Agri commodities outperformed industrial consumables with an impressive margin in 2012 due to strong fundamental support from the American continent. While the drought in Brazil and Argentina kept the global sentiments firm, the Indian government’s decision to raise the minimum support price ( MSP) of agri produce helped the price remain on a firm footing.
On the other hand, demand for industrial commodities remained low due to the prevailing uncertainty in the global economy. Commodities like cardamom offered returns of 70 per cent followed by turmeric and soybean with 38 per cent and 29 per cent, respectively………………………………………..Full Article: Source

The worst U.S. drought since the 1930s Dust Bowl is damaging wheat crops across the world’s biggest supplier, at a time when hedge funds are the most bearish on prices in seven months. About 62 percent of the country is mired in a dry spell that the government says will last at least until March in states growing the most winter wheat.
With dormant crops already in the worst condition since records began in 1985 and global inventories headed for a third annual drop, Chicago futures may rise as much as 26 percent to $9.50 a bushel this year, the median of 32 analyst estimates compiled by Bloomberg shows………………………………………..Full Article: Source

Wheat and soybean futures edged lower on Monday, but ended the year as the best performers in a basket of commodities, including crude oil, as demand lifted prices and the worst drought in half a century crimped supplies.
Wheat posted the biggest gain this year among the 19 commodities in the Thomson Reuters-Jefferies CRB index, soaring 19.2% despite falling for three straight months and tumbling 7.9% in December alone………………………………………..Full Article: Source

Coffee prices have fallen more than 50% since 2010 which can be seen through the coffee exchange traded fund symbol: JO. This investment seeks to replicate the returns that are potentially available through an unleveraged investment in coffee futures contracts as well as the rate of interest that could be earned on cash collateral invested in specified Treasury Bills.
The top weekly chart shows my price targets for 2013 while the lower hourly chart shows strong on balance volume meaning big money is slowly building a long position in coffee………………………………………..Full Article: Source

Changing global climate has wrought havoc on the agricultural sector during the past year. Drought in the United States has stunted the yields of many crops, while unusual weather patterns elsewhere in the world led to sharp spikes — and drops — in farm yields across Asia, Latin America and Europe.
Yet it’s unwise to pay too close attention to these near-term events. Instead, focus on the clear long-term trend in place for global agriculture. Millions more people are joining the middle class in fast-growing places such as China, Brazil and India, and there is a global push to ensure crop yields are maximized to meet this rising demand………………………………………..Full Article: Source

Psychologically, Sugar prices have turned bullish for the near-term, as prices rallied off recent lows after a rather bearish surplus estimate failed to draw in short-sellers. Though current momentum is now favoring Sugar bulls, we may not see any major fresh buying by large speculators unless we can see a strong close through the 20-cent per pound level.
After trading at 28-month lows, Sugar futures prices are beginning to rebound, as some traders start to exit bearish trades going into the new year. Sugar futures were one of the worst performing commodities in 2012, as a large supply surplus and average demand sent prices to lows not seen in over 2 years………………………………………..Full Article: Source

Chinese demand makes it hard to gauge the outlook for bulk metals such as copper and iron ore. But grains look different. Global stocks of agricultural commodities are low and the drought that hit harvests in the fall of 2012 has continued, jeopardizing the new wheat crop. With low rainfall also hitting river-borne U.S. trade routes, grain prices may well stay elevated.
Prices of corn and soybeans have retreated somewhat from the record highs they reached when the severity of last summer’s dry spell became clear. But the lull may be deceptive. Several factors point to high prices next year………………………………………..Full Article: Source

A massive sell-off by speculators fuelled a decline in values of US wheat which has left the grain looking amongst the cheapest in the world, challenging Indian supplies on price. Managed money, a proxy for speculators, cut it net long position in Chicago wheat futures and options by more than 22,000 contracts, the biggest sell-down since January, regulatory data showed.
The data were for the week to December 11 – a day marked by the US Department of Agriculture’s 50m-bushel cut to its forecast for US wheat exports in 2012-13, a downgrade which sent prices of the grain tumbling to their lowest since July……………………………………Full Article: Source

According to the Financial Times, “a mysterious white substance is being smuggled over the border from Vietnam to China in growing quantities.” Of course this substance is a staple of modern Western society and something increasingly in demand in China and other emerging markets.
The FT states that: “China is the world’s top importer of raw sugar and third-largest consumer overall. Toby Cohen, a director at London sugar merchant Czarnikow, points out that China’s overall sugar consumption is still low in per capita terms, and expects it to keep growing. China could consume “double the volume of sugar it is consuming today, and still be consuming less on a per capita basis than the western economies,” he said.”……………………………………Full Article: Source

The year 2012 was very exciting for the agro-commodities market. High volatility and rising trading interests resulted in improved volumes in the futures market. There were many commodities, which gave significant returns — especially during the initial eight-nine months before profit booking set in at higher levels.
Volumes shot up on the exchanges and high liquidity was observed on counters that were not very liquid so far. Assisted by strong fundamental factors, we saw commodities like pepper, jeera, chana, kapas, cocud giving 50 per cent to 100 per cent returns in the first nine months itself before corrections occurred. Turmeric prices nearly doubled from their lows……………………………………..Full Article: Source

It was a pretty hectic year for agricultural commodities as the summer months wreaked havoc on prices. After the United States endured the hottest 12-month span on record and an abysmal drought, a number of these staple commodities experienced big movements in price and trading volume alike.
But now that 2012 is nearing its close, we look back at these funds throughout the course of the year to see which funds outperformed the rest……………………………………..Full Article: Source

Chicago agricultural commodity futures post a mixed performance Thursday, with corn and wheat futures down while soybeans up, as the net weekly export data dominated the trading on the day.
The most active corn contract for March delivery fell 5.25 cents, or 0.72 percent, to close at 7.2025 dollars per bushel. March wheat edged down 3.5 cents, or 0.43 percent, to settle at 8. 085 dollars per bushel. January soybeans rose 3 cents, or 0.2 percent, to close at 14.765 dollars per bushel………………………………………..Full Article: Source

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Three consecutive years of smaller U.S. corn harvests are driving inventories of the world’s most- consumed grain to a 39-year low and spurring Goldman Sachs Group Inc. to predict that prices will rise near record highs.
Global stockpiles probably will drop 11 percent to 117.64 million metric tons by Oct. 1, according to the average of 16 analyst estimates compiled by Bloomberg. That would be 13.8 percent of what the U.S. Department of Agriculture expects to be used for food, ethanol and livestock feed, the lowest ratio of inventories since 1974. The USDA is scheduled to update its forecasts at 8:30 a.m. in Washington………………………………………..Full Article: Source

Global food prices dropped 1.5 percent in November, the United Nations Food and Agricultural Organisation (FAO) said on Thursday. The FAO’s Food Price Index, a monthly measure of changes in a basket of food commodities, moved down three points to 211 points in November, the lowest since June 2012.
“Except for dairy, international prices of all the commodity groups included in the index fell in November, with sugar undergoing the sharpest dip, followed by oils and cereals,” the FAO said in a statement………………………………………..Full Article: Source

Russia, last year’s third-biggest wheat exporter, is bracing for its coldest winter in 20 years, threatening a crop planted into parched soil at a time when drought is already diminishing yields from Australia to the U.S.
The icy blasts predicted by the state weather forecaster through February are a greater threat this season because record heat in southern areas means some crops have yet to enter dormancy and don’t have a protective snow covering. Russia will already have the lowest stockpiles relative to demand in five years when it starts harvesting in July and a damaged crop would further curb supplies available for shipping………………………………………..Full Article: Source

Goldman Sachs recommended a commodity bet including a long position in corn despite forecasting a rise in sowings of the grain to a 77-year high in 2013, while putting soybean plantings on for a record.
The investment bank included corn, crude oil and a long position in copper balanced by a short in aluminium, in its so-called “CCB commodity carry basket” of raw materials set to outperform………………………………………..Full Article: Source

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Global cotton output in 2013/14 may fall for the second consecutive season resulting in the smallest output in four years. .Lower cotton prices and increased attractiveness of competing crops will decrease the production of global cotton by 11% to 23.2 million tons, according to International Cotton Advisory committee (ICAC).
Production is expected to fall sharply in the United States and Turkey, where competition with grains and soybeans is strong. Smaller crops are also projected in China, Pakistan, Central Asia and Francophone Africa………………………………………..Full Article: Source

Most conversations around the global economy and fiscal outlook revolve around two key subjects: money printing vs. austerity, and higher taxes/more spending vs. lower taxes/less spending. Both are hot buttons and equally important to global growth.
The consequences of getting policies right/wrong fuels sub-arguments surrounding inflation vs deflation and global growth slowing vs rising population………………………………………..Full Article: Source

Monday’s weekly USDA crop ratings data showed that 33% of the US winter wheat crop was rated good/excellent, down 1% from the previous week and well below year-ago levels of 52%. Meanwhile, 26% of the crop is rated poor/very poor, up 2% from the prior week and double the year-ago level of 13%.
Southern Hemisphere weather concerns are also supporting wheat prices, with excessive rain in Argentina and Australia, Barclays noted in a report………………………………………..Full Article: Source

UN conference on trade and development (UNCTAD) says trade in futures contracts causes the most damage. The United Nations has laid the finger of blame for food price rises on trading in agricultural commodities, but says it is the trade in futures contracts – an agreement to buy at a set price sometime in the future – rather than the actual food stocks that causes the most damage.
David Bicchetti, associate economic officer at UN conference on trade and development (UNCTAD), said “enormous, humongous” amounts of money are traded on commodities that don’t actually exist. “Over $400bn [of paper money] is traded – that’s 20-30 times the physical production of the commodity.”……………………………………….Full Article: Source

Global food prices remained stable, though close to 2008 record levels, the World Bank said on Thursday, as it warned that a “new norm” of costlier food was setting in and threatening to increase hunger and malnutrition in the world’s poorer regions.
In an update of its quarterly “Food Price Watch” report, the World Bank said the absence of “panic policies,” such as food export restrictions, had helped stabilize commodity prices since price spikes in July………………………………………..Full Article: Source

Barclays Plc. is contemplating a retreat from trading in agriculture commodities, according to a Reuters report. The move comes as the company gears up for a strategic revamp of its overall business as well as to avoid any threat to its reputation.
Notably, trading in agricultural commodities has received much criticism in the recent years as the speculation activity has been blamed for a shoot up of prices. This has had severe consequences in the undeveloped countries, leading politicians as well as common people to raise their voices in protest………………………………………..Full Article: Source

The Food and Agriculture Organization of the United Nations (FAO) has raised its July forecast of global paddy production in 2012 by 4.2 million tons to 729 million tons (486 million tons, milled) because of the progression in the crop.
Prospects have improved especially for India, but also Egypt, the Democratic Republic of Korea, the Philippines, the United States and Vietnam, while they worsened in Myanmar, Colombia and Senegal………………………………………..Full Article: Source

Palm oil may trade in a range in the next three months before slumping into a bear market as global production peaks in the second half of next year, according to Dorab Mistry, director at Godrej International Ltd.
Futures on the Malaysia Derivatives Exchange will trade between 2,300 ringgit ($755) and 2,600 ringgit a metric ton until February, keeping inventories high in Indonesia and Malaysia, the top producers, Mistry told a conference in Bali, Indonesia today. Prices will drop below 2,200 ringgit in August or earlier as a pickup in output expands inventories, he said………………………………………..Full Article: Source

World corn production may witness a significant growth this year drought like condition in major corn growing areas.
A recent data by the U.S. Grains Council shows that world corn production of 839 mn metric tons for the 2012-2013 marketing year will be the second highest on record, down 37 mn tons from 2011-2012 but up 8.2 mn tons from 2010-2011, according to the U.S. Department of Agriculture………………………………………..Full Article: Source

Agriculture is perhaps the most practical commodity sector, as many of its products enjoy inelastic demand around the world. As such, this segment has always been given a fair amount of investing attention. Because there are so many different futures in the ag world, ETFs have become one of the most effective and popular ways to play this broad commodity sector.
After enduring one of the worst droughts in U.S. history, agriculture ETFs are taking another hit as they have been trending downward since September……………………………………….Full Article: Source

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The world’s farmers are the canaries in the mine when it comes to climate change. What affects farmers affects the global food supply and causes the price rises that hit middle class wallets and increases the risk of hunger for the world’s poor.
Climate change is certainly not the only culprit when it comes to food insecurity. A complex cocktail of demographic, economic and policy changes can be blamed for increased pressure on the food supply………………………………………..Full Article: Source

Australia & New Zealand Bank urged caution – for now - among investors expecting gains in agricultural commodity prices, flagging factors such as a weak Brazilian currency, and slow economic growth in capping values.
The bank said that it expected prices of commodities overall “to improve in the coming months”, helped by signs of improving economies in the US and China, a huge buyer of raw materials, which “appears to be turning the corner”………………………………………..Full Article: Source

Morgan Stanley sounded a mixed note for agricultural commodity values, even as data showed many hedge funds giving up on price gains for now, slashing long exposure to corn and cotton futures on particular.
The bank said that it was “bullish” on agricultural commodities, in particular corn, saying it “still” saw the need for prices “to move higher, and possibly trading into the double digits” in terms of dollars per bushel to ration demand following a disappointing US harvest, the world’s biggest………………………………………..Full Article: Source

China’s growing influence in the grain and oilseed market has been well covered in recent years, with the country’s increasing share of global corn, soybeans and (recently) wheat trade exhaustively scrutinized by market trackers.
But less well publicized has been China’s emerging dominance in the rice market, brought about by soaring domestic prices which sparked a wave of import buying lately that has catapulted China from seventh to second in the world rice import rankings and altered the trade flow across Asia of one of the world’s most popular dietary staples………………………………………..Full Article: Source

The commodity cocoa, refers to cocoa beans, which are the dried seeds from the, Theobroma Cacao, or cocoa tree. The tree is native to the Americas, specifically the Southern Hemisphere, and has been a major part of the area’s history, though now the vast majority of the trees exist in West Africa.
In fact, cocoa beans were used as a common currency in many areas prior to the Spanish conquest. Now, cocoa is used all over the world to create chocolate, and other products such as cocoa butter. Many consume cocoa beans because of the benefits associated with them, as they are thought to have positive effects on cardiovascular health among other things. As an investment, cocoa has become a popular commodity for investors looking to cash in on the sweet gains it can provide………………………………………..Full Article: Source

A consolidation is underway in global grain trading as the major players position themselves for an expected surge in demand for food commodities, particularly in Asia. The following are some of the key moves during the last couple of years:
OCTOBER 2012 - Archer Daniels Midland bids $2.8 billion for Australia’s GrainCorp in a deal that could give it a platform to supply Asia. MAY 2012 - Japanese trading house Marubeni Corp. agreed to buy U.S. grain merchant Gavilon for $5.6 billion including about $2 billion in debt. The deal positioned Japan’s top grains trader to benefit from China’s booming demand for imported corn from the world’s biggest supplier………………………………………..Full Article: Source

Surging demand for European Union wheat is reducing stockpiles to a 14-year low and driving prices in France, the biggest exporter, to a record premium over U.S. grain after drought withered supply from the Black Sea region.
EU licenses to ship wheat in the six weeks to Oct. 16 were 40 percent higher than a year ago, data from the 27-nation bloc show. French grain for March delivery now trades at a premium of 33 cents a bushel to Chicago futures, from a 78-cent discount in July………………………………………..Full Article: Source

I’ve been warning of a slowdown in China for some time, but there isn’t much room for argument any more. The official figures now have growth at 7.4% and some, such as Marc Faber of the Gloom, Boom and Doom Report, suspect it may be more like 4%.
More telling are some of the non-official numbers. Komatsu’s sales of excavators to China fell by 43% year-on-year in August (marking the 16th consecutive monthly decline). If sales of excavators are falling, you can assume that activity in areas in which excavators operate is also falling. Goodbye supercycle………………………………………..Full Article: Source

“It’s unavoidable” says Jim Rogers of a coming recession. He notes that roughly every four to six years has seen an economic slowdown in the U.S., and that 2013 and 2014 will be no exception to that rule. For months now, Rogers has been warning investors that our culminating debt issues and a sluggish economy will lead to a recession that is even worse than that of 2008.
He has continually told investors to be very worried and to prepare themselves, but unlike most others who predict a doomsday-like scenario, Rogers has given advice on how to prepare yourself……………………………………….Full Article: Source

The grain market has settled down the last 4-5 weeks due to a combination of weak exports for corn and soybeans, too many speculators long the market and ideas that South American crops will be huge this winter (Brazil/Argentina summer). In addition, we began forecasting in late August, the drought to begin to slowly ease in the Midwest, in which crop conditions stabilized for soybeans.
These rains went a long ways towards the USDA increasing their U.S. soybean crop estimate to 2.86 billion bushels in October, up from 2.63 billion bushels a month earlier; something that we sort of got wind about, during September………………………………………..Full Article: Source

Palm oil prices may rebound “in the medium term” as consumer demand increases after prices dropped, Oil World said. World palm oil exports may total 42.57 million metric tons in the 2012-13 season that began Oct. 1, up 5.8 percent from 40.24 million tons a year earlier, the Hamburg-based researcher said today in an e-mailed report.
Combined exports of soybean oil, rapeseed oil and sunflower seed oil may be 19.12 million tons, 5.4 percent smaller than a year earlier, Oil World said………………………………………..Full Article: Source

Commerzbank’s head of fundamental global commodities research predicts all speculative capital will ultimately leave the world’s agricultural markets, as some blame it for hiking prices of grains by one quarter this year alone.
Spot prices of grains, as measured by the S&P GSCI Grain spot index, have risen by 26.5% so far this year. Commerzbank’s Eugen Weinberg said a veto on speculation will not solve the problem of high prices, but a moratorium will happen, nevertheless………………………………………..Full Article: Source

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Higher trading limits in nine agricultural commodity markets remain in place despite a court ruling that knocked back regulators’ efforts to get tougher on speculation, futures exchanges said on Thursday.
The CME Group requested in April 2010 that so-called “legacy” position limits in markets including wheat and corn - which have been subject to speculative caps for decades - be increased to reflect the surge in trading volume and open interest as investors poured into the markets………………………………………..Full Article: Source

Agricultural commodities harvested in winter, including soybean and castor seed, hit the lower circuit in futures trade on commodity exchanges, on hopes of a bumper crop this season and cues from global markets.
Harvesting of summer sown crop has begun, with estimates of a record output, especially for the soybean crop, the largest in the oilseed basket. The revival in the monsoon rains in early August raised hopes of a better kharif crop, compared to previous estimates………………………………………..Full Article: Source

Given all of the turmoil in markets this year, we have seen a number of investors change their positions on statements made in the past. Jim Rogers, for example, has now stated that he is looking into investing in Russia after snubbing the country for his entire investing life.
But there is one thing that Rogers is still as bullish as ever on, agricultural commodities. It has been no secret that he has been a fan of these hard assets for quite some time, but a recent interview shows that he still loves these commodities and is as bullish as ever……………………………………….Full Article: Source

A Swiss political party is seeking to drum up support for a national vote to ban banks and other financial institutions from speculating in agricultural commodities, in the latest sign of growing political backlash against record food prices.
The exact size of investment in agricultural commodities from Switzerland is unclear, although it hosts banks UBS and Credit Suisse which both invest in the sector through either index funds or exchange traded funds. It is also home to multinational commodity firms such as Glencore and Cargill………………………………………..Full Article: Source

The rising price of commodities may lead to record food prices in 2013, which may last for a sustained period. This agricultural inflation or ‘agflation’ caused by failing crops worldwide will affect feed intensive crops, which will have a serious knock on effect on the animal protein and dairy industries says a recent report from Rabobank.
The worst drought in the US since 1936 and water shortages in Russia and South America are all taking their toll says Rabobank………………………………………..Full Article: Source

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Brace yourself for some painful “agflation”. That is the shorthand for agricultural commodity inflation, otherwise known as rising food prices. They are being driven upwards by the climb in grain and oilseed prices as US crops weather the country’s worst drought since 1936, while the farming belts of Russia and South America suffer through similar water shortages.
What we are seeing represents the third major rally in global grain and oilseed prices in just half a decade………………………………………..Full Article: Source

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Russia’s VTB Capital has hired Jim Rogers, an American investor and economist who in 1998 created the Rogers International Commodity Index (RICI), as an adviser to its agricultural division.
Rogers, the 69-year-old author of several books who is based in Singapore and is chairman of Rogers Holdings and Beeland Interests, joined forces with George Soros in the ’70s to set up Quantum Fund, a hedge fund that in 1992 earned Soros a billion dollars overnight and enabled the financier to forcee the Bank of Ebgland to devalue the pound………………………………………..Full Article: Source

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China’s giant sovereign wealth fund is looking to make its first significant investment in the Australian dairy industry, as it tries to lock up food ­supplies for its growing middle class. In a potential test case for foreign investment laws, China Investment Corp, which is estimated to have $US190 billion to invest outside its home market, sent four executives to Tasmania this month.
They inspected two large dairy operations in the state’s north which have a combined value of more than $200 million and significant capacity for expansion………………………………………..Full Article: Source

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Agricultural commodities prices resumed upward trends in June 2012, largely due to drought conditions in key global farming areas on top of existing low inventories. Extreme global conditions continue, with the period June-August of 2012 the hottest such period historically on record.
Agricultural commodity price rises typically feed through to retail food prices 4-6 months later, which means we could expect food prices to really escalate as of the final quarter 2012. Here is the UN food price index up to the end of August 2012:……………………………………….Full Article: Source

Food is our nourishment. It is the source of life. Growing food, processing, transforming and distributing it involves 70 per cent of humanity. Eating food involves all of us. Yet, it is not the culture or human rights that are shaping today’s dominant food economy. Rather speculation and profits are designing food production and distribution. Putting food on the global financial casino is a design for hunger.
After the US subprime crisis and the Wall Street crash, investors rushed to commodity markets, especially oil and agricultural commodities. While real production did not increase between 2005-2007, commodity speculation in food increased 160 per cent. Speculation pushed up prices and high prices pushed an additional 100 million to hunger. Barclays, Goldman Sachs, JP Morgan are all playing on the global food casino………………………………………..Full Article: Source

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Hot enough for you? The country’s sweltering summer exacerbated the worst drought conditions in the Midwest since the 1950s, and the heat wave has extended to the prices of agricultural commodities and exchange-traded products that own them.
The contract for September delivery of corn rose by about 60% between mid-June and late August, while contracts for soybeans and wheat experienced gains of about 40% over similar spans……………………………………….Full Article: Source

Investors looking for an asset class showing strong returns over the turbulent year to date may have noticed the recent gains made by soft commodities such as corn.
The US midwest - a key growing area for crops like corn, wheat and soybeans - has been hit by its worst drought for 56 years, meaning yields are likely to be much worse than expected. The price of some agricultural commodities has reached record levels as a result……………………………………..Full Article: Source