Commodities Market Impact Weather: Cool Outlook for Midwest

OMAHA--Cool weather for the Midwest, dry conditions for the Central and Southern Plains, some

heavy rains in South America are the primary weather items for the commodity trade's attention

Monday.

COOL OUTLOOK FOR MIDWEST

  The DTN ag weather forecast calls for episodes of cool and sometimes very cool weather will slow

soils from warming up and limit the potential for early spring fieldwork during the next 10 days.

Precipitation chances appear limited during this time.

DRY FOR SOUTHERN PLAINS

  Little rainfall is expected through the dry western growing areas during the next 10 days.

Concerns for this portion of the crop will increase as we move further into the spring if rainfall

doesn't improve. The weekend rain helped ease dryness somewhat where it fell, but this is only a

small part of the wheat belt.

THUNDERSTORMS IN SOUTHERN BRAZIL

  Soil moisture for second-crop corn, late-filling soybeans and late-filling early corn is adequate

to surplus at this time. Thunderstorms in Rio Grande do Sul later during the weekend or early this

week may favor late-filling crops but would be unfavorable for early maturing varieties. Somewhat

drier, warmer weather elsewhere in the region will favor mature crops and harvest activities.

DRY, HOT IN BRAZIL COFFEE AREAS

  The main growing areas will likely see little rainfall and above-normal temperatures during the

next five to seven days. This continues the summer pattern of stress on developing crops due to

below-normal rains and above-average temperatures.

HEAVY THUNDERSTORMS IN ARGENTINA

  Heavy thunderstorms hit key growing areas of Cordoba, Sante Fe and Buenos Aires late last week and

early in the weekend. This will maintain adequate to surplus soil moisture for filling crops, but

may be unfavorable for early maturing crops and any harvesting. Local flooding is likely.

MUCH WARMER WEATHER AHEAD FOR UKRAINE

  A below-normal precipitation pattern and above-normal temperature pattern during the winter left

much of the region in need of early spring rains. The warm weather forced winter grains out of

dormancy much earlier than normal. The region has had rainfall of 0.12 to 0.51 inch (3 to 13

millimeters) during the weekend as temperatures turned somewhat lower. It should continue cool early

this week before turning much warmer again at the end of the week.

FAVORABLE MOISTURE IN CHINA

  There has been normal to above-normal rainfall from the central North China Plain southward to the

rice belt since early February. This provides favorable moisture for winter wheat, winter rapeseed,

rice and sugarcane areas. More rain is needed through the northern NCP, but this isn't that unusual

for early March. Early corn planted south of the Yangtze River will also benefit from the added

rains.

WARMER, DRIER IN SOUTH AFRICA

  A period of warmer, drier weather will favor early maturing maize through the eastern areas during

the next three to five days. Recent rains have improved conditions for later-planted maize through

the western growing belt. Recent rains have mostly favored sugarcane in the east, except in areas of

local flooding.

Arabica-Coffee, Raw-Sugar Futures Slip on Profit-Taking

  NEW YORK  -  Arabica-coffee futures slipped Monday as traders took profits from this quarter's Brazil

drought-driven rally.

  Arabica beans for delivery in May on ICE Futures U.S. fell to $1.8880 a pound, the lowest since

March 5, but later pared some of the losses. The May contract was recently at $1.9330 a pound, down

2.6% or 5.1 cents.

  Prices dropped 3.7% in the previous session, signaling to some investors that it is time to

liquidate their positions, said Hernando de la Roche, a senior vice president at brokerage INTL

FCStone.

  Brazil's worst drought in decades propelled arabica-coffee prices to a more than two-year high of

$2.0975 a pound last week. Futures prices have gained 75% since the start of the year. Brazil is the

world's largest coffee producer and the source of about one-third of the world's annual output.

The dry weather has fueled worries about the size and quality of the country's crop this year.

  Some investors are likely taking profits as the first quarter winds down, said Sterling Smith, a

futures specialist at Citigroup. Prices could fall much lower if they settle below $1.80 a pound, he

said.

  Raw-sugar futures also fell, hitting the lowest point since Feb. 21. May-delivery sugar was down

1.4% at 17.01 cents a pound.

  Brazil is also the world's largest supplier of sugar, and the drought raised concerns about stress

to sugar cane ahead of the next harvest, which begins next month. Those concerns helped raw-sugar

futures reach a four-month high of 18.47 cents a pound on March 6. But recent rains and the ability

of growers to replant cane more easily than coffee trees have damped the rally.

"Funds are not as infatuated with (the raw-sugar market) as they used to be," Mr. Smith said.

  In other markets, May cocoa was up 0.1% at $2,994 a ton, while May cotton was down 0.6% at 91.68

cents a pound. Orange-juice futures for May were 0.2% lower at $1.4920 a pound.

Coffee Reserves Seen at Record as Vietnam Farmers Curb Sales

Bloomberg News  Mar 17, 2014

Coffee growers in Vietnam, the biggest producer of robusta beans used by Nestle SA, are holding record stockpiles as they curb sales amid speculation that drought will reduce next year’s harvest. Futures fell.

Inventories reached 850,000 metric tons in the week ended March 7, the highest ever at this time of the year, according to the median of eight trader and shipper estimates compiled by Bloomberg. Growers have sold 50 percent of the record 1.7 million-ton output in the year started October, compared with an average 60 percent in the past five years, the survey shows.

Coffee jumped this year as sales slowed from Vietnam and drought parched crops in Brazil, the second-biggest producer of robusta and the top grower of the more expensive arabica variety favored by Starbucks Corp. While robusta climbed 27 percent, its discount to arabica widened threefold to the highest in two years. That fueled speculation roasters may boost purchases of the cheaper variety, said ABN Amro Clearing Bank NV.

“It seems that prices will keep rising, so I’m holding back sales for now,” said Bui Van Duan, a 40-year-old farmer in Dak Lak province, which represents about 30 percent of Vietnam’s harvest. “We have savings, so I don’t need to rush.”

Robusta fell 1.5 percent to $2,143 a ton in London today. Arabica in New York was at $1.96 a pound, rebounding 77 percent in 2014 after three years of losses to become the top performer in the Standard & Poor’s GSCI gauge of 24 raw materials.

Brazil Drought

Dry weather in Brazil has raised concern global supplies will trail demand. The shortage of arabica beans will be 5.3 million bags in 2014-2015, while the deficit for robusta will be 1.2 million bags, estimates Volcafe Ltd., the Winterthur, Switzerland-based unit of commodities trader ED&F Man Holdings Ltd. A bag weighs 60 kilograms or 132 pounds.

In Vietnam, the decline in robusta prices in 2013 prompted farmers to curb sales. Growers had probably sold 33 percent of their beans before the Tet Lunar New Year Holidays in January, compared with an average 43 percent in the past five years, a survey published that month showed.

Farmers in Vietnam “think higher prices are coming,” Sterling Smith, a futures specialist at Citigroup Inc., in a March 11 e-mail in response to questions from Bloomberg.

Robusta’s discount to arabica touched $1.087 on March 5, the widest since March 2012. In 2011, it was $1.89 a pound, the highest since at least 2008. While demand for robusta jumped 15 percent in 2011-2012, usage of arabica from Brazil slid 12 percent, according to Volcafe.

Roaster Switch

“Substitution conversations have picked up, but are difficult to quantify just right now,” ABN Amro said in an e-mailed report this month. “If we have an extended period of time where the arb holds at these kind of levels there will be a switch. The problem as always for the larger roasters is being able to respond in a reasonably timely manner, if at all.”

Vietnam exported 303,000 tons in the first two months, 6.4 percent less than a year earlier, the General Statistics Office estimates. The country will ship 25.1 million bags from a record crop of 28.5 million bags in 2013-2014, according to the U.S. Department of Agriculture. Reserves will total 3.82 million bags by Sept. 30, the USDA says.

“At current market levels, I would expect more sales of robusta from Vietnam unless local market conditions dictate otherwise,” Abah Ofon, a Singapore-based director of agricultural commodities research at Standard Chartered Plc, said in a March 11 e-mail, in response to Bloomberg questions.

Drought Threat

Beans in Dak Lak traded at 41,600 dong ($1.97) a kilogram on March 13, Trade & Tourism Center data show. While prices increased 41 percent from a three-year low of 29,600 dong in November, they’re still below 45,500 dong reached in March 2013, which was the highest level in almost 18 months.

Gains in robusta futures have trailed those of arabica because of Vietnam’s increasing stockpile, said Smith of Citigroup. A dry spell in the Central Highlands region, which includes Dak Lak province, may change that, he said.

“Dry conditions are being seen in some growing areas,” Smith said in a report dated March 11. “While it is not yet a problem, it is a situation that does merit further monitoring.”

Drought and “coffee flu” in the Central Highlands and frost in Son La province will cause coffee production in 2014-2015 to decrease “significantly” from a year earlier, Vietnam Coffee and Cocoa Association, or Vicofa, said March 6, without giving specific output figures.

Dak Lak will have dry and sunny weather in the 10 days ending March 20, the province’s Meteorology and Hydrology Department said March 11. No rain was recorded from March 1 to March 10 at 10 stations, which includes one in neighboring province of Dak Nong, it said. Volcafe said last week it was “too early” to be concerned about the country’s dry weather and farmers were hoping for prices to reach 45,000 dong.

“I don’t need money yet so I’m going to wait until prices hit 45,000 dong,” said Tran Thanh Nga, a 31-year-old farmer who hasn’t sold any beans from her 4-ton stockpile. Her warehouse has capacity to store as much as 10 tons, Nga said.

Em dia corretivo, café cai forte na ICE e chega a romper os 200 cents

Os contratos futuros de café arábica negociados na ICE Futures US têm um dia de quedas consideráveis, com a predominância de liquidações especulativas e de fundos. Há pouco, a posição maio tinha perda de420 pontos, com 201,75 centavos de dólar por libra peso, depois de tocar a mínima de 197,20 centavos, com o julho tendo retração de 435 pontos, com 203,45centavos.

De acordo com analistas internacionais, o dia é caracterizado pela força vendedora de specs e fundos, que conseguiram, ao longo da manhã, empreender perdas ainda mais intensas, fazendo com que o maio operasse abaixo do nível psicológico de 200,00 centavos. Nas mínimas, contudo, algumas recompras foram processadas e, assim, as perdas desaceleraram.

"Tivemos um indicativo de que as correções poderiam ser processadas ainda na sessão de ontem, quando o after-hours apresentou uma pressão vendedora extra. Isso teve continuidade desde os primeiros movimentos de hoje e chegamos a acumular uma baixa de 875 pontos. O mercado é volátil. Temos de levar em conta que os ganhos são sucessivos praticamente desde o início do ano. Diante disso, movimentos corretivos são esperados e é possível, até mesmo, que o mercado procure novos intervalos de preço, principalmente se sentirem que a oferta global pode não ser tão afetada quanto o esperado até há pouco", disse um trader.

No segmento externo, altas ligeiras nas bolsas dos Estados Unidos, com o dólar em queda em relação a uma cesta de moedas internacionais e retração para a maior parte das commodities softs.

A forte crise relacionada à ferrugem do colmo nas lavouras de café da América Central pode não ter sido tão forte quanto se imaginava. A avaliação é da Organização Internacional do Café, que estimou as perdas da temporada em 24% em relação ao obtido na safra 2011/2012. Em seu relatório mensal, a entidade citou dados do Procafé, organismo de café da América Central, que manteve as perdas da produção derivadas da doença em 11,67milhões de sacas em 2013/2014. O montante implica em aproximadamente 8% da produção mundial de café esperada para a temporada. Em comparação com2011/2012, antes da infestação, a colheita da região foi responsável por quase15% da safra global. A Organização não indicou um número comparativo, porém, em seu informe de janeiro estimou que a produção de café da América Central e México teria queda de 12% em dois anos de ferrugem do colmo.

As exportações brasileiras no mês de março, até o dia 13,totalizaram 511.038 sacas de café, queda de 34,62% em relação às 782.038 sacas embarcadas no mesmo período do mês anterior, de acordo com informações do Cecafé (Conselho dos Exportadores de Café do Brasil).

Tecnicamente, o maio na ICE Futures US tem resistência205,05, 205,50, 206,00, 206,50, 207,00, 207,45-207,50, 208,00, 208,50, 209,00,209,50, 209,75, 209,90-210,00, 210,50,211,00 e 211,50 centavos de dólar, com o suporte em 197,05-197,00, 196,50,196,00, 195,50, 195,05-195,00, 194,50, 194,00,193,50, 193,00, 192,50, 192,00, 191,50 e 191,00 centavos.

Em sessão mais amena, café cai de forma modesta em Londres

Os contratos futuros de café robusta negociados na Euronext/Liffe encerraram esta sexta-feira com quedas, ainda que moderadas, seguindo o mau humor dos arábicas em Nova Iorque. O dia teve uma movimentação relativamente fraca, com a posição maio flutuando, ao longo de todo o pregão, abaixo do nível psicológico de 2.200 dólares.

De acordo com analistas internacionais, Londres conseguiu passar quase "ilesa" pela onda de liquidações observada em Nova Iorque e que fez com que as cotações apresentassem retrações das mais incisivas. Ao final do dia, no entanto, algumas vendas mais efetivas foram notadas e o encerramento se deu com baixas modestas.

"Tivemos um dia de lances mais calmos, sem uma volatilidade tão agressiva quanto aquela verificada ao longo dos últimos pregões. Chegamos a uma mínima de 2.161 dólares, mas nesse nível as recompras foram efetivadas. A tendência para os robustas tende a ser a manutenção desse intervalo, a menos que tenhamos uma pressão muito mais intensa vinda do processo corretivo em Nova Iorque", disse um trader.

O maio teve uma movimentação ao longo do dia de 6,09 mil contratos, contra 4,17 mil do julho. O spread entre as posições maio e julho ficou em 4 dólares.

No encerramento do dia, o maio teve queda de 14 dólares, com2.175 dólares por tonelada, com o julho tendo desvalorização de 14 dólares, para o nível de 2.171 dólares por tonelada.

Worst drought in Brazil in decades doubles the price of your coffee beans

AFP - March 16, 2014

The morning caffeine hit is about to get more pricey as drought in top producer Brazil has sparked fears of a global shortfall of coffee this year, sending the price of beans soaring.

Coffee prices hit their highest point in two years in New York, with Arabica beans due for delivery in May fetching 203.75 cents per pound, more than double that of the 100.95 cents per pound in November.

The worst drought to hit Brazil in decades has sparked fears that the crop in the world's top coffee producer could shrink for the second consecutive year for the first time since 1970.

Leandro Gomes Ribeiro Costa, head of coffee at farmer group Coopamig, said some regions of Brazil have had only a tenth of their average rainfall so far this year during a crucial stage in the beans' development.

Coopamig, which is made up of 5,800 farmers from the country's main coffee producing region Minas Gerais, expects to harvest up to 30 percent less coffee this year than in 2013.

"I've never seen such a drought in my life: in some places we have found coffee wilted on the tree," he told AFP.

The price of robusta, the more bitter variety of bean used in instant coffee, has also surged due to cold and drought in Vietnam. On Friday, London prices hit $2,176 a tonne, up from $2,076 at the same time last week.

The International Coffee Organization (ICO) now forecasts a global production deficit of at least 2 million 60 kilogram bags of coffee in 2014-15.

F.O. Licht analyst Stefan Uhlenbrock said the market has staged a complete turnaround since November, when "everybody was talking of supply overhang, with Brazil coming off a record off-year crop, Columbia seeing a very strong recovery in its production and Vietnam also heading for a bumper crop".

"Now everybody is concerned about the supply outlook for Brazil, with a real threat of a deficit in the coffee market, which has not been the case in the past four years," he told the ICO recently.

The beginning of the year is a crucial period for the development of Brazil's coffee beans, and the market is easily spooked by fears of a poor crop.

Agronomist Marcelo Almeida said the lack of water in parts of Brazil has stunted the beans' development. This year it will likely take 600-700 litres of coffee cherries to produce a bag of 60 kilogrammes, after washing and drying, compared to 500 litres in a normal year.

"It is fairly unprecedented this kind of drought at this particular period of time in terms of cherry growth," said Kona Haque, who leads Macquarie's agricultural commodities research.

F.O. Licht has already reduced its forecast for Brazil's crop this year by 15 percent to 48 million bags.

"The real damage will only be seen when the harvest starts in May," Uhlenbrock said.

- Market could go 'ballistic' -

"If the weather stays dry and you don't get rain until May, as some weather forecast suggest, this market could go ballistic," said Haque. "Equally, if the crop ends up being close to 55 (millions bags) the market could start collapsing."

Arabica prices soared to a 14-year high of 307.20 cents a pound in 2010-2011 due to fears of a global shortfall. But a rebound in production the following year saw prices collapse in 2012 and 2013.

Farmers are already worrying about the impact of the drought on next year's crop.

Ribeiro Costa said his coffee growers have only been able to apply a third of the amount of fertiliser they normally would this year, which could cut output in 2015.

And the impact is set to begin filtering down to the consumers.

Griffiths Coffee, Australia's oldest coffee roaster which supplies to the retail sector, is already forecasting a rise in consumer prices.

"The recent increase in prices of coffee beans will see an increase of at least 50 cents in a cup of coffee. A cup of coffee here in Australia costs somewhere between 3 to 4 dollars, so it'll probably go up by about 12 percent to 15 percent," Chris Togias, director of Griffiths Coffee, told AFP.

He added that "the international brokers are finding it quite difficult to supply globally because a lot of the farmers are actually not honouring their contracts."

"A lot of the farmers say they will not honour the contract at US$1.30 a pound because they can now get US$2.06 a pound. There is some talk in the industry of that happening," he said.

But some analysts are more optimistic about Brazil's ability to bounce back.

"At some point, it will rain again in Brazil," said Judith Ganes-Chase, president of J. Ganes Consulting.

"Brazil is going to be back having bigger crops, this market will return back to surplus and we'll be right back to where we were before this new development."

Early Ag Weather Watch - Mar 17

EARLY LOOK WEATHER REPORT

NATIONAL TEMPERATURE/RAINFALL EXTREMES:

HIGH SUN...94 AT MIRAMAR NAS CA AND DEATH VALLEY CA

LOW  SUN...27 BELOW ZERO AT CRANE LAKE MN AND BABBITT MN AND EMBARRASS MN AND

WAKEFIELD MI

24 HOUR RAINFALL ENDING AT 06:00 PM CT...TALLAHASSEE TN 3.21 INCHES

US OUTLOOK AND MODEL DISCUSSION:

The US and European models are in fair to good agreement during the next 7

days, fair agreement during days 8-10. I am using a little more of today's

European model as it concerns the 8-10 day period. The main difference occurs

at days 9 and 10. The European model shows a new cold air mass coming into the

Midwest from Canada at the end of the 10 day period. The US model shows a

trough developing over the central Plains. The European model would suggest

more cold weather and dry conditions. The US would be warmer and somewhat

wetter.

The shorter range maps, out to day 8, show cool to cold weather continuing

and little precipitation for the key growing areas.

MAJOR WORLD HIGHLIGHTS/IMPACT:

MIDWEST: Episodes of cool and sometimes very cool temperatures will slow the

warm up of soils and limit the potential for early spring field work during the

next 10 days. Precipitation chances appear limited during this time.

CENTRAL/SOUTH PLAINS: Little rainfall is expected through the dry western

growing areas during the next 10 days. Concerns for this portion of the crop

will increase as we move further into the spring if rainfall does not improve.

The weekend rainfall has helped ease dryness somewhat where it fell but this is

only a small part of the wheat belt.

UKRAINE WEATHER: A below normal precipitation pattern and above temperature

pattern during the winter period has left much of the region in need of early

spring rains. The warm weather forced winter grains out of dormancy much

earlier than normal. The region has had rainfall of 0.12 to 0.51 inch (3-13 mm)

during the weekend as temperatures turned somewhat cooler. It should continue

cool early this week before turning much warmer again at the end of the week.

ARGENTINA: Heavy thunderstorms hit key growing areas of Cordoba, Sante Fe and

Buenos Aires late last week and early in the weekend period. This will maintain

adequate to surplus soil moisture for filling crops but may be unfavorable for

early maturing crops and any harvesting. Local flooding is likely.

BRAZIL SOYBEANS/CORN: Soil moisture for second crop corn, late filling soybeans

and late filling early corn is adequate to surplus at this time. Thunderstorms

in RGDS later during the weekend or early this week may favor late filling

crops but would be unfavorable for early maturing varieties. Somewhat drier,

warmer weather elsewhere in the region will favor mature crops and harvest

activities.

BRAZIL COFFEE, CITRUS, SUGARCANE AREAS: The main growing areas will likely see

little rainfall and above normal temperatures during the next 5-7 days. This

continues the summer pattern of stress on developing crops due to below normal

rains and above average temperatures.

SOUTH AFRICA: A period of warmer, drier weather will favor early maturing maize

through the eastern areas during the next 3-5 days. Recent rains have improved

conditions for later planted maize through the western growing belt. Recent

rains have mostly favored sugarcane in the east, except in areas of local

flooding.

CHINA: Normal to above normal rainfall from the central NCP southward to the

rice belt since early February. This provides favorable moisture for winter

wheat, winter rapeseed, rice and sugarcane areas. More rain is needed through

the northern NCP but this is not that unusual for early March. Early corn

planted south of the Yangtze river will also benefit from the added rains.

EXPANDED SUMMARIES/FORECASTS:

Midwest corn, soybean and winter wheat

Summary...

WEST: Scattered light precipitation, 0.10-0.40 inch, occurred through northwest

Missouri during the weekend period. Dry or with only a little very light

precipitation elsewhere in the region. Temperatures averaged near to below

normal north and above normal south Saturday, below normal Sunday.

EAST: Moderate precipitation occurred in extreme southern Illinois, extreme

southern Indiana and Kentucky during the weekend period. Dry or with only a

little very light precipitation elsewhere in the region. Temperatures averaged

near to above normal Saturday, below normal Sunday.

Forecast....

WEST: Mostly dry today. Scattered light precipitation with locally heavier

during Tuesday. Drier again Wednesday. Temperatures average above normal west

and below normal east today, near normal Tuesday, below normal Wednesday.

Chance for a little light precipitation north, drier south, during Thursday

through Saturday. Temperatures average near to above normal west and below

normal east Thursday, near to above normal Friday, below normal Saturday.

EAST: Mostly dry today. Dry or with only a few light showers, favoring the

north, during Tuesday. Dry Wednesday. Temperatures average below normal today,

near to above normal west and below normal east Tuesday, near to below normal

Wednesday.

Mostly dry during Thursday. Chance for a little light precipitation during

Friday. Drier again Saturday. Temperatures average below normal Thursday, near

to above normal Friday, below normal Saturday.

6-10 Day Outlook: Temperatures are expected to average below normal.

Precipitation should average near to below normal.

Central/Southern Plains (Winter Wheat)

Summary: Rain, 0.30-1.50 inches, occurred during the weekend period through the

eastern part of the north-central Texas wheat areas. Rain, 0.25-1.00 inch,

occurred through the balance of the north-central Texas area and also through

southwest and central Oklahoma and southeast Kansas. Little elsewhere in the

region. Temperatures averaged near to above normal Saturday, below normal

Sunday.

Forecast: Mostly dry today. Chance for a little light precipitation, favoring

northern areas, during tomorrow. Drier again Wednesday. Temperatures average

above normal today, below normal north and west and above normal southeast

tomorrow, below normal Wednesday.

Mostly dry Thursday. Dry or with only a little light precipitation Friday

and Saturday. Temperatures average above normal Thursday, cooler again Friday

Early Ag Weather Watch -2-

and Saturday.

6-10 Day Outlook...Temperatures are expected to average near to below normal

during this period. Precipitation averages near to below normal.

Brazil (Corn, Soybeans, Citrus, Coffee, Sugarcane)

Summary...

Rio Grande do Sul and Parana: Moderate to heavy showers and thunderstorms,

0.50-1.50 inches (13-38 mm) and locally heavier, occurred through RGDS during

the weekend period. Little through Parana during this time. Temperatures

averaged near to below normal.

Mato Grosso, MGDS and Goias: Scattered showers, 0.12-0.75 inch (3-19 mm),

occurred through Mato Grosso during the weekend period. Little elsewhere in the

region. Temperatures averaged near to above normal.

Sao Paulo/Minas Gerais: Mostly dry during the weekend. Temperatures averaged

near to mostly above normal.

Forecast...

Rio Grande do Sul, Parana, MGDS: Episodes of rain and thunderstorms for RGDS

and Santa Catarina today through Wednesday. Rainfall may be quite heavy.

Showers and thundershowers reach to Parana later in the period. Drier in MGDS.

Temperatures turn cooler in the south, warmer north, during this period.

Chance for scattered to widely scattered showers and thundershowers through

Parana and MGDS Thursday through Saturday. Little through RGDS during this

time. Temperatures average near to above normal.

Argentina (Corn, Soybean, Wheat)

Summary...Cordoba, Sante Fe, Buenos Aires, La Pampa.

Heavy storms, 1.50-3.00 inches (40-80mm) and locally heavier, occurred from

southeast Cordoba through Sante Fe, central and eastern Buenos Aires during the

early part of the weekend period. Light rains through western Cordoba and

western Buenos Aires, little through La Pampa. Temperatures averaged near to

below normal.

Forecast...

Mostly dry today through Wednesday. Temperatures average below normal during

this period.

Mostly dry or with only a little light shower activity during Thursday

through Saturday. Temperatures average below to well below normal during this

period.

Joel Burgio

http://www.businessweek.com/news/2014-03-17/temasek-unit-s-offer-for-olam-is-credit-negative-moody-s-says

Temasek Unit’s Offer for Olam Is Credit Negative, Moody’s Says

Lisa Pham and Colin Keatinge   March 17, 2014

The offer by Temasek Holdings Pte’s unit to take over Olam International Ltd. (OLAM) is credit negative for the Singapore state-owned investment company, according to Moody’s Investors Service.

The acquisition, which values one of the world’s top three coffee and rice traders at S$5.3 billion ($4.2 billion), will put pressure on Temasek’s “portfolio liquidity,” Moody’s, which rates the investment firm at Aaa, said in a March 17 report. Olam’s 2 percent dividend yield in 2013 is also lower than Temasek’s return of about 3 percent, it said.

“Bringing a new company under the Singapore umbrella negatively pressures portfolio liquidity,” Alan Greene, a senior credit officer at Moody’s, said in the report, which estimates 65 percent of Temasek’s S$215 billion investments are in Singapore dollars.

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The bid by Temasek’s unit reflects growing interest in agricultural assets as rising global populations and emerging middle classes boost food demand. Breedens Investments Pte offered S$2.23 cash per share, a 12 percent premium to Olam’s closing price of S$1.995 before the bid was announced on March 14.

Temasek, which owns 24.6 percent of Olam according to Moody’s, is the company’s biggest shareholder. It increased its stake after concerns raised by short-seller Carson Block in November 2012 caused the stock to plummet.

Temasek is the largest investor in four of Singapore’s 10 biggest publicly traded companies, including Singapore Telecommunications Ltd. and DBS Group Holdings Ltd.

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“The high concentration of investment in Singapore-listed companies and the large size of each shareholding reduce portfolio liquidity,” Greene said. “This feature is markedly different from the typical, more broadly spread sovereign wealth funds that can adjust their holdings rapidly without moving markets or requiring placements or trade buyers to effect disposals.”