Europe Commodity Day Ahead: Governments Blocking Food Solution

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

ECONOMIC EVENTS, AGRICULTURE REPORTS:

                                  Forecast   Prior      Time
                                                       (N.Y.)


Existing Home Sales           JAN     5.22M    5.28M   10:00
Chi. Fed Nat Activity Index   JAN      0.09     0.03    8:30
Initial Jobless Claims        FEB 19   450K     410K    8:30
Continuing Claims             FEB 12  3380K    3911K    8:30
Durable Goods Orders          JAN      2.8%    -2.5%    8:30
Cap Goods Orders Nondef ExAir JAN     -1.0%     1.4%    8:30
Bloomberg Consumer Comfort    FEB 20           -43.4    9:45
New Home Sales                JAN      305K     329K   10:00
New Home Sales MoM            JAN     -7.3%    17.5%   10:00
House Price Pur. Index QoQ     4Q     -0.6%    -1.6%   10:00
House Price Index MoM         DEC     -0.1%     0.0%   10:00
US Census Soybean Crush       JAN             4.592M    8:00
US Census SoyOil Reserves     JAN             3.469M    8:00

Metal Prices: ($/ton)
                 Last   %Chg RSI
Copper       9,403.25   -0.2  39
Aluminum        2,523   -0.3  54
Zinc            2,457   -1.5  54
Lead            2,523   -0.6  48
Nickel         28,300   -1.3  62
Tin            31,500   -0.1  62

Other Markets:
                       Last   %Chg  %YTD
U.S. Dollar Index    77.246   -0.2  -2.3
Crude Oil            $98.91   +0.8  +8.3
Gold              $1,410.48   -0.1  -0.7
MSCI World Index   1,329.24   -0.1  +3.2

EXCLUSIVES:

Governments Wary of Business Block Food Solution, Olam Says

Governments need to overcome their suspicion of food companies to tackle record prices that are fueling global instability, Olam International Ltd. Chief Executive Officer Sunny Verghese said.

Palm Oil Output in Malaysia to Gain in 2011, Yusof Predicts

Palm oil production in Malaysia, the second-biggest grower after Indonesia, may advance this year as weather conditions improve, boosting yields and hurting prices, an industry group said. Futures plunged, reversing earlier gains.

Insurers Buy Gold Over Sukuk to Boost Returns: Islamic Finance

Indonesia’s Islamic insurers are starting to favor gold over bonds amid the fastest inflation in almost two years, seeking to boost returns following a ruling that allows them to invest in the precious metal.

INDUSTRIAL METALS:

Copper in London, New York Pares Gains as Investors Avoid Risk

Copper in London and New York pared gains in Asian trading on concern that geopolitical tension in the Middle East and Africa, including the revolt in Libya, may hamper global growth. Futures erased an advance in Shanghai.

China to Control Steel Production in Next Five Years, Group Says

China plans to “control” steel production over the next five years and increase iron ore mine investment overseas, the China Iron & Steel Association said in a statement at a news briefing.

Baoshan Steel Raises April Tin Plate, Chromium Plate Prices

Baoshan Iron & Steel Co. raised tin plate prices by 350 to 500 yuan a ton and chromium plate prices by 300 yuan a ton for April delivery, according to a statement on the steelmaker’s website today.

Global Iron Ore Supply to Be Tight in First-Half of 2011

The global supply of iron ore will remain tight in the first half of 2011, Luo Bingsheng, former vice chairman and current special adviser to the China Iron and Steel Association, said in Beijing today.

MINING:

Russia’s Alrosa, Biggest Diamond Miner, Prepares to Offer Stock

The board of ZAO Alrosa has approved the transformation of the world’s second-biggest diamond mining company into a public entity and a potential stock offering.

Bathurst Plans Coal Acquisitions Next Year, CEO Says

Bathurst Resources Ltd., which is developing a coking coal mine in New Zealand, said it will be ready for acquisitions next year after production starts.

Xstrata Unit, Philippine Local Officials in Talks on Tampakan

Xstrata Plc’s Philippine venture and officials of South Cotabato province are in talks to resolve a ban on open-pit mining, which may affect a $5.2 billion copper and gold project in the area, Philippine Interior Secretary Jesse Robredo said in Manila today.

Rio Tinto’s Bid for Riversdale Extended by Fourteen Days

Rio Tinto Jersey Holdings 2010 Ltd. extended the offer period for its takeover bid for all of the shares in Riversdale Mining Ltd. by a period of 14 days. The offer is now due to close on March 18.

PRECIOUS METALS:

Gold Fluctuates as Libya Unrest Fans Demand, Some Investors Sell

Gold fluctuated amid speculation that a surge to a seven- week high prompted some investors to sell, while heightened geopolitical tensions in the Middle East and North Africa boosted safe-haven demand.

Vietnam to Gradually Restrict Non-Jewelry Gold Trading

Vietnam’s central bank will “gradually” restrict and abolish trading of gold in non-jewelry form in the “free market,” according to a copy of Prime Minister Nguyen Tan Dung’s resolution being presented today to ministers in Hanoi.

AGRICULTURE:

Palm Oil Drops to Lowest in Three Months on Output Forecast

Palm oil tumbled to the lowest in almost three months on expectation that output in Malaysia, the second-largest producer, may grow this year and on speculation unrest in Libya and the Middle East may continue.

Malaysia’s Palm Oil Exports May Be Better This Year, Dompok Says

Malaysia’s palm oil exports may be better this year compared to 2010 if prices are “right,” Plantation Industries and Commodities Minister Bernard Dompok told reporters in Putrajaya, outside Kuala Lumpur, today.

Coffee May Jump 48% as Demand Can’t Be ‘Satisfied:’ Chart of Day

Coffee prices, which have doubled in the past year, may rally another 48 percent to the highest since at least 1972 as demand outpaces supply, according to Hackett Financial Advisors Inc.

Wheat Gains as Frost in Russia, Drought in China Threaten Crops

Wheat futures advanced for a second day, extending a rebound from the steepest decline in six months, as importers seek supplies amid frost in Russia and drought in China that are threatening crops. Corn also rose.

New Zealand Wool Sales Canceled After Christchurch Earthquake

Wool auctions in New Zealand, the world’s second-largest shipper, have been canceled this week after the country’s deadliest earthquake in 80 years hit Christchurch, according to an exporter.

Rubber Reverses Gains as Shanghai Market Drops Amid Libya Unrest

Rubber declined, reversing earlier gains, after the Shanghai market slumped amid concern higher energy costs may threaten the global economic recovery as Libya’s violent uprising cut oil shipments.

Vietnam’s Rubber Exports Rose 175% in February, Government Says

Vietnam’s rubber exports rose 175 percent in February, according to a statement on the government’s website, citing the General Statistics Office. The statement did not give dollar figures.

SHIPPING:

Lyttelton Port Plans to Resume Limited Operations Within Days

Lyttelton Port of Christchurch, New Zealand’s largest coal- exporting hub, plans to resume limited operations within days following the nation’s deadliest earthquake in 80 years.

ECONOMIES:

Geithner Says Financial System Stronger Than Before Crisis

The U.S. financial system is in better shape than it was before the recession and is well placed to provide the funding needed for the economic expansion, Treasury Secretary Timothy F. Geithner said.

Australian Fourth-Quarter Business Investment Climbs to Record

Australian business investment climbed to a record in the fourth quarter as a mining investment boom driven by Chinese and Indian demand for natural resources capped a year of unprecedented job growth.

Faster Singapore, Vietnam Inflation Signal Tighter Policy

Accelerating inflation from Singapore to Vietnam is set to spur higher interest rates and currency gains in Asian economies.

Fed May Increase Rates Before ECB, Japan, Sumitomo’s Okuda Says

The Federal Reserve may raise interest rates before its counterparts in Europe and Japan as the U.S. automobile and energy industries boost the nation’s recovery, according to the research unit of Sumitomo Corp.

OTHER MARKETS:

Oil Surges on Libya Disruption; Goldman Sachs Sees ‘Upside Risk’

Oil surged to the highest in almost 30 months in London as Libya’s violent uprising cut supplies from Africa’s third- biggest producer.

Yen, Franc Rise as Libya Concern Spurs Stock Drop, Safety Demand

The yen and Swiss franc rose against most of their major counterparts as continuing violence in Libya drove energy prices higher and stocks lower, spurring demand for safe-haven currencies.

Treasuries Snap Decline as Investors Seek Safety, Fed to Buy

Treasuries snapped a decline from yesterday as violence in Libya bolstered demand for the safest assets and the Federal Reserve prepared to buy government securities today.

China Stocks Rise for Second Day as Commodity Producers Gain

China’s stocks rose for a second day as higher oil prices bolstered the outlook for the nation’s energy producers and investors speculated recent declines for copper companies were excessive given the demand outlook.

Asian Stocks Fluctuate as Oil Producers Rise; Airlines Drop

Asian stocks fluctuated as oil surged to $100 a barrel for the first time in two years, boosting shares of oil producers and dragging down airlines.

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

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