Commodity Briefing

Trade sources said Indonesia plans to raise the export taxon crude palm oil (CPO) to around 50-60 per cent from the current 40 per cent to help slow down an export boom which has caused cooking oil shortages. Traders said olein hovered at 6,300-6,400 rupiah/kg in Jakarta. "Buyers are scarce as prices have risen drastically," said one trader. The trader said he heard the government planned to buy cooking oil from private companies. The cooking oil would then be channelled to traditional markets to help stabilise prices.

Dalian soybeans down

Dalian soybean futures endedmostly down on Friday on overnight losses on the Chicago Board of Trade (CBOT), traders said. Dalian’s key November 1998 contract ended at 2,555 yuan ($309) per tonne, down two yuan from Thursday’s close. It opened at 2,557 yuan, hitting and intraday high of 2,560 and a low of 2,545. "CBOT losses put pressure on Dalian," one trader said. "But most institutions waited since the CBOT will have a long holiday weekend."

Sugar prices steady

In Mumbai, sugar prices ended steady to firmer at the Vashi wholesale sugar market. Sugar medium quality (M-30) firmed up by Rs 4/Rs 25 per quintal on good local offtake while sugar small quality remained steadier in the absence of buying interest. Following were today’s rates per quintal. (previous rates in brackets). Small sugar quality S-30 Rs 1455/1467 (Rs 1453/1470). Medium sugar quality M-30 Rs 1480/1540 (Rs 1476/1515).

Australian state sees record crop

The 1998 winter harvest in the Australian state of Queensland appeared set to equal if notsurpass the record 1996 crop intake, state grain handler and trader Grainco Ltd said in a statement on Friday. The company’s intake forecasts for the coming winter harvest showed excellent promise and could exceed the record 2.6 million tonne wheat, barley, chickpea and pulse intake of 1996, general manager operations Dale Samuels said. "This year appears to be the first season in many years which will follow through with the early promise, particularly in central Queensland," he said. Recent rains, especially in central Queensland, were just in time to revive stressed crops, he said. "Generally, well-timed rain and excellent soil moisture profiles have resulted in widespread planting. This good planting and follow up rain is enticing growers to plant more grain, with still more planting expected, particularly on the Inner Downs (area West of Brisbane)," he said.

Cotton prices stay easy

In Mumbai, in a dull trading, prices ruled steady to easy on the Sewree cotton market today. Gujarat short stapleand MP medium staple cotton prices declined by Rs 100 to Rs 150 per candy on account of poor demand as compared to increased arrivals. Spinners activity was centred around qualities S-4, 797, Mech and Wagad. About 1,500 bales had transacted hands.

Orthodox tea firm

In Coimbatore, barring orthodox leaf tea, which ruled firm to dearer by Rs one to Rs two, prices witnessed lower trend in other categories, ranging from Rs.two to Rs.seven, in the Coimbatore auction today. Despite good demand at lower level, prices of CTC leaf witnessed a dip by Rs.two to Rs.five, trade sources said here.

While orthodox dust was lower by Rs.four, prices of popular and best quality CTC dust were down by Rs.four to Rs.seven. However, prices of medium and planer types were marginally down by Rs.one, they said. Exporters also remained selective. Out of a total about 4.22 lakh kgs offered, leaf tea accounted for 2.20 lakh kgs, the sources said.

German cocoa data delayed

Publication of German cocoa grind figuresfor the second quarter of 1998, originally slated for July 3, have been delayed because of slow industry responses to questionnaires, confectionery association BDS said on Friday. BDS said some member companies needed more time to prepare data, and release was now scheduled for July 5 or 6. The figures are an important pointer to cocoa consumption.

Hong Kong gold ends higher

Hong Kong spot gold ended higher on Friday after a rise in the yen against the dollar set off a brief flurry of Asian buying, traders said. Gold bullion ended at $294.00/50 per ounce on Friday compared to New York’s previous close at $293.60/294.10 on Thursday. Spot silver ended at $5.33/38 an ounce after closing in New York at $5.33/36 on Thursday.

The dollar/yen rate has dominated gold’s movement in recent weeks, with Japanese speculators buying gold when the yen strengthens and selling it when the yen weakens. "The market was quiet but when the dollar/yen moved lower suddenly we saw gold rebound to rally," one trader said.Gold moved above $295 but follow-through buying failed to appear and when European traders entered the market they began to sell, traders said.

China to trim coal output

China plans to trim domestic coal output by 70 million tonnes in 1998 in a bid to balance production and demand, a spokesman for the State Coal Industry Bureau said on Friday. The bureau would cut production by shutting down small illegal township coal mines, he said, without giving further details.

Annual coal output, estimated at around 1.3 billion tonnes in 1997, was expected to be cut by 150 million tonnes in the next two to three years, the spokesman said. China has said it produced 434.18 million tonnes of coal in the first five months of this year, down 10 per cent from the same period last year.

Tin prices drop

In Mumbai, tin prices dropped sharply while copper in all grades showed moderate declines at the non-ferrous metals market. Prices of tin slumped due to lack of industrial demand and in tandem with aweak trend at the London Metals Exchange (LME), traders said. Prices of copper of all grades were also affected by a subdued trend on the lme and poor local demand.

Following were today’s rates per kilo.(previous rates in brackets). Copper scrap heavy Rs 114.50 (Rs 115.00), copper wire bar Rs 131.50 (Rs 132.00), copper utensils Rs 103.00 (Rs 103.25), brass scrap 88.75 (Rs 89.00), brass sheets cutting Rs 92.50 (Rs 92.75), aluminium scrap Rs 64.50 (Rs 64.50), aluminium ingots Rs 83.00 (Rs 83.00), zinc Rs 78.00 (Rs 78.25), lead Rs 43.50 (Rs 43.50), tin Rs 377.00 (Rs 380.00) and nickel Rs 292.00 (Rs 292.00).

Brazil aluminium consumption up

Brazil is forecast to consume 696,400 tonnes of aluminium products in 1998, nearly eight percent higher than in 1997, the Brazilian Aluminium Association (ABAL) said. But exports were expected to fall by five per cent in 1998 and reach 764,00 tonnes, ABAL said. In its previous estimates released in April, ABAL said it expected 1998 products consumption to reach703,800 tonnes and exports 742,000 tonnes.

It gave no reason for the revisions. It added that Brazil had already seen a rise of 10.2 per cent in its aluminium products consumption in the first half of this year against the same period in 1997, totalling 170,000 tonnes.

The main growth sectors were sheets and laminates. Export volumes were down by 0.7 per cent in the first half and amounted to 189,500 tonnes, of which 170,200 were primary aluminium and alloys. ABAL forecast Brazil’s total aluminium supply, comprising primary metal and recovered scrap, would rise to 1.40 million tonnes in 1998, up 3.4 per cent on last year.

Vietnam tender to sell crude

Vietnam’s Dai Hung consortium has issued a tender to sell 450,000 barrels of Dai Hung crude for lifting August 10-31, traders said on Friday. The tender closes on July 9 and is valid for one day, traders said. The equity producers of Dai Hung are Malaysian state oil company Petronas with 63.5 per cent, Japan’s Sumitomo Corp with 10.62 per cent,France’s Total SA with 10.62 percent and state-owned Petrovietnam with 15 per cent.

In its last tender, the consortium awarded 700,000 barrels for July 1-20 lifting to Petronas, at around 33 cents per barrel under the Asian Petroleum Price Index (APPI) quotes for Minas crude, traders said.