Wheat Advances as Drought Threatens New Crop Planting in Russia, Ukraine

Wheat gained on speculation that persistent drought in Russia, Kazakhstan and East Ukraine may disrupt the planting of next year’s crop and Egypt, the world’s biggest buyer, continued purchases, boosting demand. Corn rose for a fifth day, the best run in more than three months.

December-delivery wheat gained as much as 1.1 percent to $7.44 a bushel on the Chicago Board of Trade, and traded at $7.42 at 3:17 p.m. in Singapore. The contract slumped as much as 2 percent yesterday after Australia, the world’s fourth-largest exporter, said that shipments in the 2010-2011 season may be the second-highest on record as rains boosted the harvest.

Iron Ore-Prices steady, China sees limited impact from cutbacks

Asian iron ore spot prices were little changed on Wednesday, with the Steel Index benchmark languishing at near seven-week lows as the demand outlook remained hazy. Upcoming public holidays in China, the biggest buyer of the steelmaking ingredient , also limited activity in both the physical and forward swaps markets. Chinese markets are shut on Sept. 22-24 for the Mid-Autumn Festival and on Oct. 1-7 for the National Day holiday. "The market is quiet ahead of the Chinese holidays, not much going on," said Destiny Guo, an iron ore physical and derivatives broker at London Dry Bulk in Hong Kong.

Indian coal imports to almost triple by 2020

India will nearly triple coal imports to some 250-million tons a year by 2020, one of the country’s biggest producers of the fuel said. Northern Coalfields CEO Vinay Kumar Singh told Mining Weekly Online that current import rates were 80-million to 100-million tons. “Over the next ten years it will increase to about 250-million tons a year,” he said in an interview on the sidelines of the World Energy Congress being held in Montreal.
India planned to increase power generation capacity by 100 000 MW over the next ten years, mainly by building coal-fired plants, Singh said earlier in a speech.

Indian iron ore miners cut output on low steel mill demand

BS reported that India’s independent iron ore mining companies have cut output by 80% since June due to uncertainty over exports and recovery in demand from domestic steel mills Mr RK Sharma secretary general of the Federation of Indian Mineral Industries said that Southern Railway, which used to transport 25 rakes everyday is handling only five. The same is the case for the entire country. Hardly 20% of India’s normal total annual output of 235 million tonnes is being extracted from mines across the country.
Independent iron ore miners do not have steel production facilities and therefore sell the entire output to others.
There are 3 reasons for the fall in output.

Coal to remain world's top power source over next 20 years

Global energy demand will rise as much as 40% in the next 20 years, IHS Cambridge Energy Research Associates chairperson Daniel Yergin said. "In our scenarios for the future we expect by 2030 to see growth somewhere between 30% and 40% off a much larger base in demand. That's a very large number," he told the World Energy Congress in Montreal.
Demand for energy had grown by 40% since 1990.

Wheat Harvest, Exports From Australia May Surge After Rains, Bureau Says

Wheat exports from Australia, the fourth-largest shipper, may surge to the highest level in more than a decade after rains boosted this year’s harvest, according to revised predictions from the government’s forecaster. Output may be 25.1 million metric tons in 2010-2011, compared with a June estimate of 22.1 million and last year’s harvest of 21.7 million, the Australian Bureau of Agricultural and Resource Economics-Bureau of Rural Sciences forecast in a report today. Exports may surge to 18.4 million tons, the second-highest level on record, according to the report.

Chinese economy is "in good shape" said Wen Jiabao today

China’s Premier Wen Jiabao, a truly inspiring public leader, said in a statement this week that the world’s fastest growing economy is now in “good shape” “featuring fast growth, gradual structural improvement, rising employment and basic price stability” and this statement said at the World Economic Summer Forum in Tianjin, can be seen as a positive sign that boosts the general investors confidence that the nation will avoid a sharp slowdown. He added that China’s growth will drive a global economic recovery, and Wen’s appraisal came to validate his saying of June 30th this year that China’s economy was headed in the right direction. Growth in the second quarter slowed to 10.3 percent from 11.9 percent in the first three months of the year after the government increased requirements for mortgages and halted loans for third homes to rein in gains in home prices.

WEEK36 - Dry Cargo Market “Highlights” – 03-September-2010 - 10-September-2010

This week was a market warm‐up. The Baltic Dry index is only a notch away from breaking the mostly psychological barrier of 3,000 points. In general, all 5 indices were “green” for week 36, with the Capes having an uncertain fluctuation only to finally close marginally higher than last week, while Panamaxes were the size segment with the most positive weekly gains, continuing on the momentum that they generated from previous week 35. The other two smaller sizes, the Supra’s and the Handymaxes, were positive this week contrary to week 35 that they were recorded as negative. It is worth noting that we are already counting the 10th consecutive positive run for the BDI, and what is also interesting as a pattern, is that after July 15th 2010 the Baltic Dry Index has produced two sets of consecutive increases, the firsts one lasted 12 days and then we had 2 negative days, while the next set lasted for 14 days and then again counted 2 negative days, to bring us here where we are looking at 10 days… and counting…! It seems the BDI has formed a behavioral pattern…!!

Baltic Trading: Essentially a Baltic Dry Index ETF?

New shipper company Baltic Trading (BALT) completed its initial public offering on March 15th. The new company immediately took its 228 million and began buying ships - a selection of cheap ships of varying sizes. Was this really a good time to do a shipper IPO, with shipper stocks suffering the disdain of the market? Maybe so. BALT had an idea for a different kind of shipping company, with a different kind of business plan.

The company operates as a wholly-owned subsidiary company of Genco (GNK), a major US shipping company. Not only that, but the company is largely a virtual creation, having only a single employee, its president. All the shipping operations are run by GNK.

Russian President signals end to grain export ban

Russia's grain export ban will be lifted as soon as it is clear how much has been harvested, Russian President Dmitry Medvedev has said. It contradicts Russian Prime Minister Vladimir Putin, who said last week that the ban could be lifted only after next year's harvest has been reaped. Usually, Russia's harvest results become clear in October.
Russia, one of the world's biggest producers of wheat, barley and rye, has been hit hard by drought and wildfires.
The subsequent export ban caused global wheat prices to rise sharply on the international commodity markets.
In 2009, Russia exported a quarter of its annual grain output of 97 million tonnes.
This year's crop could be as low as 60 million tonnes, but Russia needs almost 80 million just to cover domestic consumption.

India Globalization Capital Begins Iron Ore Shipments

India Globalization Capital, Inc., a company competing in the rapidly growing materials and infrastructure industry in India, announced today that it has begun its shipment of iron ore for its contracts. The Company has begun shipping Iron Ore from Orissa, India for one of its customers. As a result of continued monsoon rains in the Karnataka and Goa region of India, affecting ports from which IGC operates, the Company has moved some of its operations to the East Coast of India and has initiated servicing one customer from Vizag in Andra Pradesh. The iron ore grade being shipped is FE 63.5%.

Baltic index nears 3,000 on autumn hedging

The Baltic Exchange's main sea freight index rose by 13 points on Thursday to just below 3,000 as demand held firm at the beginning of the autumn hedging season in Europe and North America, traders said.

The index, which tracks rates to ship dry commodities including iron ore, cement, grain, coal and fertiliser, rose to 2,988 points in its ninth straight session of gains.

There was strong technical indication that the slight dip in late August may have been a technical bull-flag that historically occurs in late summer, just before many traders return from holidays and begin to hedge themselves for the upcoming winter.

Shipping Sector Points to Stronger Economy: Analyst

The strength in the shipping sector may indicate the US economy is in better shape than recent economic data suggests, according to Urs Dur, an analyst at Lazard Capital Markets.

“Right now you’re seeing a surprising growth in movement of containers globally,” Dur told CNBC Wednesday. “There’s fundamental demand that’s coming back. We just haven’t seen it in the GDP numbers yet.” 

"It doesn’t mean that the recovery is going to accelerate," he added, "(but) I feel there’s no double dip at this point.”

Dur has a net hold rating on the tanker side of the business, but does have buy ratings on Overseas Shipholding and Navios Maritime Holdings. 

He has "mostly" a buy on the dry bulk and container sides of the industry. His favorite stocks in the space include Seaspan on the container side and Genco and Eagle Bulk Shipping on the dry bulk side.

Source: CNBC

Iron Ore-China prices slip as mills cut production

Iron ore prices in China softened in anticipation of weaker demand after a number of energy-inefficient steel mills were told to reduce or halt production. Rebar, widely used in the construction sector, has been traded at high levels on the Shanghai Futures Exchange on tighter supply in coming months.
Thirty mostly medium-sized steel mills in Tangshan, capital of Hebei province, were told to limit production, with most cutting output by 50-70 percent.
The move came after 18 steel mills in Wuan, also in Hebei, were ordered to shut down for a month, while other provinces including Shanxi and Jiangsu have also trimmed electricity supply to high-energy-consuming steel mills.

Baltic index strengthens on ore buying flurry

* Indian state ore export ban watched - * Capesize market supported

LONDON, Sept 8 (Reuters) - The Baltic Exchange's main sea freight index .BADI, which tracks rates to ship dry commodities, rose on Wednesday with firmer iron ore activity boosting positive sentiment seen in recent days. The index, which gauges the cost of shipping commodities including iron ore, cement, grain, coal and fertiliser, rose 1.95 percent, or 57 points, to 2,975 points in an eighth straight session of gains.