Reports & Statistics
Retail sales for October came in with a 1.4 percent increase. Excluding automobiles, the increase was 0.2 percent.1 The Producer Price Index, as reported by the Labor Department, showed a gain of 0.3 percent compared to the 0.6 percent increase anticipated by a Dow Jones Newswires survey.2 Industrial production was up by 0.1 percent in October versus the 0.4 percent gain forecast by economists.3 Housing starts dropped 10.6 percent to 529,000. This was lower than the 600,000 forecast by economists.4 The Consumer Price Index rose 0.3 percent, nearly matching economist expectations.5
According to Energy Information Administration (EIA) data, crude oil inventories dropped 900,000 barrels compared to a 300,000 drop forecast. Supplies of gasoline fell 1.7 million barrels compared to the forecasts for no change. Distillates fell by 300,000 barrels compared to forecasts for a 700,000 barrel decline.6
Precious Metals
The World Gold Council is suggesting that “gold demand in the third quarter of this year was down against Q3 2008”; however, last year’s demand may have been “exceptionally strong”. They are also suggesting that jewelry sales may continue to struggle outside of China’s demand due to higher gold prices.7 John Paulson, a “hedge fund billionaire”, will be setting up a gold fund as reported by the Wall Street Journal. The fund is set to begin on January first.8 The South African Journal of Science has published a report that suggests South African gold reserves are nearly exhausted in some areas.9 Platinum supplies in South Africa may rise to 4.73 million ounces for 2009 based on sales of stockpiled metal.10 Global platinum jewelry demand for 2009 is expected to jump nearly 80 percent with China’s demand nearly doubling.11
Grains & Oilseeds
POET, a corn-based ethanol producer, is reporting that they have “slashed the cost of producing cellulosic ethanol from corn cobs and that it will be able to compete with gasoline in two years”.12 Vomitoxin – a fungal disease capable of making livestock sick in higher amounts – has been detected in the some US corn by Archer Daniels Midland. A spokesperson stated that only “only a small part of the crop” is affected at this time. Wet conditions may be to blame.13 Locusts in Argentina may cause damage to wheat crops if action is not taken within the ten day window of development according to an agriculture director in Buenos Aires province.14 El Nino weather may already be reducing potential soybean output in the South American country with lower rainfall volumes.15
Coffee, Cocoa & Sugar
This week saw beneficial rains in Ivory Coast for main crop cocoa. Adequate rainfall could ensure soil moisture through the dry season and help bean size.16 Brazil’s higher than average rainfall levels in the final half of this year could lower coffee yields.17 Moves by India’s government which modify the price order for sugar cane could help end farmer strikes in Uttar Pradesh. The processing delay for new crop should be over, and crushing should begin “in the next four days”.18 Australia’s biggest sugar exporter is suggesting that sugar prices will “remain firm”. F.O. Licht – a German researcher – says sugar consumption for this season will exceed production. However, Licht also said the “supply deficit is likely to narrow to 6 million tons” and “consumption may drop to about 35 percent”.19 From WIRED, Embraer and General Electric are looking to “develop sugar cane-based jet fuel for airliners” with fuel company Amyris.20
Livestock
The latest Livestock Slaughter report from the USDA showed red meat production declined 3 percent year on year. Hog kill was 4 percent lower than last year while beef production was 3 percent lower. Average weights for both were slightly higher.21 Analysts are forecasting the Cold Storage report will show pork supplies at 540 million pounds.22
Coming Up Next Week:
Monday:
Existing Home Sales, Crop Progress
Tuesday:
Consumer Confidence, GDP
Wednesday:
Personal Income, Durable Orders, New Home Sales, Energy Stocks, Gas Storage, FOMC Minutes
1 http://www.google.com/hostednews/ap/article/ALeqM5gNiyJ905Ho0Ur96V2TQhsBX19lGwD9C0TPA80
2 http://online.wsj.com/article/BT-CO-20091117-707259.html?mod=rss_Global_Stocks
3 http://www.forbes.com/feeds/afx/2009/11/17/afx7130490.html
4 http://www.forbes.com/feeds/afx/2009/11/18/afx7135721.html
5 http://www.forbes.com/feeds/afx/2009/11/18/afx7135722.html
6 http://www.reuters.com/article/marketsNews/idUSN1812782320091118
7 http://www.mineweb.com/mineweb/view/mineweb/en/page33?oid=93324&sn=Detail
8 http://www.mineweb.com/mineweb/view/mineweb/en/page67?oid=93345&sn=Detail
9 http://www.mineweb.com/mineweb/view/mineweb/en/page34?oid=93062&sn=Detail
10 http://www.mineweb.com/mineweb/view/mineweb/en/page35?oid=93222&sn=Detail
11 http://www.retail-jeweller.com/page.cfm/action=Archive/ArchiveID=1/EntryID=517
12 http://www.washingtonpost.com/wp-dyn/content/article/2009/11/18/AR2009111801937.html?hpid=moreheadlines
13 http://www.reuters.com/article/marketsNews/idUSN1919324020091119
14 http://www.bloomberg.com/apps/news?pid=20601086&sid=atzdk7s87AuY
15 http://www.bloomberg.com/apps/news?pid=20601086&sid=aFViG5GE7oX4
16 http://af.reuters.com/article/investingNews/idAFJOE5AF0G520091116?sp=true
17 http://www.bloomberg.com/apps/news?pid=20601086&sid=adS4yEFhZWuk
18 http://www.bloomberg.com/apps/news?pid=20601091&sid=aZSRKY.hrbck
19 http://www.bloomberg.com/apps/news?pid=20601091&sid=az3bxy_TeXN8
20 http://www.wired.com/autopia/2009/11/sugar-cane-fuel-azul/
21 http://usda.mannlib.cornell.edu/usda/current/LiveSlau/LiveSlau-11-20-2009.pdf
22 http://www.cattlenetwork.com/CME-Livestock-Outlook–Mainly-Firm-Hogs-As-Shorts-Cover/2009-11-20/Article.aspx?oid=942540&fid=CN-LATEST_NEWS_&aid=760;
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