Commmodities

[Muthukali]

Oil Trades Near Four-Month High on Improving Economic Outlook

By Ben Sharples - Sep 17, 2012 12:07 PM GMT+0800

Oil traded near the highest close in four months before reports forecast to show a strengthening economy in the U.S., the world’s biggest consumer of crude.

Futures were little changed in New York after surging as high as $100.42 a barrel on Sept. 14 as the Federal Reserve pledged to start buying U.S. mortgage securities. New home construction and sales of previously owned houses rose in August, economists said before U.S. data due Sept. 19. Current crude prices aren’t a threat to the world economy, Mohammad Ali Khatibi, Iran’s governor to the OPEC, said via the Oil Ministry’s news website yesterday.

“We’ve seen an ongoing and relatively positive reaction to the Fed’s easing plan,” said Ric Spooner, a chief market analyst at CMC Markets in Sydney. “That reflects the relatively open-ended nature of the proposed easing.”

Oil for October delivery gained 14 cents to $99.14 a barrel in electronic trading on the New York Mercantile Exchange at 1:58 p.m. Sydney time. The contract gained 0.7 percent to close at $99 on Sept. 14, the highest since May 3. Prices are up 13 percent from a year ago.

Brent oil for November settlement was at $116.97 a barrel, up 31 cents, on the London-based ICE Futures Europe exchange. The front-month premium for the European benchmark contract to West Texas Intermediate was at $17.53, up from $17.33.

Bullish Bets
Hedge funds raised bullish bets on oil to a four-month high just before futures surged as much as 2.2 percent on Federal Reserve Chairman Ben S. Bernanke’s plan for a new round of growth-boosting measures.

Money managers increased net-long positions, or wagers on rising prices, by 5 percent in the seven days ended Sept. 11, according to the Commodity Futures Trading Commission’s Commitments of Traders report on Sept. 14. They were at the highest level since the week ended May 1.

Housing starts increased to an annual rate of 765,000, the fastest in almost four years, from 746,000 in July, according to the median forecast in a Bloomberg survey before the Commerce Department report. Existing-home purchases advanced to a three- month high, economists said before data from the National Association of Realtors.

Most oil-consuming nations consider $100 a barrel prices to be “fair,” Khatibi said in a report published by the Shana website yesterday. Iran, the third largest producer in the Organization of Petroleum Exporting Countries, is grappling with international sanctions over its nuclear program.

Iranian Imports
South Korea stopped buying crude from Iran in August after its refiners lost insurance coverage on ships carrying supplies from the Persian Gulf nation.

Purchases fell to zero last month, reducing imports from Iran for the first eight months of this year by 34 percent from a year earlier to 5.39 million metric tons, according to data posted on the Customs Service’s website Sept. 15. South Korea bought 1.14 million tons of crude oil, or about 270,000 barrels a day, in August 2011.

Iran is facing economic sanctions from Western countries alleging the Persian Gulf nation is building nuclear weapons as part of it atomic energy program.

To contact the reporter on this story: Ben Sharples in Melbourne at [email protected]

To contact the editor responsible for this story: Mike Anderson at [email protected]

 

[Muthukali]

Gold prices up 100 baht - Thailand

The Gold Traders Association this morning set the buying prices at 25,377.84 baht per baht-weight for gold ornaments and 25,750 baht per baht-weight for gold bar.

The selling prices were set at 26,250 baht per baht-weight for gold ornaments, and 25,850 baht per baht-weight for gold bar.

The gold prices went up 100 baht from Saturday’s close.

The buying prices on Saturday closed at 25,271.72 baht per baht-weight for gold ornaments and 25,650 baht per baht-weight for gold bar.

The selling prices closed at 26,150 baht per baht-weight for gold ornaments, and 25,750 baht per baht-weight for gold bar.

 

[Muthukali]

Fuel companies are playing the system: economists

Last Updated: Friday, August 31, 2012 02:40:00



Motorcyclists scramble to fill gas at a Petrolimex filling station in downtown Hanoi on Tuesday one hour before fuel prices rose for a third time in August. Photo: AFP

Experts say recent deregulation has sent gasoline prices rising uncontrollably and they urge the government to keep a closer tab on fuel companies to stop big players from manipulating the market unfairly.

Economist Ngo Tri Long said he is a supporter of a more market-driven business environment but he feels that fuel companies have taken advantage of loosened pricing regulations for profit.

Fuel distributors have recently been allowed to change prices every 10 days without having to seek for permission from the Finance Ministry as long as the adjustment is less than 7 percent. Long said so far fuel firms have never asked for an increase of more than 7 percent, which means the ministry has not been able to turn them down.

The problem is that nobody knows whether they were really incurring losses before the hikes, he told Vietweek.

“For instance, it looks transparent when fuel companies calculate their 30-day average price based on prices of fuel imported from Singapore, but in fact they may import more when prices are low and buy very little when prices increase,” said Long, former deputy head of the Market and Price Research Institute.

Long said the authorities have not monitored inventory levels at fuel companies closely and only pay attention when there is chaos in the market.

Economist Le Dang Doanh agreed that businesses have the right to raise prices when global prices rise, but their input costs should be disclosed and checked thoroughly.

“They are clever so they know exactly when to buy in when prices are low,” he said.

Long said the government should also consider a current policy that allows fuel companies to add a fixed profit margin of VND300 per liter into their input costs. When fuel companies demanded a price hike on Monday, claiming that they were facing a loss of VND1,200 per liter, they did not factor in that granted profit, he said.

“If fuel prices are left for the market to determine, fuel companies have to accept the fact that they may make profits or losses at any given time. So why does the government keep giving them a fixed profit of VND300 per liter?” he asked.

The prices of oil products were raised on Tuesday for the third time in less than a month due to global price increases. The most common grade of fuel in Vietnam, 92-RON gasoline, now retails at VND23,650 per liter, up 2.8 percent, following a 5 percent jump two weeks ago.

The hike was smaller than the one proposed by fuel firms as they were allowed to extract money from the nation’s price stabilization fund to offset their losses.

The Ministry of Finance decided to keep import taxes unchanged.

Huynh Van Minh, chairman of the Ho Chi Minh City Business Association, said fuel price hikes led to higher prices on many other products, so “it is hard to understand why the government allowed so many consecutive increases recently.”

“Prices can go up and down and that’s normal. But it’s not normal when fuel prices in Vietnam always increase sharply and hardly ever fall,” Minh said.

“That’s just not fair,” he said.

Some economists said even if the government wants to leave the market to supply and demand conditions, it should be flexible with its import tax policy to prevent prices from rising sharply. If the tariff on gasoline is lowered from 12 percent to 5 percent, prices can be reduced by approximately VND1,000 per liter, they said.

Economist Vu Dinh Anh said the real problem with the fuel market cannot be solved by deciding when to change prices or by cutting import duties.

“What really needs to be changed is the management of the market,” he said, noting that businesses should be given pricing freedom only when there is a real competition in the market.

State-owned Petrolimex now accounts for 60 percent of the local fuel market.

Experts warned that so many gasoline hikes over a short period time will take a toll on the economy, which has already slowed this year.

“We can’t just raise prices immediately after global oil prices go up,” said Tran Dinh Thien, director of the Vietnam Economics Institute.

“The market needs prices to stay stable for quite some time so that the economy can grow steadily,” he said.

 

[Muthukali]

Oil Gains on Speculation Biggest Drop Since July Was Exaggerated
By Ben Sharples - Sep 18, 2012 9:01 AM GMT+0800

Oil rose from the lowest close in a week in New York as investors speculated that the biggest drop in two months was exaggerated.

Futures advanced as much as 0.5 percent after slipping 2.4 percent yesterday, the most since July 23. Prices tumbled more than $3 in less than a minute as October options were about to expire. Oil slipped earlier after the Federal Reserve Bank of New York’s general economic index, known as the Empire State Index, reached a three-year low. An Energy Department report tomorrow may show crude stockpiles rose a second week, according to a Bloomberg News survey of analysts.

“The market has said the aggressive fall was ridiculous,” said Jonathan Barratt, the chief executive officer of Barratt’s Bulletin, a commodity newsletter in Sydney. “We’re all thinking that perhaps it was a fat finger by someone and down it tumbles. The realistic level should be a little bit higher.”

Oil for October delivery gained as much as 51 cents to $97.13 a barrel in electronic trading on the New York Mercantile Exchange and was at $96.94 at 10:58 a.m. Sydney time. The contract slid $2.38 yesterday to $96.62, the lowest close since Sept. 10. Prices are 1.9 percent lower this year.

Brent oil for November settlement rose 28 cents to $114.07 a barrel on the London-based ICE Futures Europe exchange. It dropped 2.5 percent yesterday. The front-month European benchmark grade’s premium to the corresponding West Texas Intermediate contract was at $16.84, unchanged from yesterday.

Crude Stockpiles
The Federal Reserve Bank of New York’s general economic index dropped to minus 10.41, the lowest since April 2009, from minus 5.85 in August. The median forecast of 53 economists in a Bloomberg survey called for minus 2. Readings less than zero signal contraction for the area of New York, northern New Jersey and southern Connecticut.

U.S. crude inventories probably climbed 1 million barrels last week, according to the median estimate of seven analysts in the Bloomberg survey before the Energy Department report. Gasoline supplies probably rose by 1.5 million barrels, the first gain in eight weeks, according to the survey.

Inventories of distillate fuel, a category that includes diesel and heating oil, probably rose for a sixth week, gaining 1 million barrels, or 0.8 percent, to 129.6 million barrels, the survey showed.

The American Petroleum Institute will release separate stockpile data today. The API collects stockpile information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the Energy Department for its weekly survey.

To contact the reporter on this story: Ben Sharples in Melbourne at [email protected]

To contact the editor responsible for this story: Mike Anderson at [email protected]

 

[Muthukali]

Fed Stimulus Fading as Forecasters Say Best Is Over: Commodities
By Maria Kolesnikova - Sep 20, 2012 7:01 AM GMT+0800

The biggest advances in commodities this year may be over because of mounting concern that policy makers aren’t doing enough to bolster economic growth at a time when producers are expanding supply.

The Standard & Poor’s GSCI gauge of 24 raw materials will end the year at 677, little changed from now, based on the median of 10 investor and analyst estimates compiled by Bloomberg. The index is about 2 percent lower since the European Central Bank announced an unlimited bond-purchase program Sept. 6 and 4 percent below its level when the Federal Reserve pledged a third round of debt-buying Sept. 13.

That contrasts with a 92 percent surge from the end of 2008 through June 2011 as the Fed bought $2.3 trillion of debt in two bouts of quantitative easing. The impact will probably be smaller this time, Barclays Plc says. Prices are already in a bull market, the 17-nation euro area is contracting and China has slowed for six straight quarters. Europe and China represent about 60 percent of global copper demand and about 33 percent of crude-oil consumption.

“The investment demand that might be driven by people’s changed perception after Fed action is not going to sustain a further long-term move of the commodity complex,” said Michael Aronstein, the president of Marketfield Asset Management in New York who correctly predicted the slump in prices in 2008 and the rebound in 2009. “The longer you keep prices in all of these sectors elevated, the more supply you recruit.”

Dollar Index
The S&P GSCI rose 2 percent this year, heading for a fourth consecutive annual advance. Soybeans and wheat led the gains after the worst U.S. drought since 1956. The MSCI All- Country World Index of equities jumped 13 percent and the U.S. Dollar Index, a measure against six major trading partners, dropped 1.4 percent. Treasuries returned 1.4 percent, a Bank of America Corp. index shows.

Commodity assets under management reached $406 billion at the end of July, from $399 billion at the start of the year, based on Barclays’ estimates of money tied to exchange-traded products, medium-term notes and indexes. Assets reached a record $451 billion in April 2011. Open interest, or contracts outstanding, across the members of the S&P GSCI rose 16 percent this year, data compiled by Bloomberg show.

Morgan Stanley is forecasting supply surpluses in aluminum, nickel, zinc and thermal coal in 2013 and Barclays expects a glut in lead for at least a third consecutive year. The rally in aluminum and zinc makes production cuts in China less likely, prolonging excessive production, Macquarie Group Ltd. said in a report Sept. 17.

Oil Inventories
While the Paris-based International Energy Agency anticipates record demand for oil in 2013, it said in a monthly report Sept. 12 that inventories have become “more comfortable.” Natural-gas futures tumbled 27 percent in the past year in New York as production in the U.S., the biggest producer and consumer, advanced to a record.

Gold will probably be among the biggest winners from quantitative easing, say JPMorgan Chase & Co., Standard Bank Group and Credit Suisse Group AG. Some investors buy bullion as a hedge against inflation and a weaker dollar. The metal, which reached a six-month high of $1,779.50 an ounce yesterday, will advance to a record $2,400 by the end of 2014, assuming the stimulus lasts until then, Bank of America Corp. said.

“We view owning commodities and gold in particular as more attractive post the QE3 announcement,” said Walter “Bucky” Hellwig, who helps manage $17 billion at BB&T Wealth Management in Birmingham, Alabama. “While the QE is there, it does keep the bid under commodities prices and gives them an opportunity to continue to move higher even with a sluggish economy.”

Interest Rates
Central-bank action should boost prices across precious and industrial metals, JPMorgan said in a report Sept. 14, citing a probable decline in the dollar. Gold, silver, Brent crude oil and aluminum will probably rally more than other commodities, Standard Bank said in a Sept. 17 report.

The Fed will buy $40 billion of mortgage debt a month and hold the benchmark interest rate near zero through at least mid- 2015. The ECB held its benchmark rate at a record low of 0.75 percent and said its program will target government bonds with maturities of one to three years. The Bank of Japan unexpectedly expanded its asset-purchase fund by 10 trillion yen ($126 billion) on Sept. 19. More than two-dozen nations cut market interest rates this year, data compiled by Bloomberg show.

The S&P GSCI in one year may be at 720 points, or about 6 percent higher than now, according to the Bloomberg survey. The International Monetary Fund expects global growth to accelerate to 3.9 percent next year, from 3.5 percent in 2012.

Hedge Funds
Commodities also may rally because of supply cuts. Morgan Stanley expects copper demand to outpace supply for a fourth year in 2013. The U.S. Department of Agriculture is forecasting the smallest global corn stockpiles in six years and the lowest soybean inventories in two decades after drought across the U.S. and Europe parched crops. Sanctions against Iran are crimping oil exports from what was once the second-biggest producer in the Organization of Petroleum Exporting Countries.

Hedge funds and other speculators remain bullish and held the biggest bet on rising prices in 16 months in the week ended Sept. 11, U.S. Commodity Futures Trading Commission data show. Holdings more than doubled since mid-June. That contrasts with a 95 percent reduction in the net-long position before the start of the first round of quantitative easing in December 2008.

“This is not as much as a one-way ticket as it has been in the previous two instances,” said Sean Corrigan, the chief investment strategist at Diapason Commodities Management SA in Lausanne, Switzerland, which has about $7 billion invested in commodities. “The tug of war is between how much is already priced in and how much poorer is the underlying commodity demand because the world economy is in a much worse condition now.”

Reserve Requirements
China, the biggest consumer of everything from coal to cotton to copper, set an annual growth target of 7.5 percent in March. It cut interest rates for the second time in less than a month in July and lowered reserve requirements three times between November and May. The government approved plans this month for a $158 billion subways-to-roads construction plan.

The economy of the euro area contracted 0.5 percent in the second quarter and probably won’t expand again until the second quarter of next year, according to the median of 24 economist estimates compiled by Bloomberg. The global economy is sliding into a “twilight zone,” caught between expansion and recession, and it “could go either way,” said Joachim Fels, the chief economist at Morgan Stanley in London.

Private Banking
Equities and high-yield debt probably will give greater returns than commodities, said Ashish Misra, the head of investment strategy at Lloyds TSB Banking Group in London. Its private banking unit manages about 11 billion pounds ($18 billion) of assets. Commodities have risen about fourfold since the end of 2001, during which the MSCI All-Country World Index gained 41 percent and Treasuries returned 77 percent.

“We’re heading for a period of underperformance in commodities after years of outperformance,” Misra said. “The effects of a slowdown in China and resumption of normal production trends in agriculture after this year’s drought- driven supply shocks should continue to pressure commodity prices downward.”

To contact the reporter on this story: Maria Kolesnikova in London at [email protected]

To contact the editor responsible for this story: Claudia Carpenter at [email protected]

 

[Muthukali]

Gold prices down 50 baht - Thailand

Published: 20/09/2012 at 09:33 AM
Online news:

The Gold Traders Association this morning set the buying prices at 25,332.36 baht per baht-weight for gold ornaments and 25,700 baht per baht-weight for gold bar.

The selling prices were set at 26,200 baht per baht-weight for gold ornaments, and 25,800 baht per baht-weight for gold bar.

The gold prices went down 50 baht from yesterday’s close.

The buying prices yesterday closed at 25,377.84 baht per baht-weight for gold ornaments and 25,750 baht per baht-weight for gold bar.

The selling prices closed at 26,250 baht per baht-weight for gold ornaments, and 25,850 baht per baht-weight for gold bar.

 

[Muthukali]

Gold Bulls Extend Streak as Prices Jump on Stimulus: Commodities
By Nicholas Larkin - Sep 21, 2012 11:13 AM GMT+0800

Gold traders extended their bullish streak as analysts from Bank of America Corp. to Deutsche Bank AG forecast record prices by next year after central banks pledged more action to bolster economic growth.

http://bloom.bg/RC6h3a

Fifteen of 29 analysts surveyed by Bloomberg expect prices to rise next week and seven were bearish. A further seven were neutral, extending the overall bullish outlook for an 18th week. Hedge funds’ bets on a rally are at a six-month high and investors bought the most through gold-backed exchange-traded products this quarter in more than two years.

The Federal Reserve announced a third round of debt-buying Sept. 13 and the Bank of Japan said two days ago it will add 10 trillion yen ($128 billion) to a fund that buys assets. The European Central Bank announced an unlimited bond-purchase program Sept. 6 and China approved a $158 billion subways-to- roads construction plan. Gold rose 70 percent as the Fed bought $2.3 trillion of debt in two rounds of quantitative easing from December 2008 through June 2011.

“Gold is one of the commodities that will benefit most from quantitative easing,” said Kamal Naqvi, the head of commodities sales in Europe, Middle East and Africa for Credit Suisse Group AG in London. “Everyone is talking about gold at $2,000 an ounce and I still think we’ll get to at least that.”

Gold’s Rally
Gold rose 13 percent to $1,765.35 an ounce in London this year, reaching a six-month high on Sept. 19 and extending 11 consecutive annual gains. It set a record $1,921.15 in September last year. The Standard & Poor’s GSCI gauge of 24 commodities added 1.6 percent since the beginning of January and the MSCI All-Country World Index of equities increased 12 percent. Treasuries returned 1.6 percent, a Bank of America index (MXWD) shows.

Some investors buy bullion as a hedge against inflation and a weaker dollar. The Fed said it will buy $40 billion a month of mortgage debt to bolster the labor market and probably hold the federal funds rate near zero until at least the middle of 2015. Inflation expectations measured by the break-even rate for five- year Treasury Inflation Protected Securities surged to the highest since May 2011 on Sept. 17.

Gold will climb to $2,000 by the second quarter and will reach $2,400 by the end of 2014 if the Fed’s latest easing lasts until then, Bank of America said in a Sept. 18 report. Prices will exceed $2,000 in the first half of next year, Deutsche Bank wrote that day. Morgan Stanley expects gold to average $1,816 next year and Standard Chartered predicts a second-quarter average of $1,900. Both would be the highest ever.

ETP Holdings
Investors bought 111.5 metric tons through gold ETPs since the beginning of July, the most since the second-quarter of 2010. Holdings reached a record 2,519.3 tons on Sept. 19 now valued at $143 billion, data compiled by Bloomberg show. Billionaire John Paulson raised his stake in the SPDR Gold Trust, the biggest gold product, by 26 percent in the second quarter and George Soros more than doubled his holdings, U.S. Securities and Exchange Commission filings showed Aug. 14.

Physical purchases will bolster prices before the Indian wedding season and religious festivals later this year, said James Moore, an analyst at FastMarkets Ltd. in London. Demand has waned this year as local prices surged to a record, with India’s gold imports falling 56 percent in the second quarter, according to the World Gold Council.

Coin Sales
The advance in ETP holdings has yet to be reflected in coin purchases. Sales of American Eagle gold coins by the U.S. Mint totaled 451,500 ounces since the start of January, 46 percent less than a year earlier, data on its website show.

Some technical indicators are signaling bullion may be poised to decline after rallying 12 percent in the past two months. The metal’s 14-day relative-strength index was at 72.7 yesterday, above the level of 70 that indicates to some analysts who study such charts that a drop in prices may be imminent.

Hedge funds and other speculators are anticipating more gains. They more than doubled their net-long position since July 24 to the most since Feb. 28, U.S. Commodity Futures Trading Commission data show.

In other commodities, 12 of 23 traders and analysts surveyed by Bloomberg expect copper to gain next week and eight predicted a drop. The metal for delivery in three months, the London Metal Exchange’s benchmark contract, climbed 8.5 percent to $8,243.25 a ton this year.

Sugar Survey
Five of six people surveyed said raw sugar will drop next week and one expected a gain. The commodity slid 15 percent to 19.71 cents a pound since the start of January on the ICE Futures U.S. exchange in New York.

Twelve of 28 people surveyed anticipate lower corn prices next week and nine were bullish, while 12 of 29 said soybeans will drop and 11 predicted gains. Corn jumped 16 percent to $7.525 a bushel in Chicago this year and reached a record $8.49 on Aug. 10 as the worst U.S. drought in a half century damaged crops. Soybeans set an all-time high on Sept. 4 and are up 37 percent this year at $16.595 a bushel.

The S&P GSCI gauge of raw materials will end the year at 677, about 3.2 percent higher than now, based on the median of 10 investor and analyst estimates compiled by Bloomberg. China has slowed for six consecutive quarters and the 17-nation euro area is contracting. The International Monetary Fund expects global growth to accelerate to 3.9 percent next year, from 3.5 percent in 2012.

“I still struggle to see how you can have a sustained rally in an environment of weak growth,” said Michael Widmer, an analyst at Bank of America Merrill Lynch in London. “If you get a bottoming out in growth and potentially a pickup through the second half of next year and have quantitative easing on top of that, I think you have a very good environment for a lot of commodities.”

Gold survey results: Bullish: 15 Bearish: 7 Hold: 7 Copper survey results: Bullish: 12 Bearish: 8 Hold: 3 Corn survey results: Bullish: 9 Bearish: 12 Hold: 7 Soybean survey results: Bullish: 11 Bearish: 12 Hold: 6 Raw sugar survey results: Bullish: 1 Bearish: 5 Hold: 0 White sugar survey results: Bullish: 1 Bearish: 5 Hold: 0 White sugar premium results: Widen: 1 Narrow: 0 Neutral: 5

To contact the reporter on this story: Nicholas Larkin in London at [email protected]

To contact the editor responsible for this story: Claudia Carpenter at [email protected]

 

[Muthukali]

Exclusive: North Korea plans agriculture reforms
By Benjamin Kang Lim
BEIJING | Sun Sep 23, 2012 6:16pm EDT

(Reuters) - North Korea plans to allow farmers to keep more of their produce in an attempt to boost agricultural output, a source with close ties to Pyongyang and Beijing said, in a move that could boost supplies, help cap rising food prices and ease malnutrition.

The move to liberalize agriculture under new leader Kim Jong-un, who took office in December 2011 after the death of his father, would reverse a crackdown on private production that started in 2005. It comes amid talk that the youngest Kim to rule the impoverished North is considering reforms to boost the economy.

"Peasants will have incentive to grow more food. They can keep and sell in the market about 30-50 percent of their harvest depending on the region," said the source.

At present, most farm output is sold to the government at a state auction price that has diverged from the market rate.

It was impossible to verify the plan independently in North Korea, one of the world's most closed states, although the source has proved reliable in the past, predicting North Korea's first nuclear test in 2006 days before it was conducted, as well as the ascent of Kim's uncle, Jang Song-thaek.

The plans come as some websites run by North Korean defector groups have said the price of rice - a staple food - more than doubled at the end of August from the start of June.

The surge in rice prices, cited by DailyNK, a North Korean defector website (www.dailynk.com), was driven by a fear of economic reforms that could in fact be punitive, like a 2009 currency revaluation that confiscated most peoples' savings. This report also could not be independently verified.

North Korea experienced a devastating famine in the 1990s from which its economy has not recovered, and a third of its population is malnourished, according to U.N. estimates. The country needs about 5 million tons of grain and potatoes to feed its people and since the early 1990s its annual harvest has been 3.5-4.7 million tons, according to most observers.

Experts in South Korea believe the North desperately needs fertilizer to boost yields in a country where soil has been degraded by erosion due to poor farming techniques.

LOST IN TRANSLATION
A recent visit to Beijing, North Korea's sole major economic and diplomatic ally, by the youngest Kim's uncle Jang appeared to be aimed at economic reforms in North Korea, whose centrally planned economy is smaller than it was 20 years ago.

North Korea wants to attract Chinese investment to help it overcome tough sanctions imposed in retaliation for its nuclear tests. Kim also aims to deliver on a promise to make the North a "prosperous" nation by 2012 and to banish memories of his father's austere 17-year rule.

But it is unclear how far Kim Jong-un can go in liberalizing the economy without losing his family's firm grip on power, most independent analysts say.

The source said a September 25 meeting of the Supreme People's Assembly, the North's rubber-stamp parliament, was likely to discuss "economic adjustment", but was unlikely to result in any major steps forward.

The phrase "economic adjustment" has been chosen carefully, the source added, noting the North's decision not to use the old catchcry of its key ally, China - "reform and opening up" - should not be misinterpreted as a lack of reformist will.

Instead, the source said, North Korea was indeed trying to follow in the footsteps of China but was avoiding the phrase coined by Beijing because of an unfortunate quirk of the Korean language. "It won't be called 'reform and opening up' because it sounds like 'dog fart' in Korean," the source said.

This is the second time this year that the parliament, which rarely meets, has been assembled this year, triggering speculation in the North Korea-watching community that it could be a forum for announcing major reforms.

The source said North Korea also planned to make its 1.2 million-strong military - one of the largest armed forces in the world - food self-reliant by modeling its production model on China's armed forces.

"The food (shortage) problem will hopefully be resolved by learning from the Xinjiang Construction and Production Corps," the source said, referring to the sprawling quasi-military network of state farms and factories in northwestern China intended to secure stability in the restive region by developing the economy and helping control borderlands.

The Xinjiang corps was founded in 1954 by late vice president Wang Zhen. As of March 2011, more than 2.6 million people lived in the corps' 14 divisions, which cover a combined area of more than 70,000 sq km (27,000 sq miles). The corps owns 179 farms, 1,400 enterprises, 13 listed companies, universities, media outlets and medical institutions, and its output was worth 75 billion yuan ($11.9 billion) in 2010.

North Korea's military also has significant economic interests and its armed forces are required in part to feed themselves as transport and a central distribution system have broken down, while fuel is in short supply.

The armed forces also have little to do, experts say, to occupy their time, and so farming is encouraged and praised in visits by Kim Jong-un and by his father Kim Jong-il, whose "field guidance" advice trips were a staple of North Korean state media reports.

The source said boosting the army's food self-reliance would not be a major change in North Korea's "military first" policy. "Hopefully, the military will become (food) self-reliant. It will be given land to grow its own rice and vegetables."

(Additional reporting and editing by David Chance in SEOUL; Editing by Mark Bendeich and Ian Geoghegan)

 

[Muthukali]

Pork Supply Shrinks to Lowest Since 1975 on Drought: Commodities
By Elizabeth Campbell - Sep 25, 2012 7:00 AM GMT+0800

U.S. hog farmers are slaughtering animals at the fastest pace since 2009 as a surge in feed costs spurs the biggest losses in 14 years, signaling smaller herds next year and a rebound in pork prices.

The 73.3 million hogs processed in eight months through August were the most in three years, U.S. Department of Agriculture data show. Pork supply will drop to the lowest per- capita since 1975 next year, the USDA estimates. Hog futures that fell more than any other commodity since June 30 may surge 40 percent within 12 months to as high as $1.055 a pound, according to the median of 12 analyst forecasts compiled by Bloomberg.

Crop damage from the worst U.S. drought since 1956 sent corn-feed prices surging to a record last month and may mean losses of about $44 a head for hog farmers in the fourth quarter, the most since 1998, Purdue University estimates. Two producers in Canada filed bankruptcy petitions this month. While the acceleration in slaughtering is boosting supply now, buyers including CKE Inc., the owner of Hardee’s and Carl’s Jr. fast- food chains, expect higher prices in 2013 as herds shrink and U.S. exports rise.

“We’re going to see more consolidation in the industry,” said Mark Greenwood, who oversees $1.4 billion of loans and leases to the hog business as a vice president at AgStar Financial Services Inc. in Mankato, Minnesota. “It’s only going to get worse on the higher feed prices.”

Worst Commodity
Futures on the Chicago Mercantile Exchange fell 21 percent since June 30, the biggest drop among 24 commodities tracked by the Standard & Poor’s GSCI Spot Index (MXWD), which rose 9.7 percent. The MSCI All-Country World Index of equities gained 7.7 percent this quarter and Treasuries returned 0.2 percent, a Bank of America Corp. index shows.

A pig eats 10 bushels of corn to reach a slaughter weight of about 270 pounds (122 kilograms), the University of Missouri at Columbia estimates. Corn futures rose 47 percent since mid- June after the USDA predicted the drought will cut domestic output by 13 percent. Prices reached a record $8.49 a bushel in Chicago on Aug. 10.

Producers may receive about $56 per hundredweight for hogs in the fourth quarter, and the cost of production is estimated at about $72.29 per hundredweight, said Chris Hurt, an agricultural economist at Purdue University in West Lafayette, Indiana. That means farmers may earn about $151.20 for a 270- pound hog that cost about $195.18 to produce.

Slaughter Rush
Hog farmers will see “huge amounts of red ink” in the fourth quarter, said Jim Robb, the director of the Livestock Marketing Information Center, which is funded by the industry, universities and government. Fewer sows will be kept for breeding, cutting output and tightening pork supply, he said. That will raise both wholesale and retail prices to records by the second half of 2013, Robb said.

Prices for now are retreating, with wholesale pork costs tracked by the USDA tumbling as much as 25 percent since June 25 to the lowest in almost two years on Sept. 19. Hog slaughtering climbed 2.8 percent in first eight months of the year, the most since 2009, when farmers sought to shrink herds amid weaker demand following the global recession and the outbreak of the H1N1 virus, known as swine flu.

The 12 percent drop in corn prices from a record last month, and the prospect of bigger harvests next year, may encourage some hog farmers to slow their herd reduction. Slaughter rates in the five weeks through Sept. 1 rose less than 5 percent from a year earlier. That may leave enough sows to accelerate production once feed costs have come down enough, Rachel J. Johnson, a USDA economist, wrote in a Sept. 18 report.

Cheap Hogs
Meatpackers processed an estimated 79.735 million hogs in this year through Sept. 22, 2 percent more than a year earlier, government data show. Animals sold at slaughterhouses fell to 63.58 cents a pound on Sept. 14, the lowest since Nov. 26, 2010. Prices retreated 8.5 percent this year.

Lean-hog futures for July delivery are trading at 97.725 cents a pound, compared with 75.35 cents for this December, a sign traders are already anticipating fewer supplies next year. Per-capita pork supplies will shrink to 45.2 pounds next year, the lowest since 1975, the USDA estimates.

U.S. hog producers are retaining fewer gilts, or young females that haven’t had a litter yet, reducing the number available to replace older sows, said Rich Nelson, the chief strategist at Allendale Inc. in McHenry, Illinois, who has tracked the market for about 15 years.

Cheaper Meat
Even with higher prices, pork will remain cheaper than beef, said John Nalivka, the president of Sterling Marketing Inc., an agricultural economic research and advisory company in Vale, Oregon. Wholesale pork fell 8 percent to 78.34 cents a pound this year, as beef declined 1 percent to $1.9269 a pound, USDA data show.

“If you got sticker shock on pork, you’ll have a heart attack when you look at beef,” C. Larry Pope, the chief executive officer of Smithfield Foods Inc. (SFD), the world’s biggest pork processor, said on a conference call with analysts Sept. 4.

The price gap between hog and cattle futures was the widest in more than 26 years on Sept. 12, signaling consumers may switch to pork over beef. Rising U.S. pork exports may also spur a rebound in prices, according to Purdue’s Hurt.

U.S. exporters shipped 3.14 billion pounds (1.43 million metric tons) in the first seven months of this year, 11 percent more than a year earlier, USDA data show. Exports will expand to 5.35 billion pounds next year, from an estimated 5.346 billion in 2012, the government forecasts.

Food Costs
Rising pork prices will boost costs for restaurants and grocery stores. Consumers may pay as much as 3 percent more for pork this year and as much as 3.5 percent more in 2013, the government projects.

CKE, based in Carpinteria, California, has lower pork costs now because of the higher slaughter rate, according to CEO Andrew Puzder. Pork and beef prices probably will rise next year and the chain may offer more chicken instead, he said.

Cracker Barrel Old Country Store Inc. (CBRL)’s meat costs are rising because of feed prices, CEO Sandra Cochran said by phone. The chain, which operates more than 600 restaurants across 42 states, will probably pay about 5 percent to 6 percent more for its food commodities in its fiscal year ending in July, Chief Financial Officer Lawrence Hyatt said on a conference call with analysts Sept. 19. The chain, based in Lebanon, Tennessee, is raising menu prices about 2 percent in fiscal 2013.

Bob Evans Farms Inc., the Columbus, Ohio-based restaurant chain, has seen a drop in sow costs as herds are liquidated, and expects prices to stay low until the culling stops, CFO Paul DeSantis said on a conference call with analysts Aug. 15. Once that is over, “prices tend to increase very rapidly,” he said.

Pork Development
Big Sky Farms, the second-largest hog producer in Canada, went into receivership this month partly because of rising feed costs, said Neil Ketilson, the general manager of the Saskatchewan Pork Development Board. The company produces more than 1 million pigs a year, according to its website. Puratone Corp. sought protection from creditors on Sept. 12. The Niverville, Manitoba-based company markets more than 500,000 hogs per year, according to its website.

Brad Hennen, a hog producer in southwest Minnesota, is reducing the size of his business because costlier feed and declining prices for weaned pigs. While he generally markets as many as 15,000 pigs annually, he expects to sell no more than 6,000 this year.

“It could easily get worse than that,” said Hennen, who has been raising hogs since 1987 and is based about 3.5 miles northeast of Ghent, Minnesota. “What can I do now to minimize my losses and still have a business for when the cash starts flowing again?”

To contact the reporter on this story: Elizabeth Campbell in Chicago at [email protected]

To contact the editor responsible for this story: Steve Stroth at [email protected]

 

[Muthukali]

Gold prices up 50 baht - Thaialnd

Published: 25/09/2012 at 09:29 AM
Online news: Local News

The Gold Traders Association this morning set the buying prices at 25,377.84 baht per baht-weight for gold ornaments and 25,750 baht per baht-weight for gold bar.

The selling prices were set at 26,250 baht per baht-weight for gold ornaments, and 25,850 baht per baht-weight for gold bar.

The gold prices went up 50 baht from yesterday’s close.

The buying prices yesterday closed at 25,332.36 baht per baht-weight for gold ornaments and 25,700 baht per baht-weight for gold bar.

The selling prices closed at 26,200 baht per baht-weight for gold ornaments, and 25,800 baht per baht-weight for gold bar.

 

[Muthukali]

Hedge Funds Bullish on Silver as Hoard Nears Record: Commodities
By Nicholas Larkin and Debarati Roy - Sep 27, 2012 7:01 AM GMT+0800

Hedge funds are the most bullish on silver in seven months and investors’ holdings are expanding toward a record on speculation the metal will outperform gold as central banks seek to boost growth.

Wagers on rising prices jumped 10-fold since June, U.S. Commodity Futures Trading Commission data show. Investors bought 717.2 metric tons valued at $771.9 million through exchange- traded products this quarter, the most in a year, according to data compiled by Bloomberg. Prices will increase for at least the next three quarters and average $38 an ounce in the three months through June, or 14 percent more than now, based on the median of 14 analyst estimates compiled by Bloomberg.

If history is any guide, silver will beat gold after the Federal Reserve announced a third round of debt-buying and central banks from Europe to Japan pledged more action. Silver rose about 53 percent in the Fed’s first quantitative easing from December 2008 through March 2010, twice as much as gold, and 24 percent during the second phase ending in June 2011, three times as much. Silver will probably keep beating gold in the next several quarters, Morgan Stanley predicts.

“The recent announcements on the part of central banks really sparked the rally,” said Peter Sorrentino, who helps manage $14.6 billion of assets at Huntington Asset Advisors in Cincinnati. “Silver has now become a two-way play, getting bids both on industrial demand as well as a monetary hedge.”

U.S. Drought
Silver, used in everything from televisions to solar panels, climbed 20 percent to $33.475 in London this year, beating gold’s 12 percent gain. It is this quarter’s second-best performing commodity after lead. The Standard & Poor’s GSCI gauge of 24 commodities advanced 0.9 percent since the start of January and the MSCI (MXWD) All-Country World Index of equities rose 11 percent. Treasuries returned 2 percent, a Bank of America Corp. index shows.

Some investors buy gold and silver as a hedge against inflation and a weaker dollar. Inflation expectations measured by the break-even rate for five-year Treasury Inflation Protected Securities rose to the highest since May 2011 on Sept. 17. The U.S. Dollar Index, a measure against six major trading partners, weakened 7.7 percent since the end of November 2008.

The Fed said Sept. 13 it will buy $40 billion of mortgage debt a month and probably hold the federal funds rate near zero until at least the middle of 2015. Precious metals generally earn returns only through price gains, increasing their allure as interest rates decline.

Silver Coins
Hedge funds and ETP investors’ bullishness has yet to extend to demand for American Eagle silver coins, a market valued at about $1.3 billion in 2011 based on metal content. The U.S. Mint sold 25.8 million ounces since the start of January, 23 percent less than a year earlier, data on its website show.

Central bankers are increasing stimulus because of concern about growth. Industrial applications account for 53 percent of silver demand. International Monetary Fund Managing Director Christine Lagarde said in a speech in Washington on Sept. 24 that the group sees global growth “a bit weaker” than it had forecast in July. The fund expected growth of 3.5 percent this year and 3.9 percent in 2013.

Industrial Metals
“The slowdown impact is not over as yet for industrial metals including silver,” said Dan Denbow, a fund manager at the $2.1 billion USAA Precious Metals & Minerals Fund in San Antonio. “The money coming in today because of all the easing will not impact the economy for six months or so.”

Weaker industrial demand would leave investors with a bigger glut to absorb. Production will exceed consumption for a fifth year in 2013, leaving a surplus of 5,095 tons, Barclays Plc estimates. Higher prices may also encourage more recycling. Scrap supplies jumped 10 percent in 2010 as prices almost doubled, according to Barclays.

Silver imports by China, the second-biggest user after the U.S., reached a one-year high in August, customs data show. The nation’s growth will accelerate to 8.5 percent next year from 8 percent this year, the International Monetary Fund estimates.

Hedge funds raised their net-long position to the highest since Feb. 28 in the week ended Sept. 18, holding a combined 30,986 futures and options, CFTC data show. Investors now own 18,601.4 tons through ETPs, or 0.2 percent below the record set in April 2011, data compiled by Bloomberg show.

Coeur d’Alene
While the metal is trading 33 percent below the record $49.79 set in April 2011, this year’s average of $30.65 is the second-highest ever.

That will boost profit for Coeur d’Alene Mines Corp., which gets about 65 percent of its revenue from silver. Net income will jump 39 percent to a record $129.7 million this year, according to the mean of five analyst estimates compiled by Bloomberg. Shares (CDE) of the Coeur d’Alene, Idaho-based company rose 13 percent this year and will climb 12 percent to $30.59 in 12 months, according to the average of seven forecasts.

Pan American Silver Corp. (PAAS), based in Vancouver, will report profit of $264.6 million next year, from $212.2 million, the mean of five estimates shows. Shares of the company fell 6.1 percent in New York trading since the start of January and will rise 14 percent to $23.31 in the next 12 months, according to the average of 14 forecasts.

“In this accommodative monetary policy scenario, silver seems to be trading as an alternative currency,” said Michael Cuggino, who manages about $17 billion at San Francisco-based Pacific Heights Asset Management. “If the global economy picks up, silver will show some strength from industrial demand.”

To contact the reporters on this story: Nicholas Larkin in London at [email protected]; Debarati Roy in New York at [email protected]

To contact the editor responsible for this story: Claudia Carpenter at [email protected]

 

[Muthukali]

Oil Trades Near Eight-Week Low on Weaker Demand, European Crisis
By Ben Sharples - Sep 27, 2012 7:24 AM GMT+0800

Oil traded near the lowest level in almost two months after U.S. fuel demand slipped to the weakest since April amid concern the European debt crisis will worsen and derail the global economy.

Futures were little changed in New York after slipping 1.5 percent yesterday for the seventh decline in eight days. U.S. total fuel use decreased 1.1 percent in the four weeks ended Sept. 21 and crude stockpiles last week were at the highest level for this time of the year since 1990, according to an Energy Department report. The Bank of Spain said the nation’s economy shrank at a “significant pace” in the third quarter.

Oil for November delivery was at $90.14 a barrel, up 16 cents, in electronic trading on the New York Mercantile Exchange at 9:22 a.m. Sydney time. The contract yesterday fell $1.39 to $89.98, the lowest close since Aug. 2. Prices are up 6.1 percent this quarter and down 8.8 percent this year.

Brent oil for November settlement dropped 41 cents, or 0.4 percent, to $110.04 a barrel on the London-based ICE Futures Europe exchange yesterday. The European benchmark grade’s premium to West Texas Intermediate closed at $20.06, the widest spread since Aug. 16.

U.S. total fuel use dropped to 18.4 million barrels a day, the lowest level since April 6, the Energy Department report showed yesterday. Crude stockpiles fell 2.45 million barrels to 365.2 million barrels, the report showed. They were forecast to rise 1.9 million barrels, according to a Bloomberg survey.

Spanish protesters marched for a second night in Madrid, calling on Prime Minister Mariano Rajoy to reverse austerity measures as his nine-month-old government prepared its fifth package of budget cuts. The nation’s 10-year bond yields rose above 6 percent, approaching the levels seen before European Central Bank President Mario Draghi offered to buy struggling nations’ debt.

To contact the reporter on this story: Ben Sharples in Melbourne at [email protected]

To contact the editor responsible for this story: Alexander Kwiatkowski at [email protected]

 

[Muthukali]

Rubber up $100 a tonne in a week

Tuesday, 25 September 2012 Gregory Pellechi

The price of rubber jumped to $2,500 per tonne last week after months of the commodity steadily dropping, industry analysts reported.

The jump of $100 a tonne, or 4.2 per cent, comes after the price for rubber dropped in June from above $3,000 per tonne, according to data from the Cambodia Rubber Association.

Ly Phalla, director general of the Rubber Department of the Ministry of Agriculture, Forestry and Fisheries, said the price of rubber has gone up, “but not so much as compared to 2011”.

He attributed the change in price to three things in particular: the economic recovery in the United States and China, the work of the International Tripartite Rubber Council (ITRC), and the rainy season.

“There are lots of factors affecting the price of rubber in Cambodia, such as the world price, recovery of the USA, EU and China and even the drop in petrol prices. Now that we are in the rainy season supplies will be affected too. The three countries Malaysia, Thailand and Indonesia have been affecting stocks.”

Soon Jin, an economist at the Association of Natural Rubber Producing Countries (ANRPC) which Cambodia is a member of, concurred in Ly.

“The jump in the rubber price could be caused by the signs of economic recovery from China and US, where investors are confident and react positively to the market,” she said in an email.

The ITRC played a role as well by intervening in the market, she added.

For example, last month the ITRC agreed to take steps to boost prices by cutting shipments and old trees and by buying up stock for national reserves, according to Bloomberg.
To contac the reporter on this story: Greogry Pellechi at [email protected]

 

[Muthukali]

Gold prices up 150 baht - Thailand

Published: 28/09/2012 at 09:38 AM
Online news: Local News

The Gold Traders Association this morning set the buying prices at 25,423.36 baht per baht-weight for gold ornaments and 25,800 baht per baht-weight for gold bar.

The selling prices were set at 26,300 baht per baht-weight for gold ornaments, and 25,900 baht per baht-weight for gold bar.

The gold prices went up 150 baht from yesterday’s close.

The buying prices yesterday closed at 25,271.72 baht per baht-weight for gold ornaments and 25,650 baht per baht-weight for gold bar.

The selling prices closed at 26,150 baht per baht-weight for gold ornaments, and 25,750 baht per baht-weight for gold bar.

 

[Muthukali]

Corn Futures Jump Most Since June on Unexpected U.S. Supply Drop
By Jeff Wilson - Sep 29, 2012 3:51 AM GMT+0800

Corn prices surged the most in three months after the U.S. reported an unexpected plunge in domestic inventories to an eight-year low, signaling stronger demand for the grain.

Stockpiles left from last year’s harvest in the U.S., the world’s biggest grower and exporter, totaled 988 million bushels on Sept. 1, down 12 percent from 1.128 billion a year earlier, the U.S. Department of Agriculture said today in a report. Analysts in a Bloomberg survey expected 1.145 billion, on average. Wheat inventories fell to a four-year low, and sorghum reserves were the smallest since 1996, the agency said.

Grain supplies were tightening as record Midwest heat in June and July sparked the worst drought since 1956, causing crop damage that insurers estimate may double payouts to U.S. farmers this year to more than $20 billion. Corn prices have surged 49 percent since mid-June, boosting costs that already are forcing output cuts by meat companies including Sanderson Farms Inc. (SAFM) and ethanol makers including Valero Energy Corp. (VLO)

“With corn inventories less than a billion bushels and wheat and sorghum stocks also shrinking, the grain trade is looking at a very tight supply situation,” Mark Schultz, the chief analyst for Northstar Commodity Investment Co. in Minneapolis, said in a telephone interview. “This report signals that demand has not slowed, shifting the focus to the smaller harvest expected this year.”

Price Rally
Corn futures for December delivery rose by the 40-cent limit on the Chicago Board of Trade to close at $7.5625 a bushel at 2 p.m. That 5.6 percent gain was the biggest for the most- active contract since June 25. Before the report, the price slipped to $7.05, the lowest since July 12 and 17 percent below the record of $8.49 reached on Aug. 10.

The USDA this month predicted a harvest of 10.727 billion bushels, a drop of 13 percent from last year and down from 10.779 billion forecast in August. The agency, which had been predicting a record crop in June, before the drought, will update its projections for major crops on Oct. 11.

Today’s stockpile tally showed a decline from the USDA’s Sept. 12 report, when the agency predicted an increase to 1.181 billion bushels because some of this year’s harvest may have been consumed in place of the 2011 crop. Dry weather allowed farmers before Sept. 1 to collect grain that normally isn’t ready until October. The government said that 1.2 billion bushels of this year’s crop were available for consumption before Sept. 1, about 700 million more than a year earlier.

Less Output
Rabobank said in an e-mailed report today that the inventory estimate probably includes some grain from the 2012 crop, suggesting feed demand was larger than implied in the government report. Production this year probably will drop to 10.2 billion bushels, or 4.9 percent less than the USDA forecast, the bank said.

The government probably will boost its price forecast, which would “be bullish for CBOT corn futures,” Rabobank analysts including Luke Chandler said in the report today.

Declining U.S. output will reduce global supplies by 4.9 percent from a year earlier, the International Grains Council said today. World growers will harvest 833 million metric tons in the 2012-2013 crop year, down from 875 million the previous year, the London-based council said. World inventories before next year’s harvest will fall to 118 million tons from 135 million estimated this year, the council said.

Soybeans
U.S. soybean inventories on Sept. 1 totaled 169 million bushels, down from 215 million a year earlier, the USDA said. The average analyst estimate was 130 million bushels. The department raised its 2011 production figure to 3.094 billion bushels, up 39 million bushels, or 1.2 percent, from its Sept. 12 estimate.

Soybean consumption in the final quarter of the year ended Aug. 31 rose to 498 million bushels from 405 million a year earlier, the USDA said.

“Soybean supplies will be tight for the next six months,” Dave Marshall, a farm marketing adviser for Toay Commodity Futures Group LLC in Nashville, Illinois, said before the report. “Supplies in South America are headed for a record, and people are shifting their focus to the start of the planting season this month in Argentina and Brazil.”

Soybean futures for November delivery rose 1.9 percent to settle at $16.01 a bushel in Chicago, paring this week’s decline to 1.3 percent. The price fell 8.9 percent in September, after reaching a record $17.89 on Sept. 4 on speculation that August rains boosted Midwest yields this year.

About 2.634 billion bushels are expected to be harvested this year, the USDA said in a Sept. 12 report. The figure is 15 percent smaller than today’s revised estimate for 2011.

Corn is the biggest U.S. crop, valued at $76.5 billion in 2011, followed by soybeans at $35.8 billion, government figures show.

To contact the reporter on this story: Jeff Wilson in Chicago at [email protected]

To contact the editor responsible for this story: Steve Stroth at [email protected]

 

[Muthukali]

Oil prices near $92 on Spanish budget pledge
By PABLO GORONDI
Associated Press
2012-09-28 08:01 PM

The price of oil crept up above $92 a barrel Friday on hopes the global economy might see some improvement after Spain announced far-reaching steps to fix its ailing economy.

By early afternoon in Europe, benchmark oil for November delivery was up 21 cents to $92.06 per barrel in electronic trading on the New York Mercantile Exchange. The contract rose $1.87 to finish at $91.85 per barrel on the Nymex on Thursday.

In London, Brent crude gained 78 cents to $112.79 on the ICE Futures exchange.

"Risk appetite improved yesterday on the Spanish budget," analysts at Credit Agricole CIB in Hong Kong said in a market commentary. "With the Spanish budget paving the way for an official bailout request ... renewed concern about the Eurozone crisis has eased."

After three straight days of declines, oil posted gains in Asia on Thursday, helped by expectations the People's Bank of China will soon take more steps to stimulate the world's No. 2 economy. Spain later announced severe budget cuts intended to convince the world that it can meet deficit-reduction targets.

Oil prices also gained support from speculation that Israel was moving closer to military action against Iran's nuclear facilities, after Israeli Prime Minister Benjamin Netanyahu said at the United Nations that Iran would have enough enriched uranium by mid-2013 to build a nuclear bomb.

Still, oil analyst Stephen Schork said he expects "high volatility" as oil contracts for October expire.

In other Nymex trading in November contracts:

_ Heating oil rose 0.99 cent to $3.1607 per gallon.

_ Wholesale gasoline gained 2.52 cents to $2.9224 per gallon.

_ Natural gas rose 0.9 cent to $3.306 per 1,000 cubic feet.

_ Pamela Sampson in Bangkok contributed to this report.

 

[Muthukali]

Soybeans Drop to Lowest Since July as U.S. Harvest Progresses
By Luzi Ann Javier - Oct 2, 2012 9:40 AM GMT+0800

Soybeans declined to the lowest level in more than two months and corn fell as harvesting in the U.S. advanced at the fastest pace in at least three decades, aided by warm and dry weather after a drought this year reduced yields.

November-delivery soybeans lost as much as 0.6 percent to $5.51 a bushel on the Chicago Board of Trade, the lowest price for the most-active contract since July 27. Futures traded at $15.575, down 0.2 percent at 9:28 a.m. Singapore time, extending yesterday’s 2.6 percent decline.

About 41 percent of the soybean crop in the U.S., the largest grower last year, was harvested as of Sept. 30, compared with 15 percent a year earlier and 19 percent, on average, from 2007 to 2011, the Department of Agriculture said yesterday. Fifty-four percent of the corn crop was collected, up from 18 percent a year earlier and an average of 20 percent for the previous five years, it said. The harvest pace is the fastest since the USDA began collecting the data in 1981.

“It’s more the pace of harvesting that’s pushing prices lower, as it eases supply concerns,” Chung Yang Ker, an analyst at Phillip Futures Pte., said by phone from Singapore. “There’s also the anticipation for larger-than-expected yields.”

About 35 percent of the soybean crop was rated good-to- excellent as of Sept. 30, unchanged from a week earlier, and up from 33 percent on Sept. 16, the USDA said yesterday. Yields are forecast to drop to 35.3 bushels an acre, from 41.5 bushels a year earlier, according to the latest USDA outlook on Sept. 12.

Corn for December delivery declined as much as 0.5 percent to $7.5275 a bushel, before trading at $7.5625. December- delivery wheat slid 0.4 percent to $8.8075 a bushel, extending a yesterday’s 2 percent slump.

To contact the reporter on this story: Luzi Ann Javier in Singapore at [email protected]

To contact the editor responsible for this story: James Poole at [email protected]

 

[Muthukali]

Oil Trades Near One-Week High as U.S. Manufacturing Expands
By Ben Sharples - Oct 2, 2012 9:38 AM GMT+0800

Oil traded near the highest close in a week in New York after a measure of U.S. manufacturing beat economists’ forecasts and before a report forecast to show shrinking fuel supplies in the world’s biggest crude consumer.

Futures were little changed after advancing for a third day yesterday. The Institute for Supply Management’s U.S. factory index increased to 51.5 in September, exceeding the median forecast of 49.7 in a Bloomberg News survey. Crude supplies in the U.S. probably gained last week while gasoline and diesel inventories shrank, according to a separate survey.

“We’ve seen a bounce off recent lows and I think the primary motivator was the ISM figure,” said Ric Spooner, a chief market analyst at CMC Markets in Sydney. “It points to the fact that we’re seeing what looks like an improvement in the rate of growth in the U.S. economy.”

Crude for November delivery was at $92.57 a barrel, up 9 cents, in electronic trading on the New York Mercantile Exchange at 8:45 a.m. Singapore time. The contract climbed 0.3 percent to $92.48 yesterday, the highest close since Sept. 21. Prices are down 6.3 percent this year.

Brent oil for November settlement increased 23 cents to $112.42 a barrel on the London-based ICE Futures Europe exchange. The European benchmark grade’s premium to West Texas Intermediate was $19.87 a barrel, compared to $19.71 yesterday.

Fuel Supplies
Oil in New York has technical resistance along its 50-day moving average, at $93.64 a barrel today, according to data compiled by Bloomberg. Futures halted yesterday’s advance near this indicator. Sell orders tend to be clustered near chart- resistance levels.

U.S. crude stockpiles probably gained 1.5 million barrels last week, according to a Bloomberg survey before an Energy Department report tomorrow. The American Petroleum Institute will release separate inventory data today.

Gasoline supplies may have dropped 375,000 barrels last week, according to the median estimate of six analysts in the survey. Distillate stockpiles, a category that includes heating oil and diesel, probably fell 450,000 barrels.

The industry-funded API collects stockpile information on a voluntary basis from operators of refineries, bulk terminals and pipelines. The government requires that reports be filed with the Energy Department for its weekly survey.

U.S. Gasoline
Gasoline at U.S. pumps dropped for the second week, tracking a more than $4-a-barrel slide in oil prices last month and after oil refiners on the U.S. Gulf Coast restored output following Hurricane Isaac.

The national average for regular gasoline fell 2.2 cents to $3.804 a gallon from a week ago, the U.S. Energy Information Administration said in a survey posted on its website yesterday. Prices were up 11 percent from $3.433 a year earlier.

Retail gasoline began dropping Sept. 24 after 11 weeks of consecutive gains that boosted prices to a record high for the season. Oil in New York slid $4.28 a barrel last month and settled below $90 on Sept. 26 for the first time in eight weeks. Crude accounts for about 66 percent of the costs of the motor fuel, the Energy Department said.

To contact the reporter on this story: Ben Sharples in Melbourne at [email protected]

To contact the editor responsible for this story: Alexander Kwiatkowski at [email protected]

 

[Muthukali]

Rice farmers rally against Nida group
Academics blasted for opposition to pledging
Published: 3/10/2012 at 03:01 AM
Newspaper section: News

Rice farmers are threatening to step up protests against academics who they have blasted for opposing the government's rice pledging scheme.

The warning was issued by leaders of about 3,000 rice farmers who gathered at the National Institute of Development Administration (Nida) yesterday to protest against a call by a group of its lecturers for the Constitution Court to scrap the programme.

The lecturers' group has petitioned the court to call a halt to the pledging, claiming that it violates the constitution which promotes free trade and prohibits the state from competing in businesses with the private sector.

The farmers lambasted the academics for their move and accused them of being manipulated as a political tool against the government.

Protest leader Khwanchai Mahachuenjai, who is president of the Samtum tambon administration organisation in Ayutthaya, said the pledging scheme helped free farmers from massive debts and improve their lives.

The farmers who joined yesterday's protest came from the Central Plains, the West, the East and the South.

Mr Khwanchai said the group would intensify their protests at the institute later unless its academics call off their opposition to rice pledging.

A group of red-shirt protesters also rallied at Government House yesterday to support the government's rice scheme and later joined the farmers at Nida.

About 5,000 rice farmers from Suphan Buri, Ang Thong, Pathum Thani, Ayutthaya and Chai Nat rallied at the provincial hall of Suphan Buri yesterday in support of pledging and denounced the move by the Nida academics.

About 200 rice farmers from Chiang Mai and Lamphun staged a similar protest at the Chiang Mai provincial hall to demand Nida academics withdraw their request for the Constitution Court to rule on the scheme.

Phetchaburi senator Sumol Sutawiriyawat said the academics filed their complaint with the court because the government has wasted 400-500 billion baht on the rice scheme in the 2011-2012 crop season as it set the pledging rate too high.

Appointed senator Paibul Nititawan said the high rice pledging price should cover only small-scale farmers and the government should set another rate equal to the market price for large-scale businessmen involved in the rice trade.

As the government's pledging price is higher than the market price, the senator said that landlords were reclaiming their paddy fields from small-scale rice farmers who were lessees.

He said the landlords wanted to grow rice by themselves and cash in on the pledging money and this would cause problems for small farmers.

Opposition Democrat MP Warong Detkitwikrom yesterday dismissed Commerce Minister Boonsong Teriyapirom's statement that only 4 million tonnes of rice remained in the government's stocks, which had previously amounted to 14 million tonnes.

He said the government actually only sold about 286,600 tonnes of rice and 34,300 tonnes of broken rice from its 2011-2012 crop season stocks.

Prime Minister Yingluck Shinawatra yesterday insisted the rice pledging scheme would continue to help farmers, and without it, rice prices would tumble.

She assured that her government could sell off the rice in its stocks.

The premier admitted the pledging scheme would cause some losses to the government but said raising incomes of farmers would stimulate the economy.Mr Boonsong said the government would continue to stage bidding contests to sell rice from its stocks and even if quotations from potential buyers were too low, the government could keep the rice for food security.

The cabinet yesterday decided to proceed with the pledging programme for the 2012-2013 crop season. It plans to spend 405 billion baht to accept 26 million tonnes of rice under the scheme in the upcoming season.

The government expects 15 million tonnes of rice will come from the main crop and 11 million more from the second. Pledging will cost the government 240 billion baht for the main crop and 165 billion for the second crop.

The government plans to borrow 150 billion baht for its spending and hopes revenues from rice sales will make up for the remainder of the pledging costs.

The Commerce Ministry expects to raise 85 billion baht from the sale of government rice this year and 175 billion baht more from sales next year.

 

[Muthukali]

Gold prices down 100 baht - Thailand
Published: 3/10/2012 at 09:41 AM
Online news: Local News

The Gold Traders Association this morning set the buying prices at 25,332.36 baht per baht-weight for gold ornaments and 25,700 baht per baht-weight for gold bar.

The selling prices were set at 26,200 baht per baht-weight for gold ornaments, and 25,800 baht per baht-weight for gold bar.

The gold prices went down 100 baht from yesterday’s close.

The buying prices yesterday closed at 25,423.32 baht per baht-weight for gold ornaments and 25,800 baht per baht-weight for gold bar.

The selling prices closed at 26,300 baht per baht-weight for gold ornaments, and 25,900 baht per baht-weight for gold bar.