Top Commodity News

Precious Metals

Harmony Gold is maintaining its 2012 output target of
2.2 million ounces a year despite a first quarter drop in
production to 349,801 ounces.10According to a senior
official, Zimbabwe has experienced a 76 percent plunge
in gold output during the first part of this year – 335 kg
versus 1,407 for the same period last year11. The Finance
Minister in Venezuela has ordered that “70% of the gold
mined in Venezuela must be sold domestically and that
60% must be offered first to the Central Bank, while the
remaining 30% can be exported.”12

Recent analysis from Fortis Bank and VMGroup suggests
that silver production could drop by at least 700t and the
VMGroup CEO forecasts end-use sectors “to experience
little or no growth at all this year due to the poor demand
outlook and to restrictive credit lines.”13 The new GFMS
Platinum and Palladium Survey estimates flat supply in
2008 and attributes this to production losses being offset
by scrap and reduced demand from auto catalyst and
jewelry sectors.14

Grains & Oilseeds

According to a Reuters article, the wheat crop in
Oklahoma is expected to be 53 percent smaller than last
year’s due to weather issues.15 A Purdue University
economist reported that “only 5 percent of Indiana’s corn
crop had been planted” in contrast to an average of 47
percent in “the past five years”.16 Iowa’s corn planting is
60 percent complete and eleven days ahead of last year;
2 percent has emerged versus 7 percent normally.17 The
Agriculture Ministry in Brazil reported that drought in
the Center South region hurt soybean and corn crops.
This led to new harvest estimates of 51.4 million tons for
corn and 57.6 million tons for soybeans compared to
earlier estimates of 51.9 for corn and 58.1 for soybeans.18
In USDA export sales, soybean bookings were 28.5
million bushels – in line with expectations – and wheat
sales were 14.21 million bushels. Corn was below
expectations and last week’s number at 24.1 million

In rice news, an exporter’s group in India is urging the
end to a ban on overseas shipments of the grain
following a 99 million ton harvest with a surplus of
around 6 million tons.20

Coffee, Cocoa & Sugar

A new coffee production forecast from Fortis delivers
higher numbers for 2009/2010 arabica coffee
production – around 89 million 60 kg bags versus
approximately 79 million 60 kg bags in 2008/2009.
Robusta is forecast to fall from 54.34 million bags to
51.94 million bags. This is mostly attributed to a
forecasted decline in overall robusta output from
Vietnam.21 India’s coffee production in 2008/2009 is
lowered by 4.4 million bags according to an attaché
report from the Foreign Agricultural Service website.22

The cocoa estimate from Fortis was adjusted to a deficit
in 2009/2010 of 64,000 tons versus a prior forecast of a
101,000 ton deficit, and grindings for 2008/2009 are
forecast to fall 6.2 percent to 3.48 million tons.23

The International Sugar Organization has suggested
that global sugar demand will be 7.8 million metric tons
higher than output due to smaller cane crop harvests in
Asia. This is up from their 4.3 million ton forecast in


A Purdue University economist is suggesting that the
fallout from the H1N1 flu outbreak will affect US pork
producers for weeks or longer.25Canada has confirmed
H1N1 in a swine herd in Alberta,26 Smithfield is
completing tests on pigs from a farm in Veracruz in
Mexico in an attempt to confirm that none of the pigs
there are infected.27China has banned pork from 36 US
states, and Russia has banned at least 10.28 Meanwhile,
trade representatives from the US and the EU have
announced progress in the dispute over hormone-treated


The US Department of Commerce reported that
construction climbed 0.3 percent in March in
contrast to economists’ expectation of a 1.5
percent decline1. National Association of
Realtors data showed an increase in pending
home sales of 3.2 percent.2 Bank stress tests
were the subject of many news stories, and early
week press suggested that at least ten of the
nineteen banks being tested would require
capital.3The official stress test results released
on Thursday confirmed that ten banks and firms
would need a capital increase of $75 billion.4
Labor department data showed a total loss of
539,000 jobs inApril and an unemployment rate
of 8.9 percent. The job loss number was lower
than analysts’ expectations while the
unemployment rate was in line with estimates.5

The DOE weekly report showed natural gas
inventories increased 95 billion cubic feet to
around 1.92 trillion cubic feet, more than the 89
to 94 billion cubic foot increased expected by
analysts surveyed by Platts.6 A separate EIA
report showed gasoline inventories falling by
200,000 barrels and distillates rising 2.4 million
barrels versus Platts survey results which
showed an expectation for a 750,000 barrel
increase in gasoline and 690,000 barrel increase
in distillates.7 Crude oil stockpiles increased by
600,000 barrels last week8in contrast to a poll
by DJ Newswires which delivered an analyst
prediction of a 2.1 million barrel increase.9



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