Asian Stocks Rise a Second Day as Japan Exports Increase, Commodities Gain (Source: Bloomberg)
Asian stocks climbed for a second day, led by raw-material producers, as Japan’s exports increased more than expected, signaling a recovery in shipments is withstanding the weakening global economy. Honda Motor Co., the Japanese carmaker that gets over 80 percent of sales overseas, rose 1.4 percent in Tokyo. Toyota Motor Corp., the world’s biggest automaker by market value, added 1 percent. BHP Billiton Ltd., the largest global mining company, advanced 2 percent in Sydney after copper futures extended gains. The MSCI Asia Pacific Index increased 0.9 percent to 117.06 as of 9:45 a.m. in Tokyo, with about 12 stocks rising for each that fell. The gauge had its biggest weekly decline in a month last week after Germany said there would be no quick fix to the European debt crisis.
European leaders meeting in Brussels at the weekend ruled out tapping the European Central Bank’s balance sheet to boost the region’s rescue fund and outlined plans to aid banks, inching toward a revamped strategy to contain the Greece-fueled debt crisis. The complete blueprint won’t come together until a summit on Oct. 26.
U.S. Stocks Rise as S&P Sees Longest Weekly Rally Since February (Source: Bloomberg)
U.S. stocks rose this week, driving the Standard & Poor’s 500 Index to its longest winning streak since February, amid optimism Europe’s leaders will announce a plan to contain the debt crisis and after McDonald’s Corp. (MCD) joined companies beating profit estimates. Financial shares in the S&P 500 added 3.9 percent as European finance ministers began negotiations to prevent a Greek default and shield banks. McDonald’s rose 2.7 percent, while Bank of America Corp. (BAC) and Goldman Sachs Group Inc. climbed more than 4.3 percent after their quarterly reports. PulteGroup Inc. jumped 11 percent as data showed sentiment among homebuilders improved more than forecast. El Paso Corp. (EP) soared 28 percent after Kinder Morgan Inc. agreed to buy it.
The S&P 500 climbed 1.1 percent to 1,238.25, the highest since Aug. 3, and has risen three straight weeks. It has surged 13 percent since Oct. 3, when it closed within 1 percent of a bear market, or 20 percent plunge, from its high in April. The Dow Jones Industrial Average rose a fourth straight week, gaining 164.30 points, or 1.4 percent, to 11,808.79.
U.S. Economy Probably Picked Up in Third Quarter on Consumer Spending Gain (Source: Bloomberg)
The U.S. economy probably grew in the third quarter at the fastest pace this year, easing anxiety that the recovery was on the verge of stalling, economists said before a report this week. Gross domestic product, the value of all goods and services produced, rose at a 2.5 percent annual rate after advancing 1.3 percent in the previous three months, according to the median forecast of 68 economists surveyed by Bloomberg News before the Commerce Department’s Oct. 27 release. Orders for business equipment rose in September and new-home sales stabilized, other data may show. Consumer spending last quarter may have climbed more than twice as fast as in the prior three months, helping the economy withstand the plunge in stocks caused by Europe’s debt crisis. Nonetheless, the pace of growth has failed to cut unemployment, prompting Federal Reserve officials like Janet Yellen and Daniel Tarullo to say that more monetary stimulus may be needed.
Fed Officials Weigh Further Easing Options Even as Economy Gains Strength (Source: Bloomberg)
Federal Reserve policy makers are developing options for further monetary easing even as better- than-forecast economic reports have allayed concerns that the U.S. is on the verge of a renewed recession. Fed Vice Chairman Janet Yellen said yesterday that a third round of large-scale asset purchases “might become appropriate if evolving economic conditions called for significantly greater monetary accommodation.” A day before, Governor Daniel Tarullo said buying mortgage-backed securities “should move back up toward the top of the list of options.” They join Charles Evans, president of the Chicago Fed, and Boston’s Eric Rosengren in calling for consideration of further stimulus to boost growth and bring down a jobless rate stuck around 9 percent or higher for 30 months. A stock-market rally and gains in manufacturing and retail sales may convince the Federal Open Market Committee, which meets Nov. 1-2, to decide that it’s too soon for a third round of bond purchases.
Treasuries Advance on European Economy, Debt-Crisis Concerns (Source: Bloomberg)
Treasuries gained for the first time in three days before a European report projected to show that the region’s services and manufacturing industries contracted. Demand for the relative safety of U.S. debt increased after European policy makers ruled out tapping the central bank to boost a rescue fund for indebted nations, while outlining plans to aid banks. Futures indicated a U.S. stock index will fall. “People may be forgetting about Europe’s economy but it is worsening,” said Kiyoshi Ishigane, a senior strategist in Tokyo at Mitsubishi UFJ Asset Management Co. “That’s not good for the global economy and weighs on bond yields.” Ten-year yields fell two basis points, or 0.02 percentage point, to 2.2 percent as of 9:44 a.m. Tokyo time, according to Bloomberg Bond Trader prices. The price of the 2.125 percent securities maturing in August 2021 rose 5/32, or $1.56 per $1,000 face amount, to 99 11/32.
Payrolls Decline in 25 States , Led by North Carolina; Florida Tops Gains (Source: Bloomberg)
Payrolls fell in 25 U.S. states in September, led by North Carolina and Ohio, a sign the weakness in the job market is broad-based. Employers cut staff by 22,200 in North Carolina last month and by 21,600 in Ohio, according to Labor Department data issued today in Washington. The report also showed the jobless rate decreased in 25 states. Nevada continued to lead the nation in unemployment with a rate of 13.4 percent. The economy needs to generate faster sustained job growth to lower unemployment and spur the consumer spending that makes up about 70 percent of the economy. A Labor Department report on Oct. 7 showed employers added 103,000 payrolls last month, almost half of them telecommunications workers returning from a strike, and the jobless rate was 9.1 percent for a third month.
McDonald's Posts Higher Sales, Profit (Source: CME)
McDonald's Corp.'s third-quarter earnings rose 8.6% as the fast-food giant's continued sales gains helped compensate for higher-than-expected food cost inflation. The Oak Brook, Ill., restaurant chain has consistently outperformed fast food rivals with competitive pricing that attracts consumers in this volatile economy. Even after raising menu prices this year in light of its higher costs, the chain has still been able to boost customer visits and grow sales faster than most of its competitors. For the third quarter, global same-store sales, or sales at restaurants open at least 13 months, rose 5%, with a 4.4% boost in the U.S., 4.9% in Europe and 3.4% in the Asia Pacific, Middle East and Africa division. Chief Executive Jim Skinner said the company's better-than-expected results were "hard-won."
"We are officially out of the recession, but it hardly feels that way," he said. "Consumers everywhere continue to be cost conscious and hesitant to spend." He said global same-store sales remain strong at the beginning of the fourth quarter, and the company expects a between 4% and 5% rise this month. McDonald's reported a profit of $1.51 billion, or $1.45 a share, up from $1.39 billion, or $1.29 a share, a year earlier. Foreign currency translation boosted its third quarter earnings by eight cents a share. Revenue rose 14% from a year ago to $7.17 billion. Excluding currency fluctuations, revenue was up 8%. Analysts polled by Thomson Reuters had expected earnings of $1.43 a share on revenue of $7.03 billion. McDonald's better-than-expected results come as the company faces higher costs, especially for beef, as those prices didn't moderate after the summer grilling season like McDonald's had hoped.
As a result, it raised its commodity inflation outlook to between 4.5% and 5% from 4% to 4.5% in the U.S. and Europe for the year, as higher food costs pressure restaurant margins industry-wide. An increasingly diverse menu "ranging from value offerings to higher-margin products like blended-ice drinks" has contributed to its strong sales and helped offset its rising costs. McDonald's also implemented two rounds of menu price increases this year, averaging 1% in March and 1.4% in May, to further offset food inflation. Still, McDonald's bottom line was hit in the third quarter, as its company-owned restaurant margin decreased by one percentage point to 20% because strong same-store sales were more than offset by higher commodity costs. "We will continue to evaluate additional price increases in light of this inflationary environment, always balancing our goal of driving traffic and market share gains with managing impact of rising costs," said Chief Financial Officer Peter Bensen.
McDonald's expects 2012 commodity inflation to be about the same as this year. Grocery store prices are rising faster than restaurant prices, which might allow McDonald's to increase its menu prices again in the near-term without turning away consumers, Mr. Bensen said. Mr. Skinner added that McDonald's pricing plans are "an inside game," not determined by moves its competitors make. "We have a pricing model that we use very, very effectively," Mr. Skinner said. "And yet it takes intuition and a gut feeling of that when to pull the trigger on these kinds of things."
China Must Control Prices to Curb Inflation: Wen (Source: Bloomberg)
China must continue efforts to control food and housing prices to ease soaring inflation and maintain economic development and social stability, according to Premier Wen Jiabao. Authorities must help boost output of farm products, control the non-food use of corn and increase land supply to make more residential housing available, Wen said in a statement posted on the central government’s website on Oct. 22. Wen’s government has tightened lending and boosted imports of agricultural reserves to keep inflation from derailing growth in the world’s second-biggest economy. China probably won’t ease monetary policies until inflation slows to less than 5 percent, Yu Yongding, a former central bank adviser, said Oct. 21.
“The government has been more flexible in balancing its tightening policies” with the state of the economy, and the measures have worked, Li Qiang, managing director of Shanghai JC Intelligence Co., the country’s biggest independent agricultural researcher, said in a phone interview yesterday. “Food prices, including pork, are trending lower.”
Japanese Stocks Advance, Led by Traders and Commodity Producers (Source: Bloomberg)
Japanese stocks rose, with the benchmark Nikkei 225 (NKY) Stock Average headed for its biggest gain in a week, as trading companies and commodity producers gained on higher oil and metal prices. Mitsubishi Corp. (8058), Japan’s biggest trading company by market value, rose 2.2 percent. Sumitomo Metal Mining Co., a copper producer, increased 3.5 percent. Toyota Motor Corp. (7203), the world’s largest automaker by market value, advanced 1 percent after Japanese exports increased more than expected. The Nikkei 225 rose 1.3 percent to 8,792.31 as of 9:22 a.m. in Tokyo, set for its largest advance since Oct. 17. The broader Topix index increased 1.2 percent to 753.11, with almost 10 stocks rising for each that fell.
Stocks in Europe Post Longest Streak of Weekly Gains This Year as EU Meets (Source: Bloomberg)
European stocks advanced for a fourth week, for the longest rising streak since December, as investors speculated European leaders meeting in Brussels next week will nudge forward a solution to the region’s debt crisis. SGL Carbon SE (SGL) soared the most since 2008 after a report that Bayerische Motoren Werke AG plans to buy a stake in it. Lundin Petroleum AB (LUPE) surged 14 percent after Statoil ASA doubled its estimate of an oil discovery in the North Sea. G4S Plc (GFS) slumped 14 percent after agreeing to acquire ISS A/S, a move resisted by at least one large shareholder. The Stoxx Europe 600 Index advanced 0.2 percent to 238.93 this week, with energy, personal goods and retail industries gaining the most. The gauge trimmed its decline from this year’s high on Feb. 17 to 18 percent. The Stoxx 600 is trading at about 10 times the estimated earnings of its constituent companies, near the lowest valuation since March 2009, according to data compiled by Bloomberg.
EU Rules Out ECB Help in Boosting Fund (Source: Bloomberg)
European leaders ruled out tapping the European Central Bank’s balance sheet to boost the region’s rescue fund and outlined plans to aid banks, inching toward a revamped strategy to contain the Greece-fueled debt crisis. Europe’s 13th crisis-management summit in 21 months also explored how to strengthen the International Monetary Fund’s role. The leaders excluded a forced restructuring of Greek debt, sticking with the tactic of enticing bondholders to accept losses to help restore the country’s finances. “Work is going well on the banks, and on the fund and the possibilities of using the fund, the options are converging,” French President Nicolas Sarkozy told reporters at the Brussels summit yesterday. “On the question of Greece, things are moving along. We’re not there yet.”
EU Pushes to Solve Debt Woes as Merkel Damps Expectations (Source: Bloomberg)
European leaders started the 13th crisis summit in 21 months seeking a breakthrough over how to stamp out the Greece-led debt shock that threatens to tip the world into a recession. Chancellor Angela Merkel of Germany, Europe’s dominant economy, played down the odds of an agreement today to beef up the euro bailout fund, cut Greece’s debt without triggering a default, shield banks from the fallout and insulate Italy and Spain from the turmoil. “Today one shouldn’t expect decisions,” Merkel told reporters before the Brussels summit. She spoke of “a technically complex process” with the aim of forging a comprehensive strategy at the next summit in three days.
European Leaders Say Bank Recapitalization Is ‘Essential’ Part of Package (Source: Bloomberg)
European Union finance ministers will meet Oct. 26 to complete work on bank-recapitalization plans, EU leaders indicated in a draft statement today. The finance chiefs, who met yesterday in Brussels for 10 hours, have progressed “on measures for the banking sector” and should “finalize this work” at a meeting on Oct. 26, the EU’s government heads said in the draft text obtained by Bloomberg News. The EU’s 27 leaders are meeting today in Brussels, with the euro area’s 17 government heads due to gather in the afternoon and again in three days to draw up a plan to stem the Greece- triggered debt crisis. Bank recapitalization is one part.
EU Talks Yield ‘Limited’ Progress on Banks’ Role in Greek Crisis (Source: Bloomberg)
A 10-hour meeting in Brussels failed to yield a blueprint for banks’ role in a revamped Greek rescue as European finance ministers haggled over what they called a “credible firewall” against fallout from deeper writedowns. The ministers’ meeting broke up at about 7 p.m. after reaching agreement that European banks may need about 100 billion euros ($139 billion) in capital after marking their sovereign-debt holdings to market values, according to a person familiar with the discussions. This amount is needed to reach a core tier 1 capital level of 9 percent based on a European Banking Authority test, said the person, who declined to be identified because discussions are private. The struggle to get an accord on bank capital was just one piece of solving the two-year-old financial crisis. Governments also are pushing for deeper writedowns on banks’ holdings of Greek debt, a step the investors are resisting.
European Leaders Consider Fund to Attract Outside Cash to Tame Debt Crisis (Source: Bloomberg)
European finance ministers are considering setting up a fund to entice outside investors to buy troubled euro-area government bonds, as they struggled over how to tame the Greece-fueled debt crisis, said a person familiar with the matter. The insured investment vehicle was one of two options being weighed, along with using the European Financial Stability Facility to boost the rescue firepower from 440 billion euros ($611 billion) currently, the person said. “The principle that we leverage the EFSF with private money is being subscribed by everyone, but the level of success is uncertain,” Dutch Finance Minister Jan Kees de Jager told reporters on the second day of crisis talks in Brussels. “How much can we raise, that is being looked at.”
Berlusconi Pressed by EU Leaders on Deficit (Source: Bloomberg)
Italian Prime Minister Silvio Berlusconi was put on the defensive at a crisis summit over the country’s finances and appointments at the European Central Bank. Before the leaders convened yesterday in Brussels, Berlusconi held face-to-face talks yesterday with European Union President Herman Van Rompuy and European Commission President Jose Barroso and then with German Chancellor Angela Merkel and French President Nicolas Sarkozy. “I never flunked” an exam in my life, Berlusconi told reporters when asked if he was concerned over the push to cut Italy’s debt load, the biggest in the world after the U.S. and Japan. The demand for discipline underscored European leaders’ concern of the vulnerability of Italy, whose debt totals more than $2 trillion, accounting for almost 120 percent of its gross domestic product. The ECB started buying Italian bonds two months ago to contain borrowing costs as yields surged.
Swan Says Europe’s Sovereign Crisis Shouldn’t Damp Confidence in Australia (Source: Bloomberg)
Volatility in global markets caused by the sovereign debt crisis in Europe shouldn’t damp confidence in Australia’s economic outlook, according to Treasurer Wayne Swan. “The situation in Europe will continue to have an impact on our region, our economy and our budget bottom line,” Swan said in his weekly economic note published yesterday. “But Australians should remain confident about our prospects, based on our strong fundamentals, our very low debt, low unemployment and our massive investment pipeline.” European leaders descended on Brussels at the weekend in a last-ditch effort to stamp out a two-year-old financial crisis that threatens to tip the world into a recession. Europe’s economy will expand 1 percent in 2012, compared with 4.3 percent in Australia where a mining boom is stoking the fastest pace of growth among Group of 10 currency nations, according to Bloomberg surveys.
Indonesian Government Prevails in Tussle Over Financial Regulator’s Board (Source: Bloomberg)
Indonesia ended months of impasse over the board composition of a planned financial regulator as lawmakers yielded to the government’s efforts to reduce the risk of political interference in bank supervision. The Financial Services Authority parliamentary working committee agreed Oct. 20 to the government’s plan for two former finance ministry and central bank members on the agency’s board of commissioners, along with seven presidential picks vetted by parliament, Achsanul Qosasi, a vice chairman of the committee, said by phone in Jakarta yesterday. Parliament had wanted two of its members in the mix. “The composition of the board of commissioners is good and it will make this body independent, without political interference in supervising financial institutions,” said David Sumual, an economist at PT Bank Central Asia in Jakarta.
Monday, October 24, 2011
20111024 0949 Global Commodities Related News.
Corn (Source: CME)
US corn futures close little changed, pulling back from gains early in the session. Profit-taking and expectations for harvest to advance this weekend weighed on prices, analysts say. Brokerage firm Country Hedging predicts harvest will be almost 70% complete in USDA's weekly crop report Monday, up from 47% a week earlier. Yet, the losses could not wipe out gains from earlier this week. CBOT December corn ends down 1/4c at $6.49 1/4/bushel, up 1.4% for the week.
Wheat (Source: CME)
US wheat futures finish little changed as grain markets pared gains ahead of the close. Profit-taking and a setback in corn prices pressured the markets, traders say. Wheat lacks strong export demand for support as Russia continues to undercut US grain prices on the world market. "It's been tough to find buyers," says Dave Marshall, an independent grain analyst. CBOT December wheat ends up 1 1/4c at $6.32/bushel as KCBT December slips 2c to $7.23 and MGEX December rises 1 3/4c to $9.19 1/4.
Rice (Source: CME)
US rice futures close higher on worries about crop losses due to severe flooding in Thailand, the world's top exporter of the grain. Floodwaters reached Bangkok, and some towns were under water more than six feet high. "These floods in Thailand are pretty darn serious. It's going to drive the price of rice up," says Jim Gerlach of A/C Trading. CBOT November rice jumps 9c to $16.40 1/2/hundredweight.
Corn up for 2nd day, harvest pressure limits gains
SINGAPORE, Oct 21 (Reuters) - U.S. corn and wheat rose half a percent, gaining for a second straight day in cautious optimism ahead of a weekend meeting of European leaders on the region's debt crisis.
"The markets seems to be reacting positively but if you look at it realistically the rally may not last as there is nothing very concrete, it's just speculations about possible resolution to the debt crisis," said Lynette Tan, an analyst at Phillip Futures in Singapore.
India, Pakistan rice exports to rise- trade officials
HO CHI MINH CITY, Oct 21 (Reuters) - India, the world's second-largest rice producer after China, is forecast to produce 102 million tonnes of rice in the 2011/2012 season, up around 3 percent from the previous season, an executive at a rice export company said on Friday.
The country, which returned to the market in September with a plan to ship 2 million tonnes of non-basmati rice by March 2012, has 5 million tonnes set aside for export, Chairman Karan Chanana of the New Delhi-based Amira group told Reuters.
Ukraine grain export duties expire on Oct.22
KIEV, Oct 21 (Reuters) - Export duties on Ukrainian wheat and maize will expire on Saturday, according to a law published on Friday.
Ukraine imposed the duties in July and traders have said the measure slashed Ukrainian exports as Ukrainian-origin grain proved unable to compete with cheaper Russian exports.
India won't allow food grain exports from govt stocks-min
NEW DELHI, Oct 21 (Reuters) - India, the world's second-biggest wheat and rice producer, will not allow overseas sale of food grains from government stocks, Food Minister K.V. Thomas said on Friday.
"No, we want to be cautious and government has not allowed exports from government stocks," Thomas said when asked whether such grain exports would be permitted.
China 2012 rice import seen steady at 700,000T-govt
HO CHI MINH CITY, Oct 21 (Reuters) - China's milled rice import demand in 2012 is expected to be around 700,000 tonnes, similar to this year due to sufficient stock while market prices would remain high, a government official said on Friday.
The 2012 import, equivalent to around 1 million tonnes of rough rice, or paddy, would come from Thailand and Vietnam, the official from the government-run National Grain and Oilseeds Information Center told Reuters, adding that the higher-priced Thai grain would meet demand for the luxury market.
High rice prices to hit Thai, Vietnam exports
HO CHI MINH CITY, Oct 20 (Reuters) - High prices may lead to a 30 percent cut in rice shipments from top exporter Thailand next year and No. 2 seller Vietnam may be unable to increase its export volumes as buyers turn to cheaper rice from India, traders and industry officials said.
India, the world's second-biggest producer, eased curbs on exports last month and its grain is around $100 a tonne cheaper than Thai and Vietnamese rice, they said at a rice conference in Vietnam.
US Grain Exports- China buys, corn sales hit 7-mth high
CHICAGO, Oct 20 (Reuters) - A big U.S. corn purchase by China propelled export sales of the grain last week to a near seven-month high, although the sales fell short of trade expectations, according to U.S. Agriculture Department data released early on Thursday.
USDA confirmed a large purchase by the emerging corn importer last week, along with a sizable sale to undisclosed buyers. But absent those sales, the week's tally was disappointing, analysts said.
EU clears 296,000 tonnes wheat exports this week
PARIS, Oct 20 (Reuters) - The European Union this week granted export licences for 296,000 tonnes of soft wheat, taking the total since the beginning of the 2011/12 (July-June) season to 4.35 million tonnes, official data showed on Thursday.
The total so far this season remained well below the volume seen at the same stage in 2010/11, when 7.7 million tonnes of export licences had been cleared, the data showed.
EU wheat sowing going well in good weather
HAMBURG, Oct 20 (Reuters) - Wheat sowing in key European Union producing countries is progressing well in favourable weather and farmers may be choosing wheat over other grains and oilseeds, analysts said on Thursday.
"The EU could be heading for a slightly larger wheat harvested area in 2012 but sowing problems in Germany could cut the rapeseed area," one analyst said. "Overall a good start has been made with wheat and plants in the main producing countries in good shape to face the winter."
Russian grain harvesting 91.6 percent over - AgMin
MOSCOW, Oct 20 (Reuters) - Russia had harvested 93.4 million tonnes of grain by bunker weight by Oct. 18, up from 62.2 million by the same date last year but down from 98.2 million tonnes two years ago, Agriculture Ministry data showed on Thursday.
Russia officially expects to harvest 90-92 million tonnes of grain this year, up from 61 million in 2010, when it was hit by a drought, the most severe in decades, but les than the 97 million tonnes reaped in 2009.
Rains slow harvesting in eastern US Midwest; Plains parched
CHICAGO, Oct 20 (Reuters) - Overall good harvest weather continued in the U.S. Midwest with the exception of the soggy eastern part of the region, including much of the northern Ohio River Valley, an agricultural meteorologist said on Thursday.
"Most of the Midwest is okay but there was a lot of rain in the eastern Corn Belt especially in Ohio, Michigan and eastern Indiana," said Andy Karst, meteorologist for World Weather Inc.
Nearly 2.5M Hectares Of Crops Destroyed By SE Asia Floods - FAO (Source: CME)
The devastating floods that have left hundreds dead in south-east Asia may cause further problems for the region as millions of hectares of crops have been destroyed, the United Nations warned. Intense monsoon rains, typhoons and tropical storms have flooded more than 2.5 million hectares of cropland in Cambodia, Laos, the Philippines, Thailand and Vietnam, according to research by the Food and Agriculture Organization. Meanwhile, millions of animals have already been killed and millions are thought to be at risk from the flood waters and already overspilling damns. In worst-hit Thailand, 1.6 million hectares--12.5% of the area under crops nationwide--has been flooded, along with an estimated 12% of acreage in the Philippines and 7.5% of plantings in Cambodia. "The floods occurred when the current main wet season cereal crops were in the field, with paddy rice at the initial to mid growing stage, and maize at an advance critical flowering stage," said the FAO.
"Loss of livestock and poultry is reported and significant numbers are considered to be at risk."
India Won't Allow Foodgrain Exports From Govt Stocks - Minister (Source: CME)
India won't allow any grain exports from surplus government stocks as it is worried about high food inflation and wants to preserve supplies to meet a proposed food security law, Food Minister K.V. Thomas said. "We have to be cautious as we will need enough foodgrains...once we introduce the food security law," he told reporters. The food security law, which guarantees cheap grain supplies to the majority of the country's population, is expected to be introduced in parliament in December.
Czech Republic's 2011 Grain Harvest Showed Record Yields - USDA (Source: CME)
Grain production in the Czech Republic rose almost 20% on the year to 8.2 million metric tons in 2011 as farmers harvested a record yielding crop, the U.S. Department of Agriculture said. "This year's harvest is one of the best in the last decade" with yields jumping to an average of 5.62 tons a hectare and most grain of good quality, the USDA's Prague attache said in a note. "Sufficient exportable surplus of milling wheat is anticipated," it said. For next year, farmers are expected to continue to expand plantings of the most lucrative crops, including wheat, corn and rapeseed, at the expense of grains such as barley and rye, the attache added.
Argentina's Kirchner, Farmers Make Peace Ahead Of Second Term (Source: CME)
With reelection almost certain this Sunday, Argentina's President Cristina Kirchner is actively courting the support of farmers who nearly four years ago blocked highways to protest her attempt to hike taxes on grain producers. Argentina is blessed with some of the world's most productive farmland, ranking No. 1 in global soymeal and soyoil exports, and second in corn exports. Taxes on grain exports provide significant revenue to the federal government. Those exports are also the country's single largest source of hard currency. Grain export dollars have allowed Argentina to run a hefty trade surplus for years as well as accumulate international reserves that the government taps to pay its creditors. Farmers still grumble about the government's policy of limiting corn and wheat exports to keep food prices low at the expense of producers. But with Kirchner on the cusp of winning a second, four-year term with an overwhelming mandate from voters, many farm groups have decided to make peace with the government.
Kirchner made the unprecedented gesture on Monday of attending a three-hour lunch and meeting with representatives of farm group Coninagro, whose leaders have been among her most vocal critics over the past three years. "A new phase has opened up with the government," Coninagro president Carlos Garetto said in televised comments after the meeting at the group's headquarters. "Neither the farmers nor the government want conflict," he said. "The state needs the farmers and the farmers need the state." High global prices for soy and grains have also helped both sides smooth over the lingering resentment from the 2008 strike. Soybean prices on the local grain exchange have risen 8% this year, and global corn prices are up about 17%, according to the Agriculture Ministry. Even the conservative Argentine Rural Society, which historically represented the cattle barons and big landowners who dominated politics in the early 20th century, is cautiously optimistic about the government's peace overtures.
"It's an important change of attitude [but] it doesn't mean that there is going to be a change in the policies nor does it mean that she's going to recognize that our demands are right," Rural president Hugo Biolcati told Radio 10. Kirchner could receive as much as 55% of the vote this Sunday, giving her a nearly 40-point lead over the nearest challenger and easily surpassing the threshold to avoid a runoff, according to respected pollster Poliarquia. Her Frente Para La Victoria coalition, which claims to represent the populist-nationalist movement founded by former President Juan Domingo Peron in the 1940s, is also poised to retake control of Congress. In recent months, Kirchner has sought to mend fences with disaffected farmers and industrialists in what some analysts say is a precursor to a grand social pact early next year to correct some of the more serious distortions of her high growth, high inflation policies.
While the government has made it clear that the export limits are here to stay, Kirchner is keen to get farmers' support for a 10-year plan aimed at lifting agricultural production 60% between now and 2020. The government wants to increase grain output 50% to 150 million metric tons from the record crop harvested during the 2010-11 season, while beef production is seen rising 70% thanks to the use of feedlots. Those ambitious targets are feasible with the use of biotechnology and increasing the amount of farmland, brokerage Panagricola vice president Ricardo Baccarin said in a phone interview. Farmers are looking forward to another gangbuster harvest this season. The U.S. Department of Agriculture's latest forecast puts the 2011-12 soy crop at 53 million metric tons, the second-largest ever, while corn production is expected to smash all records at 27.5 million tons.
ICE sugar, coffee firm as commodities recover
LONDON, Oct 21 (Reuters) - ICE raw sugar, cocoa and arabica coffee futures firmed in early trade on Friday, tracking a broad-based recovery in other commodity markets as stocks bounced after France and Germany said a comprehensive euro zone debt deal was on its way.
Uncertainty about the euro zone's resolution of its debt crisis was likely to cap gains.Raw sugar futures were firmer, with the market focused on news on when Indian exports may be authorised.
China 2011/12 cotton consumption seen down-report
NEW YORK, Oct 20 (Reuters) - Cotton consumption in China, the world's top consumer of the fiber, is seen falling over 5 percent in 2011/12 to 9.4 million tonnes, industry publication Cotlook said on Thursday.
Cotlook said the use of cotton by China "has undergone a further downward adjustment, principally as a result of a decrease in projected mill use of raw cotton in China, where a modest net decline in consumption is now foreseen."
Costa Rica coffee harvest suffers some damage from rains
SAN JOSE, Costa Rica, Oct 20 (Reuters) - Torrential rains in Costa Rica caused an estimated loss of at least 23,000 60-kg bags and that number could rise as plant disease spreads in the country's soaked fields, the national coffee institute said on Thursday.
Officials at the institute, known as ICAFE, had forecast coffee production at around 1.58 million 60-kg bags for the 2011/12 crop that began in October.
Euro Coal-Price slide continues at $1.50 a day
LONDON, Oct 20 (Reuters) - Prompt physical coal prices on Thursday fell by $1.00-1.50 for the fourth day running as traders and utilities sold fourth-quarter cargoes in expectation of further price falls.
The stagnation which has plagued the coal market for most of this year may be over, they said, now that prices have broken out of their range on the downside and continued to fall.
Brent crude oil steady above $109 before EU summits
LONDON, Oct 21 (Reuters) - Brent crude held above $109 per barrel as financial markets awaited two key summits of European leaders to agree a solution to the euro zone's debt crisis.
"The big risk for markets is that EU leaders don't deliver what is expected: a solution to the debt crisis," said Carsten Fritsch, commodities analyst at Commerzbank in Frankfurt.
Oil Gains a Second Day Before European Debt Summit; Brent Premium Widens (Source: Bloomberg)
Oil rose for a second day in New York before European leaders meet this week to agree on a blueprint to tackle the region’s sovereign debt crisis. London- traded Brent’s premium to U.S. crude widened. Futures climbed as much as 0.6 percent after earlier declining 0.5 percent. European leaders yesterday outlined plans to aid banks while ruling out using the European Central Bank’s balance sheet to boost the region’s rescue fund. They may agree to a complete plan at a summit on Oct. 26. Saudi Arabia, the Organization of Petroleum Exporting Countries’ largest oil producer, is waiting for a successor to the crown prince after the death of Sultan bin Abdulaziz Al Saud. “The market is still riding on optimism,” said Jonathan Barratt, a managing director of Commodity Broking Services Pty in Sydney. “Crude did come off a little bit and it might have something to do with a little bit of nervousness in terms of control on compliance in OPEC after the Sultan passed away.”
S.Korea's Sept crude oil imports up 7.5 pct y/y -KNOC
SEOUL, Oct 21 (Reuters) - South Korea's crude imports in September rose 7.5 percent from a year earlier thanks to bullish regional demand for oil products, while the country's year-on-year crude runs were lower in the month due to some maintenance shutdown.
Crude imports by the world's fifth-largest crude buyer rose to 80.6 million barrels last month from 74.9 million barrels a year ago, state-run Korea National Oil Corp (KNOC) said on Friday.
Australia's Indo Mines plans $1 bln Indonesia iron project-govt
JAKARTA, Oct 21 (Reuters) - Australia's Indo Mines is to start construction of a $1 billion project on Indonesia's Java island in December, to begin operations in at least three years to produce 9-15 million tonnes of iron ore a year, a government official said on Friday.
The joint venture will involve PT Jogja Magasa Iron, which will own a 30 percent stake in the project, said Mudrajad Kuncoro, a local government official in Yogyakarta, central Java.
Iron Ore-Spot eyeing biggest weekly fall since July 2010
SINGAPORE, Oct 21 (Reuters) - Spot iron prices slid to their lowest in a year and are set to post their biggest weekly decline in 15 months as demand from top importer China remained thin, fuelling expectations prices could drop further.
Weaker demand for steel in China, the world's biggest consumer and producer, dragged down steel prices and slashed appetite for iron ore, the key steelmaking raw material.
Baltic index rises for 2nd day, capes drive gains
LONDON, Oct 20 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, rose for a second day on Thursday helped by firmer demand for larger capesize vessels hauling iron ore and coal to China.
The overall index rose 21 points or 0.98 percent to 2,161 points.
US corn futures close little changed, pulling back from gains early in the session. Profit-taking and expectations for harvest to advance this weekend weighed on prices, analysts say. Brokerage firm Country Hedging predicts harvest will be almost 70% complete in USDA's weekly crop report Monday, up from 47% a week earlier. Yet, the losses could not wipe out gains from earlier this week. CBOT December corn ends down 1/4c at $6.49 1/4/bushel, up 1.4% for the week.
Wheat (Source: CME)
US wheat futures finish little changed as grain markets pared gains ahead of the close. Profit-taking and a setback in corn prices pressured the markets, traders say. Wheat lacks strong export demand for support as Russia continues to undercut US grain prices on the world market. "It's been tough to find buyers," says Dave Marshall, an independent grain analyst. CBOT December wheat ends up 1 1/4c at $6.32/bushel as KCBT December slips 2c to $7.23 and MGEX December rises 1 3/4c to $9.19 1/4.
Rice (Source: CME)
US rice futures close higher on worries about crop losses due to severe flooding in Thailand, the world's top exporter of the grain. Floodwaters reached Bangkok, and some towns were under water more than six feet high. "These floods in Thailand are pretty darn serious. It's going to drive the price of rice up," says Jim Gerlach of A/C Trading. CBOT November rice jumps 9c to $16.40 1/2/hundredweight.
Corn up for 2nd day, harvest pressure limits gains
SINGAPORE, Oct 21 (Reuters) - U.S. corn and wheat rose half a percent, gaining for a second straight day in cautious optimism ahead of a weekend meeting of European leaders on the region's debt crisis.
"The markets seems to be reacting positively but if you look at it realistically the rally may not last as there is nothing very concrete, it's just speculations about possible resolution to the debt crisis," said Lynette Tan, an analyst at Phillip Futures in Singapore.
India, Pakistan rice exports to rise- trade officials
HO CHI MINH CITY, Oct 21 (Reuters) - India, the world's second-largest rice producer after China, is forecast to produce 102 million tonnes of rice in the 2011/2012 season, up around 3 percent from the previous season, an executive at a rice export company said on Friday.
The country, which returned to the market in September with a plan to ship 2 million tonnes of non-basmati rice by March 2012, has 5 million tonnes set aside for export, Chairman Karan Chanana of the New Delhi-based Amira group told Reuters.
Ukraine grain export duties expire on Oct.22
KIEV, Oct 21 (Reuters) - Export duties on Ukrainian wheat and maize will expire on Saturday, according to a law published on Friday.
Ukraine imposed the duties in July and traders have said the measure slashed Ukrainian exports as Ukrainian-origin grain proved unable to compete with cheaper Russian exports.
India won't allow food grain exports from govt stocks-min
NEW DELHI, Oct 21 (Reuters) - India, the world's second-biggest wheat and rice producer, will not allow overseas sale of food grains from government stocks, Food Minister K.V. Thomas said on Friday.
"No, we want to be cautious and government has not allowed exports from government stocks," Thomas said when asked whether such grain exports would be permitted.
China 2012 rice import seen steady at 700,000T-govt
HO CHI MINH CITY, Oct 21 (Reuters) - China's milled rice import demand in 2012 is expected to be around 700,000 tonnes, similar to this year due to sufficient stock while market prices would remain high, a government official said on Friday.
The 2012 import, equivalent to around 1 million tonnes of rough rice, or paddy, would come from Thailand and Vietnam, the official from the government-run National Grain and Oilseeds Information Center told Reuters, adding that the higher-priced Thai grain would meet demand for the luxury market.
High rice prices to hit Thai, Vietnam exports
HO CHI MINH CITY, Oct 20 (Reuters) - High prices may lead to a 30 percent cut in rice shipments from top exporter Thailand next year and No. 2 seller Vietnam may be unable to increase its export volumes as buyers turn to cheaper rice from India, traders and industry officials said.
India, the world's second-biggest producer, eased curbs on exports last month and its grain is around $100 a tonne cheaper than Thai and Vietnamese rice, they said at a rice conference in Vietnam.
US Grain Exports- China buys, corn sales hit 7-mth high
CHICAGO, Oct 20 (Reuters) - A big U.S. corn purchase by China propelled export sales of the grain last week to a near seven-month high, although the sales fell short of trade expectations, according to U.S. Agriculture Department data released early on Thursday.
USDA confirmed a large purchase by the emerging corn importer last week, along with a sizable sale to undisclosed buyers. But absent those sales, the week's tally was disappointing, analysts said.
EU clears 296,000 tonnes wheat exports this week
PARIS, Oct 20 (Reuters) - The European Union this week granted export licences for 296,000 tonnes of soft wheat, taking the total since the beginning of the 2011/12 (July-June) season to 4.35 million tonnes, official data showed on Thursday.
The total so far this season remained well below the volume seen at the same stage in 2010/11, when 7.7 million tonnes of export licences had been cleared, the data showed.
EU wheat sowing going well in good weather
HAMBURG, Oct 20 (Reuters) - Wheat sowing in key European Union producing countries is progressing well in favourable weather and farmers may be choosing wheat over other grains and oilseeds, analysts said on Thursday.
"The EU could be heading for a slightly larger wheat harvested area in 2012 but sowing problems in Germany could cut the rapeseed area," one analyst said. "Overall a good start has been made with wheat and plants in the main producing countries in good shape to face the winter."
Russian grain harvesting 91.6 percent over - AgMin
MOSCOW, Oct 20 (Reuters) - Russia had harvested 93.4 million tonnes of grain by bunker weight by Oct. 18, up from 62.2 million by the same date last year but down from 98.2 million tonnes two years ago, Agriculture Ministry data showed on Thursday.
Russia officially expects to harvest 90-92 million tonnes of grain this year, up from 61 million in 2010, when it was hit by a drought, the most severe in decades, but les than the 97 million tonnes reaped in 2009.
Rains slow harvesting in eastern US Midwest; Plains parched
CHICAGO, Oct 20 (Reuters) - Overall good harvest weather continued in the U.S. Midwest with the exception of the soggy eastern part of the region, including much of the northern Ohio River Valley, an agricultural meteorologist said on Thursday.
"Most of the Midwest is okay but there was a lot of rain in the eastern Corn Belt especially in Ohio, Michigan and eastern Indiana," said Andy Karst, meteorologist for World Weather Inc.
Nearly 2.5M Hectares Of Crops Destroyed By SE Asia Floods - FAO (Source: CME)
The devastating floods that have left hundreds dead in south-east Asia may cause further problems for the region as millions of hectares of crops have been destroyed, the United Nations warned. Intense monsoon rains, typhoons and tropical storms have flooded more than 2.5 million hectares of cropland in Cambodia, Laos, the Philippines, Thailand and Vietnam, according to research by the Food and Agriculture Organization. Meanwhile, millions of animals have already been killed and millions are thought to be at risk from the flood waters and already overspilling damns. In worst-hit Thailand, 1.6 million hectares--12.5% of the area under crops nationwide--has been flooded, along with an estimated 12% of acreage in the Philippines and 7.5% of plantings in Cambodia. "The floods occurred when the current main wet season cereal crops were in the field, with paddy rice at the initial to mid growing stage, and maize at an advance critical flowering stage," said the FAO.
"Loss of livestock and poultry is reported and significant numbers are considered to be at risk."
India Won't Allow Foodgrain Exports From Govt Stocks - Minister (Source: CME)
India won't allow any grain exports from surplus government stocks as it is worried about high food inflation and wants to preserve supplies to meet a proposed food security law, Food Minister K.V. Thomas said. "We have to be cautious as we will need enough foodgrains...once we introduce the food security law," he told reporters. The food security law, which guarantees cheap grain supplies to the majority of the country's population, is expected to be introduced in parliament in December.
Czech Republic's 2011 Grain Harvest Showed Record Yields - USDA (Source: CME)
Grain production in the Czech Republic rose almost 20% on the year to 8.2 million metric tons in 2011 as farmers harvested a record yielding crop, the U.S. Department of Agriculture said. "This year's harvest is one of the best in the last decade" with yields jumping to an average of 5.62 tons a hectare and most grain of good quality, the USDA's Prague attache said in a note. "Sufficient exportable surplus of milling wheat is anticipated," it said. For next year, farmers are expected to continue to expand plantings of the most lucrative crops, including wheat, corn and rapeseed, at the expense of grains such as barley and rye, the attache added.
Argentina's Kirchner, Farmers Make Peace Ahead Of Second Term (Source: CME)
With reelection almost certain this Sunday, Argentina's President Cristina Kirchner is actively courting the support of farmers who nearly four years ago blocked highways to protest her attempt to hike taxes on grain producers. Argentina is blessed with some of the world's most productive farmland, ranking No. 1 in global soymeal and soyoil exports, and second in corn exports. Taxes on grain exports provide significant revenue to the federal government. Those exports are also the country's single largest source of hard currency. Grain export dollars have allowed Argentina to run a hefty trade surplus for years as well as accumulate international reserves that the government taps to pay its creditors. Farmers still grumble about the government's policy of limiting corn and wheat exports to keep food prices low at the expense of producers. But with Kirchner on the cusp of winning a second, four-year term with an overwhelming mandate from voters, many farm groups have decided to make peace with the government.
Kirchner made the unprecedented gesture on Monday of attending a three-hour lunch and meeting with representatives of farm group Coninagro, whose leaders have been among her most vocal critics over the past three years. "A new phase has opened up with the government," Coninagro president Carlos Garetto said in televised comments after the meeting at the group's headquarters. "Neither the farmers nor the government want conflict," he said. "The state needs the farmers and the farmers need the state." High global prices for soy and grains have also helped both sides smooth over the lingering resentment from the 2008 strike. Soybean prices on the local grain exchange have risen 8% this year, and global corn prices are up about 17%, according to the Agriculture Ministry. Even the conservative Argentine Rural Society, which historically represented the cattle barons and big landowners who dominated politics in the early 20th century, is cautiously optimistic about the government's peace overtures.
"It's an important change of attitude [but] it doesn't mean that there is going to be a change in the policies nor does it mean that she's going to recognize that our demands are right," Rural president Hugo Biolcati told Radio 10. Kirchner could receive as much as 55% of the vote this Sunday, giving her a nearly 40-point lead over the nearest challenger and easily surpassing the threshold to avoid a runoff, according to respected pollster Poliarquia. Her Frente Para La Victoria coalition, which claims to represent the populist-nationalist movement founded by former President Juan Domingo Peron in the 1940s, is also poised to retake control of Congress. In recent months, Kirchner has sought to mend fences with disaffected farmers and industrialists in what some analysts say is a precursor to a grand social pact early next year to correct some of the more serious distortions of her high growth, high inflation policies.
While the government has made it clear that the export limits are here to stay, Kirchner is keen to get farmers' support for a 10-year plan aimed at lifting agricultural production 60% between now and 2020. The government wants to increase grain output 50% to 150 million metric tons from the record crop harvested during the 2010-11 season, while beef production is seen rising 70% thanks to the use of feedlots. Those ambitious targets are feasible with the use of biotechnology and increasing the amount of farmland, brokerage Panagricola vice president Ricardo Baccarin said in a phone interview. Farmers are looking forward to another gangbuster harvest this season. The U.S. Department of Agriculture's latest forecast puts the 2011-12 soy crop at 53 million metric tons, the second-largest ever, while corn production is expected to smash all records at 27.5 million tons.
ICE sugar, coffee firm as commodities recover
LONDON, Oct 21 (Reuters) - ICE raw sugar, cocoa and arabica coffee futures firmed in early trade on Friday, tracking a broad-based recovery in other commodity markets as stocks bounced after France and Germany said a comprehensive euro zone debt deal was on its way.
Uncertainty about the euro zone's resolution of its debt crisis was likely to cap gains.Raw sugar futures were firmer, with the market focused on news on when Indian exports may be authorised.
China 2011/12 cotton consumption seen down-report
NEW YORK, Oct 20 (Reuters) - Cotton consumption in China, the world's top consumer of the fiber, is seen falling over 5 percent in 2011/12 to 9.4 million tonnes, industry publication Cotlook said on Thursday.
Cotlook said the use of cotton by China "has undergone a further downward adjustment, principally as a result of a decrease in projected mill use of raw cotton in China, where a modest net decline in consumption is now foreseen."
Costa Rica coffee harvest suffers some damage from rains
SAN JOSE, Costa Rica, Oct 20 (Reuters) - Torrential rains in Costa Rica caused an estimated loss of at least 23,000 60-kg bags and that number could rise as plant disease spreads in the country's soaked fields, the national coffee institute said on Thursday.
Officials at the institute, known as ICAFE, had forecast coffee production at around 1.58 million 60-kg bags for the 2011/12 crop that began in October.
Euro Coal-Price slide continues at $1.50 a day
LONDON, Oct 20 (Reuters) - Prompt physical coal prices on Thursday fell by $1.00-1.50 for the fourth day running as traders and utilities sold fourth-quarter cargoes in expectation of further price falls.
The stagnation which has plagued the coal market for most of this year may be over, they said, now that prices have broken out of their range on the downside and continued to fall.
Brent crude oil steady above $109 before EU summits
LONDON, Oct 21 (Reuters) - Brent crude held above $109 per barrel as financial markets awaited two key summits of European leaders to agree a solution to the euro zone's debt crisis.
"The big risk for markets is that EU leaders don't deliver what is expected: a solution to the debt crisis," said Carsten Fritsch, commodities analyst at Commerzbank in Frankfurt.
Oil Gains a Second Day Before European Debt Summit; Brent Premium Widens (Source: Bloomberg)
Oil rose for a second day in New York before European leaders meet this week to agree on a blueprint to tackle the region’s sovereign debt crisis. London- traded Brent’s premium to U.S. crude widened. Futures climbed as much as 0.6 percent after earlier declining 0.5 percent. European leaders yesterday outlined plans to aid banks while ruling out using the European Central Bank’s balance sheet to boost the region’s rescue fund. They may agree to a complete plan at a summit on Oct. 26. Saudi Arabia, the Organization of Petroleum Exporting Countries’ largest oil producer, is waiting for a successor to the crown prince after the death of Sultan bin Abdulaziz Al Saud. “The market is still riding on optimism,” said Jonathan Barratt, a managing director of Commodity Broking Services Pty in Sydney. “Crude did come off a little bit and it might have something to do with a little bit of nervousness in terms of control on compliance in OPEC after the Sultan passed away.”
S.Korea's Sept crude oil imports up 7.5 pct y/y -KNOC
SEOUL, Oct 21 (Reuters) - South Korea's crude imports in September rose 7.5 percent from a year earlier thanks to bullish regional demand for oil products, while the country's year-on-year crude runs were lower in the month due to some maintenance shutdown.
Crude imports by the world's fifth-largest crude buyer rose to 80.6 million barrels last month from 74.9 million barrels a year ago, state-run Korea National Oil Corp (KNOC) said on Friday.
Australia's Indo Mines plans $1 bln Indonesia iron project-govt
JAKARTA, Oct 21 (Reuters) - Australia's Indo Mines is to start construction of a $1 billion project on Indonesia's Java island in December, to begin operations in at least three years to produce 9-15 million tonnes of iron ore a year, a government official said on Friday.
The joint venture will involve PT Jogja Magasa Iron, which will own a 30 percent stake in the project, said Mudrajad Kuncoro, a local government official in Yogyakarta, central Java.
Iron Ore-Spot eyeing biggest weekly fall since July 2010
SINGAPORE, Oct 21 (Reuters) - Spot iron prices slid to their lowest in a year and are set to post their biggest weekly decline in 15 months as demand from top importer China remained thin, fuelling expectations prices could drop further.
Weaker demand for steel in China, the world's biggest consumer and producer, dragged down steel prices and slashed appetite for iron ore, the key steelmaking raw material.
Baltic index rises for 2nd day, capes drive gains
LONDON, Oct 20 (Reuters) - The Baltic Exchange's main sea freight index, which tracks rates to ship dry commodities, rose for a second day on Thursday helped by firmer demand for larger capesize vessels hauling iron ore and coal to China.
The overall index rose 21 points or 0.98 percent to 2,161 points.
20111024 0948 Soy Oil & Palm Oil Related News.
Soybeans (Source: CME)
US soybean futures finish lower as the market continues its setback from last week's surge. Prices slide 4.5% this week after climbing 9.6% last week on an unexpected cut in USDA's year-end inventory outlook. Additional pressure comes from expectations farmers will continue to advance the soy harvest this weekend. "There's still pre-weekend hedge pressure that has to be absorbed," says Dave Marshall, an independent analyst. CBOT November soybeans fall 12 3/4c to $12.12 1/4 a bushel.
Soybean Meal/Oil (Source: CME)
Soy products also weaken, with December soymeal dropping $3.80 to $316.50/short ton and December soyoil slipping 0.14c to 51.25c/lb.
Palm oil perks up on euro zone resolution hopes
KUALA LUMPUR, Oct 21 (Reuters) - Malaysian palm oil futures inched up as investors waited for a weekend meeting of euro zone leaders for signs of resolving the region's debt crisis that could plunge the world into recession if left unchecked.
"It is all eyes on the euro zone. They better get it right this time as there is too much uncertainty in markets like palm oil that are not fully reflecting fundamentals," said a trader with a brokerage in Kuala Lumpur.
Argentina soy area seen 18.6 mln hectares-exchange
BUENOS AIRES, Oct 20 (Reuters) - Argentine farmers will plant soy on 18.6 million hectares (46 million acres), the Buenos Aires Grains Exchange said on Thursday in its first 2011/12 area estimate for the world's No. 3 soybean supplier.
The forecast marked a slight increase from the 18.5 million hectares seeded in the 2010/11 season, the exchange said in its weekly crop progress report.
US soybean futures finish lower as the market continues its setback from last week's surge. Prices slide 4.5% this week after climbing 9.6% last week on an unexpected cut in USDA's year-end inventory outlook. Additional pressure comes from expectations farmers will continue to advance the soy harvest this weekend. "There's still pre-weekend hedge pressure that has to be absorbed," says Dave Marshall, an independent analyst. CBOT November soybeans fall 12 3/4c to $12.12 1/4 a bushel.
Soybean Meal/Oil (Source: CME)
Soy products also weaken, with December soymeal dropping $3.80 to $316.50/short ton and December soyoil slipping 0.14c to 51.25c/lb.
Palm oil perks up on euro zone resolution hopes
KUALA LUMPUR, Oct 21 (Reuters) - Malaysian palm oil futures inched up as investors waited for a weekend meeting of euro zone leaders for signs of resolving the region's debt crisis that could plunge the world into recession if left unchecked.
"It is all eyes on the euro zone. They better get it right this time as there is too much uncertainty in markets like palm oil that are not fully reflecting fundamentals," said a trader with a brokerage in Kuala Lumpur.
Argentina soy area seen 18.6 mln hectares-exchange
BUENOS AIRES, Oct 20 (Reuters) - Argentine farmers will plant soy on 18.6 million hectares (46 million acres), the Buenos Aires Grains Exchange said on Thursday in its first 2011/12 area estimate for the world's No. 3 soybean supplier.
The forecast marked a slight increase from the 18.5 million hectares seeded in the 2010/11 season, the exchange said in its weekly crop progress report.
Friday, October 21, 2011
20111021 1804 FCPO EOD Daily Chart Study.
Bollinger band reading : side way range bound little downside biased.
MACD Histrogram : rising, buyer taking small position.
Support : 2850, 2800, 2770, 2750 level.
Resistance : 2900, 2920, 2950, 2970 level.
Comment :
FCPO closed recorded small gain with slower volume transacted while overnight soy oil closed recorded small loss and currently trading little higher while crude oil price edge up little higher.
FCPO price traded in positive zone through out the day with news on Indonesia sets lower crude palm oil tax for Nov 2011 to 15% from Oct 2011 16.5% level and Malaysia exploring options that include cutting crude palm oil export tax to be on par with Indonesia.
Daily chart formed a down doji bar candle closed in between upper and middle Bollinger band level after market opened gap up, swing downwards and to closed recorded small gain.
Base on chart reading, FCPO still likely to trade side way range bound little downside biased testing support and resistance level for the near term.
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.
20111021 1734 FKLI EOD Daily Chart Study.
Bollinger band reading : pullback correction little upside biased.
MACD Histrogram : weakenning, buyer lock in profit and reduce exposure.
Support : 1425, 1420, 1400, 1395 level.
Resistance : 1440, 1445, 1458, 1470 level.
Comment :
FKLI closed recorded gain with slower volume changed hand doing 3 points discount compare to cash market that closed recorded small loss. Overnight U.S. markets closed little higher and today Asia markets closed mixed while European markets opened and currently trading higher.
Global markets awaits development from the Europe Crisis Summits as policy makers discussed unleashing $1.3 trillion in funds to help contain the euro area’s debt crisis.
Daily chart formed a down doji bar candle closed in between middle and upper Bollinger band level after market lower opened higher, slide downward and traded range bound before resume climbing higher followed by sudden downward dive cause by cash market suddenly recording loss by more than 60 pver points(cause still unknown) and stabilised little higher towards market closed.
FKLI still trading in pullback correction phase within a little upside biased market development testing support and resistance level.
When to buy : buy at support or weakness with quick cut loss and profit target.
When to sell : sell at resistance or strength with quick cut loss and profit target.
20111021 1708 Regional Markets EOD Daily Chart Study.
DJIA chart reading : side way range bound little upside biased.
Hang Seng chart reading : side way range bound little downside biased.
KLCI chart reading : pullback correction upside biased.
20111021 1616 Global Market & Commodities Related News.
Asian markets cautious ahead of Europe summit
TOKYO, Oct 21 (Reuters) - Asian shares inched up while the euro clung to overnight gains, but markets largely stayed within range, as investors awaited a weekend meeting of European leaders for signs of progress in resolving the region's debt crisis.
"Assets across the board are coming under pressure as it becomes clear that European banks, when faced with a stress test, will likely reduce their assets to strengthen their capital," said Naohiro Niimura, a partner at research and consulting firm Market Risk Advisory Co.
EU Said to Consider Wielding $1.3 Trillion to Break Impasse (Bloomberg)
European governments may unleash as much as 940 billion euros ($1.3 trillion) to fight the debt crisis, seeking to break a deadlock between Germany and France that is forcing leaders to hold two summits within four days. Negotiations on combining the European Union’s temporary and planned permanent rescue funds as of mid-2012, while scrapping a ceiling on bailout spending, accelerated this week after efforts to leverage the temporary fund ran into European Central Bank opposition and provoked the French-German clash, two people familiar with the discussions said. They declined to be identified because political leaders will have to decide.
The option may be one way out of the impasse between Europe’s two biggest economies as President Barack Obama presses for them to find a solution. Finance ministers meet in Brussels today from about 2 p.m. to lay the groundwork for an Oct. 23 meeting of government leaders that had been the deadline for a solution to the debt crisis. A summit for Oct. 26 was set yesterday after Germany and France said the EU needs more time to seal a “global and ambitious” accord.
Stocks Advance in Europe Before EU Debt-Crisis Summit; U.S. Futures Rise (Bloomberg)
European stocks advanced as policy makers discussed unleashing $1.3 trillion in funds to help contain the euro area’s debt crisis as they seek to break a deadlock between Germany and France. Asian shares and U.S. index futures climbed. Banks and mining companies rebounded from their biggest selloffs in more than two weeks. Valeo SA (FR) gained 1.8 percent, while Safran SA (SAF) slumped 6.6 percent after the companies reported earnings. The benchmark Stoxx Europe 600 Index gained 0.7 percent to 234.76 at 8:26 a.m. in London, trimming this week’s loss to 1.6 percent. The MSCI Asia Pacific Index rose 0.3 percent, while futures on the Standard & Poor’s 500 Index expiring in December climbed 0.2 percent.
Japan to Sell $10.4 Billion More Debt to Pay for Earthquake Reconstruction (Bloomberg)
Japan will sell about 800 billion yen ($10.4 billion) of additional government debt to the market this fiscal year to fund earthquake reconstruction and help companies cope with a strong yen, the Ministry of Finance said. The total for investors such as banks and life insurers will be a record 145.7 trillion yen, compared with an initial plan for the year started April 1 of 144.9 trillion yen. The amount announced today was below predictions from analysts at UBS AG, Mizuho Securities Co. and Nomura Securities Co. as the government seeks to control the biggest debt burden in the industrialized world. Policy makers aim to drive an economic recovery after three-consecutive quarters of contraction and the March 11 quake and tsunami that left more than 19,000 people dead or missing.
FOREX-Nervous euro clings to gains, outlook brittle
TOKYO, Oct 21 (Reuters) - The euro clung to gains eked out in volatile overnight trade but looked increasingly vulnerable as European leaders remained deeply divided ahead of a weekend summit on the region's debt crisis.
The euro, last at $1.3786 , has kept well off its nine-month low hit in early October, however, despite a widening in spreads on yields between safe-haven German Bunds and other European countries.
Corn up for 2nd day, harvest pressure limits gains
SINGAPORE, Oct 21 (Reuters) - U.S. corn and wheat rose half a percent, gaining for a second straight day in cautious optimism ahead of a weekend meeting of European leaders on the region's debt crisis.
"The markets seems to be reacting positively but if you look at it realistically the rally may not last as there is nothing very concrete, it's just speculations about possible resolution to the debt crisis," said Lynette Tan, an analyst at Phillip Futures in Singapore.
China 2012 rice import seen steady at 700,000T-govt
HO CHI MINH CITY, Oct 21 (Reuters) - China's milled rice import demand in 2012 is expected to be around 700,000 tonnes, similar to this year due to sufficient stock while market prices would remain high, a government official said on Friday.
The 2012 import, equivalent to around 1 million tonnes of rough rice, or paddy, would come from Thailand and Vietnam, the official from the government-run National Grain and Oilseeds Information Center told Reuters, adding that the higher-priced Thai grain would meet demand for the luxury market.
Argentina soy area seen 18.6 mln hectares-exchange
BUENOS AIRES, Oct 20 (Reuters) - Argentine farmers will plant soy on 18.6 million hectares (46 million acres), the Buenos Aires Grains Exchange said on Thursday in its first 2011/12 area estimate for the world's No. 3 soybean supplier.
The forecast marked a slight increase from the 18.5 million hectares seeded in the 2010/11 season, the exchange said in its weekly crop progress report.
Costa Rica coffee harvest suffers some damage from rains
SAN JOSE, Costa Rica, Oct 20 (Reuters) - Torrential rains in Costa Rica caused an estimated loss of at least 23,000 60-kg bags and that number could rise as plant disease spreads in the country's soaked fields, the national coffee institute said on Thursday.
Officials at the institute, known as ICAFE, had forecast coffee production at around 1.58 million 60-kg bags for the 2011/12 crop that began in October.
High rice prices to hit Thai, Vietnam exports
HO CHI MINH CITY, Oct 20 (Reuters) - High prices may lead to a 30 percent cut in rice shipments from top exporter Thailand next year and No. 2 seller Vietnam may be unable to increase its export volumes as buyers turn to cheaper rice from India, traders and industry officials said.
India, the world's second-biggest producer, eased curbs on exports last month and its grain is around $100 a tonne cheaper than Thai and Vietnamese rice, they said at a rice conference in Vietnam.
Thailand 2012 rice exports to fall 30 pct -assoc
HO CHI MINH CITY, Oct 20 (Reuters) - Rice exports from Thailand next year could fall as much as 30 percent from 2011 to 7.0 million-7.5 million tonnes, as export prices have been pushed up by a government intervention scheme and floods, a senior industry official said on Thursday.
Higher export prices, as well as India's recent return to the market to sell, would cut Thailand's annual rice shipment this year to 10 million tonnes from 12 million tonnes in earlier projections, said Korbsook Iamsuri, President of Thai Rice Exporters Association. Exports in 2010 were 9 million tonnes.
Panasonic to drop planned Japan solar plant -source
TOKYO, Oct 21 (Reuters) - Panasonic Corp will drop a plan to convert a television panel plant in Japan into a solar panel factory, hit by an industry price war and a strong yen that is making exports less competitive, a source with direct knowledge of the matter said.
Panasonic is also in talks with public-private venture Japan Display about selling a liquid-crystal display TV panel plant located in Chiba, not far from Tokyo, said two sources with knowledge of the matter.
Brent crude steady above $109 ahead of Europe Summit
SINGAPORE, Oct 21 (Reuters) - Brent crude held steady above $109, after recovering in the previous session on optimism policymakers will move closer to resolving the euro zone's debt crisis at a meeting this weekend and stem any slowdown in oil demand.
"The market will trade in a very narrow range, between $84 and $88 a barrel for U.S. crude till the outcome of the summit is known," said Ken Hasegawa, a commodities derivatives manager with Newedge Brokerage in Tokyo. "Nobody is willing to take positions at this point."
China's alumina imports may rise in Oct-Dec on prices
HONG KONG, Oct 20 (Reuters) - China's imports of alumina, the main raw material for primary aluminium production, may rise in the October-December period as smelters take term shipments due to lower prices, trading sources said on Thursday.
Trading sources said Chinese aluminium smelters holding 2011 alumina import contracts had settled prices with overseas suppliers for 200,000-300,000 tonnes of alumina in September and early October as London Metal Exchange aluminium prices fell.
Italy 9-mo steel output up 11.3% yr/yr - industry
MILAN, Oct 20 (Reuters) - Steel output in Italy, the European Union's second-biggest producer after Germany, rose 11.3 percent year-on-year to 21.259 million tonnes in the first nine months of 2011, industry body Federacciai said on Thursday.
In September alone, Italy's steel output rose 11.4 percent to 2.551 million tonnes, according to data published on Federacciai's website.
LME copper rebounds after near 7-pct drop; Europe summit eyed
SHANGHAI, Oct 21 (Reuters) - London copper rose after its largest one-day collapse in four weeks in the previous session, while investors kept an eye on a weekend meeting of European leaders for signs of progress in resolving the region's debt crisis.
"The fall in London copper last night was not caused by any new information, but reflected the volatility ahead of the EU summit. The rebound today is still a reflection of the prevailing uncertaintites and a lack of trading direction," said CRU analyst Qu Yi.
METALS-LME copper rebounds after near 7-pct drop; Europe summit eyed
SHANGHAI, Oct 21 (Reuters) - London copper rose after its largest one-day collapse in four weeks in the previous session, while investors kept an eye on a weekend meeting of European leaders for signs of progress in resolving the region's debt crisis.
Three-month copper on the London Metal Exchange rose 4 percent to $7,005.25 a tonne by 0307 GMT, after dropping nearly 7 percent in the previous session.
PRECIOUS-Gold edges up on arbitrage buying; EU summit eyed
SINGAPORE, Oct 21 (Reuters) - Gold prices rebounded, boosted by arbitrage buying interest from Shanghai market, but gains could be limited as uncertainty remains on whether European policymakers would agree on a definitive solution to euro zone's debt crisis.
Deep division among European leaders on strengthening the bloc's rescue fund has dampened hopes that Europe was close to finding a solution, rattling commodities and sending gold down more than 1 percent in the previous session.
Gold edges up on arbitrage buying; EU summit eyed
SINGAPORE, Oct 21 (Reuters) - Gold prices rebounded, boosted by arbitrage buying interest from Shanghai market, but gains could be limited as uncertainty remains on whether European policymakers would agree on a definitive solution to euro zone's debt crisis.
"There was quite some buying from Shanghai after market opened there," said Peter Fung, head of dealing at Wing Fung Precious Metals in Hong Kong.
TOKYO, Oct 21 (Reuters) - Asian shares inched up while the euro clung to overnight gains, but markets largely stayed within range, as investors awaited a weekend meeting of European leaders for signs of progress in resolving the region's debt crisis.
"Assets across the board are coming under pressure as it becomes clear that European banks, when faced with a stress test, will likely reduce their assets to strengthen their capital," said Naohiro Niimura, a partner at research and consulting firm Market Risk Advisory Co.
EU Said to Consider Wielding $1.3 Trillion to Break Impasse (Bloomberg)
European governments may unleash as much as 940 billion euros ($1.3 trillion) to fight the debt crisis, seeking to break a deadlock between Germany and France that is forcing leaders to hold two summits within four days. Negotiations on combining the European Union’s temporary and planned permanent rescue funds as of mid-2012, while scrapping a ceiling on bailout spending, accelerated this week after efforts to leverage the temporary fund ran into European Central Bank opposition and provoked the French-German clash, two people familiar with the discussions said. They declined to be identified because political leaders will have to decide.
The option may be one way out of the impasse between Europe’s two biggest economies as President Barack Obama presses for them to find a solution. Finance ministers meet in Brussels today from about 2 p.m. to lay the groundwork for an Oct. 23 meeting of government leaders that had been the deadline for a solution to the debt crisis. A summit for Oct. 26 was set yesterday after Germany and France said the EU needs more time to seal a “global and ambitious” accord.
Stocks Advance in Europe Before EU Debt-Crisis Summit; U.S. Futures Rise (Bloomberg)
European stocks advanced as policy makers discussed unleashing $1.3 trillion in funds to help contain the euro area’s debt crisis as they seek to break a deadlock between Germany and France. Asian shares and U.S. index futures climbed. Banks and mining companies rebounded from their biggest selloffs in more than two weeks. Valeo SA (FR) gained 1.8 percent, while Safran SA (SAF) slumped 6.6 percent after the companies reported earnings. The benchmark Stoxx Europe 600 Index gained 0.7 percent to 234.76 at 8:26 a.m. in London, trimming this week’s loss to 1.6 percent. The MSCI Asia Pacific Index rose 0.3 percent, while futures on the Standard & Poor’s 500 Index expiring in December climbed 0.2 percent.
Japan to Sell $10.4 Billion More Debt to Pay for Earthquake Reconstruction (Bloomberg)
Japan will sell about 800 billion yen ($10.4 billion) of additional government debt to the market this fiscal year to fund earthquake reconstruction and help companies cope with a strong yen, the Ministry of Finance said. The total for investors such as banks and life insurers will be a record 145.7 trillion yen, compared with an initial plan for the year started April 1 of 144.9 trillion yen. The amount announced today was below predictions from analysts at UBS AG, Mizuho Securities Co. and Nomura Securities Co. as the government seeks to control the biggest debt burden in the industrialized world. Policy makers aim to drive an economic recovery after three-consecutive quarters of contraction and the March 11 quake and tsunami that left more than 19,000 people dead or missing.
FOREX-Nervous euro clings to gains, outlook brittle
TOKYO, Oct 21 (Reuters) - The euro clung to gains eked out in volatile overnight trade but looked increasingly vulnerable as European leaders remained deeply divided ahead of a weekend summit on the region's debt crisis.
The euro, last at $1.3786 , has kept well off its nine-month low hit in early October, however, despite a widening in spreads on yields between safe-haven German Bunds and other European countries.
Corn up for 2nd day, harvest pressure limits gains
SINGAPORE, Oct 21 (Reuters) - U.S. corn and wheat rose half a percent, gaining for a second straight day in cautious optimism ahead of a weekend meeting of European leaders on the region's debt crisis.
"The markets seems to be reacting positively but if you look at it realistically the rally may not last as there is nothing very concrete, it's just speculations about possible resolution to the debt crisis," said Lynette Tan, an analyst at Phillip Futures in Singapore.
China 2012 rice import seen steady at 700,000T-govt
HO CHI MINH CITY, Oct 21 (Reuters) - China's milled rice import demand in 2012 is expected to be around 700,000 tonnes, similar to this year due to sufficient stock while market prices would remain high, a government official said on Friday.
The 2012 import, equivalent to around 1 million tonnes of rough rice, or paddy, would come from Thailand and Vietnam, the official from the government-run National Grain and Oilseeds Information Center told Reuters, adding that the higher-priced Thai grain would meet demand for the luxury market.
Argentina soy area seen 18.6 mln hectares-exchange
BUENOS AIRES, Oct 20 (Reuters) - Argentine farmers will plant soy on 18.6 million hectares (46 million acres), the Buenos Aires Grains Exchange said on Thursday in its first 2011/12 area estimate for the world's No. 3 soybean supplier.
The forecast marked a slight increase from the 18.5 million hectares seeded in the 2010/11 season, the exchange said in its weekly crop progress report.
Costa Rica coffee harvest suffers some damage from rains
SAN JOSE, Costa Rica, Oct 20 (Reuters) - Torrential rains in Costa Rica caused an estimated loss of at least 23,000 60-kg bags and that number could rise as plant disease spreads in the country's soaked fields, the national coffee institute said on Thursday.
Officials at the institute, known as ICAFE, had forecast coffee production at around 1.58 million 60-kg bags for the 2011/12 crop that began in October.
High rice prices to hit Thai, Vietnam exports
HO CHI MINH CITY, Oct 20 (Reuters) - High prices may lead to a 30 percent cut in rice shipments from top exporter Thailand next year and No. 2 seller Vietnam may be unable to increase its export volumes as buyers turn to cheaper rice from India, traders and industry officials said.
India, the world's second-biggest producer, eased curbs on exports last month and its grain is around $100 a tonne cheaper than Thai and Vietnamese rice, they said at a rice conference in Vietnam.
Thailand 2012 rice exports to fall 30 pct -assoc
HO CHI MINH CITY, Oct 20 (Reuters) - Rice exports from Thailand next year could fall as much as 30 percent from 2011 to 7.0 million-7.5 million tonnes, as export prices have been pushed up by a government intervention scheme and floods, a senior industry official said on Thursday.
Higher export prices, as well as India's recent return to the market to sell, would cut Thailand's annual rice shipment this year to 10 million tonnes from 12 million tonnes in earlier projections, said Korbsook Iamsuri, President of Thai Rice Exporters Association. Exports in 2010 were 9 million tonnes.
Panasonic to drop planned Japan solar plant -source
TOKYO, Oct 21 (Reuters) - Panasonic Corp will drop a plan to convert a television panel plant in Japan into a solar panel factory, hit by an industry price war and a strong yen that is making exports less competitive, a source with direct knowledge of the matter said.
Panasonic is also in talks with public-private venture Japan Display about selling a liquid-crystal display TV panel plant located in Chiba, not far from Tokyo, said two sources with knowledge of the matter.
Brent crude steady above $109 ahead of Europe Summit
SINGAPORE, Oct 21 (Reuters) - Brent crude held steady above $109, after recovering in the previous session on optimism policymakers will move closer to resolving the euro zone's debt crisis at a meeting this weekend and stem any slowdown in oil demand.
"The market will trade in a very narrow range, between $84 and $88 a barrel for U.S. crude till the outcome of the summit is known," said Ken Hasegawa, a commodities derivatives manager with Newedge Brokerage in Tokyo. "Nobody is willing to take positions at this point."
China's alumina imports may rise in Oct-Dec on prices
HONG KONG, Oct 20 (Reuters) - China's imports of alumina, the main raw material for primary aluminium production, may rise in the October-December period as smelters take term shipments due to lower prices, trading sources said on Thursday.
Trading sources said Chinese aluminium smelters holding 2011 alumina import contracts had settled prices with overseas suppliers for 200,000-300,000 tonnes of alumina in September and early October as London Metal Exchange aluminium prices fell.
Italy 9-mo steel output up 11.3% yr/yr - industry
MILAN, Oct 20 (Reuters) - Steel output in Italy, the European Union's second-biggest producer after Germany, rose 11.3 percent year-on-year to 21.259 million tonnes in the first nine months of 2011, industry body Federacciai said on Thursday.
In September alone, Italy's steel output rose 11.4 percent to 2.551 million tonnes, according to data published on Federacciai's website.
LME copper rebounds after near 7-pct drop; Europe summit eyed
SHANGHAI, Oct 21 (Reuters) - London copper rose after its largest one-day collapse in four weeks in the previous session, while investors kept an eye on a weekend meeting of European leaders for signs of progress in resolving the region's debt crisis.
"The fall in London copper last night was not caused by any new information, but reflected the volatility ahead of the EU summit. The rebound today is still a reflection of the prevailing uncertaintites and a lack of trading direction," said CRU analyst Qu Yi.
METALS-LME copper rebounds after near 7-pct drop; Europe summit eyed
SHANGHAI, Oct 21 (Reuters) - London copper rose after its largest one-day collapse in four weeks in the previous session, while investors kept an eye on a weekend meeting of European leaders for signs of progress in resolving the region's debt crisis.
Three-month copper on the London Metal Exchange rose 4 percent to $7,005.25 a tonne by 0307 GMT, after dropping nearly 7 percent in the previous session.
PRECIOUS-Gold edges up on arbitrage buying; EU summit eyed
SINGAPORE, Oct 21 (Reuters) - Gold prices rebounded, boosted by arbitrage buying interest from Shanghai market, but gains could be limited as uncertainty remains on whether European policymakers would agree on a definitive solution to euro zone's debt crisis.
Deep division among European leaders on strengthening the bloc's rescue fund has dampened hopes that Europe was close to finding a solution, rattling commodities and sending gold down more than 1 percent in the previous session.
Gold edges up on arbitrage buying; EU summit eyed
SINGAPORE, Oct 21 (Reuters) - Gold prices rebounded, boosted by arbitrage buying interest from Shanghai market, but gains could be limited as uncertainty remains on whether European policymakers would agree on a definitive solution to euro zone's debt crisis.
"There was quite some buying from Shanghai after market opened there," said Peter Fung, head of dealing at Wing Fung Precious Metals in Hong Kong.
20111021 0951 Global Economic Related News.
Philippines: Holds rate to protect economy from growth risks
The Philippines kept its benchmark interest rate unchanged for a fourth meeting, joining nations from Indonesia to South Korea in choosing to protect growth as a weakening global economy reduces the urgency to fight inflation. Bangko Sentral ng Pilipinas kept the rate it pays lenders for overnight deposits at 4.5%, according to a statement yesterday. The central bank maintained the reserve requirement ratio for lenders at 21% after ordering an increase in July that took effect the next month. (Bloomberg)
Brazil: Cuts rate to 11.5% on Europe crisis, slowing growth. The bank's board, led by President Alexandre Tombini, voted unanimously to reduce the benchmark Selic rate to 11.5% from 12%. (Source: Bloomberg)
India: Food inflation rate rose to the highest level in almost six months, maintaining pressure on the central bank to boost interest rates next week. An index measuring wholesale prices of agricultural products gained 10.6% YoY in the week ended Oct. 8, the commerce ministry said in a statement in New Delhi. It rose 9.32% YoY the previous week. (Source: Bloomberg)
Taiwan: Export orders rose the least in 2 years in September
Taiwan’s export orders increased by the least in two years in September, indicating the export-led economy remains under pressure from a faltering global recovery. Orders, an indication of shipments in the next one to three months, climbed 2.72% from a year earlier, after a 5.26% gain in August, the Ministry of Economic Affairs said yesterday. Orders from Japan fell 13.19% in September from a year earlier, after declining 9.52 percent in August. Demand from China and Hong Kong combined increased 5.67%, after rising 3.44%. Purchases from the U.S. climbed 9.33%, compared with a 9.05% gain in August. Orders from Europe were down 2.22%, after gaining 8.08% in August. (Bloomberg)
Japan: May add extra USD52bn in aid for companies hurt by Yen
Japan is preparing to unveil plans to spend an extra JPY4trn (USD52bn) to help its exporters cope with a surging yen and spur job creation, according to documents obtained by Bloomberg News. The government will add JPY2trn to the JPY8trn in foreign-exchange reserves being shifted to the state-run Japan Bank for International Cooperation to aid exporters and spur acquisitions overseas. A further JPY2trn will be allocated to encourage investment in domestic plants and to hire workers, according to another document obtained from two government officials who declined to be identified because the plan isn’t public .(Bloomberg)
Euro: EU recommends paying Greek aid loans ‘as soon as possible’
The European Commission recommended paying Greece the next installment of aid as “soon as possible” after Prime Minister George Papandreou secures parliamentary approval for new austerity measures. The draft report from the Brussels-based commission, one of three organizations providing financing to the country, said Greece’s debt remains “extremely worrying” and the ratio, which exceeded 140% of gross domestic product at the end of 2010, will remain “at very high levels for many years.” This will leave the country “vulnerable to adverse shocks,” it said. (Bloomberg)
US: Sales of existing homes fell as forecast in September
Sales of existing homes fell in September, extending a pattern of declines and gains that show the industry continues to be buffeted by consumer pessimism and unemployment above 9%. Purchases dropped 3% to a 4.91m annual rate, figures from the National Association of Realtors showed yesterday. The median price dropped 3.5% from a year ago and about one in five real-estate agents polled said contracts had been canceled, the group said. Growing pessimism about the economy, unemployment above 9% and limited access to credit are keeping some Americans from taking advantage of near record-low mortgage rates. (Bloomberg)
US: Factories lead recovery as jobs, housing flag
Manufacturing in the Philadelphia area unexpectedly expanded in October at the fastest pace in six months, signaling factories are helping support a US economy weighed down by weakness in the housing and labor markets. The Federal Reserve Bank of Philadelphia’s general economic index increased to 8.7 from minus 17.5 last month, the biggest one-month rebound in 31 years. Readings greater than zero indicate expansion in the area covering eastern Pennsylvania, southern New Jersey and Delaware. (Bloomberg)
US: Jobless claims decreased 6,000 last week to 403,000
The number of Americans filing applications for unemployment benefits declined last week to a level that shows little improvement in the labor market since the start of the year. Jobless claims dropped by 6,000 to 403,000 in the week ended 15 Oct, Labor Department figures showed yesterday. The four-week average fell to the lowest level since April. Some companies are still paring their workforces at the same time demand has fallen short of the level that may spur businesses to expand staff. (Bloomberg)
The Philippines kept its benchmark interest rate unchanged for a fourth meeting, joining nations from Indonesia to South Korea in choosing to protect growth as a weakening global economy reduces the urgency to fight inflation. Bangko Sentral ng Pilipinas kept the rate it pays lenders for overnight deposits at 4.5%, according to a statement yesterday. The central bank maintained the reserve requirement ratio for lenders at 21% after ordering an increase in July that took effect the next month. (Bloomberg)
Brazil: Cuts rate to 11.5% on Europe crisis, slowing growth. The bank's board, led by President Alexandre Tombini, voted unanimously to reduce the benchmark Selic rate to 11.5% from 12%. (Source: Bloomberg)
India: Food inflation rate rose to the highest level in almost six months, maintaining pressure on the central bank to boost interest rates next week. An index measuring wholesale prices of agricultural products gained 10.6% YoY in the week ended Oct. 8, the commerce ministry said in a statement in New Delhi. It rose 9.32% YoY the previous week. (Source: Bloomberg)
Taiwan: Export orders rose the least in 2 years in September
Taiwan’s export orders increased by the least in two years in September, indicating the export-led economy remains under pressure from a faltering global recovery. Orders, an indication of shipments in the next one to three months, climbed 2.72% from a year earlier, after a 5.26% gain in August, the Ministry of Economic Affairs said yesterday. Orders from Japan fell 13.19% in September from a year earlier, after declining 9.52 percent in August. Demand from China and Hong Kong combined increased 5.67%, after rising 3.44%. Purchases from the U.S. climbed 9.33%, compared with a 9.05% gain in August. Orders from Europe were down 2.22%, after gaining 8.08% in August. (Bloomberg)
Japan: May add extra USD52bn in aid for companies hurt by Yen
Japan is preparing to unveil plans to spend an extra JPY4trn (USD52bn) to help its exporters cope with a surging yen and spur job creation, according to documents obtained by Bloomberg News. The government will add JPY2trn to the JPY8trn in foreign-exchange reserves being shifted to the state-run Japan Bank for International Cooperation to aid exporters and spur acquisitions overseas. A further JPY2trn will be allocated to encourage investment in domestic plants and to hire workers, according to another document obtained from two government officials who declined to be identified because the plan isn’t public .(Bloomberg)
Euro: EU recommends paying Greek aid loans ‘as soon as possible’
The European Commission recommended paying Greece the next installment of aid as “soon as possible” after Prime Minister George Papandreou secures parliamentary approval for new austerity measures. The draft report from the Brussels-based commission, one of three organizations providing financing to the country, said Greece’s debt remains “extremely worrying” and the ratio, which exceeded 140% of gross domestic product at the end of 2010, will remain “at very high levels for many years.” This will leave the country “vulnerable to adverse shocks,” it said. (Bloomberg)
US: Sales of existing homes fell as forecast in September
Sales of existing homes fell in September, extending a pattern of declines and gains that show the industry continues to be buffeted by consumer pessimism and unemployment above 9%. Purchases dropped 3% to a 4.91m annual rate, figures from the National Association of Realtors showed yesterday. The median price dropped 3.5% from a year ago and about one in five real-estate agents polled said contracts had been canceled, the group said. Growing pessimism about the economy, unemployment above 9% and limited access to credit are keeping some Americans from taking advantage of near record-low mortgage rates. (Bloomberg)
US: Factories lead recovery as jobs, housing flag
Manufacturing in the Philadelphia area unexpectedly expanded in October at the fastest pace in six months, signaling factories are helping support a US economy weighed down by weakness in the housing and labor markets. The Federal Reserve Bank of Philadelphia’s general economic index increased to 8.7 from minus 17.5 last month, the biggest one-month rebound in 31 years. Readings greater than zero indicate expansion in the area covering eastern Pennsylvania, southern New Jersey and Delaware. (Bloomberg)
US: Jobless claims decreased 6,000 last week to 403,000
The number of Americans filing applications for unemployment benefits declined last week to a level that shows little improvement in the labor market since the start of the year. Jobless claims dropped by 6,000 to 403,000 in the week ended 15 Oct, Labor Department figures showed yesterday. The four-week average fell to the lowest level since April. Some companies are still paring their workforces at the same time demand has fallen short of the level that may spur businesses to expand staff. (Bloomberg)
20111021 0948 Malaysia Corporate Related News.
Five prequalify for MRT tunnelling
Five companies have prequalified to bid for the mass rapid transit (MRT) tunnelling project, with tender documents slated to be given to the companies today, sources say. The Edge Financial Daily understands that the Gamuda and MMC Corp joint venture (JV), China’s Sinohydro Group and South Korea’s SK Holdings have been prequalified. The other two parties which have been shortlisted are from Japan and China. (Financial Daily)
United Plantations plans more biogas plants
United Plantations Bhd (UP) plans to add more biogas plants in one or two years at its palm oil mills in Malaysia and Indonesia to save energy cost. Vice-chairman/executive director (corporate affairs) Datuk Carl Bek-Nielsen said the company reduced 25% of fossil fuel usage yearly at its Perak plantation by relying on electricity generated from its biogas plant in Teluk Intan. He said the cost of building a biogas plant was about RM7m and the group had invested RM20m for its existing three plants. (StarBiz)
Cahya Mata, OM seal USD500m smelter deal
Cahya Mata Sarawak Bhd has signed a shareholders agreement with Singapore’s OM Holdings Ltd to build a USD500m (RM1.57bn) manganese and ferro silicon smelting plant, with an annual capacity of 600,000 tonnes a year in Samalaju, Sarawak. Completion is targeted for 2015. (BT)
Kumpulan H&L High-Tech halts Thailand ops
Kumpulan H&L High-Tech Bhd’s (HIghTec) 70%-owned subsidiary in Thailand has temporarily ceased its operations there due to the severe flood conditions. It said yesterday that H&L High-Tech Mould (Thailand) Co. Ltd. (H&LM) located at Bangpa-In Industrial Estate, Ayutthaya had halted operations. H&LM is principally engaged in the manufacturing of metal pants for electronic and metal surface treatment. HighTec said H&LM and its local team were in the process of monitoring the events leading to the above and is working on the recovery plan. (Financial Daily)
TDM: Sells poultry business for RM4m. TDM Bhd has sold its poultry business under TD Poultry Sdn Bhd to Vision Poultry Sdn Bhd for RM4m cash. The rationale for the disposal is to streamline and rationalise the core business of TDM Group. (Source: Bursa Malaysia)
Property: RM8b-RM10b Cyberjaya project on drawing board. Cyberview Sdn Bhd, the landowner of Cyberjaya, is coming up with a new commercial project worth about RM8-10b to drive new investments at the cybercity. Known as Cyberjaya City Centre, the 57ha project will take about 15 years to develop. It is understood that more than 20 developers are keen in the project, including Mah Sing Group, UEM Land Holdings and Naza Group. (Source: Business Times)
Media: All terrestrial TV stations to go digital by 2015. Come 2015, all terrestrial television stations will have to go digital once the analog system becomes obsolete. With this in mind, the government plans to award contracts to the private sector to undertake the job because of the high cost involved, which is more than RM2b. Privately-held Puncak Semangat Sdn Bhd owned by Tan Sri Syed Mokhtar Al-Bukhary made a bid. The company has been working on the proposal for three years with the Information, Communication and Culture Ministry and is waiting for a good response. (Source: Business Times)
Five companies have prequalified to bid for the mass rapid transit (MRT) tunnelling project, with tender documents slated to be given to the companies today, sources say. The Edge Financial Daily understands that the Gamuda and MMC Corp joint venture (JV), China’s Sinohydro Group and South Korea’s SK Holdings have been prequalified. The other two parties which have been shortlisted are from Japan and China. (Financial Daily)
United Plantations plans more biogas plants
United Plantations Bhd (UP) plans to add more biogas plants in one or two years at its palm oil mills in Malaysia and Indonesia to save energy cost. Vice-chairman/executive director (corporate affairs) Datuk Carl Bek-Nielsen said the company reduced 25% of fossil fuel usage yearly at its Perak plantation by relying on electricity generated from its biogas plant in Teluk Intan. He said the cost of building a biogas plant was about RM7m and the group had invested RM20m for its existing three plants. (StarBiz)
Cahya Mata, OM seal USD500m smelter deal
Cahya Mata Sarawak Bhd has signed a shareholders agreement with Singapore’s OM Holdings Ltd to build a USD500m (RM1.57bn) manganese and ferro silicon smelting plant, with an annual capacity of 600,000 tonnes a year in Samalaju, Sarawak. Completion is targeted for 2015. (BT)
Kumpulan H&L High-Tech halts Thailand ops
Kumpulan H&L High-Tech Bhd’s (HIghTec) 70%-owned subsidiary in Thailand has temporarily ceased its operations there due to the severe flood conditions. It said yesterday that H&L High-Tech Mould (Thailand) Co. Ltd. (H&LM) located at Bangpa-In Industrial Estate, Ayutthaya had halted operations. H&LM is principally engaged in the manufacturing of metal pants for electronic and metal surface treatment. HighTec said H&LM and its local team were in the process of monitoring the events leading to the above and is working on the recovery plan. (Financial Daily)
TDM: Sells poultry business for RM4m. TDM Bhd has sold its poultry business under TD Poultry Sdn Bhd to Vision Poultry Sdn Bhd for RM4m cash. The rationale for the disposal is to streamline and rationalise the core business of TDM Group. (Source: Bursa Malaysia)
Property: RM8b-RM10b Cyberjaya project on drawing board. Cyberview Sdn Bhd, the landowner of Cyberjaya, is coming up with a new commercial project worth about RM8-10b to drive new investments at the cybercity. Known as Cyberjaya City Centre, the 57ha project will take about 15 years to develop. It is understood that more than 20 developers are keen in the project, including Mah Sing Group, UEM Land Holdings and Naza Group. (Source: Business Times)
Media: All terrestrial TV stations to go digital by 2015. Come 2015, all terrestrial television stations will have to go digital once the analog system becomes obsolete. With this in mind, the government plans to award contracts to the private sector to undertake the job because of the high cost involved, which is more than RM2b. Privately-held Puncak Semangat Sdn Bhd owned by Tan Sri Syed Mokhtar Al-Bukhary made a bid. The company has been working on the proposal for three years with the Information, Communication and Culture Ministry and is waiting for a good response. (Source: Business Times)
20111021 0942 Global Market Related News.
Asian Stocks Advance as Europe Considers $1.3 Trillion for Crisis Fund (Source: Bloomberg)
Asian stocks rose, narrowing a weekly decline on the regional benchmark index, as European governments considered deploying $1.3 trillion to fight the region’s debt crisis, boosting the earnings outlook for Asian exporters. The MSCI Asia Pacific Index rose 0.2 percent to 115.46 as of 9:11 a.m. in Tokyo. The measure has dropped about 1.2 percent this week.
Sales of Existing U.S. Homes Fell as Forecast in September (Source: Bloomberg)
Sales of existing homes fell in September, extending a pattern of declines and gains that show the industry continues to be buffeted by consumer pessimism and unemployment above 9 percent. Purchases dropped 3 percent to a 4.91 million annual rate, matching the median forecast of economists surveyed by Bloomberg News, figures from the National Association of Realtors showed today in Washington. The median price dropped 3.5 percent from a year ago and about one in five real-estate agents polled said contracts had been canceled, the group said. Growing pessimism about the economy, unemployment above 9 percent and limited access to credit are keeping some Americans from taking advantage of near record-low mortgage rates. Foreclosures that are adding to the supply of homes for sale and driving down prices remain a hurdle for an industry that’s made little progress more than two years after the recession ended.
Factories Help to Support U.S. Economy as Labor, Housing Markets Struggle (Source: Bloomberg)
Manufacturing in the Philadelphia area unexpectedly expanded in October at the fastest pace in six months, signaling factories are helping support a U.S. economy weighed down by weakness in the housing and labor markets. The Federal Reserve Bank of Philadelphia’s general economic index increased to 8.7 from minus 17.5 last month, the biggest one-month rebound in 31 years. Readings greater than zero indicate expansion in the area covering eastern Pennsylvania, southern New Jersey and Delaware. Companies such as hydraulic equipment-maker Parker Hannifin Corp. (PH) are raising sales forecasts as they benefit from rising business investment and overseas demand. Other reports today showed purchases of existing homes declined and Americans’ confidence in the economic outlook slumped with unemployment stuck near 9 percent and wages stagnant.
U.S. Leading Economic Indicators Rose 0.2% in September (Source: Bloomberg)
The index of U.S. leading economic indicators increased in September at a pace that suggests a slower rate of growth in the coming months. The Conference Board’s gauge of the outlook for the next three to six months climbed 0.2 percent after a 0.3 percent gain in August, the New York-based research group said today. The September increase, the lowest since a decline in April, matched economists’ projections, according to the median forecast in a Bloomberg News survey. A Federal Reserve survey published yesterday said the economy maintained its expansion last month even as more companies reported more doubt about the strength of the recovery. An acceleration in growth is needed to support the job gains that drive household spending, the biggest part of the U.S. economy.
Consumers Most Negative Since Recession (Source: Bloomberg)
Consumer confidence in the U.S. economic outlook slumped in October to the lowest level since the recession, highlighting the challenges facing the biggest part of the economy. The Bloomberg Consumer Comfort Index’s monthly expectations gauge dropped to minus 45, the worst reading since February 2009. The weekly measure of current conditions was minus 48.4 for the period ended Oct. 16, up from minus 50.8 the prior week that was close to a record low. A volatile stock market, little hiring and a lack of wage gains are souring Americans’ moods, raising the risk that the consumer spending that accounts for 70 percent of the economy will slump. Policy makers from Federal Reserve Chairman Ben S. Bernanke to President Barack Obama are taking steps to spur growth in the world’s largest economy.
Treasuries Set for Weekly Gain as Solution to Europe’s Debt Crisis Delayed (Source: Bloomberg)
Treasuries were set for their first weekly gain in a month, as prospects European leaders will need more time to resolve the region’s sovereign debt crisis spurred demand for the relative safety of U.S. government securities. Ten-year yields snapped an advance from yesterday after German Chancellor Angela Merkel and French President Nicolas Sarkozy planned a second meeting on Oct. 26 to agree on a package of measures to address the crisis after this weekend’s leaders summit in Brussels. The Federal Reserve is scheduled to buy $4.25 billion to $5 billion of Treasuries due from November 2019 to August 2021 as part of its plan to swap shorter maturities in its holdings for longer ones.
“Treasuries will be well supported by this news,” said Hiromasa Nakamura, who helps oversee the equivalent of $43 billion as an investor in Tokyo at Mizuho Asset Management Co., a unit of Japan’s second-largest lender. There is “a flight to quality in the market from risk assets. There are many problems in Europe. It will take much time to resolve them.”
Japan Stocks Swing Between Gains, Losses (Source: Bloomberg)
Japanese stocks swung between gains and losses amid concern European leaders won’t deliver a plan to resolve the region’s debt crisis at a summit this weekend. Nissan Motor Co., a carmaker that gets about 15 percent of sales from Europe, lost 0.9 percent. Mizuho Financial Group Inc., Japan’s third-biggest lender by market value, slipped 0.9 percent. Kawasaki Heavy Industries Ltd. climbed 3.5 percent after the maker of heavy machinery beat its earnings forecast. The Nikkei 225 (NKY) added 0.1 percent to 8,691.39 as of 9:14 a.m. in Tokyo, after losing as much as 0.1 percent. The broader Topix was little changed at 745.84. The gauge tumbled 17 percent this year through yesterday as Europe’s crisis threatens to spread.
Japan May Add Extra $52B Aid on Strong Yen (Source: Bloomberg)
Japan is preparing to unveil plans to spend an extra 4 trillion yen ($52 billion) to help its exporters cope with a surging yen and spur job creation, according to documents obtained by Bloomberg News. The government will add 2 trillion yen to the 8 trillion yen in foreign-exchange reserves being shifted to the state-run Japan Bank for International Cooperation to aid exporters and spur acquisitions overseas, one document shows. A further 2 trillion yen will be allocated to encourage investment in domestic plants and to hire workers, according to another document obtained from two government officials who declined to be identified because the plan isn’t public. A yen appreciation of almost 6 percent this year has prompted the government to adopt a multi-pronged approach to currency policy. While threatening intervention, Japanese authorities have offered aid to companies hit by the yen’s move and highlighted the lower cost of making overseas acquisitions. Japan imports about 80 percent of its energy needs.
EU Said to Mull Wielding $1.3T to Break Impasse (Source: Bloomberg)
European governments may unleash as much as 940 billion euros ($1.3 trillion) to fight the debt crisis, seeking to break a deadlock between Germany and France that is forcing leaders to hold two summits within four days. Negotiations on combining the European Union’s temporary and planned permanent rescue funds as of mid-2012, while scrapping a ceiling on bailout spending, accelerated this week after efforts to leverage the temporary fund ran into European Central Bank opposition and provoked the French-German clash, two people familiar with the discussions said. They declined to be identified because political leaders will have to decide.
That option may be one way out of the impasse between Europe’s two biggest economies Finance ministers meet in Brussels today from about 2 p.m. to lay the groundwork for an Oct. 23 meeting of government leaders that had been the deadline for a solution to the debt crisis. A summit for Oct. 26 was set yesterday after Germany and France said the EU needs more time to seal a “global and ambitious” accord.
France Likely to Lose Top Rating: S&P (Source: Bloomberg)
France is among euro-region sovereigns likely to be downgraded in a stressed economic scenario, according to Standard & Poor’s. The sovereign ratings of Spain, Italy, Ireland and Portugal would also be reduced by another one or two levels in either of New York-based S&P’s two stress scenarios, the ratings firm said in a report dated today. These assume low economic growth and a double-dip recession in the first set of circumstances, and add an interest-rate shock to the recession in the second. “Ballooning budget deficits and bank recapitalization costs would likely send government borrowings significantly higher under both scenarios,” S&P analysts led by Chief Credit Officer Blaise Ganguin in Paris wrote in the report. “Credit metrics would deteriorate sharply as a result.”
Papandreou Prevails in Austerity Vote (Source: Bloomberg)
Greek Prime Minister George Papandreou won a parliamentary vote on a new round of austerity designed to secure more financial aid, risking further unrest that left one person dead after protests turned violent. Papandreou secured the backing of a majority of lawmakers in the 300-seat chamber in Athens late yesterday as European leaders announced a second summit next week to give them more time to work on a “global and ambitious” strategy to combat the sovereign debt crisis that is roiling global markets. The vote in Athens capped a day in which hooded protesters in gas masks fought running battles with riot police firing tear-gas rounds outside the parliament building on the capital’s Syntagma Square. Ringed by a cordon of police, lawmakers debated the second round of austerity measures in four months that are necessary to secure the next tranche of international aid to stave off default and win any reduction in Greece’s debt burden.
ECB Said to Weigh Increasing Loans to Banks Revealing More on Collateral (Source: Bloomberg)
The European Central Bank is considering lending more money against asset-backed securities where issuers provide additional information about the loans securing the bonds, said a person familiar with the matter. Banks can borrow money from the ECB’s liquidity facility by posting collateral with a discount applied depending on its perceived safety. The bank’s Eurosystem Risk Management Committee is discussing lowering the reduction on asset-backed bonds from the 16 percent levied now, said the person, who declined to be identified because the talks are private. The proposed change is part of a broader ECB initiative to encourage banks to improve transparency in asset-backed bonds they sell to investors and boost confidence in a market blamed for worsening the credit crisis in 2007. The Frankfurt-based lender also said in April 2010 that it was seeking ways to control the quality of the assets it takes in as collateral for loans to financial institutions.
European Officials Said to See Market Risk in Greek Bondholder Debt Swap (Source: Bloomberg)
European Union officials weighing deeper losses for Greek bondholders in a revamped bailout are concerned that any investor involvement risks further roiling markets, say people familiar with the EU’s deliberations. Greece has accumulated at least 20 billion euros ($27 billion) in additional financing needs since a 159 billion-euro package was set in July, because of a deepening recession and delays in enacting the plan, said the people, who declined to be identified because euro-area leaders have yet to agree on their strategy. French President Nicolas Sarkozy and German Chancellor Angela Merkel yesterday demanded “immediate talks” with investors to reduce Greece’s debt load. The EU is considering five scenarios, ranging from sticking with July’s voluntary swap to a so-called hard restructuring, where investors could be forced to exchange Greek bonds for new ones at 50 percent of their value, the people said.
European Stocks Slide as Leaders Split; UniCredit, Actelion Fall (Source: Bloomberg)
European stocks declined the most in two weeks amid concern the euro area’s leaders are far from agreeing on a plan to end the region’s debt crisis. Intesa Sanpaolo SpA (ISP) and UniCredit SpA (UCG) led a selloff in banks, sliding more than 9 percent, as corporate bond risk advanced. Actelion Ltd. (ATLN) sank the most in more than 18 months as Europe’s largest biotechnology company said it expects drug sales to decrease next year. Schneider Electric SA (SU), the world’s biggest maker of low- and medium-voltage equipment, plunged 7.6 percent after trimming its 2011 profit target. The benchmark Stoxx Europe 600 Index slid 1.5 percent to 233.07 at the close of trading, extending losses after Die Welt reported that Germany hasn’t ruled out postponing a euro-area summit planned for Oct. 23. That’s the biggest decline since Oct. 4 and brings the retreat from this year’s high in February to 20 percent.
Thai Floods Hit Apple, Toyota Supply Chains (Source: Bloomberg)
Apple Inc. (AAPL) and Toyota Motor Corp. (7203) are facing the worst supply disruptions since the March earthquake that crippled Japan, leading investors to scramble assessing the financial toll of the floods in Thailand. Apple Chief Executive Officer Tim Cook said this week Thailand’s worst floods in half a century set back supply of components used in Mac computers, while Toyota suspended production of its Camry and Prius vehicles in the kingdom. Western Digital Corp. (WDC), the world’s largest maker of hard-disk drives, warned it will post a loss this quarter and production won’t return to normal for months.
The floods have claimed more than 300 lives since July and shuttered more than 14,000 businesses in a country that makes about a quarter of the world’s hard-disk drives and serves as the Southeast Asian production hub for Japanese carmakers. While the government estimates damages of as much as 120 billion baht ($3.9 billion), disruptions to the global supply chain may be underestimated, according to BGC Partners Inc. (BGCP)
Olympus Scandal Prompts Record Speculation (Source: Bloomberg)
A record number of shares in Olympus Corp. (7733) are being bought and sold through Japanese margin-trading accounts as investors seek to capitalize on volatility amid a scandal over payments to advisers. The number of Olympus shares being held through margin accounts has surged to the highest since at least 1997, according to data from Japan Securities Finance Co., a provider of loans and lending services. Olympus has lost almost half of its value since Michael C. Woodford was fired as president on Oct. 13 after calling for a probe of $687 million in payments during a $2 billion takeover in 2008. “The volatility of Olympus is rising and the share price is likely to swing wildly in both directions,” said Kenichi Hirano, a general manager and strategist at Tachibana Securities Co. in Tokyo. “Investors see this as a rare opportunity to gain big profits in the short term.”
Asian stocks rose, narrowing a weekly decline on the regional benchmark index, as European governments considered deploying $1.3 trillion to fight the region’s debt crisis, boosting the earnings outlook for Asian exporters. The MSCI Asia Pacific Index rose 0.2 percent to 115.46 as of 9:11 a.m. in Tokyo. The measure has dropped about 1.2 percent this week.
Sales of Existing U.S. Homes Fell as Forecast in September (Source: Bloomberg)
Sales of existing homes fell in September, extending a pattern of declines and gains that show the industry continues to be buffeted by consumer pessimism and unemployment above 9 percent. Purchases dropped 3 percent to a 4.91 million annual rate, matching the median forecast of economists surveyed by Bloomberg News, figures from the National Association of Realtors showed today in Washington. The median price dropped 3.5 percent from a year ago and about one in five real-estate agents polled said contracts had been canceled, the group said. Growing pessimism about the economy, unemployment above 9 percent and limited access to credit are keeping some Americans from taking advantage of near record-low mortgage rates. Foreclosures that are adding to the supply of homes for sale and driving down prices remain a hurdle for an industry that’s made little progress more than two years after the recession ended.
Factories Help to Support U.S. Economy as Labor, Housing Markets Struggle (Source: Bloomberg)
Manufacturing in the Philadelphia area unexpectedly expanded in October at the fastest pace in six months, signaling factories are helping support a U.S. economy weighed down by weakness in the housing and labor markets. The Federal Reserve Bank of Philadelphia’s general economic index increased to 8.7 from minus 17.5 last month, the biggest one-month rebound in 31 years. Readings greater than zero indicate expansion in the area covering eastern Pennsylvania, southern New Jersey and Delaware. Companies such as hydraulic equipment-maker Parker Hannifin Corp. (PH) are raising sales forecasts as they benefit from rising business investment and overseas demand. Other reports today showed purchases of existing homes declined and Americans’ confidence in the economic outlook slumped with unemployment stuck near 9 percent and wages stagnant.
U.S. Leading Economic Indicators Rose 0.2% in September (Source: Bloomberg)
The index of U.S. leading economic indicators increased in September at a pace that suggests a slower rate of growth in the coming months. The Conference Board’s gauge of the outlook for the next three to six months climbed 0.2 percent after a 0.3 percent gain in August, the New York-based research group said today. The September increase, the lowest since a decline in April, matched economists’ projections, according to the median forecast in a Bloomberg News survey. A Federal Reserve survey published yesterday said the economy maintained its expansion last month even as more companies reported more doubt about the strength of the recovery. An acceleration in growth is needed to support the job gains that drive household spending, the biggest part of the U.S. economy.
Consumers Most Negative Since Recession (Source: Bloomberg)
Consumer confidence in the U.S. economic outlook slumped in October to the lowest level since the recession, highlighting the challenges facing the biggest part of the economy. The Bloomberg Consumer Comfort Index’s monthly expectations gauge dropped to minus 45, the worst reading since February 2009. The weekly measure of current conditions was minus 48.4 for the period ended Oct. 16, up from minus 50.8 the prior week that was close to a record low. A volatile stock market, little hiring and a lack of wage gains are souring Americans’ moods, raising the risk that the consumer spending that accounts for 70 percent of the economy will slump. Policy makers from Federal Reserve Chairman Ben S. Bernanke to President Barack Obama are taking steps to spur growth in the world’s largest economy.
Treasuries Set for Weekly Gain as Solution to Europe’s Debt Crisis Delayed (Source: Bloomberg)
Treasuries were set for their first weekly gain in a month, as prospects European leaders will need more time to resolve the region’s sovereign debt crisis spurred demand for the relative safety of U.S. government securities. Ten-year yields snapped an advance from yesterday after German Chancellor Angela Merkel and French President Nicolas Sarkozy planned a second meeting on Oct. 26 to agree on a package of measures to address the crisis after this weekend’s leaders summit in Brussels. The Federal Reserve is scheduled to buy $4.25 billion to $5 billion of Treasuries due from November 2019 to August 2021 as part of its plan to swap shorter maturities in its holdings for longer ones.
“Treasuries will be well supported by this news,” said Hiromasa Nakamura, who helps oversee the equivalent of $43 billion as an investor in Tokyo at Mizuho Asset Management Co., a unit of Japan’s second-largest lender. There is “a flight to quality in the market from risk assets. There are many problems in Europe. It will take much time to resolve them.”
Japan Stocks Swing Between Gains, Losses (Source: Bloomberg)
Japanese stocks swung between gains and losses amid concern European leaders won’t deliver a plan to resolve the region’s debt crisis at a summit this weekend. Nissan Motor Co., a carmaker that gets about 15 percent of sales from Europe, lost 0.9 percent. Mizuho Financial Group Inc., Japan’s third-biggest lender by market value, slipped 0.9 percent. Kawasaki Heavy Industries Ltd. climbed 3.5 percent after the maker of heavy machinery beat its earnings forecast. The Nikkei 225 (NKY) added 0.1 percent to 8,691.39 as of 9:14 a.m. in Tokyo, after losing as much as 0.1 percent. The broader Topix was little changed at 745.84. The gauge tumbled 17 percent this year through yesterday as Europe’s crisis threatens to spread.
Japan May Add Extra $52B Aid on Strong Yen (Source: Bloomberg)
Japan is preparing to unveil plans to spend an extra 4 trillion yen ($52 billion) to help its exporters cope with a surging yen and spur job creation, according to documents obtained by Bloomberg News. The government will add 2 trillion yen to the 8 trillion yen in foreign-exchange reserves being shifted to the state-run Japan Bank for International Cooperation to aid exporters and spur acquisitions overseas, one document shows. A further 2 trillion yen will be allocated to encourage investment in domestic plants and to hire workers, according to another document obtained from two government officials who declined to be identified because the plan isn’t public. A yen appreciation of almost 6 percent this year has prompted the government to adopt a multi-pronged approach to currency policy. While threatening intervention, Japanese authorities have offered aid to companies hit by the yen’s move and highlighted the lower cost of making overseas acquisitions. Japan imports about 80 percent of its energy needs.
EU Said to Mull Wielding $1.3T to Break Impasse (Source: Bloomberg)
European governments may unleash as much as 940 billion euros ($1.3 trillion) to fight the debt crisis, seeking to break a deadlock between Germany and France that is forcing leaders to hold two summits within four days. Negotiations on combining the European Union’s temporary and planned permanent rescue funds as of mid-2012, while scrapping a ceiling on bailout spending, accelerated this week after efforts to leverage the temporary fund ran into European Central Bank opposition and provoked the French-German clash, two people familiar with the discussions said. They declined to be identified because political leaders will have to decide.
That option may be one way out of the impasse between Europe’s two biggest economies Finance ministers meet in Brussels today from about 2 p.m. to lay the groundwork for an Oct. 23 meeting of government leaders that had been the deadline for a solution to the debt crisis. A summit for Oct. 26 was set yesterday after Germany and France said the EU needs more time to seal a “global and ambitious” accord.
France Likely to Lose Top Rating: S&P (Source: Bloomberg)
France is among euro-region sovereigns likely to be downgraded in a stressed economic scenario, according to Standard & Poor’s. The sovereign ratings of Spain, Italy, Ireland and Portugal would also be reduced by another one or two levels in either of New York-based S&P’s two stress scenarios, the ratings firm said in a report dated today. These assume low economic growth and a double-dip recession in the first set of circumstances, and add an interest-rate shock to the recession in the second. “Ballooning budget deficits and bank recapitalization costs would likely send government borrowings significantly higher under both scenarios,” S&P analysts led by Chief Credit Officer Blaise Ganguin in Paris wrote in the report. “Credit metrics would deteriorate sharply as a result.”
Papandreou Prevails in Austerity Vote (Source: Bloomberg)
Greek Prime Minister George Papandreou won a parliamentary vote on a new round of austerity designed to secure more financial aid, risking further unrest that left one person dead after protests turned violent. Papandreou secured the backing of a majority of lawmakers in the 300-seat chamber in Athens late yesterday as European leaders announced a second summit next week to give them more time to work on a “global and ambitious” strategy to combat the sovereign debt crisis that is roiling global markets. The vote in Athens capped a day in which hooded protesters in gas masks fought running battles with riot police firing tear-gas rounds outside the parliament building on the capital’s Syntagma Square. Ringed by a cordon of police, lawmakers debated the second round of austerity measures in four months that are necessary to secure the next tranche of international aid to stave off default and win any reduction in Greece’s debt burden.
ECB Said to Weigh Increasing Loans to Banks Revealing More on Collateral (Source: Bloomberg)
The European Central Bank is considering lending more money against asset-backed securities where issuers provide additional information about the loans securing the bonds, said a person familiar with the matter. Banks can borrow money from the ECB’s liquidity facility by posting collateral with a discount applied depending on its perceived safety. The bank’s Eurosystem Risk Management Committee is discussing lowering the reduction on asset-backed bonds from the 16 percent levied now, said the person, who declined to be identified because the talks are private. The proposed change is part of a broader ECB initiative to encourage banks to improve transparency in asset-backed bonds they sell to investors and boost confidence in a market blamed for worsening the credit crisis in 2007. The Frankfurt-based lender also said in April 2010 that it was seeking ways to control the quality of the assets it takes in as collateral for loans to financial institutions.
European Officials Said to See Market Risk in Greek Bondholder Debt Swap (Source: Bloomberg)
European Union officials weighing deeper losses for Greek bondholders in a revamped bailout are concerned that any investor involvement risks further roiling markets, say people familiar with the EU’s deliberations. Greece has accumulated at least 20 billion euros ($27 billion) in additional financing needs since a 159 billion-euro package was set in July, because of a deepening recession and delays in enacting the plan, said the people, who declined to be identified because euro-area leaders have yet to agree on their strategy. French President Nicolas Sarkozy and German Chancellor Angela Merkel yesterday demanded “immediate talks” with investors to reduce Greece’s debt load. The EU is considering five scenarios, ranging from sticking with July’s voluntary swap to a so-called hard restructuring, where investors could be forced to exchange Greek bonds for new ones at 50 percent of their value, the people said.
European Stocks Slide as Leaders Split; UniCredit, Actelion Fall (Source: Bloomberg)
European stocks declined the most in two weeks amid concern the euro area’s leaders are far from agreeing on a plan to end the region’s debt crisis. Intesa Sanpaolo SpA (ISP) and UniCredit SpA (UCG) led a selloff in banks, sliding more than 9 percent, as corporate bond risk advanced. Actelion Ltd. (ATLN) sank the most in more than 18 months as Europe’s largest biotechnology company said it expects drug sales to decrease next year. Schneider Electric SA (SU), the world’s biggest maker of low- and medium-voltage equipment, plunged 7.6 percent after trimming its 2011 profit target. The benchmark Stoxx Europe 600 Index slid 1.5 percent to 233.07 at the close of trading, extending losses after Die Welt reported that Germany hasn’t ruled out postponing a euro-area summit planned for Oct. 23. That’s the biggest decline since Oct. 4 and brings the retreat from this year’s high in February to 20 percent.
Thai Floods Hit Apple, Toyota Supply Chains (Source: Bloomberg)
Apple Inc. (AAPL) and Toyota Motor Corp. (7203) are facing the worst supply disruptions since the March earthquake that crippled Japan, leading investors to scramble assessing the financial toll of the floods in Thailand. Apple Chief Executive Officer Tim Cook said this week Thailand’s worst floods in half a century set back supply of components used in Mac computers, while Toyota suspended production of its Camry and Prius vehicles in the kingdom. Western Digital Corp. (WDC), the world’s largest maker of hard-disk drives, warned it will post a loss this quarter and production won’t return to normal for months.
The floods have claimed more than 300 lives since July and shuttered more than 14,000 businesses in a country that makes about a quarter of the world’s hard-disk drives and serves as the Southeast Asian production hub for Japanese carmakers. While the government estimates damages of as much as 120 billion baht ($3.9 billion), disruptions to the global supply chain may be underestimated, according to BGC Partners Inc. (BGCP)
Olympus Scandal Prompts Record Speculation (Source: Bloomberg)
A record number of shares in Olympus Corp. (7733) are being bought and sold through Japanese margin-trading accounts as investors seek to capitalize on volatility amid a scandal over payments to advisers. The number of Olympus shares being held through margin accounts has surged to the highest since at least 1997, according to data from Japan Securities Finance Co., a provider of loans and lending services. Olympus has lost almost half of its value since Michael C. Woodford was fired as president on Oct. 13 after calling for a probe of $687 million in payments during a $2 billion takeover in 2008. “The volatility of Olympus is rising and the share price is likely to swing wildly in both directions,” said Kenichi Hirano, a general manager and strategist at Tachibana Securities Co. in Tokyo. “Investors see this as a rare opportunity to gain big profits in the short term.”
20111021 0941 Global Market & Commodities Related News.
Nestle CEO Expects Commodity Prices To Remain High (Source: CME)
Nestle SA expects commodities prices to remain close to their present high levels, Chief Executive Paul Bulcke said. The maker of Nescafe soluble coffee and Maggi season cubes spends around CHF30 billion a year on ingredients and packaging, and in February said it expects its 2011 bill to rise between CHF2.5 billion and CHF3 billion. Earlier this month the U.N.'s Food and Agriculture Organization said its September Food Price Index averaged 225 points, only 13 points below the peak of 238 reached in February. "I do believe the level is going to stay high. Is it going to explode even on top of that? No I don't believe that, " Bulcke told Dow Jones Newswires on the sidelines of a press conference here.
Corn (Source: CME)
US corn futures close higher in a turnaround from Wednesday's losses. Prices rose as "a little bit of broad-based buying developed across the floor," says Shawn McCambridge of Jefferies Bache. He notes wheat futures also closed higher and soybeans ended off their lows. Commodity funds were buyers of the grains, snapping up an estimated 10,000 corn contracts, a moderate amount. Traders also shrugged off early disappointment with weekly corn-export sales that were toward the low end of expectations. CBOT December corn jumped 11c to $6.49 1/2 a bushel.
Wheat (Source: CME)
US wheat futures finish stronger, with KCBT rising the most amid ongoing worries about dryness hurting output in the Plains. Wheat is being planted in the region and attempting to grow. Yet, "extreme to exceptional drought will likely remain in place across most of the southern Plains for some time," says Kyle Tapley of MDA EarthSat Weather. Light showers may ease dryness "very slightly" in eastern Oklahoma and Texas this weekend, he notes. CBOT December wheat gains 11 1/4c to $6.30 3/4 a bushel; KCBT December climbs 19 1/2c to $7.25; MGEX December gains 6c to $9.17 1/2.
Rice (Source: CME)
US rice futures pull back as traders book profits following recent gains. Prices have retreated 3% since reaching a three-week high Monday. Declining demand added pressure to prices, traders say. Weekly export sales of 45,600 tons were down from 63,400 tons a week earlier. CBOT November rice slides 13 1/2c to $16.31 1/2/hundredweight.
Thailand 2012 rice exports to fall 30 pct -assoc
HO CHI MINH CITY, Oct 20 (Reuters) - Rice exports from Thailand next year could fall as much as 30 percent from 2011 to 7.0 million-7.5 million tonnes, as export prices have been pushed up by a government intervention scheme and floods, a senior industry official said on Thursday.
Higher export prices, as well as India's recent return to the market to sell, would cut Thailand's annual rice shipment this year to 10 million tonnes from 12 million tonnes in earlier projections, said Korbsook Iamsuri, President of Thai Rice Exporters Association. Exports in 2010 were 9 million tonnes.
Ukraine leader opens way for bumper grain export
KIEV, Oct 19 (Reuters) - Ukraine's President Viktor Yanukovich on Wednesday signed a law cancelling export duties for wheat and maize, opening the way for the former Soviet republic to pursue ambitious plan to export a record 27 million tonnes this season.
Ukraine imposed the duties in July and traders have said the measure slashed Ukrainian exports as Ukrainian-origin grain proved unable to compete with cheaper Russian exports.
Soy slides to 1-week low; corn, wheat extends losses
SINGAPORE, Oct 20 (Reuters) - U.S. soybean futures lost more ground, falling for a fourth straight day, while corn and wheat slid amid a selloff in the commodity markets triggered by mounting worries over the euro zone debt crisis.
"Euro zone crisis does remain a key concern for the financial markets and there are murmurs that the Chinese economy could be facing some headwind," said Luke Mathews, a commodity strategist at Commonwealth Bank of Australia in Sydney.
Analyst hikes EU maize crop to 63.4 mln tonnes
PARIS, Oct 20 (Reuters) - French analyst Strategie Grains raised sharply on Thursday its forecast of this year's maize crop in the European Union, driven by strong yields in western countries as well as revisions to data in Romania.
Strategie Grains now sees the EU's 2011/12 maize crop at 63.4 million tonnes, up 1.7 million tonnes from last month and 15 percent above estimated output of 55.3 million last year.
Vietnam cuts 2011 rice export f'cast, demand weak
HO CHI MINH CITY, Oct 19 (Reuters) - Vietnam slightly lowered on Thursday its rice export forecast for this year to more than 7 million tonnes from an initial projection of up to 7.5 million tonnes, but said floods did not affect production.
The projection reflects slowing sales in recent weeks as buyers stand back to assess flood damages in top exporter Thailand, where prices have been rising also due to a government buying scheme, or to seek cheaper grain in India and Pakistan.
Thai floods delay rice loading, no default seen
HO CHI MINH CITY, Oct 19 (Reuters) - Thailand's worst floods in five decades have delayed the loading of at least 100,000 tonnes of rice for export as high waters have hindered the movement of rice barges, industry analysts and a trader said on Wednesday.
But the floods will not cause any defaults on deliveries from the world's largest rice export nation, President Korbsook Iamsuri of Thai Rice Exporters Association said.
Egypt says to grow 3 mln acres of wheat in 2011/12
SHARM EL-SHEIKH, Egypt Oct 19 (Reuters) - Egypt, the world's largest wheat importer, expects to grow 3 million acres of wheat in the 2011/12 season, the chairman of the country's National Seed Council said, about the same acreage as last year while it offers to pay farmers a higher price.
The planting area will be "around 3 million acres, plus or minus ... nearly like last year's area," Fawzi Mahrous told reporters on the sidelines of a Russian grain conference in Egypt on Wednesday.
Rain slows harvest in eastern US Midwest; dry in west
CHICAGO, Oct 19 (Reuters) - Rainfall at mid-week was slowing the corn and soybean harvests in the eastern U.S. Midwest, while dry weather was conducive to rapid combining in the west, an agricultural meteorologist said Wednesday.
"The wettest day will be today and the heaviest rain in Michigan, Indiana and Ohio with up to 1.0 inch to 3.00 inches today and tomorrow," said Kyle Tapley, meteorologist for World Weather Inc.
Cambodia rice exports may triple in 2011 to 180,000T
PHNOM PENH/HO CHI MINH CITY, Oct 19 (Reuters) - Cambodia, a small rice exporter, is projected to export 180,000 tonnes of the grain in 2011, more than three times last year's volume, under an ambitious plan that envisages shipments to jump to 1 million tonnes by 2015, traders and officials said.
If the 1 million-tonne rice export target is achieved, it could generate about $500 million in revenue, or almost a quarter of the country's overall export revenues, its Deputy Prime Minister Yim Chhay Ly told a conference in Phnom Penh this week.
Ukraine Agmin sees higher grain crop, record export
KIEV, Oct 19 (Reuters) - Ukraine is likely to harvest about 53 million tonnes of grain in 2011 compared to 39.2 million in 2010 and the previous 2011 outlook of 51-52 million tonnes, Farm Minister Mykola Prysyazhnyuk said on Wednesday.
"This year, we plan to harvest about 53 million tonnes of grain. It will be one of the highest harvests in Ukrainian history. This volume allows us to export about 27 million tonnes," the ministry quoted Prysyazhnyuk as saying.
Saudi expects to import 1.9 mln T wheat in 2011
SHARM EL-SHEIKH, Egypt, Oct 19 (Reuters) - Saudi Arabia expects to import 1.9 million tonnes of wheat in 2011, the director general of the state-run Grain Silos and Flour Mills Organisation (GSFMO) said on Wednesday.
"Around 1.9 million tonnes this year and slightly more next year," Waleed el-Khereiji told reporters on the sidelines of a Russian grain conference in Egypt.
Global Rice Prices May Rise On Tight US, Thai Supply (Source: CME)
Global rice prices are likely to move higher in the next few months due to lower U.S. output and a slowdown in shipments from Thailand, the world's largest exporter, a senior industry analyst said. A Thai government plan to buy rice from farmers at prices above market rates and severe flooding that has hit vast tracks of paddy fields in the country may push prices up, Jeremy Zwinger, chief executive of The Rice Trader, a global consultancy and organizer of World Rice Conference said. Prices of Thailand's 5% broken rice may rise by more than 16% to above $700 a metric ton in the next few months, he said. These likely gains will be on the top of a 20% increase since early July. Zwinger said lower output in another major exporter, the U.S., due to adverse weather conditions is also supporting prices.
The International Grains Council has forecast U.S. rice output in the marketing year to March 31 at an 11-year low of 6.1 million tons, down 20% from 2010-11 but Zwinger said actual output is expected to be even lower. Rice futures on the Chicago Board of Trade and physical offers from key exporting countries are both undervalued, he said. CBOT November rice rose 19 cents Wednesday to $16.45 per hundredweight amid global supply concerns. California-based Zwinger said many traditional rice growers in the state are turning to corn cultivation, as earnings per acre can then be higher by almost one-third. Inputs from rice industry players in Thailand show that the damage due to floods is worse than was initially feared, with both the standing crop and rice held in warehouses getting affected, Zwinger said.
He said in milled terms, around 3.0 million metric tons, or 20%, of the country's main rice crop that is mostly harvested in December and January has been hit by floods. Supplies will also be squeezed because the Thai government will procure a large part of the crop at THB15,000/ton, around 40% above current market rates. Zwinger said even though India is selling rice some $100-$150/ton lower than Thai prices, Indian supply is not enough to offset impact of lower supply from Thailand. India may not be able to export more than 500,000 tons rice a month, including the premium variety, Basmati grades, due to inland and port bottlenecks, he said. Thailand has exports more than double that amount each month. Supply has tightened at a time when demand is on the rise with global rice trade expected to rise by more than 10% this year, Zwinger said.
Soybeans Slide for a Fourth Day as Rainfall May Boost Yields in Argentina (Source: Bloomberg)
Soybeans fell for a fourth day in Chicago on dry weather in Brazil and rain in Argentina that is likely to improve planting conditions for the oilseed. Brazil will have three to five days of drier weather to aid sowing, forecaster DTN said yesterday. Fields in Argentina will get light to moderate rain through Oct. 24, Accuweather.com forecast yesterday. Prices also dropped on concern European leaders will fail to address the region’s debt crisis. “We’ve had some decent rains in Argentina over the last couple of weeks,” boosting optimism yields will rise, Michael Creed, an agribusiness economist at National Australia Bank Ltd., said by phone from Melbourne today. Europe’s debt issues are also damping investor demand for commodities, he said.
Corn Rises on Improving Overseas Demand for U.S. Supply; Soybeans Decline (Source: Bloomberg)
Corn futures posted their biggest gain in more than a week on signs that last month’s price drop revived demand for supplies from the U.S., the world’s biggest exporter. Soybeans fell for a fourth straight day. U.S. exporters sold 1.763 million metric tons of corn in the week ended Oct. 13, the most since March, the Department of Agriculture said today in a report. Total sales for delivery before Aug. 31 are 5 percent higher than at the same time last year and are at the highest level in four years. Last week, the USDA forecast a 13 percent drop in this season’s shipments. The “USDA looks a little too pessimistic on U.S. export sales this year,” Marty Foreman, an economist at Doane Advisory Services Co. in St. Louis, said in a telephone interview. “Export demand is a little stronger than the government expected.”
Sugar Traders Most Bearish in Three Months on Glut: Commodities (Source: Bloomberg)
Sugar traders and analysts are the most bearish in almost three months on mounting speculation that supply will outpace demand for the first time in four years, creating a glut that may persist through 2013. Nine of 13 people surveyed by Bloomberg expect raw sugar to drop on the ICE Futures U.S. exchange next week, the highest proportion since the end of July. The last time they were that bearish, prices fell 7.6 percent the following week. Speculators cut their bets on higher prices by 49 percent since the end of July, Commodity Futures Trading Commission data show. Traders also expect lower refined-sugar prices next week, and gains in gold, copper, corn and soybeans, separate surveys showed.
Sugar already fell 26 percent since reaching a three-decade high in February as the surge encouraged farmers to plant more cane. UBS AG, Macquarie Group Ltd. and Barclays Capital are among banks anticipating a surplus in the next 12 months. Kingsman SA, a researcher in Lausanne, Switzerland, expects the biggest glut since 2002-03, when prices dropped 25 percent.
ICE sugar, coffee dip as commodities decline
LONDON, Oct 20 (Reuters) - ICE raw sugar, cocoa and arabica coffee futures eased in early trade, tracking a broad-based retreat in crude oil and other commodities markets as investors dumped riskier assets on mounting concern about the euro zone's debt crisis.
Raw sugar futures were lower, dragged down by the overall weakness of commmodity markets.
Uganda expects Oct. coffee exports at 200,000 60-kg bags
KAMPALA, Oct 20 (Reuters) - Uganda expects to export 200,000 60-kg bags of coffee in October, up from 188,012 bags in the same month last year, the Uganda Coffee Development Authority said on Thursday.
"Coffee exports in October 2011 are projected at 200,000 bags as exporters and other players prepare for the new season 2011/12 and also continue offloading their stocks to fulfil contractual obligations with buyers," UCDA said in a sector performance report for September.
China 11/12 sugar output seen 11.8 mln tonnes-attache
Oct 19 (Reuters) - Following are selected highlights from a report issued by a U.S. Department of Agriculture attache in China:
"In MY 2011/12, total sugar production is forecast at 11.8 million tonnes raw value, up 5 percent due to an increase in acreage. In MY 2010/11, total sugar production is estimated at 11.2 million tonnes raw value, down 2 percent because of frost damage. For MY 2011/12 sugar imports are forecast at 2.2 million tonnes raw value, a 15-year record high on rising domestic consumption and consecutive years of low sugar production."
Brazil cocoa output idles before next harvest
BRASILIA, Oct 19 (Reuters) - Cocoa arrivals at Brazilian warehouses in Brazil dipped in the last week with the upcoming main crop harvest yet to get under way, data from the Bahia Commercial Association showed on Wednesday.
Deliveries from the main cocoa state Bahia and outlying states totaled 39,463 bags in the week to Oct. 16.
Oil Climbs on Europe Plan, U.S. Optimism; Libyan Output Recovery Forecast (Source: Bloomberg)
Oil climbed in New York, trimming the first weekly decline in three, as investors bet signs of an economic recovery in the U.S. and Europe’s steps to contain in its debt crisis mean demand for raw materials may increase. Futures gained as much as 0.5 percent after a U.S. manufacturing gauge unexpectedly expanded and European governments discussed deploying $1.3 trillion in funds to tackle the sovereign debt crisis. The death of former Libyan leader Muammar Qaddafi will expedite efforts to revive crude output to normal levels, the state-run National Oil Corp. said. Crude oil for December delivery rose as much as 43 cents to $86.50 a barrel and was at $86.36, in electronic trading on the New York Mercantile Exchange at 9:41 a.m. Sydney time. The contract yesterday fell 0.3 percent to $86.07. Front-month futures are down 0.5 percent this week and 5.5 percent lower this year.
Oil steady at $108 ahead of EU summit
LONDON, Oct 20 (Reuters) - Oil prices held steady at around $108 on Thursday supported by tight supply although Europe's failure to agree a plan to resolve the euro zone's debt crisis continued to stalk the market.
"A lot of the strength of the market is being driven by the fact that there are cargoes missing from the programme and we expect to see some missing from next month's as well," a trader said.
Silver Bear Market Seen Ending on Extended Europe Debt Crisis: Commodities (Source: Bloomberg)
Silver, the best-performing and most-volatile precious metal of the past year, may rebound from a bear market as investors bet on growth in developing nations and an extended European debt crisis. The metal may average $38 an ounce this quarter and rise to a record $42 by the final three months of 2012, compared with $30.155 at 5:10 p.m. in London today, according to the median in a Bloomberg survey of 11 analysts. The gains will mean record profit for producers Pan American Silver Corp. (PAA) and Fresnillo Plc (FRES), analyst estimates compiled by Bloomberg show.
China, the biggest emerging-market user, is expanding at more than five times the speed of the U.S., driving consumption of the precious metal most used in industry. Demand is also coming from investors looking for an alternative to cash and gold, which costs about 50 times more than silver. The 30-week correlation coefficient between the two metals is now at 0.82, from as low as 0.47 in 2005, data compiled by Bloomberg show, with a figure of 1 meaning the two move in lockstep.
Gold Drops for Fifth Day, Heading for Longest Losing Streak Since January (Source: Bloomberg)
Gold for immediate delivery fell for a fifth day, the longest period of decline since January, dropping as much as 0.6 percent to $1,611.82 an ounce. The metal traded at $1,613.88 at 7:08 a.m. Singapore time, down 4 percent this week and poised for its first weekly decrease in three weeks.
Nestle SA expects commodities prices to remain close to their present high levels, Chief Executive Paul Bulcke said. The maker of Nescafe soluble coffee and Maggi season cubes spends around CHF30 billion a year on ingredients and packaging, and in February said it expects its 2011 bill to rise between CHF2.5 billion and CHF3 billion. Earlier this month the U.N.'s Food and Agriculture Organization said its September Food Price Index averaged 225 points, only 13 points below the peak of 238 reached in February. "I do believe the level is going to stay high. Is it going to explode even on top of that? No I don't believe that, " Bulcke told Dow Jones Newswires on the sidelines of a press conference here.
Corn (Source: CME)
US corn futures close higher in a turnaround from Wednesday's losses. Prices rose as "a little bit of broad-based buying developed across the floor," says Shawn McCambridge of Jefferies Bache. He notes wheat futures also closed higher and soybeans ended off their lows. Commodity funds were buyers of the grains, snapping up an estimated 10,000 corn contracts, a moderate amount. Traders also shrugged off early disappointment with weekly corn-export sales that were toward the low end of expectations. CBOT December corn jumped 11c to $6.49 1/2 a bushel.
Wheat (Source: CME)
US wheat futures finish stronger, with KCBT rising the most amid ongoing worries about dryness hurting output in the Plains. Wheat is being planted in the region and attempting to grow. Yet, "extreme to exceptional drought will likely remain in place across most of the southern Plains for some time," says Kyle Tapley of MDA EarthSat Weather. Light showers may ease dryness "very slightly" in eastern Oklahoma and Texas this weekend, he notes. CBOT December wheat gains 11 1/4c to $6.30 3/4 a bushel; KCBT December climbs 19 1/2c to $7.25; MGEX December gains 6c to $9.17 1/2.
Rice (Source: CME)
US rice futures pull back as traders book profits following recent gains. Prices have retreated 3% since reaching a three-week high Monday. Declining demand added pressure to prices, traders say. Weekly export sales of 45,600 tons were down from 63,400 tons a week earlier. CBOT November rice slides 13 1/2c to $16.31 1/2/hundredweight.
Thailand 2012 rice exports to fall 30 pct -assoc
HO CHI MINH CITY, Oct 20 (Reuters) - Rice exports from Thailand next year could fall as much as 30 percent from 2011 to 7.0 million-7.5 million tonnes, as export prices have been pushed up by a government intervention scheme and floods, a senior industry official said on Thursday.
Higher export prices, as well as India's recent return to the market to sell, would cut Thailand's annual rice shipment this year to 10 million tonnes from 12 million tonnes in earlier projections, said Korbsook Iamsuri, President of Thai Rice Exporters Association. Exports in 2010 were 9 million tonnes.
Ukraine leader opens way for bumper grain export
KIEV, Oct 19 (Reuters) - Ukraine's President Viktor Yanukovich on Wednesday signed a law cancelling export duties for wheat and maize, opening the way for the former Soviet republic to pursue ambitious plan to export a record 27 million tonnes this season.
Ukraine imposed the duties in July and traders have said the measure slashed Ukrainian exports as Ukrainian-origin grain proved unable to compete with cheaper Russian exports.
Soy slides to 1-week low; corn, wheat extends losses
SINGAPORE, Oct 20 (Reuters) - U.S. soybean futures lost more ground, falling for a fourth straight day, while corn and wheat slid amid a selloff in the commodity markets triggered by mounting worries over the euro zone debt crisis.
"Euro zone crisis does remain a key concern for the financial markets and there are murmurs that the Chinese economy could be facing some headwind," said Luke Mathews, a commodity strategist at Commonwealth Bank of Australia in Sydney.
Analyst hikes EU maize crop to 63.4 mln tonnes
PARIS, Oct 20 (Reuters) - French analyst Strategie Grains raised sharply on Thursday its forecast of this year's maize crop in the European Union, driven by strong yields in western countries as well as revisions to data in Romania.
Strategie Grains now sees the EU's 2011/12 maize crop at 63.4 million tonnes, up 1.7 million tonnes from last month and 15 percent above estimated output of 55.3 million last year.
Vietnam cuts 2011 rice export f'cast, demand weak
HO CHI MINH CITY, Oct 19 (Reuters) - Vietnam slightly lowered on Thursday its rice export forecast for this year to more than 7 million tonnes from an initial projection of up to 7.5 million tonnes, but said floods did not affect production.
The projection reflects slowing sales in recent weeks as buyers stand back to assess flood damages in top exporter Thailand, where prices have been rising also due to a government buying scheme, or to seek cheaper grain in India and Pakistan.
Thai floods delay rice loading, no default seen
HO CHI MINH CITY, Oct 19 (Reuters) - Thailand's worst floods in five decades have delayed the loading of at least 100,000 tonnes of rice for export as high waters have hindered the movement of rice barges, industry analysts and a trader said on Wednesday.
But the floods will not cause any defaults on deliveries from the world's largest rice export nation, President Korbsook Iamsuri of Thai Rice Exporters Association said.
Egypt says to grow 3 mln acres of wheat in 2011/12
SHARM EL-SHEIKH, Egypt Oct 19 (Reuters) - Egypt, the world's largest wheat importer, expects to grow 3 million acres of wheat in the 2011/12 season, the chairman of the country's National Seed Council said, about the same acreage as last year while it offers to pay farmers a higher price.
The planting area will be "around 3 million acres, plus or minus ... nearly like last year's area," Fawzi Mahrous told reporters on the sidelines of a Russian grain conference in Egypt on Wednesday.
Rain slows harvest in eastern US Midwest; dry in west
CHICAGO, Oct 19 (Reuters) - Rainfall at mid-week was slowing the corn and soybean harvests in the eastern U.S. Midwest, while dry weather was conducive to rapid combining in the west, an agricultural meteorologist said Wednesday.
"The wettest day will be today and the heaviest rain in Michigan, Indiana and Ohio with up to 1.0 inch to 3.00 inches today and tomorrow," said Kyle Tapley, meteorologist for World Weather Inc.
Cambodia rice exports may triple in 2011 to 180,000T
PHNOM PENH/HO CHI MINH CITY, Oct 19 (Reuters) - Cambodia, a small rice exporter, is projected to export 180,000 tonnes of the grain in 2011, more than three times last year's volume, under an ambitious plan that envisages shipments to jump to 1 million tonnes by 2015, traders and officials said.
If the 1 million-tonne rice export target is achieved, it could generate about $500 million in revenue, or almost a quarter of the country's overall export revenues, its Deputy Prime Minister Yim Chhay Ly told a conference in Phnom Penh this week.
Ukraine Agmin sees higher grain crop, record export
KIEV, Oct 19 (Reuters) - Ukraine is likely to harvest about 53 million tonnes of grain in 2011 compared to 39.2 million in 2010 and the previous 2011 outlook of 51-52 million tonnes, Farm Minister Mykola Prysyazhnyuk said on Wednesday.
"This year, we plan to harvest about 53 million tonnes of grain. It will be one of the highest harvests in Ukrainian history. This volume allows us to export about 27 million tonnes," the ministry quoted Prysyazhnyuk as saying.
Saudi expects to import 1.9 mln T wheat in 2011
SHARM EL-SHEIKH, Egypt, Oct 19 (Reuters) - Saudi Arabia expects to import 1.9 million tonnes of wheat in 2011, the director general of the state-run Grain Silos and Flour Mills Organisation (GSFMO) said on Wednesday.
"Around 1.9 million tonnes this year and slightly more next year," Waleed el-Khereiji told reporters on the sidelines of a Russian grain conference in Egypt.
Global Rice Prices May Rise On Tight US, Thai Supply (Source: CME)
Global rice prices are likely to move higher in the next few months due to lower U.S. output and a slowdown in shipments from Thailand, the world's largest exporter, a senior industry analyst said. A Thai government plan to buy rice from farmers at prices above market rates and severe flooding that has hit vast tracks of paddy fields in the country may push prices up, Jeremy Zwinger, chief executive of The Rice Trader, a global consultancy and organizer of World Rice Conference said. Prices of Thailand's 5% broken rice may rise by more than 16% to above $700 a metric ton in the next few months, he said. These likely gains will be on the top of a 20% increase since early July. Zwinger said lower output in another major exporter, the U.S., due to adverse weather conditions is also supporting prices.
The International Grains Council has forecast U.S. rice output in the marketing year to March 31 at an 11-year low of 6.1 million tons, down 20% from 2010-11 but Zwinger said actual output is expected to be even lower. Rice futures on the Chicago Board of Trade and physical offers from key exporting countries are both undervalued, he said. CBOT November rice rose 19 cents Wednesday to $16.45 per hundredweight amid global supply concerns. California-based Zwinger said many traditional rice growers in the state are turning to corn cultivation, as earnings per acre can then be higher by almost one-third. Inputs from rice industry players in Thailand show that the damage due to floods is worse than was initially feared, with both the standing crop and rice held in warehouses getting affected, Zwinger said.
He said in milled terms, around 3.0 million metric tons, or 20%, of the country's main rice crop that is mostly harvested in December and January has been hit by floods. Supplies will also be squeezed because the Thai government will procure a large part of the crop at THB15,000/ton, around 40% above current market rates. Zwinger said even though India is selling rice some $100-$150/ton lower than Thai prices, Indian supply is not enough to offset impact of lower supply from Thailand. India may not be able to export more than 500,000 tons rice a month, including the premium variety, Basmati grades, due to inland and port bottlenecks, he said. Thailand has exports more than double that amount each month. Supply has tightened at a time when demand is on the rise with global rice trade expected to rise by more than 10% this year, Zwinger said.
Soybeans Slide for a Fourth Day as Rainfall May Boost Yields in Argentina (Source: Bloomberg)
Soybeans fell for a fourth day in Chicago on dry weather in Brazil and rain in Argentina that is likely to improve planting conditions for the oilseed. Brazil will have three to five days of drier weather to aid sowing, forecaster DTN said yesterday. Fields in Argentina will get light to moderate rain through Oct. 24, Accuweather.com forecast yesterday. Prices also dropped on concern European leaders will fail to address the region’s debt crisis. “We’ve had some decent rains in Argentina over the last couple of weeks,” boosting optimism yields will rise, Michael Creed, an agribusiness economist at National Australia Bank Ltd., said by phone from Melbourne today. Europe’s debt issues are also damping investor demand for commodities, he said.
Corn Rises on Improving Overseas Demand for U.S. Supply; Soybeans Decline (Source: Bloomberg)
Corn futures posted their biggest gain in more than a week on signs that last month’s price drop revived demand for supplies from the U.S., the world’s biggest exporter. Soybeans fell for a fourth straight day. U.S. exporters sold 1.763 million metric tons of corn in the week ended Oct. 13, the most since March, the Department of Agriculture said today in a report. Total sales for delivery before Aug. 31 are 5 percent higher than at the same time last year and are at the highest level in four years. Last week, the USDA forecast a 13 percent drop in this season’s shipments. The “USDA looks a little too pessimistic on U.S. export sales this year,” Marty Foreman, an economist at Doane Advisory Services Co. in St. Louis, said in a telephone interview. “Export demand is a little stronger than the government expected.”
Sugar Traders Most Bearish in Three Months on Glut: Commodities (Source: Bloomberg)
Sugar traders and analysts are the most bearish in almost three months on mounting speculation that supply will outpace demand for the first time in four years, creating a glut that may persist through 2013. Nine of 13 people surveyed by Bloomberg expect raw sugar to drop on the ICE Futures U.S. exchange next week, the highest proportion since the end of July. The last time they were that bearish, prices fell 7.6 percent the following week. Speculators cut their bets on higher prices by 49 percent since the end of July, Commodity Futures Trading Commission data show. Traders also expect lower refined-sugar prices next week, and gains in gold, copper, corn and soybeans, separate surveys showed.
Sugar already fell 26 percent since reaching a three-decade high in February as the surge encouraged farmers to plant more cane. UBS AG, Macquarie Group Ltd. and Barclays Capital are among banks anticipating a surplus in the next 12 months. Kingsman SA, a researcher in Lausanne, Switzerland, expects the biggest glut since 2002-03, when prices dropped 25 percent.
ICE sugar, coffee dip as commodities decline
LONDON, Oct 20 (Reuters) - ICE raw sugar, cocoa and arabica coffee futures eased in early trade, tracking a broad-based retreat in crude oil and other commodities markets as investors dumped riskier assets on mounting concern about the euro zone's debt crisis.
Raw sugar futures were lower, dragged down by the overall weakness of commmodity markets.
Uganda expects Oct. coffee exports at 200,000 60-kg bags
KAMPALA, Oct 20 (Reuters) - Uganda expects to export 200,000 60-kg bags of coffee in October, up from 188,012 bags in the same month last year, the Uganda Coffee Development Authority said on Thursday.
"Coffee exports in October 2011 are projected at 200,000 bags as exporters and other players prepare for the new season 2011/12 and also continue offloading their stocks to fulfil contractual obligations with buyers," UCDA said in a sector performance report for September.
China 11/12 sugar output seen 11.8 mln tonnes-attache
Oct 19 (Reuters) - Following are selected highlights from a report issued by a U.S. Department of Agriculture attache in China:
"In MY 2011/12, total sugar production is forecast at 11.8 million tonnes raw value, up 5 percent due to an increase in acreage. In MY 2010/11, total sugar production is estimated at 11.2 million tonnes raw value, down 2 percent because of frost damage. For MY 2011/12 sugar imports are forecast at 2.2 million tonnes raw value, a 15-year record high on rising domestic consumption and consecutive years of low sugar production."
Brazil cocoa output idles before next harvest
BRASILIA, Oct 19 (Reuters) - Cocoa arrivals at Brazilian warehouses in Brazil dipped in the last week with the upcoming main crop harvest yet to get under way, data from the Bahia Commercial Association showed on Wednesday.
Deliveries from the main cocoa state Bahia and outlying states totaled 39,463 bags in the week to Oct. 16.
Oil Climbs on Europe Plan, U.S. Optimism; Libyan Output Recovery Forecast (Source: Bloomberg)
Oil climbed in New York, trimming the first weekly decline in three, as investors bet signs of an economic recovery in the U.S. and Europe’s steps to contain in its debt crisis mean demand for raw materials may increase. Futures gained as much as 0.5 percent after a U.S. manufacturing gauge unexpectedly expanded and European governments discussed deploying $1.3 trillion in funds to tackle the sovereign debt crisis. The death of former Libyan leader Muammar Qaddafi will expedite efforts to revive crude output to normal levels, the state-run National Oil Corp. said. Crude oil for December delivery rose as much as 43 cents to $86.50 a barrel and was at $86.36, in electronic trading on the New York Mercantile Exchange at 9:41 a.m. Sydney time. The contract yesterday fell 0.3 percent to $86.07. Front-month futures are down 0.5 percent this week and 5.5 percent lower this year.
Oil steady at $108 ahead of EU summit
LONDON, Oct 20 (Reuters) - Oil prices held steady at around $108 on Thursday supported by tight supply although Europe's failure to agree a plan to resolve the euro zone's debt crisis continued to stalk the market.
"A lot of the strength of the market is being driven by the fact that there are cargoes missing from the programme and we expect to see some missing from next month's as well," a trader said.
Silver Bear Market Seen Ending on Extended Europe Debt Crisis: Commodities (Source: Bloomberg)
Silver, the best-performing and most-volatile precious metal of the past year, may rebound from a bear market as investors bet on growth in developing nations and an extended European debt crisis. The metal may average $38 an ounce this quarter and rise to a record $42 by the final three months of 2012, compared with $30.155 at 5:10 p.m. in London today, according to the median in a Bloomberg survey of 11 analysts. The gains will mean record profit for producers Pan American Silver Corp. (PAA) and Fresnillo Plc (FRES), analyst estimates compiled by Bloomberg show.
China, the biggest emerging-market user, is expanding at more than five times the speed of the U.S., driving consumption of the precious metal most used in industry. Demand is also coming from investors looking for an alternative to cash and gold, which costs about 50 times more than silver. The 30-week correlation coefficient between the two metals is now at 0.82, from as low as 0.47 in 2005, data compiled by Bloomberg show, with a figure of 1 meaning the two move in lockstep.
Gold Drops for Fifth Day, Heading for Longest Losing Streak Since January (Source: Bloomberg)
Gold for immediate delivery fell for a fifth day, the longest period of decline since January, dropping as much as 0.6 percent to $1,611.82 an ounce. The metal traded at $1,613.88 at 7:08 a.m. Singapore time, down 4 percent this week and poised for its first weekly decrease in three weeks.
20111021 0940 Soy Oil & Palm Oil Related News.
Reuters: Indonesia sets crude palm oil export tax for Nov 2011 @ 15%, down from Oct 2011 16.5%.
Reuters : Malaysia, Indonesia agree to review crude palm oil export tax for "mutual benefit" - Malaysia government source.
Reuters : Malaysia exploring options that include cutting crude palm oil export tax to be on par with Indonesia. - Malaysia industry source.
Soybeans (Source: CME)
US soybean futures close unchanging, ending a three-day slide. The market recovered from sharp losses earlier in the session as broad-based buying emerged, paring losses in the soy market and pushing grain futures higher, analysts say. Soybeans were due for a recovery after dropping 3.5% in the first three days of the week, they add. Still, market participants remain jittery about demand after weekly export sales fell short of expectations. CBOT November soybeans finish flat at $12.25/bushel.
Soybean Meal/Oil (Source: CME)
Soymeal futures close higher on stronger export demand. USDA reports sales of 348,900 tons for the week ended Oct. 13, up from 221,600 tons the previous week. Mexico was the biggest buyer, snapping up 169,000 tons. The strengthening US soymeal sales pace will help boost the US soy crush rate, say analysts at AgResource. CBOT December soymeal rises $1 to $320.30 per short ton. Yet, soyoil slips slightly, with the December contract dropping 0.09c to 51.39c/pound.
Argentina Soy Area Seen 18.6M Hectares Vs 18.5M Last Season-Exchange (Source: CME)
Argentina's farmers are set to plant 18.6 million hectares with soybeans in the upcoming 2011-12 season, little changed from a year earlier, the Buenos Aires Cereals Exchange said in its weekly crop report. Farmers are expected to shift some fields to corn at the expense of soybeans in the central farm belt, while more soybeans will be planted in newly cleared fields in the north of the country and other marginal areas, Buenos Aires Cereals Exchange analyst Esteban Copati said in an interview. Soy area could increase if corn prices drop or planting conditions are too dry for corn toward the end of the year, leading farmers to turn to soybeans, Copati said. Last season farmers planted 18.5 million hectares with soybeans, the nation's top crop, the exchange said. Argentina is the world's third largest soybean exporter, ranks second in corn, first in soymeal and soyoil, and is a leading exporter of wheat and sunflower seed oil.
Planting conditions are good after recent showers soaked Argentina's fields, but farmers are concerned that a developing La Nina weather system could bring drought this season as it did in 2008-09. Local specialists say this season is likely to be milder and that those fears are likely overblown. The pattern should be similar to the recently finished 2010-11 season that was also affected by La Nina, according to the Buenos Aires Cereals Exchange's chief climatologist, Eduardo Sierra. La Nina is seen bringing relatively wet conditions from October through the first half of November. A long dry stretch is expected from November through the first two weeks of January, when rain levels should return to normal and bring relief to crops. La Nina refers to cooling of the equatorial Pacific Ocean that usually brings dry weather to the farm belts of Argentina, Uruguay, Paraguay and the south of Brazil. El Nino is the opposite, with warming ocean temperatures and heavier-than-normal rainfall in those areas.
Meanwhile, Argentina's 2011-12 wheat crop is developing well after the soaking and production is expected to total at least 12.6 million tons, according to the exchange. Wheat production during the 2010-11 season totaled 15 million tons, according to the U.S. Department of Agriculture. Corn planting is also progressing well after the showers. So far, 42.8% of the 3.5 million hectares seen going to corn this season has been planted, down about 20 percentage points from the progress made at this point last year. Dry weather through September led many farmers to put off corn planting, Copati said. So far sunflower seed planting is 31% complete, with 1.86 million hectares expected by the exchange this season.
Palm oil drops as euro zone crisis festers
KUALA LUMPUR, Oct 20 (Reuters) - Malaysian palm oil futures dropped sharply on Thursday as investors' avoided risky assets on concerns that a key European leaders' summit may not reach a consensus on the debt crisis in the region.
"Palm oil's fundamentals are slightly bullish but that has been stamped out by the greater macro bear called the euro zone," said a trader with a foreign commodities brokerage.
Palm oil output at 300,000 T in 2011- Bakrie Sumatera
JAKARTA, Oct 20 (Reuters) - Palm oil output at Indonesia's Bakrie Sumatera will rise by more than 35 percent this year to 300,000 tonnes, Ambono Janurianto, chief executive at the planter, said on Thursday.
Earlier this year, the Bakrie Group's agricultural unit forecast 2011 output at 280,000 tonnes compared with 220,000/230,000 tonnes last year.
Reuters : Malaysia, Indonesia agree to review crude palm oil export tax for "mutual benefit" - Malaysia government source.
Reuters : Malaysia exploring options that include cutting crude palm oil export tax to be on par with Indonesia. - Malaysia industry source.
Soybeans (Source: CME)
US soybean futures close unchanging, ending a three-day slide. The market recovered from sharp losses earlier in the session as broad-based buying emerged, paring losses in the soy market and pushing grain futures higher, analysts say. Soybeans were due for a recovery after dropping 3.5% in the first three days of the week, they add. Still, market participants remain jittery about demand after weekly export sales fell short of expectations. CBOT November soybeans finish flat at $12.25/bushel.
Soybean Meal/Oil (Source: CME)
Soymeal futures close higher on stronger export demand. USDA reports sales of 348,900 tons for the week ended Oct. 13, up from 221,600 tons the previous week. Mexico was the biggest buyer, snapping up 169,000 tons. The strengthening US soymeal sales pace will help boost the US soy crush rate, say analysts at AgResource. CBOT December soymeal rises $1 to $320.30 per short ton. Yet, soyoil slips slightly, with the December contract dropping 0.09c to 51.39c/pound.
Argentina Soy Area Seen 18.6M Hectares Vs 18.5M Last Season-Exchange (Source: CME)
Argentina's farmers are set to plant 18.6 million hectares with soybeans in the upcoming 2011-12 season, little changed from a year earlier, the Buenos Aires Cereals Exchange said in its weekly crop report. Farmers are expected to shift some fields to corn at the expense of soybeans in the central farm belt, while more soybeans will be planted in newly cleared fields in the north of the country and other marginal areas, Buenos Aires Cereals Exchange analyst Esteban Copati said in an interview. Soy area could increase if corn prices drop or planting conditions are too dry for corn toward the end of the year, leading farmers to turn to soybeans, Copati said. Last season farmers planted 18.5 million hectares with soybeans, the nation's top crop, the exchange said. Argentina is the world's third largest soybean exporter, ranks second in corn, first in soymeal and soyoil, and is a leading exporter of wheat and sunflower seed oil.
Planting conditions are good after recent showers soaked Argentina's fields, but farmers are concerned that a developing La Nina weather system could bring drought this season as it did in 2008-09. Local specialists say this season is likely to be milder and that those fears are likely overblown. The pattern should be similar to the recently finished 2010-11 season that was also affected by La Nina, according to the Buenos Aires Cereals Exchange's chief climatologist, Eduardo Sierra. La Nina is seen bringing relatively wet conditions from October through the first half of November. A long dry stretch is expected from November through the first two weeks of January, when rain levels should return to normal and bring relief to crops. La Nina refers to cooling of the equatorial Pacific Ocean that usually brings dry weather to the farm belts of Argentina, Uruguay, Paraguay and the south of Brazil. El Nino is the opposite, with warming ocean temperatures and heavier-than-normal rainfall in those areas.
Meanwhile, Argentina's 2011-12 wheat crop is developing well after the soaking and production is expected to total at least 12.6 million tons, according to the exchange. Wheat production during the 2010-11 season totaled 15 million tons, according to the U.S. Department of Agriculture. Corn planting is also progressing well after the showers. So far, 42.8% of the 3.5 million hectares seen going to corn this season has been planted, down about 20 percentage points from the progress made at this point last year. Dry weather through September led many farmers to put off corn planting, Copati said. So far sunflower seed planting is 31% complete, with 1.86 million hectares expected by the exchange this season.
Palm oil drops as euro zone crisis festers
KUALA LUMPUR, Oct 20 (Reuters) - Malaysian palm oil futures dropped sharply on Thursday as investors' avoided risky assets on concerns that a key European leaders' summit may not reach a consensus on the debt crisis in the region.
"Palm oil's fundamentals are slightly bullish but that has been stamped out by the greater macro bear called the euro zone," said a trader with a foreign commodities brokerage.
Palm oil output at 300,000 T in 2011- Bakrie Sumatera
JAKARTA, Oct 20 (Reuters) - Palm oil output at Indonesia's Bakrie Sumatera will rise by more than 35 percent this year to 300,000 tonnes, Ambono Janurianto, chief executive at the planter, said on Thursday.
Earlier this year, the Bakrie Group's agricultural unit forecast 2011 output at 280,000 tonnes compared with 220,000/230,000 tonnes last year.
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