Credit Suisse Sees Corn Poised to Drop on Enlarged Supply

Corn may fall to $5.50 a bushel in three months and $5 in 12 months, Credit Suisse analysts led by Tobias Merath said today in an e-mailed report. Farmers in Europe have replanted damaged winter-wheat fields with corn, and yields in the U.S. may increase because this year’s rapid planting pace will allow for an earlier harvest, the bank said.

Corn prices are set for a “sharp drop” because of prospects for rising world supplies in the next year, Credit Suisse said.

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Nickel Slump Seen Ending as China Faces Ore Import Curbs

Nickel fell 12 percent this year on prospects for the biggest surplus since 2009. Morgan Stanley now predicts the glut will peak in 2012 and Barclays says prices should rally toward the end of the year on strengthening demand from stainless-steel makers, the biggest consumers.

The rebound may not happen until then as China runs down record ore stockpiles accumulated in anticipation of the Indonesian ban.

After slumping more than any other industrial metal, analysts and traders say the worst may be over for nickel as restrictions on shipments from Indonesia, the biggest producer, diminish a worldwide glut.

via Nickel Slump Seen Ending as China Faces Ore Import Curbs – Bloomberg.

Shale gas: China’s turn

Shale gas exploitation has already caused an energy revolution in the United States. The other global superpower, China, wants in…

The National Development and Reform Commission, China’s Ministry of Finance, the Ministry of Land and Resources (MLR), and the National Agency Energy on March 13, 2012 jointly published the first five-year plan for development of shale gas in China for 2011–2015.

Production targets are ambitious and emphasize the need for foreign cooperation, particularly in technology, to allow the growth of this economic sector .

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Sugar prices down due to excess production

Sugar prices have dropped further this week, cancelling the increase from last week.
The main factors are the economic climate far from being the most euphoric, a stronger dollar and a very significant production surplus.

Wednesday, prices have dropped to 548.20 dollars per tonne in London and 19.36 cents per pound in New York, which corresponds to the lowest prices since August 2010.

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Why American Natural Gas Will Change The World

In this ‘Tale of Two Cities’ you’ll get $2/MMBtu in New York (Henry Hub) and around $20/MMBtu in Singapore (Asian spot). The divorce between the Atlantic Basin and Pacific Basin couldn’t be any starker – the question is whether these spreads will incrementally narrow under inexorable laws of economics, or whether politics will throw a spanner in the works.

‘Convergence’ makes most sense for the US of course – Chesapeake’s foibles merely mask a structural problem for American gas players; they are selling their gas for a pittance in the US when they could be making an absolute killing overseas, roughly to the tune of $1bn spreads a day in Asia.

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Is China’s appetite for commodities coming to an end?

In the last few days, Chinese customers started to either require deliveries to be postponed, or they simply refused shipments of iron or coal, mainly for the steel industry. For example, a large Chinese company postponed delivery of 6 million tons of iron.

This is the kind of Information that has a chilling effect for the three major iron exporters as China absorbs more than half of the world production. This is not the first time such a blip occurs and it could become self-sustaining. Seeing lower prices on the spot market, Chinese buyers, being savvy traders, are in no hurry to receive orders placed at a much higher price.

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North American prices fall for polyethylene, polypropylene and PVC

An uncertain demand picture and increasing feedstock supplies have combined to drive down North American prices for polyethylene, polypropylene and PVC resin since May 1.

Regional polyethylene prices are down an average of 7 cents per pound, while polypropylene prices have tumbled 10 cents and PVC prices have taken a 2-cent dip, according to buyers and market watchers contacted recently by Plastics News.

via Plastics News – North American prices fall for polyethylene, polypropylene and PVC.

Wheat Fields Parched by Drought From U.S. to Russia

Wheat traded in Chicago rose as much as 18 percent in the 10 days through May 21 on concern that the market is returning to the droughts of 2010. Russia and Ukraine curbed exports that year and prices more than doubled to $9.1675 a bushel by February 2011, the month when world food costs tracked by the United Nations rose to a record. Analysts surveyed by Bloomberg expect futures to gain 13 percent to $7.51 by mid-July.

Droughts withering wheat crops from the U.S. to Russia to Australia will probably spur the biggest reduction in global supply estimates since 2003 and drive prices to the highest in almost a year.

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Argentina’s soybean crop at risk

Some 700,000 hectares are under water in the southwestern province of Buenos Aires, the heart of the Argentine agricultural power, threatening the soybean crops and about 500,000 heads of livestock, local producers said yesterday.

Soybeans, of which Argentina is the third largest producer, was already hit by drought and production should decrease by 18.5% from about 49 million tonnes in 2011 to 41 this year, according to forecasts by Bolsa de Cereales, the Buenos Aires Grain Exchange.

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Rubber Seen Poised for Glut on Weaker Chinese Growth

Supplies of rubber, used in tires and gloves, are set to exceed demand, reversing a shortage and pressuring prices as growth slows in Europe and China. Futures fell the most in two weeks.

Futures have plunged 50 percent from a record in February 2011 as Europe struggled with its debt crisis and China expanded last quarter at its slowest pace in almost three years.

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