Wednesday, October 27, 2010
Soft Commodity Technicals by Reuters
SINGAPORE, Oct 27 (Reuters) – CBOT wheat’s December contract is expected to pull back towards the middle channel line support at $6.80 as strong resistance is seen at $7.00-1/2.
A further confirmation on the break of the middle channel line is needed.
Wheat failed to overcome the resistance at $7.00 -½ – the 61.8 percent Fibonacci retracement level on the fall from $7.22-¼ to $6.55 – and as a result, it may fall further.
at 10:11 AM
Thursday, October 21, 2010
SINGAPORE, Oct 21 (Reuters) – CBOT December wheat <WZ0> is technically neutral between $6.73 and $6.93, with an escape from the range needed to determine its next directional move.
Wednesday, October 20, 2010
Be selective when investing in the agribusiness sector to avoid disappointment.
Be selective when investing in the agribusiness sector to avoid disappointment.
Rising prices, growing demand and some global shortages have combined to propel the agribusiness sector into the investment spotlight. However, despite what appear to be excellent fundamentals, a paucity of quality stocks means local investors must be selective if they wish to become involved with this theme.
Africa is hungry, with 240 million people undernourished.
Now, for the first time, small African farmers have been properly consulted on how to solve the problem of feeding sub-Saharan Africa.
Their answers appear to directly repudiate a massive international effort to launch an African Green Revolution funded in large part by the Bill and Melinda Gates Foundation.
Monday, October 18, 2010
Secretary to the Ministry of Agriculture K.E.Karunarathne said that the government has given prominence to the development of the agricultural sector. In the year 2005 , Sri Lanka has imported 85 percent of its requirement of corn. However by last year, Sri Lanka was able to produce 85 percent of its corn requirement.
ROC Council of Agriculture Minister Chen Wu-hsiung underscored measures for dealing with food and climate crises, as well as Taiwan’s contribution in this regard at the first APEC Ministerial Meeting on Food Security, which closed its doors in Niigata, Japan Oct. 17.
SINGAPORE, Oct. 18 (Reuters) - New York sugar is expected to retrace to a range between 25.42 cents and 26.12 cents per lb as indicated by its wave pattern and a Fibonacci retracement analysis.
A five-wave completion is seen on the rise from 22.49 cents to 28.36 cents, and the current correction is expected to drive the price down to a range formed by the 38.2 percent and 61.8 percent Fibonacci retracement levels.
A bearish divergence that has formed on the RSI indicator confirms the completion of the five-wave cycle.
Resistance is at 27.80 cents, a break above which would temporarily invalid the bearish outlook.
SINGAPORE, Oct 18 (Reuters) - CBOT wheat's December contract may rise towards $7.25 per bushel, as a consolidation that started from $7.39-¾ could have completed.
A descending wedge was broken at its upper trendline resistance of $7.06.
The contract then found strong support at $6.95, which is sandwiched between $6.88-½ and $6.98-⅜ - the 61.8 percent and 50 percent Fibonacci retracement levels on the rise from $6.57 to $7.39-3/4.
A fall below support at $6.95 would be very bearish, as it may extend to $6.69.
SINGAPORE, Oct. 18 (Reuters) - A bullish target at $12.26 per bushel for the CBOT soybean November futures contract has been aborted as a five-wave cycle could have been completed at the Friday high of $12.04-1/4.
A bearish target has been established at $11.42-1/4, the 38.2 percent level, as per a Fibonacci retracement analysis, on the rise from $10.42 to $12.04-1/4.
A minor support is observed at $11.66, the 23.6 percent level, but it could be too vulnerable to hold the fall.
Resistance is at $11.90, a break above which would slightly extend its gain to $12.00.
SINGAPORE, Oct 18 (Reuters) - Malaysian palm oil may retrace further to 2,849 ringgit per tonne based on its wave pattern and a Fibonacci retracement analysis.
A five-wave cycle has completed on the rise from 2,653 ringgit to 2,970 ringgit, and a Fibonacci retracement analysis reveals a possible target for the current retracement at 2,489 - the 38.2 percent level.
Palm oil may also consolidate between 2,880 ringgit and 2,940 ringgit on Monday without rushing towards 2,849, as the wave "4" trough generally provides minor support which may hold up a fall temporarily.
Resistance is at 2,940 ringgit, a rise above which indicates a consolidation would take longer within a wider range between 2,880 ringgit to 2,970 ringgit.
Cotton prices soared to a nominal record high on Friday amid heavy buying in China, the world’s largest importer, and disappointing crops in major producing nations including Pakistan.
The rise in the price of cotton will reverberate through the textile industry, forcing clothing companies to either pass the increase onto the consumer or face lower margins. While the impact is likely to be muted on high-priced clothes, it could be more noticeable in cheaper items such as t-shirts and underwear.
Clothing companies including UK-based Next and jeans maker Levi Strauss & Co have already announced price hikes due to rising cotton costs.
Saturday, October 16, 2010
On World Food Day, officials call for a growth in agriculture to help almost one billion people facing chronic hunger.
The UN Food and Agriculture Organisation (FAO) has called for "urgent and concerted actions" from world leaders and international organisations to help put an end to chronic hunger, which affects almost one billion people across the globe.
Jacques Diouf, the FAO Director-General, Pope Benedict XVI, and the president of Rwanda were among leading figures backing the call on World Food Day on Saturday.
Jacques Diouf, the FAO Director-General, Pope Benedict XVI, and the president of Rwanda were among leading figures backing the call on World Food Day on Saturday.
ISLAMABAD Oct 16 (APP): The Canadian Government on Saturday announced further support in agriculture sector for those affected by the recent floods in Pakistan.Minister of International Cooperation Canada Beverley J. Oda, in a news release issued here said the contribution responds to agricultural recovery needs by providing seeds, fertilizers, and tools and by supporting the rehabilitation of the land and livestock sector in Pakistan.
Friday, October 15, 2010
DES MOINES, Iowa (Reuters) - Gates Foundation, which has donated $1.5 billion to agriculture in developing countries, is focusing more investments on seeds and technology to help small farmers adapt to climate change, the foundation's chief executive said on Thursday.
"Most of our grants support conventional breeding. But in certain instances we include biotechnology approaches because we believe they can help farmers confront drought, flooding, disease, or pests more effectively than conventional breeding alone," Jeff Raikes, chief executive of the foundation started by the billionaire founder of software giant Microsoft, said in a speech to the World Food Prize meeting.
SINGAPORE, Oct 15 (Reuters) - The CBOT wheat December contract <WZ0> may establish a trend soon, as the current consolidation is approaching an end.
A descending wedge may contract to a point above $6.88-1/2, the 61.8 percent Fibonacci retracement level on the rise from $6.57 to $7.39-3/4.
It is not strategically safe to assume a bullish move right now even if the bias is for a rise, as a resistance at $7.12 needs to be cleared to confirm the development of an uptrend.
SINGAPORE, Oct 15 (Reuters) - CBOT December corn <CZ0> is technically neutral as it is trapped within a narrow range between $5.53 and $5.89 per bushel.
A rise above pivotal resistance at $5.89 could trigger a very explosive rally towards $6.20, as the current five-wave cycle will make up a bigger wave, and a new rally would be the stronger wave three.
A retracement from the current level could find strong support at $5.53, and will be limited to $5.37 should $5.53 fail to hold up the fall.
SINGAPORE, Oct 15 (Reuters) - A bullish target at $12.26 per bushel for the CBOT soybean November futures contract <SX0> is unchanged, as it has stood above a consolidation channel between $11.50-¾ and $11.88-3/4.
The projected target is based on the price difference between the high and the low of the channel.
The wave pattern indicates a wave "5" is running up towards a more aggressive target at $12.80 in the medium term, as pointed by an ascending trendline, confirming the move towards $12.26 in short term.
Support has shifted up to $11.78 from the previous level of $11.70, and a break below would extend losses to $11.50-3/4, the low of the range.
SINGAPORE, Oct. 15 (Reuters) - The New York cotton second-month contract <CTc2> is expected to retrace to $1.06 per lb first and consolidate above it over the next four weeks as the current rally may peak around $1.20.
A wave classification on the rise from the March 2009 low at 40.01 cents labels the current sharp rise as a wave "v", which is the last surge of a five-wave cycle.
The wave "5" is typically difficult to be pinpointed by a final peak, however, based on an upper channel duplicated from the lower channel, the wave "v" may end around the upper channel line resistance at $1.20.
The following retracement is expected to drive the price down to the range of the wave "iv" between $1.06 and $1.00, and it may take several weeks for cotton to regain its bullish momentum and rally towards $1.25 again.
SINGAPORE, Oct. 15 (Reuters) - Malaysian palm oil <KPOc3> is expected to retrace to 2,880 ringgit per tonne, as a bearish engulfing pattern is observed on its daily chart.
The engulfing pattern is one of the typical bearish reversals seen on a candlestick chart. As well, the rally from the Oct. 4 low at 2,653 ringgit could be too sharp not to be followed by a consolidation or retracement.
But the downside may not be limited to 2,880 ringgit, as a gap that formed between 2,808 ringgit and 2,886 ringgit could be partially filled as well.
Resistance is at 2,948 ringgit, a rise above which would open the way to 2,980.
European Union 2010-11 soft wheat production rose slightly to 127.9 million tons to reflect higher output from Poland, Germany and the U.K. and small cuts to southeastern EU and Baltic harvests, Strategie Grains said.
The company estimates EU soft wheat output will be 700,000 tons higher than its September estimate and down 0.9% compared with 129.1 million tons from last year.
The French forecaster says the outlook for EU wheat "remains very tight with high export demand," potential even though the U.S. remains the most competitive source for wheat given its ample wheat stocks that can be used to make up for the shortfall in Russian and Ukrainian wheat exports.
Strategie Grains expects the EU will export 18 million tons of wheat in 2010-11, up slightly from its September estimate of 17.4 million tons. The U.K. will export at a "very high level" of almost 2 million tons because it remains price competitive relative to France and southeast EU wheat origins, the firm said.
The U.K. export figure stands in contrast to the Home Grown Cereals Authority expectations for a 46% drop in U.K. wheat exports to 1.3 million tons in 2010-11.
2010-11 Intra-EU exports remained unchanged compared with the September estimate since an upward revision to Polish, Lithuanian and Denmark exports were offset by lower export expectations from the Czech Republic, France and Germany.
From a global perspective, wheat ending stocks are now forecast at a more comfortable 166 million tons, partly due to ample U.S. wheat stocks even though a severe drought in the Ukraine and Russia has crimped exports from those two countries.
Within the EU, the story is a bit different. "The supply situation remains very tight with soft wheat ending stock estimated at just 9 million tons" and no feed wheat surplus to spare, the French forecaster said.
"This situation indicates that [EU] prices will stay sustained until at least Christmas and that the decrease potential after then will be small," it added.
EU wheat prices will hinge on how tight corn supplies remain, changes to U.S. wheat prices, and 2011 world wheat production.
Strategie Grains expects 2011-12 EU planting area for soft wheat and barley to rise 3% on the year and corn to grow 4%.
Strategie Grains Thursday also revised its total grains forecast up by 1 million tons to 275.9 million tons due to a rise in barley and wheat output estimates, which largely offset a cut to maize output estimates.
"The maize harvest is progressing normally in west Europe and the southeast, but has been delayed by rains in central Europe," prompting the firm to reduce its maize output estimate downward by 400,000 tons to 55.6 million tons compared with the September estimate.
Dow Jones Newswire
Dow Jones Newswire
Use of genetically modified crops in Africa, where yields lag far behind the rest of the world, is a decision best left to individual nations, former United Nations Secretary General Kofi Annan said.
Annan, in an interview, said high prices and safety concerns stand in the way of the adoption of genetically modified crops in Africa, which is the only continent yet to attain food self sufficiency.
"What is important is that these governments develop the (expertise) that is necessary to determine whether [genetic modification] poses problems for health," Annan said on the sidelines of the World Food Prize Conference in Iowa. "The decision of whether they use [genetic modification] or conventional methods is up to the government."
Annan noted that some countries, including Zambia and Zimbabwe, refused aid shipments of genetically modified crops last decade despite an ongoing famine. Farmers are concerned, he said, that if genetically modified grains contaminate supplies, they would lose Europe as a potential export market.
Large seed companies such as Iowa-based Pioneer Hi-Bred, a subsidiary of DuPont Co., are making a push to increase their presence in Africa.
Annan, now chairman of the Alliance for a Green Revolution in Africa, said a lot of potential exists in boosting yields through conventional breeding. He added that small, independent seed companies are key to improving farmer yields. The alliance focuses on increasing crop yields and food self-sufficiency in Africa.
"The large seed companies are not very big players" in Africa, he said. "First of all, the African farmers cannot afford their seeds."
Annan said the recent run up in agricultural commodity prices will have an impact on African populations, given many people there already spend 70% to 80% of their salaries on food. Corn and wheat prices at the Chicago Board of Trade have soared in recent months on supply concerns in the U.S. and places such as Russia and Pakistan.
"If this continues, I think you'll see some more social unrest," Annan said.
He said the use of food crops for ethanol remains a concern. Annan has "no problem" with Brazil's use of sugar cane for ethanol, but questioned government subsidies for corn-based ethanol, which he said pushes food prices higher.
"Some people say it has no impact," he said. "I'm not convinced."
Little action has been taken to guard against supply shortages since record-high food prices caused food riots in some parts of the world in 2008, Annan said. And while the establishment of a global grain reserve is a good way to safeguard against a supply crisis, it would be "extremely difficult" to get governments to agree on the structure and management of such a system.
"We missed an opportunity to exploit the (last food) crisis, just as we've done with the financial crisis," he said.
DowJones News Wire
Thursday, October 14, 2010
OUR Green Revolution is near spent. The enormous and lasting gains made in crop yield through conventional plant breeding, mechanisation, crop protection and clever agronomy are slowing.
But the next era for mainstream broadacre farming is already here, it might well be called the Gene Revolution.
More than 95 percent of Australia's near 400,000 hectare cotton crop this summer consists of GM varieties. And in only the third year of commercial production, there are some 133,300ha of GM canola in NSW, Victoria and WA this spring - an estimated 9pc of the total canola crop.
What else is coming over the hill? Well, you name it - GM research underway in Australia covers: papaya, pineapple, sugarcane, grapevines, carnations, rice, white clover, wheat, Indian mustard, bananas, barley, perennial ryegrass, tall fescue, corn and roses. Most work is focusing on key traits which lessen production risks and underpin yield.
The big-ticket item, GM wheat, is just seven or more years away. Clearly, our farmers and their advisors, and the supply chain all the way through to customers and consumers, now need to start appreciating the GM reality, and separate myth from fact.
Fact 1: GM science will be essential for our food security in the decades ahead. It is estimated that the number of humans on the planet will rise from 6 billion in 2000 to near 9b in 2050, and food demand will rise by 70pc (Source: FAO).
Fact 2: Globally, farmers and supply-chains are going with GM; in 2009, 134 million ha of GM crops were planted in 26 countries representing an 80-fold increase since 1996 when GM crops were first commercialised. There were 2m new adopters last year.
Fact 3: It is estimated that biotech related gains in corn, soybean & canola had delivered an extra 14mt of production since 1996. And it has all been successfully traded.
Fact 4: Farmers who use GM technology appreciate that GM R&D businesses simply need a return on their long-term investments. Remember, much GM work is by public-private collaboration, and these bodies can only protect their IP through patents and fund their work via royalties. It is how innovation is incentivized. It is standard practice. And market forces ensure the pricing of the technology to farmers is realistic.
Fact 5: The costs of doing the R&D and bringing a variety to market are huge: Monsanto alone spends $1.1b/year ($3m/day) in research. Multiply that figure 10-fold or more for the global GM R&D effort.
Perhaps the biggest misguided myth is around 'safety'. Those who have a different view of mainstream farming reality continue to raise questions about GM science and GM crop safety, and refer to studies which purport to have discovered something harmful about GM.
Fact 6: Such studies have, without exception, been discredited by the weight of mainstream scientific evidence, opinion and peer review, and by recognised regulatory agencies around the world.
Fact 7: Major scientific and health organizations, and regulatory bodies, have endorsed the safety of approved GM crops to human health and the environment.
In Australia, we are regulatory leaders. We have an excellent, world-class system that is purposely designed to pick-up anomalies and look for any potential problem. Human health and environmental safety is the first priority. Why would it be anything other than that? Indeed, GM crops are subjected to incredible scrutiny, whereas 'conventional' crops receive relatively less.
For example, our record started with Gossypium sp. When we started work with cotton (Gossypium pima) in the early 1990's to develop GM varieties, we knew that there were some native Australian Gossypium plant species. We were rightly required to conduct thousands of tests to analyse every possible facet of potential transfer of genetic material from the new GM varieties to the native plants.
The point is that we had to do the work, and the system proved that there were no risks. If the extent and comprehensive-ness of the safety analyses was seen and understood by the public, people would not give a second thought to approved GM varieties.
Fact 8: Over the years billions of meals have been made and consumed that contain one or more GM crop ingredients or whole foods.
While GM canola and cottonseed oils are pure oil - they contain no proteins - even if they did, they'd be broken down into basic amino-acids. It happens every meal: just think of what was for dinner last night!
In our gut all proteins, starches and fats/oils that are in lettuce, carrots, potatoes, pumpkin, tomatoes, corn, soybeans and canola dairy products, beef, lamb, chicken or fish are all broken down into the basic biochemical building blocks, and no genetic material becomes incorporated into our genes!
The reality of today's farming is that scientists are working for the betterment of society and GM crops are simply the next major agricultural technology.
* Dr Jim Peacock is Australia's former Chief Scientist.
Oct 13 - Farmers around the world must ramp up food production dramatically to feed a rapidly expanding global population, a coalition of agricultural groups said in a report on Wednesday.
Meeting the needs of a global population estimated to jump roughly 50 percent to 9.2 billion by 2050, will require public and private investments in "science and technology" to boost agricultural productivity, the groups said.
"We need to do more with less and we must start implementing measures and policies that increase productivity today," said Bill Lesher, executive director of Global Harvest Initiative, the consortium of major agricultural companies, including Archer Daniels Midland, Monsanto, DuPont and Deere & Co that issued the report.
The group developed the agricultural productivity report in conjunction with the Farm Foundation, NFP, a public policy group, and the U.S. Department of Agriculture's Economics Research Service (ERS).
The report said doubling agricultural output to meet global demand by 2050 will require an annual average growth of at least 1.75 percent in "total factor productivity" - defined as the increase in output per unit of total resources employed in production. Between 2000 and 2007, USDA's ERS estimates global agricultural total factor productivity growth averaged 1.4 percent per year.
"To close the gap without additional land and resources, we must increase the rate of productivity growth an average of 25 percent more per year over the next 40 years," said Neil Conklin, president of the Farm Foundation.
The groups said rising per capita wealth will lead consumers in developing countries to increase not only the quantity but also the quality of food they consume.
Today, cereals and root and tuber crops make up more than 60 percent of the global diet, but by 2050 the United Nations Food and Agriculture Organization expects those staples will make up only 54 percent of food consumption, while animal proteins like meat and dairy, and vegetable oils will rise to nearly 40 percent of the global diet from about one-third today.
The groups said increased agricultural production should not be pursued by bringing more land into production and using more water or chemicals but through increased backing for technology that increases crop yields. They cited the need for strategies to use water more efficiently and improve infrastructure for water distribution, as well as improving labor productivity through mechanization.
"We have 40 years in which to double agricultural output, but we have to do it in a sustainable fashion with the same amount of land, less water and reduced inputs," said Lesher.
European Commissioner for Agriculture and Rural Development Dacian Ciolos is attending several events taking place in Bucharest and Sibiu (central) on Oct 13-15.
EU Commissioner Ciolos is to conclude the works of the Conference on the Contribution of EU Funds to Integration of Roma Population.
Likewise, the EU official will hold talks on the future of the Common Agricultural Policy with the members of the Parliament’s commissions for agriculture and the officials of the agricultural organizations.
On Thursday Oct 14, the European Commissioner for Agriculture and Rural Development will attend the opening of the Conference on Competition in the Key Sectors of the Romanian Economy, and this after he closes the works of the Conference on Semi-Subsistence Farming in the EU: Current Situation and Prospects, due in Sibiu.
The European official, on Friday Oct 15, meets a new series of representatives of the professional animal breeding organizations and discuss the future of the Common Agricultural Policy.
During his visit to Romania, the EU Commissioner Dacian Ciolos will meet with Minister of Agriculture and Rural Development Valeriu Tabara and discuss topics relevant to the agriculture and the rural development. financiarul.ro
Wheat futures fell, erasing earlier gains, on speculation that grain demand will ease after prices jumped almost 10 percent last week.
Wheat dropped in tandem with corn futures. Both grains are used in livestock feed. Corn declined as much as 2.3 percent following a 16 percent jump in the previous three sessions after the U.S. Department of Agriculture lowered its forecast for global grain supplies.
“Corn really tipped the scales here, wanting to sell off, and then wheat sold off with it too,” said Lane Broadbent, a vice president of KIS Futures Inc. in Oklahoma City.
Wheat futures for December delivery fell 7.25 cents, or 1 percent, to close at $7.0275 a bushel at 1:15 p.m. on the Chicago Board of Trade. Earlier, the price rose as much as 1.7 percent.
The commodity has jumped 46 percent since the end of June. Russia banned grain exports in August following the most-severe drought in five decades.
On Oct. 8, the USDA slashed its estimate for corn production by 3.8 percent from a month earlier. The agency cut its estimate for global wheat supplies by 1.8 percent.
Wheat also dropped today on signs that beneficial weather will boost crops.
“Spotty, locally heavy” rains fell on winter-wheat areas yesterday from Kansas to Kentucky, and sections of the Midwest were receiving more rain today, Allen Motew, a meteorologist at QT
Weather in Chicago, said in a report.
“We’re into planting season now, and there’s dry weather concern around, but we’ve got another 60 days before we really get into big trouble,” Broadbent said. “If you get planted before Christmas, you can still raise a crop.”
The dollar’s slump has boosted the appeal of grain sales from the U.S., the world’s biggest exporter.
Today, the greenback approached a nine-month low against a against a basket of six currencies. U.S. exporters sold 100,000 metric tons to Iraq for delivery in the year that began June 1, the USDA said.
“We’ve got a dollar that’s been weakening, and that’s going to help make U.S. wheat prices more attractive,” said Dan Kuechenmeister, the manager of the commodities department at RBC Dain Rauscher in Minneapolis. Exports have been cut way back from Eastern Europe and the former Soviet Union, so the number of shops somebody can go to buy wheat seems to be dwindling.”
Wheat is the fourth-biggest U.S. crop, valued at $10.6 billion in 2009, behind corn, soybeans and hay, government data show.
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