Commodity Blog

Posts Tagged ‘harvest’

Wheat was flat today after falling yesterday on forecasts of increasing supply.

The Grain Industry Association of Western Australia predicted that output from Western Australia may double to 9.24 million metric tons, above the 9.12 million tons estimated last month. Rainy weather in Argentina may help accelerate planting. Oil World forecast that Argentine farmers will increase sowing 6.8 percent to 4.87 million hectares (12 million acres).

Growing production in the Southern Hemisphere added to increasing supply from Russia and Ukraine. As a result, demand for the US wheat shrank. US exports are expected to drop to 26.54 million tons in the 2011–12 season from 35.1 million tons a year ago, according to the Department of Agriculture.

Wheat spot price was near its opening level of $6.1625 per bushel as of 8:09 GMT on CBoT.

Sugar declined on forecasts of good harvest. At the same time, expectations for soybean yield more pessimistic, causing the crop to gain.

Sugar was down on the signs of advancing output from Ukraine. Ukraine’s harvest of sugar beet was almost 29 percent larger than in the previous year as of November 1, according to the government report. The US Department of Agriculture estimated that Ukraine’s sugar exports will double in the 2011–12 season.

The USDA projections for soybeans, on the other hand, were more pessimistic. The USDA predicted that production in the USA will decline 8.5 percent to 82.9 million metric tons this year. The reason for the declining output is dry weather in parts of the United States.

March futures for delivery of raw sugar declined 1.6 percent to $0.2499 per pound by 8:21 on ICE. The weekly decline was 2.3 percent, while prices were down 22 percent over this year. Futures for delivery of soybeans in January advanced 0.7 percent to $11.755 per bushel as of 13:15 on CBoT.

Corn posted the biggest advance in more than a week on the anticipation of returning demand for the US supplies. According to the report of the US Department of Agriculture, the US exports of corn totaled 1.763 million metric tons in the week ended October 13, the highest level since March. Total sales for delivery before August 31 were 5 percent above the sales in the same period of the previous year, being at the highest level in four years. Settlement for corn jumped from $6.38 to $6.50 per bushel by 23:38 GMT today on CBoT.

The forecasts of good weather drove soybeans down. Dry weather in Brazil and rains in Argentina should boost harvest. The problems of Europe and the resulting worries also weighted down the oilseed. Soybean prices retreated from $12.2525 to $12.2350 per bushel today on CBoT.

The European crisis also caused the drop of rubber to the lowest level in 14 months. The leaders of European nations will discuss the situation in Europe at the summit this weekend. Some economists argue that the bailout fund will be boosted. Yet others speculate that the politicians won’t be able to reach an agreement and such speculation weight the commodity down. January future fo delivery of rubber slumped as much as 4.4 percent to 25,445 yuan ($3,985) per ton in Shanghai.

US sugar stockpiles shrank to the lowest level in 37 years, making prices surge and forcing the government to increase import quotas.

The US Department of Agriculture estimated yield in Minnesota, the biggest beet growing state of America, will be 19 percent down from the previous year. Four more of the 10 biggest producing states may also have reduced output. The USDA forecast the US inventories of sugar will shrink more than 35 percent in the year through August 2012.

Retail prices for the sweetener have risen 9 percent since the beginning of this year. The rising prices caused the government to increase import quotas by 45 percent in 2011.

Spot price for sugar rose from 24.75 to 25.25 today as of 18:56 on ICE. Earlier settlement reached the daily maximum of 25.69.

Crude oil gained as the US inventories declined. US stockpiles of crude fell by 3.7 million last week as refineries operated at 90.3 percent of capacity, the highest rate in 11 months. August for crude oil delivery advanced $0.64 to $98.14 per barrel on NYMEX.

Wheat posted today the biggest gain in a weeks as the dollar weakened and on the forecast that supply from Europe will decrease. Droughts in spring already reduced expected yield in Europe and now heavy rains can harm quality of the grain. September futures for delivery of wheat gained $0.0725 (1 percent) to $7.0075 per bushel by 10:33 on CBoT.

Copper fell today after the report showed an unexpected decline of existing home sales in the US, the biggest consumer of the metal in the world. US existing home sales decreased from 4.81 million to 4.77 million in June. September futures for delivery of copper slipped $0.032 (0.7 percent) to $4.436 per pound as of 13:22 on COMEX.

Crude oil gained today on improving prospects for growth of China’s and the US economies that may result in higher demand for fuel. The US factory orders increased 0.8 percent in May, following the 0.9 percent drop in April. China’s service industries grew with the second-fastest rate this year. August futures for delivery of crude oil advanced $1.95 to $96.89 per barrel on NYMEX. August contract for Brent oil delivery rose as much as $2.22 (2 percent) to $113.61 per barrel on ICE.

Wheat fell today on forecast that rains will slow harvest in the US. Parts of Nebraska may receive as much as 4 inches of precipitation in the next two days, according to Joel Widenor, the director of agricultural services at the Commodity Weather Group LLC. Some areas of Kansas, the biggest winter-wheat growing state in the US, may get 1.5 inches of rain. The slowdown likely won’t have serious impact on the harvest as the US Department of Agriculture reported that 44 percent of the winter crop was already harvested as of June 26, compared the five-year average of 37 percent. September futures for delivery wheat gained $0.2325 (3.8 percent) to $6.355 per bushel by 13:15 on CBoT.

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.

Copper rallied today as concerns that demand may outpace supply outweighed the impact of another earthquake in Japan. Rio Tinto Group predicted that the shortage may increase to somewhere between 400,000 and 500,000 tons this year. Gains may still be limited after Japan was hit by the 7.1-magnitude earthquake today. May futures for copper delivery gained $0.0475 (1.1 percent) to $4.4175 as of 12:41 on COMEX.

Corn jumped to the highest level since 2008 and wheat headed for the biggest weekly gain this year today on concerns that adverse weather in the US may hurt harvest. Some parts of the US have cool wet weather and even snow that can slow planting of corn. Yet other regions have drought that is bad for wheat. May contract for corn delivery rose $0.0625 (0.8 percent) to $7.6925 per bushel by 12:51 on CBoT after touching $7.7325, the highest price since July 3, 2008. July delivery for wheat advanced $0.0375 (0.5 percent) to $8.22 per bushel. The grain rose 8.2 percent so far this week.

Corn fell on the forecast that the US farmers will increase planting this year and on the speculation that the advance of prices weakened demand. Goldman Sachs Group Inc. predicted that the US farmers will sow 92.1 million acres of corn this year. According to the US Department of Agriculture, the farmers have sown 88.2 million acres of corn last year. May delivery for corn fell $0.1 (1.5 percent) to $6.765 per bushel by 12:14 on CBoT.

Cotton jumped by the exchange limit on ICE on the speculation that rains will curb supplies from Australia. The wet weather may slow the harvest that starts this month. Prices have more than doubled in the past year as the global demand rises while the supply declines. May delivery for cotton surged by the limit of $0.07 (3.5 percent) to $2.0596 per pound as of 14:39 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.