Policy Makers Make Progress Tackling Debt Crisis (Source: Bloomberg)
Gold resumed a decline, trimming a 12th quarterly advance, as investors sold the metal for cash as commodities including oil and copper fell on concern European leaders may fail to contain the region’s debt crisis. Immediate-delivery gold dropped as much as 1.1 percent to $1,632.05 an ounce, and traded at $1,645.88 at 12:24 p.m. in Singapore. Bullion also fell before reports that economists say may show U.S. durable goods orders dropped, while European consumer confidence slumped to a two-year low in September. “The recent price declines have been because other markets are falling and some investors have to sell their gold to meet margin calls,” Dick Poon, precious metals trading manager at Heraeus Ltd., said by phone from Hong Kong. “The debt situation in Europe hasn’t changed and as that goes on, we continue to see strong demand for gold, which will keep prices supported.”
Gold falls 1 pct on dollar strength;investors cautious
SINGAPORE, Sept 28 (Reuters) - Gold slipped 1 percent in volatile trade as the U.S. dollar regained strength on doubts over the progress of Europe's efforts to tackle the region's debt crisis, while this week's brutal correction also kept investors at bay.
"After the freefall in prices, sentiments have been impacted and there could be some further downside. Investors are likely looking for prices to stabilise before they return to the market," said Ong Yi Ling, an analyst at Phillip Futures in Singapore.
METALS-LME copper falls as rebound loses steam, dlr firms
SHANGHAI, Sept 28 (Reuters) - London copper fell 2.3 percent as a rebound in the previous session faltered over lingering worries about euro zone debt woes, a firmer dollar and arbitrage plays.
"The holiday is coming up and everyone is out to make a quick buck before that. The shorts are closing positions, locking in profits, while others are doing arbitrage plays-buying copper on Shanghai and selling on London," said CIFCO Futures analyst Zhou Jie.
PRECIOUS-Gold falls 1 pct on dollar strength;investors cautious
SINGAPORE, Sept 28 (Reuters) - Gold slipped 1 percent in volatile trade as the U.S. dollar regained strength on doubts over the progress of Europe's efforts to tackle the region's debt crisis, while this week's brutal correction also kept investors at bay.
"After the freefall in prices, sentiments have been impacted and there could be some further downside. Investors are likely looking for prices to stabilise before they return to the market," said Ong Yi Ling, an analyst at Phillip Futures in Singapore.
20110928 1544 Soy Oil & Palm Oil Related News.
Soybeans (Source: CME)
US soybean futures end higher, continuing to stabilize after a month long price slide amid renewed optimism that the EU debt crisis is nearing a resolution. Rallies in external financial markets attracted broader based buying, with ongoing uncertainty about crop size and tightening supplies, buoying prices, analysts say. However, futures pared early advances, succumbing to profit taking pressure on improved harvest outlooks and traders evening positions ahead Friday's inventory reports from U.S. Department of Agriculture. CBOT Nov soy end up 3 1/4c at $12.63/bushel.
Soybean Meal/Oil (Source: CME)
Soy product futures rise in step with broader based commodity rally. The return of investment fund buying across broader markets buoyed prices, with soyoil drawing support from soybeans and sharp gains in crude oil futures. CBOT Dec soyoil end up 0.7% at 52.78 cents/pound, and Dec soymeal finished up 0.1% at $330.50/short ton.
Palm oil bounces as investors hunt for bargains
KUALA LUMPUR, Sept 27 (Reuters) - Malaysian palm oil futures bounced as bargain hunters resurfaced after the market neared a one year low the previous day on concerns that developed countries were pushing the world into a recession.
"Sentiment is still poor but agriculture commodities like palm oil have the potential to weather the financial storm as the fundamentals are supportive," said a trader with a foreign commodities brokerage in Kuala Lumpur.
Isolated rain falls on early Brazil soy planting
SAO PAULO, Sept 26 (Reuters) - Planting of Brazil's new soybean crop will spread in the No.1 growing state of Mato Grosso as isolated showers continue to fall this week and next, forecasters Somar said on Monday.
The official planting season for soy started on Sept. 15 in the state but weather has been mostly dry over the center-west region that normally kicks off planting in Brazil .
US soybean futures end higher, continuing to stabilize after a month long price slide amid renewed optimism that the EU debt crisis is nearing a resolution. Rallies in external financial markets attracted broader based buying, with ongoing uncertainty about crop size and tightening supplies, buoying prices, analysts say. However, futures pared early advances, succumbing to profit taking pressure on improved harvest outlooks and traders evening positions ahead Friday's inventory reports from U.S. Department of Agriculture. CBOT Nov soy end up 3 1/4c at $12.63/bushel.
Soybean Meal/Oil (Source: CME)
Soy product futures rise in step with broader based commodity rally. The return of investment fund buying across broader markets buoyed prices, with soyoil drawing support from soybeans and sharp gains in crude oil futures. CBOT Dec soyoil end up 0.7% at 52.78 cents/pound, and Dec soymeal finished up 0.1% at $330.50/short ton.
Palm oil bounces as investors hunt for bargains
KUALA LUMPUR, Sept 27 (Reuters) - Malaysian palm oil futures bounced as bargain hunters resurfaced after the market neared a one year low the previous day on concerns that developed countries were pushing the world into a recession.
"Sentiment is still poor but agriculture commodities like palm oil have the potential to weather the financial storm as the fundamentals are supportive," said a trader with a foreign commodities brokerage in Kuala Lumpur.
Isolated rain falls on early Brazil soy planting
SAO PAULO, Sept 26 (Reuters) - Planting of Brazil's new soybean crop will spread in the No.1 growing state of Mato Grosso as isolated showers continue to fall this week and next, forecasters Somar said on Monday.
The official planting season for soy started on Sept. 15 in the state but weather has been mostly dry over the center-west region that normally kicks off planting in Brazil .
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