Cotton

ICE Canada Grain/OilsWinnipeg, Apr 02, 2008 -- RNI ICE Futures Canada (ICE) grain and oilseed futures closed Wednesday's session higher with canola posting strong gains on talk of fresh export bookings amid the big upward surge in Chicago Board of Trade soyoil futures, brokers said.

Canola saw a heavy trade with intermonth spreading comprising much of the volume. Index funds continued to roll their May contracts into July, although traders feel that with today's activity fund rolling is virtually finished. Commercials dominated the remainder of the spread activity.

The total canola volume was estimated at 21,579 contracts, up from Tuesday's 18,885 contracts, including an estimated 18,726 contracts involved in the spread trade. Canola options trade occurred as 1663 July 630 calls traded.

Canola rallied in the overnight trading session in the wake of strength in Asian vegetable oil prices and higher European rapeseed prices. Canola held onto its gains at the opening of the North American trading session and moved higher despite weakness in CBOT soybean futures. Export demand and scale up farmer pricing gave support to the market. Canola finished the session sharply higher near its highs as the CBOT soy complex rallied.

Exporters could confirm no business but traders indicated that fresh sales have been made in the past two sessions and that China had been in the market for canola. Ideas canola was oversold also helped to lift prices.

Weighing on the market was the firm Canadian dollar and increased farmer pricing following two days of higher values.

Commission house short covering augmented exporter pricing and routine crusher buying. Commodity funds were felt to have purchased 1,000 July contracts. The selling came from commission houses and elevator company scale up hedging.

Western barley ended moderately higher in moderate trade. The bulk of the volume was comprised of intermonth spreading by index funds. The firm tone in CBOT corn and slow farmer selling accounted for the gains on light end user buying.

The total barley volume was estimated at 697 contracts, down from 4,804 contracts on Tuesday, including an estimated 622 contracts involved in the spread trade.

Feed wheat was untraded.

Wheat price realised in Punjab, Haryana more than MSP............Chandigarh, Apr 02, 2008 -- Farmers in Punjab and Haryana realised more price for wheat than the minimum support price (Rs 1000) on the first day of the rabi marketing season, with private traders buying aggressively in Punjab and state-owned agencies making maximum procurement in Haryana yesterday.

Farmers in Haryana were paid maximum price of Rs 1,023 per quintal and the minimum rate of Rs 1,000 per quintal on the first day of arrival, an official said.

In Punjab, farmers got highest price of Rs 1,005 per quintal while the lowest price remained at Rs 920 per quintal.

In addition to it, mandis in Punjab observed increased arrival of wheat at 215 metric tonne (MT), compared to the arrival of 20 MT in the corresponding period last year, an official of Food and Supplies Department said.

Out of the total arrival, private traders bought 195 MT of wheat while state-owned agencies, like last year, did not enter the market so far.

However, the total arrival of wheat in Haryana mandis stood at 138 MT, lower than the arrival of 150 MT in the corresponding period previous year. Unlike last year, state-owned procurement agencies including Hafed and Haryana Warehousing Corporation bought 124 MT of wheat while 14 MT was lifted by private traders.

The arrival of wheat is expected to receive a boost after Baisakhi festival when the harvesting of the crop would further speed up, said an expert.

FAO predicts hike in rice production in Asia

New York, April 03: The United Nations has forecast an increase in the production of rice in all major Asian rice- producing countries including India, and easing of existing tight supply position.

The Food and Agriculture Organization said the world production of rice was expected to increase in the current year by 12 million tonnes or 1.8 per cent provided the normal weather conditions prevail.

Sizable production increases are expected in all major Asian rice producing countries including India, China, Bangladesh, Indonesia, Myanmar, The Philippines and Thailand where the demand and supply position are currently stretched, it said.

However, the FAO said the world trade is likely to decrease mainly due to restrictions on exports placed by major exporters because of rising prices and increase gap between demand and supply.

Production outlook is also positive in Africa, where high world prices may sustain a two per cent growth, particularly in Egypt, Guinea, Nigeria and Sierra Leone, it said.

Concerns about food import dependency in the African region, it said, have led to mobilization of resources towards the rice sector.

Production is expected to recover strongly in Latin America as also European Union but it may contract in Japan, one of the few countries where producer prices fell last year.

In the rest of the world, a "dismal" production is forecast in Australia, reflecting extremely low water availability.

/02 10:15a CST DJ ICAC: World Cotton Area Seen Stable, Production Up In 2008-09

NEW YORK (Dow Jones)--World cotton planted area is likely to remain stable
in 2008-09, while production rises, the International Cotton Advisory Committee
said in a press release.

World cotton area is projected to remain relatively stable in 2008-09 at
33.8 million hectares, ICAC said in the release issued Tuesday. While U.S.
cotton harvested area is projected to decline by 15% to 9.38 million acres from
10.83 million last year as a result of surging prices of competing crops, the
losses could be offset by acres in China, India, Africa, Australia and Brazil.
Stable cotton area is projected for Pakistan, Turkey and Uzbekistan, ICAC
stated.

World cotton production in 2008-09 is projected up 3% at 26.9 million tons
from 26.04 million tons in 2007-08. World mill use is projected to grow at a
rate of 1%, down from 2% mill use in 2007-08 due to slower economic growth and
an increase in cotton prices relative to polyester, ICAC said.

As a result of the gap between production and consumption, world cotton
ending stocks are projected to decline for the second season during 2008-09 to
10.96 million tons from 11.6 million in 2007-08.

The Cotlook A Index is likely to average 80 cents per pound in 2008-09,
according to ICAC.

"Increases in prices of competing crops, the increasing role of speculative
activity and commodity investment funds may be affecting cotton prices in ways
that are not reflected in fundamental measures of cotton supply and use," ICAC
said.

The 2008-09 Cotlook A Index projection is based on the 2007-08 index. While
fundamentals suggest a 2007-08 season-average Cotlook A Index of less than 70
cents a pound, trends during the first eight months of the marketing year
indicate higher prices, according to the committee. Considering those trends
and assuming that the Cotlook A Index fluctuates between 76 and 83 cents per
pound during the rest of the season, the ICAC Secretariat projects that the
Cotlook A Index will average 74 cents per pound during 2007-08.



WORLD COTTON SUPPLY AND DISTRIBUTION
2006-07 2007-08 2008-09 2006-07 2007-08 2008-09
Million Tons Million Bales
Production 26.74 26.04 26.9 122.8 119.6 123.4
Consumption 26.65 27.14 27.5 122.4 124.6 126.2
Exports 8.11 8.5 8.72 37.3 39.1 40.0
Ending Stocks 12.70 11.6 10.96 58.1 53.1 50.3
Stocks Adjustment 0.0 0.0 +0.26 0.0 0.0 +1.4
Cotlook A Index 59.15 74* 80*** 59.15 74* 80***

* Season-average Cotlook A Index (U.S. cents per pound).

** The price projection for 2007-08 represents the Secretariat judgment,
based on the average price for the first seven months and projected price
variations during the rest of the season.

*** The price projection for 2008-09 is based on the ending
stocks/consumption ratio in the world except for China in 2006-07, in 2007-08
(estimate), and in 2008-09 (projection), and on the ending stocks/consumption
ratio in China in 2006-07 and in 2007-08 (estimate). 95% confidence interval:
67 to 93 cents per pound.

Crop shortfall, contamination: July-February cotton import up by 159 percent

KARACHI (April 04 2008): The country's cotton import rose by 135 percent during the first eight months of the current fiscal year due to shortfall in the crop and contamination issue, importers told Business Recorder.

They said Pakistan is a leading producer of cotton, however this year the country had almost missed its cotton production target due to attack of different pests especially mealy bug, while contamination issue and low-grade cotton are the other major factors behind the increasing import of raw cotton.

"We are the largest producer of cotton, but have failed to produce quality cotton, therefore, our export-oriented textile units are relying on imported cotton," they added. They said that industrialists are demanding long staple cotton, as its production is short in the country. To meet the local industry demand raw cotton is being imported from India, USA and Brazil.

During current year, the country is facing a shortfall of 3.5-4 million bales raw cotton, which is also a big reason for rising import, a leading importer said, adding that current year's local production would be around 11.5 million bales against the demand of 15.5-16 million bales.

Statistics show that during July-February raw cotton import rose by 135 percent to 912.032 million dollars against some 387.752 million dollars during the corresponding period of last fiscal year.

Cotton import during February 2008 stood at 185 million dollars as compared to imports worth 89 million dollars during February 2007, depicting a surge of 107 percent. Importers said that raw cotton import is increasing gradually, despite high rate in the international market due to contamination issue. It is expected that by the end of the current fiscal year raw cotton import will surpass 3.5 million bales.

Conclude Doha Round `now`, says Zoellick

Washington, April 03: World Bank president Robert Zoellick called for a quick conclusion of the Doha Round of world trade talks - aimed at increasing trade in food to finance that could in turn boost growth in economies plagued by financial crises.

Terming it was a "now or never" situation to end the Doha round, started in 2001, the former Bush administration official maintained that the poor in the world need lower food prices but agricultural trading system was stuck in the past.

Besides, the Doha round will have an important bearing on how countries go about yet another critical issue -- climate change, he said, arguing that the ongoing trade talks are not to be seen as some kind of a poker contest.

In a major policy speech ahead of the Spring Meetings of the Bank and the International Monetary Fund next week, Zoellick outlined the major challenges facing the comity of nations against the backdrop of globalisation, one of which being the imperative of bringing the Doha Round to a successful closure.

The talks have failed to progress over who among the developed and developing countries should make greater concessions such as lowering tariffs and subsidies and opening up economies.

"A fairer and more open global trading system for agriculture will give more opportunities and confidence to African and other developing country farmers to expand production.

The Bank Group can assist developing countries seize the possibilities by expanding the capacity to trade, overcoming barriers to get to markets, and helping with trade finance. Taxpayers and governments can save the costs of subsidies, improving budgets" Zoellick said.

INDIA'S SUPREME COURT ADMITS MAHYCO SEED PETITIONS.......NEW DELHI, Apr 04, 2008 -- India's Supreme Court has admitted a batch of petitions filed by Mahyco Seeds Ltd seeking quashing of the National Consumer Court's order which attributed the cotton crop failure in Karnataka to defective seeds supplied by it.

A bench headed by Justice C K Thakker, while issuing notice to a group of farmers, admitted the pleas and tagged them with identical matters pending before it.

The National Consumer Disputes Redressal Commission had dismissed the company's appeal holding that there were sufficient indications to prove that the seeds were not of the expected quality.

The Karnataka State Consumer Disputes Redressal Commission, Bangalore, had asked Mahyco to pay compensation at the rate of Rs 5,000 (US$125) per acre to farmers for supplying defective seeds.

The complainants had alleged that they had purchased Chamamtkar cotton seeds manufactured by the company and despite following instructions contained in the pamphlets, the crops did not grow at the expected height and failed to give the expected yields.

While denying that the seeds were defective, Mahyco said the Chamatkar cotton crops had failed because the complainants did not adopt correct agricultural practices.

According to the petitions, the report of the agricultural officer and the certificate from the village accountant could not be relied upon as there were no findings arriving at the conclusion that the seeds were defective.

It further stated that both the consumer courts failed to appreciate that seeds were duly tested in its quality control laboratory before marketing and genetic purity results were found to be above 98 per cent and thus the seeds could not be faulty

Palm oil prices up

KUALA LUMPUR, April 3: Malaysian crude palm oil futures jumped by 4.4 per cent on Thursday, boosted by strengthening soybean oil prices and prospects of strong demand from India after New Delhi scrapped edible oil import tariffs.

The tropical oil has lost more than 26 per cent since hitting a record high of 4,486 ringgit a ton last month.

India is sniffing around and buying in small quantities, said one trader with a leading plantation house in Kuala Lumpur.

We expect the demand to rise because prices have come down considerably and edible oil has become cheaper for Indian consumers after the removal of import duties.

The benchmark June contract on Bursa Malaysia

Derivatives Exchange rose as much as 141 ringgit to 3,311 ringgit ($1,039) per ton, holding on to gains of more than 7 per cent made this year. The contract settled up 120 ringgit at 3,290 ringgit.

Spot soyaoil at the Chicago Board of Trade was down 0.4 per cent at 54.85 cents per pound, after rebounding in overnight US trade.

The most-active September soyaoil contract at Dalian Commodity exchange was up 2.2 per cent.

India scrapped import duties on crude edible oils on Monday and banned exports of non-basmati rice amid a raft of measures to stem rising inflation, which hit a 14-month high in mid-March and has alarmed policymakers.

Soyabean futures on the Chicago Board of Trade surged on Wednesday as prospects for increased export interest spurred a rebound from the previous day’s sell-off, traders said.

May soyabean oil closed 2.9 cents per lb higher at 55.05 cents. Dealers said support for the most-traded palm oil contract stood at 3,000 ringgit.

As of now, it is unlikely to fall below the 3,000 ringgit level. But if we have a huge stock build up then there is strong possibility for the market to go below 3,000 ringgit, said S.Paramalingam, a broker in Kuala Lumpur.

Malaysian Palm Oil Board is due to unveil March production, exports and stocks data next Thursday.

Cotton market steady on fresh price-hike hopes

By Our Staff Reporter

KARACHI, April 3: Cotton market on Thursday maintained a firm outlook as ginners firmly held on to their unsold positions anticipating fresh increase in prices after the final arrival figures were released by the Pakistan Cotton Ginners Association. The figure of unsold stock with the ginners in the final arrival figures will largely set the future market trend, analysts said, adding “both the buyer and seller will tailor future policies on the supply and demand factors.

“The fact, that some of the leading spinners and mills go for fine lots well above Rs3,500 per maund, has encouraged ginners to hold on for another couple of weeks to get a still better price,” market sources said. They said although spinners are trying to maintain their export parity levels the changing world cotton scene and higher prices did not allow them to sit idle as they still need more lint.

Although the task to remain competitive on the tight world markets is pretty difficult, spinners are endeavouring to maintain a status quo after playing hide and seek game with the ginners.

“At times they enter the market with a bang and lift all the lots offered for sales by the ginners but they keep quiet for the next couple of sessions in an effort to contain prices within the current levels,” said a broker.

Meanwhile, reports coming from the lower Sindh cotton belt, where the crop is sown early owing to climatic conditions, is said to be further delayed owing to irrigation water problems. The crop is sown here in February or early March, market sources said.

New York cotton futures showed modest fall on selling at the overnight higher levels and fell by 0.27 and 0.29 cents per lb at 70.18 and 73.65 cents for both the ruling May and the distant July contracts, respectively.

There was, however, no change in the local official rates, which were again held unchanged at Rs3,300 per maund.

Ready off-take was slow totaling about 2,000 bales, the following being some of the notable deals: 400 bales, each Buchari and Kot Ghulam Muhammad at Rs3.350 per maund.

11.3 million cotton bales reach ginneries: PCGA
RECORDER REPORT
MULTAN (April 06 2008): The Pakistan Cotton Ginners Association (PCGA) has announced the production statistics of cotton for the season 2007-08. According to the details, about 11.3 million bales of cotton have reached the ginning factories till April 1, 2008 which is about 1 million bales less which had reached the ginning factories till April 1, 2007.

Almost 0.8 million bales of cotton are yet to be sold. From March 1 to April 1, 2008, about 130,000 bales of cotton have reached the ginning factories while last year during the same period, about 144,000 bales of cotton had reached the ginning factories.

Overall 151 ginning factories are working, out of which 148 are working in Punjab whereas just three ginning factories are working in Sindh. In Punjab, this year about 8.8 million bales of cotton reached the factories whereas last year during the same season almost 10 million bales of cotton reached the factories.

In Sindh, this year 2.5 million bales reached the factories whereas last year 2.3 million bales reached the factories. The Trading Corporation of Pakistan has not bought any cotton in this season whereas exporters have bought 111,000 bales of cotton.