April 30th, 2012

Unleaded gasoline capped the first monthly drop since November as reports showing weakness in Europe’s economy added to concern that global demand will slow.

Gasoline futures fell with crude, which declined for the first time in seven days, after Spain’s gross domestic product dropped in the first quarter and Italy’s inflation remained at a six-month high. The euro weakened against the dollar, reducing the appeal of commodities as an investment alternative.

“Gasoline is being dragged down by crude oil prices,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston. “There’s quite a bit of concern about Spain and Italy. The anticipation is that the economies there will slow and reduce oil demand.”

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April 30th, 2012

Crude oil fell as Spain’s economy contracted in the first quarter, putting the country into its second recession since 2009 and bolstering concern that fuel demand in the euro region will contract.

Crude oil futures dropped as much as 1 percent after the Madrid-based National Statistics Institute said today that gross domestic product shrank 0.3 percent in the first three months of this year, the same as in the previous quarter. The decline in crude prices accelerated as the dollar rose against the euro on an increase in U.S. consumer spending.

“Concerns about Europe have been weighing on the market for a long time,” said Phil Flynn, an analyst at futures brokerage PFGBest in Chicago. “Today’s Spanish headlines are worrisome. The personal spending numbers here are a positive economic signal which pushed the dollar higher and as a result hit commodities.”

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April 30, 2012

Managed Futures – Smaller managed futures funds able to exploit niche commodity markets and the most volatile conditions are increasingly likely to win assets from investors disappointed with returns from the big trend-followers that dominate the industry.

Managed futures, or commodity trading advisers (CTAs), attracted a wave of assets in 2009 after performing well during the 2008 financial crisis.

Mainstream institutional money flooded into some of the best-known trend-followers, so that 60 percent of total CTA assets are now with the top 10 players.

But since 2009, industry performance has been patchy as traditional trend-following models have struggled in range-bound markets in which it is hard to gain traction.

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April 30th, 2012

Sugar Futures – The price of raw sugar traded in New York may fall below 19 cents a pound “very soon,” prompting processors in top producer Brazil to make ethanol rather than the sweetener, Marex Spectron Group said.

Sugar futures have fallen 8.4 percent on ICE Futures U.S. in New York this year, as supplies outpace demand by 6 million metric tons, up from a previous forecast of 5.2 million tons, according to the International Sugar Organization in London. The price was at 21.34 cents a pound by 6:28 a.m. Below 19 cents a pound, millers in Brazil would favor production of the biofuel, Marex Spectron said, referring to the variety used in flex fuel cars.

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April 30th, 2012

Corn Futures – Speculators reduced bullish bets on corn by more than any other commodity, just before the U.S. reported its single biggest export sale in 18 years and prices had their largest two-day rally in almost a month.

Money managers cut corn wagers by 30 percent to 103,079 futures and options in the week ended April 24, the biggest decline since June 2010, according to data from the Commodity Futures Trading Commission. The drop of 43,511 contracts was larger than for any of the 18 raw materials tracked by Bloomberg. Holdings across all the commodities fell for a fifth week, the longest slide since June 2010, the data show.

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April 27th, 2012

Coffee Futures – Buyers of coffee from Brazil, the world’s largest producer, are getting a bigger discount for beans as the new-crop harvest approaches, brokers said.

Fine cup beans for May and June shipment are trading at a discount of 8 cents a pound to the price on ICE Futures U.S. in New York, data from Rio de Janeiro-based broker Flavour Coffee showed. That compares with a 5-cent discount last week, according to the data.

Buyers of good cup beans for shipment in the same period are getting a discount of 15 cents a pound to the exchange price, up from 12 cents last week, Flavour Coffee said in a report e-mailed yesterday. Fine cup coffee is usually more expensive than good cup quality because of its taste profile.

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April 27th, 2012

Cattle Futures – U.S. beef packer profits are back in the black for the first time in seven months as the onset of spring has boosted demand for steaks and hamburgers that will headline backyard cookouts.

This annual surge in beef sales, and subsequent profits, could not come soon enough for the U.S. beef industry, which has been hurt by drought, an uproar over ammonia-treated beef, and another case of mad cow disease.

On Thursday, U.S. beef packers earned an estimated $3.45 per head of cattle, according to the Colorado-based analytics firm HedgersEdge, which uses proprietary data to calculate the margins.

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April 26th, 2012

Commodity Brokers – The Commodity Futures Trading Commission, the main U.S. derivatives regulator, is reviewing the release of information about the first domestic case of mad cow disease in six years.

Cattle futures slumped in advance of a U.S. Department of Agriculture April 24 announcement that a case of bovine spongiform encephalopathy, or BSE, had been confirmed in a dairy cow in California.

“CFTC reached out to USDA with questions on the BSE announcement timeline for their routine market analysis,” Courtney Rowe, USDA spokeswoman, said in an e-mail yesterday.

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April 26th, 2012

S&P 500 Futures – U.S. stocks gained, giving the Standard & Poor’s 500 Index its biggest three-day advance since February, after better-than-estimated housing data overshadowed disappointing earnings at United Parcel Service Inc.

A measure of homebuilders in S&P indexes rose 4.8 percent as PulteGroup Inc. rallied 10 percent amid a narrower loss. Chevron Corp. (CVX) advanced 2.3 percent as the energy company lifted its dividend. Amazon.com Inc. (AMZN), the largest Internet retailer, surged 12 percent at 4:57 p.m. New York time as revenue beat estimates. UPS (UPS), the biggest package-delivery company that is considered a proxy for the economy, retreated 1.8 percent.

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April 26th, 2012

Oil traded near the highest level in more than a week after Federal Reserve Chairman Ben S. Bernanke said that while further stimulus is unlikely, central banks “remain prepared to do more” to protect the economy.

Futures were little changed, paring an earlier gain after more Americans than forecast filed applications for unemployment benefits last week. Economic growth is expected to “remain moderate over coming quarters and then to pick up gradually,” the Federal Open Market Committee said in a statement. U.S. crude supplies gained more than estimated last week, and Iran’s envoy in Moscow said his country may halt the expansion of its atomic program to avert new Western sanctions.

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