Softs outrun grains in pre-poll positioning

Agrimoney.com | softs outrun grains in pre-poll positioning
It was pretty much a tale of two markets on Friday.  In Chicago, grains sank under the weight of wetter US weather forecasts, besides data from Informa Economics lifting further expectations for corn seedings.  In New York, soft commodities surfed a bright financial market, all things (ie Greek elections) considered, amid growing ideas that central banks are poised to act if this weekend's poll points the country towards the exit from the eurozone.  So while agricultural commodities, like the CRB commodities index, closed overall pretty much at last night's finish, this hid a large amount of underlying volatility.

OPEC Decision Puts Onus on Saudi Arabia Should Oil Fall

OPEC Decision Puts Onus on Saudi Arabia Should Oil Fall - Bloomberg
OPEC’s decision to keep its output quota unchanged yesterday throws the onus on the group’s biggest producer, Saudi Arabia, to cut supply should crude prices extend their drop below $100 a barrel.
The Organization of Petroleum Exporting Countries would need to reduce output by 1.6 million barrels a day to comply with its targeted ceiling of 30 million barrels a day, Secretary-General Abdalla El-Badri said yesterday. Increased production from Saudi Arabia has been blamed for plunging prices by members including Iran, whose own exports are set to drop as a European Union embargo starts July 1. Saudi Arabia will make sure there is enough supply in the global crude market, the kingdom’s oil minister said today in an interview.

Hong Kong Exchanges Bid for LME Beats out ICE

Hong Kong Exchanges Bid for LME Beats out ICE - Bloomberg
Hong Kong Exchanges & Clearing Ltd., host to the world’s fifth-largest equity market, agreed to pay 1.39 billion pounds ($2.15 billion) for the London Metal Exchange, which handles more than 80 percent of global trade in industrial-metal futures.  LME investors will get 107.60 pounds per ordinary share in cash, with a vote scheduled before the end of next month, the bourses said today. The stock traded at 4.925 pounds in July 2011, before the LME said it was considering bids. JPMorgan Chase & Co., Goldman Sachs Group Inc. and closely held Metdist Ltd. are the biggest LME shareholders.

Ethanol Declines as Corn Tumbles on Abundant Overseas Crops

Ethanol Declines as Corn Tumbles on Abundant Overseas Crops - Bloomberg
Ethanol tumbled as corn, the primary ingredient in the fuel additive, fell the most in three weeks.  Futures followed corn lower on concern that demand for the grain will wane because of larger crops overseas. One bushel of corn makes at least 2.75 gallons of ethanol.  “Everyone’s kind of unwinding stuff today,” said Will Babler, a broker at First Capitol Risk Management in Galena, Illinois. “People are trying to get out of everything heading into the weekend.”  Denatured ethanol for July delivery slumped 3.8 cents, or 1.8 percent, to settle at $2.027 a gallon on the Chicago Board of Trade, the lowest price since June 5 and the steepest decline since June 1. Prices have fallen 8 percent this year.

Favorable weather pressures corn futures on Friday Markets

Favorable weather pressures corn futures on Friday Markets - Cattle & Grain Prices, Quotes, Charts
Corn futures settled 7 to 18 cents lower on Friday. The market closed down on favorable weather and expectations for large corn acreages. Calls for weekend rains across the U.S. Midwest weighed on deferred contracts, while profit taking and long liquidation sent the July contract tumbling. News that the 2012 corn acreage is expected to be higher than the USDA’s 95.9 million estimate added pressure to prices also.  Soybean futures settled mixed on Friday...

China Said to Buy 1 Million Tons of U.S. Cotton for Reserves

China Said to Buy 1 Million Tons of U.S. Cotton for Reserves - Bloomberg
China, the world’s biggest cotton user, is seeking to buy 1 million metric tons of new-crop output from the U.S. to boost government stockpiles, according to two executives familiar with the matter. Prices climbed.  The China National Cotton Reserves Corp., which stockpiles the commodity on behalf of the government, has bought 160,000 tons since last week, said the executives, who declined to be identified as they aren’t authorized to speak to the media. Phone calls to the state company today weren’t answered.  Purchases by China may help futures post a second weekly gain.

NY sugar and coffee end up, cocoa down; Greek poll looms

NY sugar and coffee end up, cocoa down; Greek poll looms | Reuters
Raw sugar and arabica coffee futures ended higher Friday while cocoa settled lower as players tweaked their positions ahead of vital Greek elections that may spark financial turmoil if Athens is put on a path to exit the euro...

Bernanke’s Inflation View Validated as Commodities Fall

Bernanke’s Inflation View Validated as Commodities Fall - Bloomberg
A plunge in global commodity prices is tilting the balance in favor of Federal Reserve Chairman Ben S. Bernanke and colleagues who may seek further action to boost growth as the U.S. labor market falters and risks from Europe rise.  The Standard & Poor’s GSCI Total Return Index of 24 commodities has fallen 16 percent since May 1. Oil is down 21 percent, and corn has slumped 18 percent. Inflation, as measured by the personal consumption expenditures index, slowed to an annual 1.8 percent rate in April, below the Fed’s 2 percent goal. The consumer price index, another measure of the cost of living, fell by the most in more than three years in May, a report yesterday showed.

Oklahoma Rancher in Russia Threatens U.S. Beef Exports

Oklahoma Rancher in Russia Threatens U.S. Beef Exports - Bloomberg
Anthony Stidham, a 48-year-old third-generation rancher from Oklahoma, is at the forefront of President Vladimir Putin’s plan to cut Russia’s $3 billion annual bill as the world’s biggest beef importer. At the country’s largest beef farm about 400 kilometers (250 miles) southwest of Moscow, Stidham is passing on cattle- rearing skills to locals in a drive toward self-sufficiency that’s already involved shipping in about 60,000 Aberdeen Angus cattle from the U.S. and Australia.  With incomes rising and beef sales set to increase, Russia has been cutting import quotas to revive a cattle-breeding tradition decimated under the rule of dictator Joseph Stalin. Putin wants the country to meet 85 percent of its meat and poultry needs by 2020, threatening to curtail sales by Tyson Foods Inc. (TSN) of Springdale, Arkansas, and Brasil Foods SA...

Gold rises on uncertainty over Greece, easing hopes

PRECIOUS-Gold rises on uncertainty over Greece, easing hopes | Reuters
Gold rose on Friday for a sixth straight session as investors added the metal as a hedge against economic uncertainty ahead of key Greek elections this weekend. The metal is on track to rise 2 percent for the week, underpinned by hopes of further U.S. monetary easing on signs that the American economy's recovery is on shaky ground. Friday's weak U.S. manufacturing output and consumer sentiment data also lifted gold. Bullion investors cautiously added bullish bets on Friday after European Central Bank hinted at an interest rate cut and the Bank of England was prepared to offer credit.

Futures imply flat open after data

Futures imply flat open after data - CNBC

Stock futures pointed to a flat open on Friday as optimism over possible coordinated action by major world central banks, if Sunday's Greek vote causes financial turmoil, was offset by a weak reading on domestic manufacturing.  Officials of the Group of 20 leading industrialized nations told Reuters that central banks of major economies would take steps to stabilize markets and prevent a credit squeeze, if necessary.  The news spurred sharp gains late in Thursday's session, and that rally looked to be extended. However, a gauge of manufacturing in New York state fell sharply in June, and while it still showed growth, it was the latest data pointing to a sluggish economy in the U.S.  Stock index futures came off earlier highs following the data, and traded near breakeven levels.  Investors continued to watch developments in Europe ahead of the Sunday election in Greece, which investors fear may set the nation on a path to an exit from the euro zone. That possibility, along with questions about the effectiveness of a bank bailout plan in Spain, has spurred volatility in a thinly traded week, with the S&P 500 moving more than 1 percent for three of the past four days.

OIL FUTURES: Crude-Oil Near Flat on Weak Data, Stimulus Hopes

OIL FUTURES: Crude-Oil Near Flat on Weak Data, Stimulus Hopes - WSJ.com
U.S. crude futures held near flat Friday, with weakening economic data and worries about the upcoming Greek election paired against hopes for central bank stimulus measures.  Light, sweet crude for July delivery recently traded 4 cents higher at $83.95 a barrel on the New York Mercantile Exchange, after trading as high as $84.80 earlier in the session.  Brent crude on the ICE futures exchange for August delivery traded 26 cents higher at $97.43 a barrel.  Rising claims for unemployment in the U.S., coupled with weak manufacturing data, have added to concerns that oil demand will slump with the broader economy.  On Friday, a reading of manufacturing activity in New York in June came in far below expectations, falling to the lowest level since November. Additionally, May industrial production fell 0.1%. Economists had expected a modest increase.  But weakness in U.S. and global economic indicators is also providing hope among investors that the Federal Reserve and other central banks will take further steps to help the economy.