Europe Commodity Day Ahead: Gold May Extend Rally to $2,000, Schiff Says

The following are the top stories on metals, agriculture and shipping.

ECONOMIC EVENTS, AGRICULTURAL REPORTS:

                                   Forecast  Prior     Time
                                                       (N.Y.)
Change in Nonfarm Payrolls SEP      -5K      -54K      8:30
Change in Private Payrolls SEP      75K       67K      8:30
Unemployment Rate SEP              9.7%      9.6%      8:30
U.S. Corn Production OCT         12973M    13160M      8:30
U.S. Soybean Production OCT       3499M     3483M      8:30
World Wheat End Stocks OCT         870M      902M      8:30
U.S. Cotton Production OCT        18.9M    18.84M      8:30

Metal Prices: ($/ton)
                 Last  % Chg
Copper          8,110   +0.1
Aluminum        2,345   +0.9
Zinc            2,256   -0.2
Lead            2,222   +0.6
Nickel         24,000   +0.4
Tin            25,800   +0.8

Other Markets:
                       Last   %Chg      %YTD
U.S. Dollar Index    77.359   -0.04     -0.6
Crude Oil            $81.69   +0.4      +2.6
Gold              $1,333.70   -0.06     +21
MSCI World Index   1,204.80   -0.13     +3.1 *T

TOP STORIES:
Gold May Jump to $2,000 Amid Currency ‘Battle’: Chart of the Day
     Gold futures may surge 50 percent to $2,000 an ounce next
year as central banks ramp up stimulus programs, said Peter
Schiff, president of Euro Pacific Capital in New York.

Tea Prices May Climb as India Output Drops, Labor Costs Rise
     Tea prices in India, the biggest grower after China, may
climb as labor costs rise and crop damage from pest attacks
widens a production deficit, according to the state-run Tea
Board of India.

Merchant Hedge Fund’s Coleman, King Buy Rubber Trader
     Michael Coleman, who co-manages the $1.3 billion Merchant
Commodity Fund, and his partner Doug King have bought a stake in
a Singapore-based rubber trader, which had sales of about $1
billion last year.

Aluminum Is ‘Probing’ Resistance of $2,400: Technical Analysis
     Oct. 8 (Bloomberg) -- Aluminum is “probing resistance” of
$2,400 a metric ton and may gain 6.4 percent to this year’s peak,
according to a technical analysis by Barclays Capital.


INDUSTRIAL METALS:
Copper Heads for Longest Rally Since January as Dollar Retreats
     Copper rebounded, on pace for its longest winning streak in
nine months, as the dollar declined and investors in China
bought the metal after London prices advanced during the
country’s week-long National Day holiday. Lead and nickel gained.

Copper May Drop in London on Concerns Over Demand, Survey Shows
    Copper may decline on speculation that further efforts by
the U.S. Federal Reserve to stimulate the economy could take
time to produce a demand rebound, a survey showed.

Alcoa Says Chinese Auto Demand Driving Growth in Aluminum Use
     Alcoa Inc., the largest U.S. aluminum producer, reported
profit that beat analysts’ estimates and said growing Chinese
demand will help boost global use by 13 percent this year.


MINING:
BHP Billiton Copper Output May Rise 65% by 2020, Deutsche Says
     BHP Billiton Ltd., majority owner of the world’s largest
copper mine, may boost copper output from existing operations 65
percent by 2020, according to a report from Deutsche Bank AG.

Australia Considering Mine Tax Changes, Financial Review Reports
     Australia’s federal government is considering changes to
its proposed mining profits tax, including altering the A$50
million threshold where it begins, the Australian Financial
Review reported, citing an unnamed government official. Mining
companies are seeking changes to the proposed tax and held
meetings with the government’s policy transition group in Perth
yesterday, according to the report.

IRC Halves IPO Size to About $240 Million, E-Mail Says
    IRC Ltd., the iron ore unit of Petropavlovsk Plc, more than
halved the size of its initial public offering in Hong Kong to
about $240 million, according to a sales document.

Bradford Sees Value in Alcoa Shares on Global Recovery: Video
    Charles Bradford, a partner at Affiliated Research Group LLC,
a New York-based consulting firm, talks about Alcoa Inc.’s
financial results and growth outlook.

Alumina Shares Gain After Partner Alcoa Tops Profit Projections
     Alumina Ltd. rose to its highest level in nine months in
Sydney trading after partner Alcoa Inc., the largest U.S.
aluminum producer, reported third-quarter profit that topped
analysts’ expectations.

Queensland’s Record Rain Prompts Coal Supply Concern, UBS Says
    Queensland’s wettest September in 100 years has prompted
concern that further rainfall may crimp coal output from the
Australian state and drive up prices, according to a report from
UBS AG.

Trapped Miners’ Ordeal Nears End in Chile as Drill Bores Down
     Chile’s government is making final preparations to rescue
33 miners trapped half a mile underground as engineers predicted
that drills boring into the earth will reach the men by tomorrow.


PRECIOUS METALS:
Gold on Track for a Fourth Weekly Advance as Dollar Retreats
     Gold headed for a fourth weekly advance as the dollar
retreated, boosting demand for precious metals as a store of
value. Silver was on track for its best weekly run in more than
four years.

Gold May Rise on Demand for Currency Alternative, Survey Shows
     Gold, which rose to a record this week, may extend its
advance on demand for an alternative to currencies, a survey
found.

AGRICULTURE:
Corn Heads for Biggest Weekly Advance in Almost Four Months
     Corn advanced, heading for the biggest weekly gain in
almost four months, on speculation the U.S. may cut its crop
estimates after floods and hot weather damaged plants. Rice was
poised for the longest winning streak in almost three years.

Palm Oil Climbs to Two-Year High as Weak Dollar Boosts Demand
     Palm oil climbed to the highest level in more than two
years as a weak dollar increased the appeal of commodities as a
hedge against inflation and as rival soybean oil advanced on
increased Asian demand.

Malaysia Lowers 2010 Crude Palm Oil Output Forecast, Times Says
     The Malaysian Palm Oil Board lowered its crude palm oil
output forecast for this year to 17.6 million metric tons from
18.1 million tons due to lower oil extraction rates as
harvesting has been disrupted by heavier rainfall, the Business
Times reported, citing Director-General Mohd Basri Wahid.

China Starts Hunting for Domestic Potash Reserves, Xinhua Says
    China plans to spend 100 million yuan ($15 million) a year
to explore for potash reserves in the country in the next five
years, the official Xinhua News Agency reported, citing an
unidentified official with China Geological Survey.

Australia Recommends Cuts to Key Farmland Irrigation
     Irrigation in the Murray-Darling Basin should be cut by as
much as 37 percent to protect the environment in a drought-prone
region that is home to almost half of Australia’s farms,
according to a government-commissioned report today.

Agrium A$1.2 Billion Bid for AWB Fair, Lonergan Edwards Says
    Agrium Inc.’s A$1.2 billion ($1.2 billion) bid for AWB Ltd.,
Australia’s largest wheat exporter, is in the best interests of
shareholders, according to an independent expert report.

Rice Production in South Korea May Drop 12 Percent This Year
     South Korea’s rice production may decrease by 12 percent
this year as rice area fell and reduced sunshine hours because
of rainfall hurt yields, according to a state agency report.

Rabobank Maintains Australian Wheat Crop Forecast for 2010-11
     Australian wheat production may reach 22 million to 23
million metric tons this harvest, Rabobank said in an e-mailed
report today, leaving its outlook unchanged from a report last
month.


SOFT COMMODITIES:
Sugar Futures May Rise on Tight Supply in Brazil, Survey Shows
     Sugar futures may rise on concern that dry weather and port
delays will curb shipments from Brazil, the world’s biggest
producer, according to a survey.

Rubber in Tokyo Drops on Strong Yen; Shanghai Sets 2-Year High
     Rubber in Tokyo retreated from a more than five-month peak
after Japan’s currency surged against the dollar, weakening the
appeal of yen-based contracts. Shanghai futures set a two-year
high after a week-long holiday.


Cotton in the U.S. Jumps 3.4% to $1.0725, Extending Surge
    Cotton prices jumped by as much as 3.4 percent to $1.0725 a
pound on ICE Futures U.S., extending yesterday’s 4 percent gain.


ECONOMIES:
Unemployment Probably Climbed as U.S. Companies Limited Hiring
    Unemployment probably climbed in September for a second
consecutive month as slower U.S. growth prompted companies to
limit hiring, economists said before a report today.

Greenspan Says U.S. Creating ‘Scary’ Deficit as Borrowing Rises
     Former Federal Reserve Chairman Alan Greenspan said the U.S.
fiscal deficit is “scary” and the federal government needs to
cut spending on entitlements.

Australia Should Reduce Energy Intensity 30% by 2020, Study Says
     Australia should target a 30 percent improvement in energy
intensity by 2020, according to a government report released
today by Prime Minister Julia Gillard’s Task Group on Energy
Efficiency.

Australian Job Boom Sends Immigration ‘Wake-Up Call’
     Australia’s surging job market, capping its strongest
quarter since 2006, signals the government may need to retreat
from a campaign pledge to slow population growth as the central
bank tries to control inflation.

India Doesn’t Plan to Restrict Foreign Investment
     India’s government doesn’t need to restrict foreign
institutional investment and foreign direct investment at this
time, Finance Minister Pranab Mukherjee said after the rupee
climbed to near a two-year high.

Kan’s Cabinet Approves $62 Billion Japan Stimulus
     Prime Minister Naoto Kan’s cabinet endorsed a 5.1 trillion
yen ($62 billion) stimulus plan for Japan to safeguard an
economic recovery and help local governments and small
businesses cope with the surging yen.

OTHER MARKETS:
Oil Reverses Losses as Dollar Drop Boosts Commodities Buying
     Oil reversed losses in New York as the dollar fell against
the euro, increasing the appeal of commodities as an alternative
investment.

Rain Propels Argentine Bonds Past Pakistan: Argentina Credit
     Rainfall is producing record soybean crops in Argentina,
boosting the economy and bond market. In Pakistan, it’s creating
deadly floods and hurting the nation’s credit.

Trichet on ‘Battlefield’ Edge as Policy Propels Euro to $1.40
     European Central Bank President Jean-Claude Trichet is
bucking the global push toward easier monetary policy, fueling
the euro’s advance just as finance chiefs convene in Washington
amid concern of a “currency war.”

Asia’s Reserves Rising at Fastest Pace in History, DBS Says
     Asia has attracted $2 billion of capital inflows daily
since April 2009 and its foreign reserves have risen
“significantly faster than any time in history,” according to
DBS Group Holdings Ltd.

TIPS 30-Year Inflation Rate Highest Since June on Fed Outlook
     Treasury 30-year bonds are yielding the most relative to
inflation-protected debt since June as investors bet the Federal
Reserve will be successful in pushing up prices with further
purchases of government bonds.



To contact the reporter on this story:
Claire Leow in Singapore at 
cleow@bloomberg.net

To contact the editor responsible for this story:
Jim Poole at 
jpoole4@bloomberg.net



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