Wednesday, May 16, 2012

RTRS- Oil World cuts forecast of EU 2012 rapeseed crop

HAMBURG, May 15 (Reuters) - Hamburg-based oilseeds analysts Oil World said on Tuesday it has again cut its forecast of the European Union's 2012 rapeseed crop because of bad weather, this time by 0.1 million tonnes.

The EU crop will fall to a six-year low of 18.10 million tonnes from 19.12 million tonnes in 2011 after poor autumn sowing weather and a bitterly cold winter which damaged plants, Oil World said.

This follows a cut of 0.27 million tonnes in Oil World's harvest forecast on May 1. [ID:nL5E8FUBZY] Rapeseed oil is the EU's main edible oil and rapeoil is also widely used for biodiesel output.

France's crop will fall to 5.15 million tonnes from 5.37 million tonnes in 2011 and Poland's will fall to 1.60 million tonnes from 1.87 million tonnes, it said.

Germany's harvest will rise to 4.45 million tonnes against 3.78 million tonnes last year. Britain's 2.72 million tonnes will be close to the record 2.76 million tonne harvest last year, Oil World said.

"The reduced production will raise EU import requirements of rapeseed and canola," Oil World said.

Oil World also warned of a poor crop in Ukraine, a major rapeseed supplier to the EU.

Ukraine's 2012 rapeseed crop will fall to 0.95 million tonnes from 1.32 million tonnes last year, Oil World estimates.

"Ukrainian exports will decline sharply owing to the very small crop next season," it said. "This will raise the global dependence on Canadian and Australian rapeseed and canola export supplies and will keep prices of rapeseed and canola well supported."

RTRS- Soybean prices to remain well supported -Oil World

HAMBURG, May 15 (Reuters) - The sharp fall in soybean prices in recent days is premature and tight supply fundamentals are likely to keep prices well supported in coming months, Hamburg-based oilseeds analysts Oil World said on Tuesday.

"We see only limited downward potential for soybean prices in the near to medium term," Oil World said.

U.S. soybean futures fell to six-week lows on Monday, dragged down by continued selling of long positions by funds and by concerns over the strength of the global economy. [GRA/]

The fall from highs reached on May 2 is "premature and mainly based on technical factors rather than fundamentals," Oil World said.

Global soybean harvests in the current 2011/12 season will fall to 116.07 million tonnes from 137.68 million tonnes in 2010/11, it said.

This is likely to be caused by expected poor crops in Argentina and Brazil. [ID:nL5E8G85U2]

"With South American supplies significantly reduced as of end-August 2012, there will be a run on U.S. export supplies - soybeans, soymeal and oil - for shipment in Sept./Feb. 2012/13," it said.

Near-record soymeal prices will also be required to ration available soymeal supplies, it added.

"Vegetable oil prices are seen appreciating in the near to medium term owing to insufficient world soybean supplies in the next few months, the prospective palm oil deficit in Malaysia...and insufficient world supplies of rapeseed and canola oils," it added.

Trader's Highlight

DJI- NEW YORK, May 15 (Reuters) - The euro fell to a four-month low against the dollar and global stocks dropped o n T uesday as Greece's decision to hold new elections added to uncertainty about its future and a possible exit from the euro zone.

Gold hit a 4-1/2-month low with the euro's retreat.

The political turmoil in Greece kept pressure on markets. Investors have been concerned that long-lasting problems in the euro zone and a likely recession will hit global growth.

Greek politicians again failed to agree on a new government, nine days after an inconclusive election. After Greece's president said the country will hold new elections, the euro slumped and investors fled to the safe-haven dollar.

"They are running out of money ahead of elections, so expect European leaders in the next few days to put enormous pressure on them to come up with a workable government along with some sort of extended schedule for the bailout," said Boris Schlossberg, director of FX Research at GFT in Jersey City, New Jersey.

The euro fell for the fifth of the last six sessions on chances left-wing politicians opposed to Greece's international bailout could win the June elections. A report showing the Greek economy slid deep in recession added to worries.

The euro last traded down 0.7 percent at $1.2732, with the session trough at $1.2720, the lowest since Jan. 18.

Wall Street stocks fell for a third straight day on the shaky situation in Greece.

The Dow Jones industrial average <.DJI> fell 63.35 points, or 0.50 percent, to close at 12,632.00. The Standard & Poor's 500 Index <.SPX> was down 7.69 points, or 0.57 percent, at 1,330.66. The Nasdaq Composite Index <.IXIC> was down 8.82 points, or 0.30 percent, at 2,893.76.

Economic data on U.S. regional manufacturing and national homebuilder sentiment was positive, however. A gauge of homebuilder sentiment rose to the highest in five years this month. [ID:nN9E8FH00R] Separately, the pace of growth in New York state manufacturing rebounded, the New York Federal Reserve said. [ID:L1E8GF2YM]

Data also showed U.S. retail sales rose 0.1 percent in April, coming in under expectations.

Among gains, JPMorgan Chase & Co shares rose 1.3 percent to $36.24 after falling more than 11 percent last week after the bank disclosed a trading loss of at least $2 billion. Pressure mounted on the bank to reclaim some of the millions of dollars it paid to the executives who oversaw the wrong-way trades. [ID:nL1E8GF0VL]

On the down side were Chesapeake Energy Corp shares, which fell as low as $14.31, their lowest since March 2009, after a credit rating downgrade and news that the natural gas producer will increase its borrowing to $4 billion from the planned $3 billion as it faces a liquidity crunch. Chesapeake shares finished the session down 5.6 percent at $14.65. [ID:nL1E8GF4RS]

Germany kept hopes for growth alive when it reported that strong exports helped its economy grow 0.5 percent in the first three months of the year, ahead of market forecasts. Germany's performance offset zero growth in France and recession in Italy and Spain, leaving the whole 17-member euro zone economy stagnating but not in recession. [ID:nL5E8GF4FA]

The upbeat German data helped support the price of Brent crude, which snapped three days of declines. In London, ICE Brent crude for June delivery settled at $112.24 a barrel, rising 67 cents, or 0.60 percent.

NYMEX crude for June delivery settled at $93.88 a barrel, down 80 cents, or 0.84 percent.

In the precious metals market, spot gold was off 0.88 percent at $1,542.60 an ounce and hit its lowest level since Dec. 29 at $1,541.10 on heightened concerns over Europe's financial crisis.

"The euro has done very poorly against the dollar because of everything going on predominantly in Greece. Gold has gotten sold off quite hard in the last couple of sessions. I think people are unwinding and getting into cash and a little bit of Treasuries, German bunds, and that's about it," said Fred Schoenstein, metals trader at Heraeus in New York.

U.S. Treasuries prices eased as traders booked profits from an eight-week run-up primed by worries over the outcome of the European debt crisis.

The benchmark 10-year U.S. Treasury note was down 1/32, the yield at 1.7705 percent.

While U.S. yields rose slightly, benchmark rates remain below the technically important 1.8 percent level and not far off the seven-month low of 1.76 percent touched in overnight trade. Last week Treasuries yields fell for the eighth consecutive week.

NYMEX- NEW YORK, May 15 (Reuters) - U.S. crude futures extended losses in post-settlement trading on Tuesday after industry data showed that domestic crude inventories rose sharply last week, dwarfing the forecast in a Reuters poll and adding to oil demand worries.

Crude futures earlier settled lower for a third straight day as political turmoil in Greece stoked worries that it might exit the euro zone, outweighing upbeat German GDP data and a mixed set of U.S. economic reports pointing to continued, through slower, growth.

The euro slumped on worries about Greece while the dollar rose, prompting investors to spurn trades in riskier assets such as equities and major commodities such as oil and metals.

Euro zone worries persisted even though data showed that the region narrowly avoided recession in early 2012, official data showed. However, the bloc's debt crisis had weakened the French and Italian economies. [ID:nL538GF4FA]

This added to concerns about bleaker prospects for oil demand, a problem that has already kept investors queasy following weak industrial production data from China last week.

The industry group Amerian Petrioleum Institute said that in the week to May 11, domestic crude stocks shot up by 6.6 million barrels, far above the forecast for a 1.7 million barrel increase. [API/S] [EIA/S]

Crude stocks in Cushing, Oklahoma, the delivery hub for U.S.-traded crude oil futures, jumped 2.8 million barrels, the API said.

* On the New York Mercantile Exchange, June crude settled at $93.88 a barrel, down 80 cents, or 0.84 percent, after trading between $93.78 and $95.48. Since the beginning of the month, the contract has fallen $12.18, or 11.5 percent.

* In post-settlement trading, June crude extended the day's low to $93.18 and further fell to $93.02, the lowest since Dec. 19's intraday low of $92.54, after issuance of the API data.

* The euro zone's gross domestic product stagnated in the first quarter, according to official data. It was a touch better than forecasts of a 0.2 percent dip and dodged a technical recession following a 0.3 percent contraction in the last quarter of 2011. [ID:nL5E8GF4FA]

* A jump in exports pushed Germany to a surprisingly strong economic growth of 0.5 percent in the first quarter, beating forecasts and bouncing back from a contraction of 0.2 percent in the fourth quarter of 2011. [ID: nL5E8GF1SE]

CBOT SOYBEAN- Soybean futures on the Chicago Board of Trade ended nearly 2 percent higher, staging a technical recovery from recent sharp losses amid rumors of Chinese export interest for U.S. soy, traders said.

* Nearby soybean and soymeal contracts gained against back months amid rumors that China was seeking old-crop U.S. soy, traders said. They noted that analytical firm Celeres on Monday said Brazilian farmers had sold 83 percent of their 2011/12 harvest. [ID:nL1E8GE7Q2]
* CBOT soybeans seen as due for a bounce after a two-week sell-off drove the market to a six-week low by Monday, a sharp setback from the near-four-year high set in late April.

* Soymeal posted the biggest gains in the soy complex on a percentage basis. Market supported by concerns about crop losses in South America, including fears of further losses in Argentina, the world's biggest exporter of soymeal.

* Hamburg-based oilseeds analysts Oil World cut its forecast of the European Union's 2012 rapeseed crop because of bad weather. The EU crop will fall to a six-year low of 18.10 million tonnes, from 19.12 million tonnes in 2011, Oil World said. [ID:nL5E8GE9OX]

* The sharp fall in CBOT soybean prices in recent days is premature and tight supply fundamentals are likely to keep prices well supported in coming months - Oil World. [ID:nL5E8GEECF]

* USDA said the U.S. soybean crop was 46 percent seeded as of Sunday, up from 24 percent a week earlier and ahead of the five-year average of 24 percent. The crop was 16 percent emerged. [US/SOY]

* Dry, mild weather expected this week in the U.S. Midwest should help farmers to wrap up corn planting and move ahead with soybeans, said Andy Karst, meteorologist with World Weather Inc. Soil moisture is adequate in most areas but rising temperatures will speed the drying of the ground. Rain expected by the weekend, Karst said.

FCPO- SINGAPORE, May 15 (Reuters) - Malaysian palm oil futures rebounded on Tuesday, supported by bargain hunting after prices fell to a three-month low in the previous session, although concerns remained that demand could be hit if Greece exits the euro zone.

Buying interest picked up as some traders felt that the market was oversold. Malaysian exports for the first 15 days showed a slight improvement, reinforcing the view that palm oil fundamentals remained solid despite global economic uncertainty.

"We see a small recovery today because selling was a bit overdone yesterday and exports were also slightly better," said a trader with a foreign commodities brokerage in Malaysia.

"But sentiment is still weak because of external factors, especially when we talk about Greece and the revival of uncertainty in Europe."

Benchmark July palm oil futures on the Bursa Malaysia Derivatives Exchange gained 2.4 percent to close at 3,226 ringgit ($1,048) per tonne. Prices closed at 3,150 ringgit on Monday, the weakest since Feb. 13.

Traded volumes stood at 34,697 lots of 25 tonnes each, much higher than the usual 25,000 lots.

Malaysian palm oil exports for first 15 days of May picked up by a slight 0.7 percent to 599,044 tonnes, according to cargo surveyor Intertek Testing Services, reflecting a still-healthy demand for the edible oil. [PALM/ITS]

Another cargo surveyor Societe Generale de Surveillance meanwhile reported a 7 percent drop in exports to 564,477 tonnes, thanks to lower shipments to China and India. [PALM/SGS]

But traders said the lower exports did not weigh on prices much as they do not necessarily indicate weaker demand and especially in an already-oversold market. In the latest development of an upcoming listing of

Malaysian palm oil firm Felda Global Venture Holdings (FGVH), commodities group Louis Dreyfus has agreed to take a minority stake in Felda, it said on Monday. [ID:nL5E8GEHGX]

REGIONAL EQUITY- BANGKOK, May 15 (Reuters) - Stocks in Singapore and Thailand pushed higher on Tuesday, with beaten down commmodities-related shares rebounding, as strong growth in Germany spurred late buying and eased worries over the political turmoil in Greece and the euro debt problems.

Singapore's main index <.FTSTI> edged up 0.44 percent at 2,876.70, bouncing back from an intraday low of 2,850.61 and reversing losses of the past two sessions. The Thai SET index <.SETI> climbed 1.63 percent after Monday's 2.1 percent drop.

A flurry of foreign selling activity pulled Thai shares off their 16-year highs hit early this month.

The Thai stock market saw around $182 million worth of net foreign outflows so far in May to Monday, after a combined $2.7 billion of net foreign inflows for the first four months, according to Thomson Reuters data.

Indonesia <.JKSE> also posted net foreign outflows of $146 million for the period, but Vietnamese stocks <.VNI> had $19.9 million worth of inflows, the data showed. The Malaysian bourse said it took in around $160 million of inflows during the period.