Commodity Blog

Posts Tagged ‘Brazil’

Corn and wheat fell on the forecast that favorable weather will boost yield. Rainfall in the UK and France should boost crops that were already planted, as well as those that will be planted later. Stronger dollar curbed appeal of US commodities and attracted traders to Europe. December futures for corn delivery slid $0.03 (0.5 percent) to $6.57 per bushel as of 10:35 on CBoT.

Sugar reached the highest level in two months on concerns about disruptions of supplies from Brazil. Shipments of Brazilian sugar are expected to be delayed for another 20 or 30 days. October futures for delivery of raw sugar rose $0.0083 (3.3 percent) to $0.2621 per pound by 14:00 on ICE. The price for thee most-traded contract reached touched $0.2631, the highest level since April 12. Futures advanced 3.4 percent last week.

Gold climbed, while crude oil slid, as the US labor market was in bad condition last month. The US nonfarm payrolls showed the increase by 54,000 in May, compared to the forecast 161,000. The unemployment rate increased to 9.1 percent from 9.0 percent. The US stockpiles of crude increased by 2.9 million last week. August futures for delivery of gold went up $9.70 (0.6 percent) to $1,542.40 per ounce as of 13:38 on COMEX. July contract for crude oil delivery slipped $0.18 t$100.22 per barrel on NYMEX.

Sugar jumped to the highest level in seven weeks on speculation that supply from Brazil may decrease. Unica, Brazil’s sugarcane industry association, said that the production fell 17 percent in the first half of May from a year ago. July delivery for raw sugar gained as much as $0.043 (1.8 percent) to $0.2395 per pound by 14:00 on ICE.

Sugar gained today for the fourth consecutive session on the speculation that production will fall, while demand continues to grow. According to Unica, the Brazilian Sugarcane Industry Association, the total amount of cane processed since the beginning of this year’s harvest in Brazil was 56.66 million tons as of May 15, 39.51 percent below 93.67 million tons for the same period in the previous year. The European Union and Mexico raised their import allowances this week. July delivery for raw sugar gained $0.0018 (0.8 percent) to $0.2287 per pound as of 9:52 on ICE.

Gold and silver advanced today as the dollar fell, increasing demand for commodities as alternative assets. The greenback slid 0.8 percent against the basket of six major currencies. The Thomson Reuters/Jefferies CRB Index of 19 raw materials headed for the third consecutive weekly gain. August contract for delivery of gold went up $9.70 (0.6 percent) to $1,533.50 by 10:41 on COMEX. July delivery for silver added $0.565 (1.5 percent) to $37.895 per ounce.

Corn and wheat gained today as heavy rains in the US slowed planting and are expected to decrease output. Soybeans declined.

The High Plains Regional Climate Center informed that precipitation in parts of Illinois, Indiana and Ohio was two times the average amount in the past month. Fields in the Mississippi River delta area are experiencing floods. The US Department of Agriculture reported that the rate of corn planting was about a half of the previous year’s pace as of May 8, while wheat sowing also lagged.

Soybeans performed totally different even as US crops were also threatened by bad weather. There are plenty of supplies from other countries, especially from Brazil, where record harvest is expected.

July futures for corn delivery rose $0.155 (2.3 percent) to $6.975 per bushel by 13:15 on CBoT. July futures for wheat delivery gained $0.0875 (1.2 percent) to $7.365 per bushel. July futures for soybean delivery dropped $0.03 (0.2 percent) to $13.265 per bushel.

Corn and soybeans advanced on the forecast that the cold, wet weather in the US will diminish harvest. The area from central Arkansas to Detroit will probably receive 20 centimeters of rain over the next 10 days, according to Tim Bowden, a senior meteorologist at Planalytics Inc. Field from Nebraska to northern Indiana will get 10 centimeters of rain. July futures for corn delivery gained $0.04 (0.5 percent) to $7.445 per bushel as of 13:15 on CBoT. July futures for soybean delivery rose $0.205 (1.5 percent) to $13.8975 per bushel.

Expectations of bad weather and increasing demand in Brazil spurred sugar. Frosts may damage crops as El Nina weather pattern weakened. Brazil increased usage of sugar in ethanol production. July contract for raw sugar delivery advanced as much as $0.0027 (1.1 percent) to $0.238 by 14:00 on ICE.

Soybeans gained on the concern that rains in Brazil may cause flooding, slowing the harvest and harming the quality of the crops. World inventories of soybeans are expected to decline to 58.2 million metric ton, the lowest level in two years, according to the estimates of the US Department of Agriculture. May delivery for soybeans rose $0.14 (1 percent) to $13.8925 per bushel at 13:09 on CBoT.

Copper fell on the concern that the surging oil prices will slow the global economic recovery, diminishing demand for the industrial metal. Oil continues its rally on the tensions in Libya. May futures for copper delivery fell $0.0115 (0.3 percent) to $4.498 per pound by 13:22 on COMEX.

Cotton jumped on the speculation that supply will trail demand. The Chinese imports surged 31 percent January from a year ago, following the jump by 86 percent in the previous year, while the output in the country fell by 6.3 percent in 2010. May delivery for cotton gained by the exchange limit of $0.07 (3.6 percent) to $2.006 as of 14:55 on ICE.

Soybeans showed a strong rally in the previous year and in January, which has stalled recently. It looks like the commodity ran ahead of itself. Soybeans, as well as soybean meal and soybean oil, may advance in the next month, though.

There are some concerns regarding soybeans and soybeans meals as the high prices may curb demand. The Oil Crops Outlook by the United States Department of Agriculture supported the outlook for lower demand. Soybean crushing decreased by 2 million bushels to 153.1 million bushels in December. The US exports of soybean meal dropped 1.9 million short tons as of February 3 from a year earlier. Crops in Argentina may be boosted by rains, but the harvest will be likely smaller because of the previous drought. The lower supplies from Argentina will be easily offset by output from Brazil and Paraguay.

Soybean oil is excluded from this negative trend, even though the prices for the commodity are high. In fact forecasts suggest that the price for soybean oil may reach the record average monthly level. The USDA raised its 2010/11 forecast for this month by 100 million pounds to 2.8 billion. China is the biggest buyer, purchasing 38 percent of the US soybean oil.

Despite the not encouraging outlook for the demand, the World Agricultural Supply and Demand Estimates predict an increase of the prices for the soybean group of commodities. The soybean price range for 2010/11 is projected at $11.20 to $12.20 per bushel, the soybean oil prices are forecast at $0.51 to $0.55 per pound and the soybean meal prices are forecast at $340 to $380 per short ton.

Sugar declined on the speculation that production will increase in Brazil and India. Fain Shaffer, the president of Infinity Trading Corp., said that the prices may fall even lower if prospect for the crops.

The Indian government said that the country is planning to export 500,000 metric tons of sugar this week. India’s DCM Shriram Consolidated Ltd. predicted that its sugar production may rise 58 percent this season. Research company Datagro forecast that output in Brazil’s Center South will advance from 33.5 million metric tons in 2010 to 35.1 million tons in 2011.

May delivery for raw sugar dropped $0.0102 (3.6 percent) to $0.2736 per pound by 14:00 on ICE. The prices reached $0.3608 on February 2, the highest level since November 1980. In London, May futures for delivery of refined sugar declined $16.40 (2.3 percent) to $702.60 per ton on NYSE Liffe.

Sugar rallied today on the speculation that output will trail consumption, causing a global deficit. Production in India, the second biggest grower after Brazil, may be lower than previously predicted. Balrampur, India’s second-largest sugar company, estimated that production in India in the year ending September 30 will be 24.5 million metric tons, compared to the November forecast of 25 million tons.

Australia, the third biggest exporter, will also have reduced output as the crops were harmed by adverse weather. Rabobank estimated that the next harvest will produce 3.5 million metric tons. That’s compared to the previous harvest of 3.6 million tons and the earlier forecast of 4.2 million for the next harvest.

March delivery for raw sugar rose $0.0041 (1.3 percent) to $0.3305 per pound by 11:17 on ICE. May futures for delivery of refined sugar advanced $11.20 (1.5 percent) to $780.70 per metric ton on NYSE.

Corn and soybeans gained today as unfavorable weather may reduce output in Argentina and Brazil. Rains missed some important regions in the South African countries and now forecasts promise dry weather and high temperatures, which may harm crops. March futures for corn delivery gained $0.12 cents (2 percent) to $6.07 per bushel as of 13:15 on CBoT. March futures for soybean delivery went up $0.155 (1.1 percent) to $13.805 per bushel.

Copper extended its decline today on the speculation that demand in China may drop. Chinese copper imports fell 2 percent in September, following the 29 percent jump in November. March futures for copper delivery dropped $0.018 (0.4 percent) to $4.2645 per pound by 13:16 on COMEX.

Gold and silver rallied today as concerns about potential spreading of the European debt crisis strengthened. Costs of insuring Portugal’s and Spain’s debt against a default jumped to the record ahead of the planned bond sales. February futures for gold delivery climbed $5.20 (0.4 percent) to $1,374.10 per ounce at 13:55 on COMEX. March futures for silver delivery rose $0.19 (0.7 percent) to $28.861 per ounce.