Govt Open to Extension of Raw Mineral Ban Deadline

By Ranga Prakoso, October 21, 2013.
The Jakarta Globe
Details are emerging as to how the government will allow case-by-case extensions to next year’s deadline of a mineral export ban, a top official said in Jakarta. Initial indications suggest it will include export quotas and collateral from mining companies.

Companies are likely to miss the deadline set by a 2009 law forcing them to process all their ore domestically or risk shutting down their operations and laying off thousands of workers.

After the deadline has passed, companies would be unable to export raw minerals.

The government is sending out a team to verify 28 smelter projects across the country. The findings would provide the basis for extensions to the deadline.

The team, comprising officials from the industry, energy and mineral resources, and trade ministries will verify the progress being made by mining companies to determine their commitment to the new regulations, said Dede Ida Suhendra, director of mineral concession and development at the Ministry of Energy and Mineral Resources.

“The results of the verification will be the starting point for determining a company’s mineral ore export quota in 2014,” Dede said on Sunday.

He said companies would have to pay a bond to the government as collateral they would finish the smelter by a stated deadline. The verification team would give a recommendation for the amount of the bond while the government and economists will have the final say.

Should the company fail to complete the smelter on time the government would keep the collateral.

Susilo Siswoutomo, deputy minister of energy and mineral resources, said on Friday miners that proved their commitment to processing mineral commodities domestically would be allowed to continue exporting for a specified period.

Susilo said the government would ask the House of Representatives how to allow mineral exports without having to revise the 2009 law.

Mining companies have had several years to plan for the local processing requirement, since the law requiring it was enacted in 2009, but they have been reluctant to start work citing long-term, existing contracts with smelters overseas.

With an election in 2014 the government — faced with the politically embarrassing prospect of companies forced to close and lay off large numbers of employees — has been scrambling to find an exit strategy that pushes for the law’s provisions without seeing mass layoffs.

Chinese iron ore futures fall on subdued steel demand outlook

Mon Oct 21, 2013
* Iron ore futures fall after rise on debut day

* Mills restocking curbed by tight cash flow

* Steel demand is typically sluggish in winter season
By Ruby Lian and Fayen Wong
SHANGHAI, Oct 21 (Reuters) - Chinese iron ore futures fell more than 1 percent on Monday as restocking by steel mills in the world's top consumer remained tepid on a sluggish demand
outlook for the alloy in the fourth quarter.

Steel demand typically slows down in November and December as construction activities in China's northern regions are hampered by the cold temperatures, which limits steel mills'
appetite for building inventories of the raw material.

"Mills' sales orders are weaker and they are short of cash flow which has restrained iron ore buying, wiping out upside for prices, though purchases in small volumes have kept prices
relatively steady for now," said an iron ore trader in Shanghai.

The most active 62 percent grade iron ore futures for May settlement on the Dalian Commodity Exchange fell 1.5 percent to a session low of 960 yuan ($160) a tonne. It closed
0.6 percent lower at 969 yuan.

The new contract closed 1.8 percent higher at 977 yuan on its debut on Friday. The contract price includes a 17 percent value added tax and other costs.

By comparison, the benchmark spot price for same grade iron ore .IO62-CNI=SI stood unchanged at $134.4 a tonne on Friday, according to provider Steel Index.

In the absence of a pick-up in orders from end users, Shagang, China's top privately-owned steelmaker, kept prices unchanged for late October bookings, traders said. That means
rebar will fetch 3,580 yuan a tonne and wire rod 3,640 yuan a tonne.

The most-traded January rebar contract on the Shanghai Futures Exchange inched up 0.25 percent to close at 3,570 yuan a tonne after falling for three consecutive sessions.

"The cash flow will remain a big issue for mills until there is a big improvement in steel demand and some billet producers are cutting prices to withdraw cash," said an iron ore trader in
Beijing.

  Shanghai rebar futures and iron ore indexes at 0800 GMT

  Contract                          Last    Change   Pct Change
  SHFE REBAR JAN4                   3570     +9.00        +0.25
  THE STEEL INDEX 62 PCT INDEX     134.4     +0.00        +0.00
  METAL BULLETIN INDEX            134.78     +0.17        +0.13

  Rebar in yuan/tonne                                                
  Index in dollars/tonne, show close for the previous trading day
 ($1 = 6.0968 Chinese yuan)

(Editing by Muralikumar Anantharaman and Anand Basu)

Morning markets: wheat extends gains, but sugar rally stalls

21st Oct 2013, by Agrimoney
Two agricultural commodities, sugar and wheat, were notable for strong performances in the last session, but only one managed to extend gains into early deals on Monday.

And that wasn't sugar.

Prices of the sweetener gained 2.6% in the last session – and hit 20.16 cents a pound at one point, their highest in nearly a year - after fire tore through a port warehouse belonging to Copersucar, Brazil's largest producer of the sweetener and ethanol.

"This worsened concerns about the supply of raw sugar," Joyce Liu at Phillip Futures said, noting also the rain which has been slowing Brazil's cane harvest.

'Compounded market worries'

At Commonwealth Bank of Australia, Luke Mathews said: "The fire in Brazil spooked traders and led to significant short covering and large spread movements.

"Brazilian sugar production is already down on expectations this year, so any further losses compounded market worries."

However, was the damage quite as severe as had been thought?

While it is as yet unclear for how long Copersucar sugar export activities will be disrupted for, with estimates between three and six months, the co-operative did say that 180,000 tonnes of raw sugar had been destroyed  - less than the 300,000 tonnes initially reported.

Raw sugar for March stalled at 19.50 cents a pound  in New York as of at 09:55 UK time (04:55 New York time, 03:55 Chicago time).

'Large buyers of US wheat'

As for wheat, it managed to extend its winning streak, adding 0.6% to $7.10 ¼ a bushel in Chicago for December delivery, as worries over tighter world supplies persisted.

Argentina's estimate last week of an 8.8m-tonne harvest - well below forecasts from other commentators including the US Department of Agriculture, which has the crop at 12.0m tonnes – continues to prove a major prop to values.

On the face of it, "lower wheat production in Argentina limits their exportable surplus and means Brazil will remain large buyers of US wheat," as Mr Mathews noted.

But there is more, in that many investors believe a crop of that size will prompt Argentina's government, which has a rich history of intervention in agricultural markets, will ban exports altogether.

While denting export earnings, this would keep domestic prices in check, and avoid the risk of spiralling food inflation which, as North Africa's recent experiences have reminded, can fuel social unrest.

'Rain will be critical'

But US prices are also being lifted by ideas that supplies from some other major exporters are not so healthy either, with Ikar, the market analysis group, estimating on Friday that the rain restrictions to autumn sowings have already cost Russia 4m tonnes of wheat production.

Sure, area left void now can be planted in the spring. But spring wheat has lower yields than winter wheat.

Besides, farmers will likely opt to put much of the non-seeded area into spring crops such as corn or sunflowers instead.

Meanwhile, although Australia's nascent harvest is not providing any major concerns, there are some niggles.

"Hot and dry conditions continue to plague producers across the eastern states, leading to a loss of yield potential," Mr Mathews said, although noting forecasts for rains heading into southern New South Wales and Victoria.

"The rain will be critical in ensuring further yield losses are avoided."

Iraq tender

There are ideas on the market, anyway, of hefty demand for US supplies, from China as well as Brazil.

Benson Quinn Commodities, flagging fresh rumours of sales of five-to-six cargoes of wheat to China, equivalent to perhaps 200,000-250,000 tonnes, said that "any confirmation of rumoured business will attract additional buying".

Late on Friday, the US Department of Agriculture revealed, in delayed data, that US wheat export sales for the week to September totalled 837,000 tonnes, twice some market estimates.

Still, the market on Monday also received a reminder that US supplies can be uncompetitive to some destinations, with an Iraq tender showing Ukraine wheat as the cheapest offered, at $326 a tonne c&f, while Romanian was offered at $348.35 a tonne and Russian at $355 a tonne.

Australian wheat was priced at $362.50, Canadian and $369.90 a tonne and US at $394 a tonne.

Backlogged data

With wheat firm, that gave some help to corn too, which added 0.3% to $4.42 ¾ a bushel in Chicago for December delivery, keeping below $2.60 a bushel at least its already high discount to wheat.

The USDA data showed decent corn exports too in the week to September 26, of 775,300 tonnes, in the top end of market estimates, and prospects for USDA data backlogged by the Washington shutdown revealing further large orders gave bulls some traction despite forecasts for a record US harvest.

"Corn futures continue to chop higher as traders wait for updated weekly export sales. Many expect a large number due to talk of sales with China, Japan and Mexico," CHS Hedging said.

As for the harvest, on progress, a USDA report revealed after the close of play is seen showing some 35% of the US crop in the barn.

Strong exports

For soybeans, the figure is expected nearer 55-60% completion, and with light showers this week expected to see continuing rapid progress.

"This equates to near 1.89bn bushels of fresh supplies based on USDA's forecasted production of 3.15bn bushels in September, and should start to alleviate some of tight pipeline issues," Kim Rugel at Benson Quinn Commodities said.

Still, there are ideas of huge figures for US export sales too to be released from the USDA, on top of shipments which have already reached 976m bushels so far for 2013-14 – 71% of the forecast for the full season, less than two months in.

A year ago, the figure was 64%.

Soybeans for November added 0.4% to $12.96 a bushel.

Raw Sugar Surges to One-Year High as Fire Hits Brazil Port

By Isis Almeida & Lucia Kassai - Oct 19, 2013
Bloomberg
Raw-sugar futures jumped to the highest in almost a year after a fire left four injured and six warehouses “totally compromised” at the biggest port in Brazil, the world’s largest producer and exporter.

A blaze that is now under control started at the port of Santos at about 6:10 a.m. local time, affecting the six depots owned by Copersucar SA and destroying 180,000 tons of raw sugar, the Sao Paulo-based company said in statements today. Copersucar didn’t say when it plans to resume sugar loading at the port terminal, or how long it will take to rebuild the affected facilities.

“In a preliminary assessment, Codesp informs that all the affected facilities in the accident are totally compromised,” Santos-based Codesp, the state-controlled operator of the Port of Santos, said in an e-mailed statement today.

Copersucar, the world’s largest sugar trader after Minneapolis-based Cargill Inc., shipped 5.12 million tons of the sweetener in the crop year 2011-12 that started in April, according to information on its website.

Copersucar’s sugar cargoes that are on the road heading to the Port of Santos have been diverted to a neighboring terminal controlled by a Cosan SA Industria & Comercio unit, Sao Paulo-based Cosan said in a separate statement.

Slower Harvesting

Sugar gained 11 percent in New York last month, the most since July 2011, as rain will mean reduced output in Brazil’s Center South, the country’s main growing region, according to Sao Paulo-based industry group Unica. Dry periods will be short and infrequent over the next 60 to 75 days, slowing harvesting and exports, Celso Oliveira, a meteorologist with Somar Meteorologia, said this week.

“One estimate is it could take up to six months to get operational in some form again so the impact on the delivery and next year’s harvest will be felt,” Michael McDougall, head of Brazil desk at Newedge Group in New York, said by e-mail.

Raw sugar for delivery in March rose 2.6 percent to settle at 19.5 cents a pound on ICE Futures U.S. in New York at 2 p.m. Earlier, prices gained as much as 6.1 percent to 20.16 cents, the highest for a most active contract since Oct. 22.

Copersucar trades sugar and ethanol from 47 mills, including Virgolino de Oliveira SA and Aralco SA Acucar & Alcool. Virgolino’s $300 million of 2018 securities rallied 2.7 cents to 77.4 cents. Aralco’s $250 million of 2020 bonds rallied 0.7 cents to 73.9 cents on the dollar.

Santos Depots

Fire affected depots 20, 21, VI, XI, XVI and XXI, according to the Codesp statement. The terminal’s facilities have the capacity to store 300,000 metric tons of sugar, Guilherme Pena, a spokesman for Copersucar, said in a telephone interview from Sao Paulo.

Ten ships were scheduled to load sugar at Copersucar’s terminal at Santos from yesterday through Nov. 3, Isis Markarian, a market assistant at Santos-based SA Commodities and Unimar Agenciamentos Maritimos, said by telephone today. The ships were scheduled to load 38,000 tons of white sugar and at least 340,000 tons of raw sweetener, according to Nicolle de Castro, a business analyst at the company.

“The main issue is how long these warehouses and surrounding parts of the loading terminals will be out of action and how it will disrupt port operations,” Kona Haque, an analyst at Macquarie Group Ltd. in London, said by telephone today.

Copersucar was the seller of 83 percent of raw sugar delivered on ICE to settle the October futures, two people with direct knowledge of the transaction said Oct. 1. The ICE delivery totaled a record 1.49 million tons, and Louis Dreyfus Commodities took all of the sweetener.

Eleni Androulaki, a spokeswoman for Louis Dreyfus, declined to comment on how the fire will affect deliveries.

Global Surplus

About 398,659 raw-sugar contracts changed handed on ICE today. That would be the highest aggregate volume for futures since January 2008. Trading was more than triple the average in the past 100 days, according to data compiled by Bloomberg.

Through yesterday, prices fell 47 percent since reaching a 30-year high in 2011 as farmers from Brazil to Australia boosted output, resulting in a record global surplus of 10 million tons last season, according to the International Sugar Organization in London. For the current season, supplies will top demand by 2 million tons, according to London-based Czarnikow Group Ltd., which traded 2.4 million tons of raw sweetener last year.

Refined, or white, sugar for delivery in December gained 1.5 percent to $513.80 a ton on NYSE Liffe in London, after reaching $529.40, the highest since March.

Wheat Advances to Four-Month High on Argentine Harvest Outlook

By Phoebe Sedgman - Oct 21, 2013
Bloomberg
Wheat climbed for a third day to the highest level in four months as cold and dry weather damaged crops in Argentina, threatening to curb record global supplies.

The contract for December delivery on the Chicago Board of Trade gained as much as 0.8 percent to $7.1125 a bushel, the highest price for most-active futures since June 21, and was at $7.1025 by 12:48 p.m. in Singapore. Prices rose 2 percent last week, advancing for a fifth straight week.

About 100,000 hectares (247,105 acres) were damaged in Entre Rios and La Pampa provinces due to cold weather and lack of rain, according to the Argentine Agriculture Ministry. The country is the top exporter in the Southern Hemisphere after Australia, according to the U.S. Department of Agriculture. Wheat declined 8.7 percent this year as the USDA predicts global production will jump to a record 708.9 million metric tons.

“Lower wheat production in Argentina limits their exportable surplus and means Brazil will remain large buyers of U.S. wheat,” Luke Mathews, a commodity strategist at Commonwealth Bank of Australia, wrote in a note today.

Argentina will harvest 8.8 million tons in 2013-2014, the country’s agriculture ministry said Oct. 17. The USDA predicts production of 12 million tons. The agency’s reports were halted due to the 16-day government shutdown that started Oct. 1.

Colder weather could produce some frost in Argentina’s southern areas early this week, possibly damaging heading wheat, forecaster DTN said Oct. 18.

Russia may lose 4 million tons from its potential harvest after rains restricted planting of winter crops, the Institute for Agricultural Market Studies said last week.

Corn for December delivery fell 0.1 percent to $4.41 a bushel. Soybeans for delivery in November were little changed at $12.915 a bushel.

India's rice exports may fall to 9.3 million tons in 2013-14: USDA

By PTI | 21 Oct, 2013
NEW DELHI: Rice exports from India, the world's largest producer and exporter, are estimated to fall marginally to 9.3 million tonnes in 2013-14 marketing year that started this month, a latest report said.

India re-entered the rice exports market in September 2011 after a four-year ban on exports of non-basmati rice. It had emerged as the world's largest rice exporter in 2012 ahead of its Asian counterpart Thailand.

According to the US Department of Agriculture (USDA), rice exports are pegged at 9.3 million tonnes for the 2013-14 marketing year (October-September), slightly lower than 10 million tonnes in the same period last year.

The report did not give reasons for projecting a likely drop in rice shipments for this year.

However, the USDA noted that the Indian government is unlikely to impose any export restrictions in the near future with the forecast of near-record production and "more-than-sufficient" government-held rice stocks this year.

Stating that strong exports may affect domestic price movement, the report said the government has enough rice stocks to control any significant flare up in domestic prices due to the upcoming general elections in 2014.

Assuming normal weather conditions during the harvesting period, the USDA said that the country's total rice production is projected to remain near-record 105 million tonnes, as against 104.4 million tonnes last year. A record rice output of 105.3 million tonnes was achieved in 2011-12.

Earlier, the USDA had forecast rice output of a record 108 million tonnes this year. It has now lowered the rice output projections considering lower planting due to deficient rains in eastern states, the major rice growing region where most of the rice is not irrigated, the report said.

Continued dryness in October in eastern India and the 'normal' cyclones in October-November period across coastal India could damage the standing crop and further temper the prospects of summer-sown rice production, it added.

USDA has pegged overall India's consumption to rise marginally to 96.70 million tonnes during 2013-14, while estimating the total grain availability at 130.5 million tonnes for the same period.

Iron ore prices pressured by supply, softer China steel market

Mon Oct 7, 2013
* Chinese markets reopen on Tuesday after week-long break

* Iron ore steadied at $131.40/tonne last week
By Manolo Serapio Jr
SINGAPORE, Oct 7 (Reuters) - Greater supply of iron ore and a subdued Chinese steel market may weigh on prices for the steelmaking raw material when China reopens after a week-long holiday.

Trading in both iron ore physical and swaps markets remained thin on Monday, a day before Chinese markets resume trading.

Benchmark 62-percent grade iron ore .IO62-CNI=SI for delivery to top market China stood at $131.40 a tonne over the past week, based on data compiled by Steel Index.

"There's a bit of concern over more availability of spot iron ore from miners so traders are not in a hurry to take on any positions," said a Hong Kong-based trader.

Iron ore exports to China from Australia's Port Hedland, which handles about a fifth of the global seaborne iron ore market, rose 3.2 percent to just under 23 million tonnes in September from August.

Global miners have been ramping up output confident Chinese demand will remain brisk. Rio Tinto loaded the first shipment of iron ore from its expanded annual capacity in Australia of 290 million tonnes in September and has said a further expansion of its port, rail and power infrastructure is underway towards a planned 360 million tonnes capacity.

Traders will be eyeing Shanghai rebar futures on Tuesday. They hit a 12-week low of 3,570 yuan ($580) a tonne shortly before Chinese markets closed for the National Day holiday amid rising steel stockpiles.

"Some of the Chinese expect a move down during the re-opening tomorrow. We have probably been sitting on the bullish side for the past couple of weeks given the low inventories for iron ore at ports and sustained appetite for steel," said an iron ore swaps broker in Singapore.

"But we're beginning to think a small sell-off might be the likeliest scenario. Rebar is so fickle it always does the opposite of what you fundamentally expect it to do."

There may also be pressure on Chinese commodities and equities as some investors shy away from riskier assets due to the nearly week-long U.S. budget impasse. Concern is mounting that the stalemate could drag on and undermine moves to increase Washington's borrowing limit by an Oct. 17 deadline, raising the possibility of a sovereign bond default.

($1 = 6.1220 Chinese yuan) (Reporting by Manolo Serapio Jr.; Editing by Joseph Radford)

India, Africa should form JVs in fertiliser area: Vikramjit Singh Sahney

By PTI | 6 Oct, 2013,
JOHANNESBURG: Indian and African companies should form joint ventures for setting up fertiliser units in the continent as it will help both the regions to enhance agriculture production, says an industry official.

There is a vast potential between the regions in the fertiliser sector. Africa has huge deposits of raw material like phosphate and potash for fertiliser production.

"Companies of both the sides should form joint ventures in setting up of units," Sun International Chairman Vikramjit Singh Sahney told PTI here.

Sahney was one of the members of India-Africa Business Council. He was here to attend the second meeting of the council, with Indian industry body Ficci as a partner. Sun International is involved mainly in trading of fertilisers and intermediates besides agriculture commodities.

He said countries in Africa like Ghana and Nigeria have gas reserves while huge phosphate rock deposits are there in South Africa and Togo. Potash deposits are also present in several parts of the continent.

Sahney also said India can help Africa in enhancing agriculture production.

"India has modern technology in fertiliser production. Agriculture production in Africa has stagnated and its population is increasing. India can also help in introduction of good management practices in agri sector," he added.

Besides, he said Africa offers huge scope in contract farming.

"India can harness the vast potential of natural resources of Africa and help Africa to fight food insecurity," he said.

Indian companies such as Indorama Eleme Petrochemicals Ltd have already firmed up plans to set up fertiliser units in African nations.

India is also in talks with resource-rich Algeria to manufacture of nitrogenous fertilisers.

In 2010, India and Ghana had signed the Memorandum of Understanding to set up the urea plant with initial capacity of 1.2 million tonne per annum at Shama district in western Ghana.

Bangladesh tenders to import 50,000 T of wheat

Sun Oct 6, 2013
Oct 6 (Reuters) - Bangladesh's state grains buyer issued an international tender on Sunday to import 50,000 tonnes of wheat, the seventh for the financial year that began in July, as the South Asian nation looks to replenish reserves.

The imports are part of a plan by the Directorate General of Food to ship in 850,000 tonnes of wheat in the current financial year, up from around 350,000 tonnes a year ago.

The deadline to submit offers is Oct. 27, with validity up to Nov. 5, and the wheat is to be shipped within 40 days of signing the contract, Mohammad Badrul Hasan, procurement director at the state grains agency said on Sunday.

The state grains buyer is buying a total of 150,000 tonnes of wheat at $289.86, $282.66 and $288.26 a tonne CIF liner out in three previous tender from a Ismail Food Products as the domestic trader came in first with the lowest offers.

Two more tenders are in the process, with one due to open on Oct. 8 and another on Oct. 22, as the state buyer seeks to secure supplies amid a drop in government reserves, which have fallen to around 1 million tonnes now from 1.4 million tonnes a year earlier.

The state grains buyer cancelled its third tender, citing higher prices.

Bangladesh's government is buying 200,000 tonnes of wheat from Ukraine at $307 a tonne CIF liner out.

The state agency could not achieve last financial year's import target of 800,000 tonnes mainly because of supply failure by traders.

That has prompted it to introduce tougher delivery rules to ensure supplies are delivered on time by the winning bidder.

Apart from the government, private traders also import about 2.5 million tonnes of wheat a year to help meet local demand of 4 million tonnes. Domestic output amounts to about 1 million tonnes.

Wheat consumption is rising in Bangladesh in line with steady economic growth and changes in lifestyle, though rice remains the staple food for its 160 million people.

($1 = 77.6550 Bangladesh taka) (Reporting by Ruma Paul, editing by William Hardy)

GRAINS-Wheat near 3-1/2 month high on supply concerns, soy firm

Mon Oct 7, 2013
* U.S. wheat rises for nine out of 11 sessions

* Production concerns in top suppliers support wheat

* Soybeans up as Informa cuts U.S. output forecast
By Naveen Thukral
SINGAPORE, Oct 7 (Reuters) - U.S. wheat edged higher on Monday, rising for nine out of 11 sessions and trading near a 3-1/2 month high on concerns over weather damaging crops in key
producing countries.

Soybeans climbed 0.4 percent, gaining from last week's 19-month low after a forecast showed lower U.S. production, while corn ticked down on seasonal harvest pressure.

"We are seeing strong export demand for U.S. wheat and production in Ukraine is likely to be hit because of adverse weather, so you are going to see less supplies," said Vanessa
Tan, an investment analyst at Phillip Futures Singapore.

Chicago Board of Trade front-month wheat had risen 0.3 percent to $6.88-3/4 a bushel by 0243 GMT, trading near Thursday's highest since June 21.

Ukraine's wheat harvest could be down by a third to about 15 million tonnes in 2014 from around 22 million tonnes this year because heavy rains will cut the sowing area, the agriculture
minister said on Friday.

Rains earlier this year damaged the wheat crop in top grower China, while frost hampered wheat in Argentina and Brazil. All this led to increased demand for exports from the United States
and Canada.

This year's Canadian wheat crop will be the largest ever, but the estimate of 33.026 million tonnes was within analysts' expectations, according to data released by Statistics Canada.

STORM BREWING

Soybeans for delivery in November added 0.4 percent to $13.00-1/2 a bushel and December corn eased 0.1 percent to $4.42-3/4 a bushel.

"There are forecasts of a storm later this week which could slow the U.S. soybean and corn harvest and we saw Informa lower its estimates for the U.S. soybean crop," said Tan.

Private analytics firm Informa Economics lowered its estimate of U.S. 2013 soybean yield and production while raising its corn crop estimates.

The firm, in its monthly U.S. and world crop reports issued on Friday, projected U.S. 2013 soybean production at 3.176 billion bushels, with a yield of 41.7 bushels per acre (bpa).

The figures are below Informa's Sept. 20 estimates for a 3.224 billion bushel crop with a yield of 42.4 bpa.

Informa raised its corn yield estimate to 158.8 bpa from 157.6, and increased its production forecast to 14.010 billion bushels from 13.889 billion.

Wet weather and another storm system later this week will slow harvesting of the 2013 U.S. corn and soybean crops, an agricultural meteorologist said.

The ongoing shutdown of the U.S. government - including the Department of Agriculture - is likely to delay the release of the U.S. harvest report on Monday and the agency's monthly
supply and demand report due in a week.

There was additional support for soybeans with lack of rainfall delaying soy planting in Brazil.

Soy planting in Mato Grosso, Brazil's top soy state, is 7.2 percentage points behind the same time a year ago because of too little rain, the state's farm research institute IMEA said.

Just 1.4 percent of the expected crop has been sown, compared with 8.6 percent on Oct. 4, 2012, IMEA said in a weekly report.

Commodity funds bought a net 5,000 CBOT corn contracts on Friday, trade sources said. They purchased 6,000 soybean contracts and sold 2,000 wheat.

  Prices at 0243 GMT
  Contract        Last    Change  Pct chg  MA 30   RSI
  CBOT wheat     688.75     1.75  +0.25%   867.37   72
  CBOT corn      442.75    -0.50  -0.11%   756.67   34
  CBOT soy      1300.50     5.50  +0.42%   1573.89   45
  CBOT rice      $14.97    $0.10  +0.64%   $15.47   30
  WTI crude     $103.35   -$0.49  -0.47%   $89.43   45
  Currencies                                               
  Euro/dlr       $1.357   $0.128
  USD/AUD         0.942   -0.113
  Most active contracts
  Wheat, corn and soy US cents/bushel. Rice: USD per hundredweight
  RSI 14, exponential

(Reporting by Naveen Thukral; Editing by Joseph Radford)

Soybeans Rise to One-Week High as Rains Seen Slowing Harvesting

By Supunnabul Suwannakij - Oct 7, 2013
Bloomberg
Soybeans advanced to a one-week high, rising for a fourth day, on speculation that rain in the U.S. will delay harvesting in the world’s largest producer.

Soybeans for November delivery rose as much as 0.8 percent to $13.05 a bushel on the Chicago Board of Trade, and traded at $13.005 at 9:56 a.m. in Singapore. A fourth day of gains would be the best run since the period to Aug. 15.

Rain in the east of the U.S. over the weekend may be disruptive to harvesting, forecaster DTN said on Oct. 4. Areas in the north-central region may be affected by rain later this week, DTN said. Soybean futures dropped 7.7 percent this year.

“For soybeans, gains can be attributed to unfavorable harvesting weather,” Vanessa Tan, an analyst at Phillip Futures Pte, said by e-mail. Storms forecast for later this week will slow down the harvesting, supporting prices, she said.

Informa Economics Inc., based in Memphis, Tennessee, cut its forecast on Oct. 4 for the harvest by 1.5 percent to 3.176 billion bushels from a Sept. 20 estimate, partly as crop conditions fell. The harvest was 11 percent completed as of Sept. 29, trailing the five-year average, government data showed.

Wheat for December delivery climbed 0.3 percent to $6.8875 a bushel. The grain rose for a third week last week as excess rain reduced winter-crop planting in Ukraine and Russia
Corn for December delivery was little changed at $4.4275 a bushel after touching $4.35 last week, the lowest intraday price since August 2010.

Global corn and soybeans inventories before next year’s Northern Hemisphere harvests probably will be larger than the U.S. government predicted last month, while wheat reserves may fall, a Bloomberg survey of as many as 17 analysts and trading firms showed.

The USDA’s scheduled monthly update on Oct. 11 for domestic and global estimates of supply and demand may be delayed by an extended shutdown of the federal government. The agency has suspended daily reports.

Sugar mills sitting on huge inventory of 8.5 mn tonnes: ISMA

PTI
NEW DELHI, OCT 6: 
Sugar mills have begun the 2013-14 marketing year, that started this month, with an opening stock of 8.5 million tonnes and this huge inventory could spell trouble for the sector, according to industry body ISMA.

In 2012-13 marketing year (October-September), mills had an opening stock of 6.2 million tonnes, sufficient to meet three months’ demand.

“We have the opening stock of sugar of about 8.5 million tonnes, higher than last year. The production estimate for 2013-14 is also more than the demand,” Indian Sugar Mills Association (ISMA) Director General Abinash Verma said.

“It will be a difficult situation for the industry unless there is support from the state, central governments and rationalisation of sugarcane pricing,” he added.

Ex-factory prices of sugar are currently lower than the last year’s level, he said, adding that banks are reluctant to give loans to Uttar Pradesh-based mills unless there is linkage between cane and sugar prices.

Verma feared that sugarcane arrears to farmers will increase substantially from the current outstanding of about Rs 3,000 crore in the absence of government support. Maximum arrears pertain to Uttar Pradesh, the second biggest sugar producing state in the country.

ISMA has pegged sugar production in 2013-14 at 25 million tonnes as against the annual demand of 23.5 million tonnes. With likely surplus production this year, mills will have to focus on exports, said Verma.

Asked about crushing operation, Verma said mills in Uttar Pradesh will start after the announcement of state advisory price (SAP) for this year.

In Maharashtra, the country’s largest sugar producing state, mills are expected to begin crushing operations by the end of this month.

The Centre has fixed a fair and remunerative price of sugarcane at Rs 210 per quintal for 2013-14 marketing year.

Last year, the country produced 25.1 million tonnes of sugar and imported 0.75 million tonnes, taking the total availability of sweetener to 25.85 million tonnes. The demand was about 23 million tonnes and exports were 0.35 million tonnes.

Lukewarm response to wheat export tenders

By Madhvi Sally, ET Bureau | 4 Oct, 2013
NEW DELHI: The State-run trading companies such as MMTC, State Trading Corp (STC)and PEC, which have been exporting wheat from government warehouses, have got lukewarm response to tender floated for export of 1.60 lakh tonnes government wheat. With global prices weak, all bids received have been below the export floor price of $300 a tonne set by the government

According to government officials, STC which had come up with tender to offload 60,000 tonnes wheat from the Mundra got the highest bid from Singapore based trading company, Concordia which quoted $267 a tonne. Delhi headquartered Emmsons bid at $261.08 a tonne and Cargill at $253.00 a tonne.

The bids are invalid as the quotes were below the floor price of $300 a tonne set by the government.

With huge wheat stock in the central pool, the government has allowed export of 2 million tonnes wheat.As per the latest data, on September 16 the total grain stock with the central agency was 57.22 million tonnes. Wheat accounted to 37.48 million tonnes and rice at 19.74 million tonnes.

Also, the tender floated by MMTC to export 60,000 tonnes wheat got unsuccessful bids from Canada based Agrocorp at $261.25 a tonnes and Singapore based Starcom at $250 a tonne. The shipment was to go from the Kakinada port.

A similar fate was for PEC tender, which was for 40,000 tonnes wheat from the Kandla port. PEC received three bids from Singapore based Starcom at $248 a tonne, Emmsons at $260.08 a tonnes and Cargill at $253.00 a tonnes.