Soybean prices are on the rise. As this article from Bloomberg highlights, some new interesting trends have emerged in recent years which commodity investors would do well to take note of.
China Seen Boosting Purchases of Soybeans as Feed Demand Expands
[Source] : Bloomberg
Crushers in China, the world’s biggest buyer of soybeans, boosted purchases last week as rising demand for livestock feed increased profits from processing, according to a Bloomberg survey.
Companies ordered 30 cargoes from the U.S. or South America, the equivalent of about 1.8 million metric tons, according to the median of estimates from five crushers and one researcher compiled by Bloomberg. That compares with a usual weekly average of 10 cargoes to 20 cargoes, respondents said.
China canceled 1.16 million tons of shipments since Dec. 18, according to the U.S. Department of Agriculture, which increased concern consumption may be slowing. Fresh purchases by China, which buys more than 60 percent of globally traded beans, suggest demand is recovering as U.S. supplies decline.
“Traders are securing more shipments for the next two months” because of the looming shortage in supplies and limited loading capacity in South America, said Monica Tu, analyst at Shanghai JC Intelligence Co., who took part in the survey.
Consumption of soybean meal in China is increasing as farmers fatten hogs before the Lunar New Year festival in February when pork demand rises, Tu said from Shanghai yesterday. Stockpiles of soybeans in the U.S, the biggest producer last year, were 1.966 billion bushels on Dec. 1, 17 percent less than a year earlier, according to the USDA.
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As of recent, I have been keeping a close watch on newly published literature, news and essentially whatever catches my attention on how US Foreign Policy in Latin America might evolve over the course of the next decade.
This topic has recently garnered a fair share of attention for multiple reasons. For starters, the world today is a very different place when compared to the world of 1993 when the Western Hemisphere attempted to foster the foundations for a Free Trade Area of the Americas (FTAA). This foray of attempting to implement a Hemisphere wide free trade zone failed miserably for various reasons. However, as we kick off the new year, it is clear to many policy experts, it will be necessary for the US, and its counterparts throughout Latin America to adapt and redefine their foreign policy goals within the context of 21st century geopolitics and an ever more increasingly globalized world economy.
Christopher Sabatini, author of the article “In Latin America, Creative Focus Could Pay Off,” published by World Politics Review on January 8, 2012 offers great insight into how the US could make some changes in its Latin America Foreign Policy Agenda for the benefit of not only the US, but the region as a whole. Below are a few excerpts from his article which you can read the full version of by click the link above or at the end of this entry.
For decades, Latin America policy specialists have lamented how the Western Hemisphere is never a priority for U.S. presidents. For all the United States’ economic and cultural ties with the region, however, America’s neighbors to the south do not face the kinds of imminent threats that tend to get a president’s undivided attention — and fortunately so.
But while Latin America may never, and arguably should never, figure on the list of the U.S. executive’s top concerns, several innovative pushes across the U.S. foreign policy apparatus would not only dramatically help advance U.S. relations and leadership in the region, they would also set the tone for relations for decades to come, while making sure the region never gets what many have wrongly longed for: the president’s urgent attention.
In 2011, trade between the United States and Latin America and the Caribbean totaled $800 billion, with the economies to the south of the Rio Grande consuming more than 20 percent of U.S. exports. The rise of Asian economies notwithstanding, the volume of U.S.-Latin American trade is still greater than that with China for either side. More important for U.S. workers, America’s southern trade partners are buying high-end manufactured American goods. Thirteen countries, including Chile, Colombia, Guatemala, Venezuela and Mexico, import more from the U.S. than from any other country, much of it in the form of goods like computers, telecommunications equipment, cars and machinery.
Though little-known, the negotiations to create the Trans-Pacific Partnership (TPP) could be one of the most important institution-building initiatives since the Cold War.
To be sure, the next four years will see hemispheric crises that will land on the president’s desk. Among them will likely be some form of political transition in Venezuela and possibly Cuba, and ongoing security concerns in Mexico and Central America. For too long, however, crises and specific issues like security and narcotics have driven U.S. policy in the hemisphere.
In an era of selective cross-hemispheric convergence and greater competition among states in the region, the Obama administration now needs to look for ways to leverage its relations with economic and political allies in Latin America to expand the hemisphere’s global reach, seize the advantages of the region’s global ambitions and break free of the ideological baggage of the past. This requires only that the president send a signal of executive commitment and interest by setting in motion a limited series of initiatives. Doing so will update and remake our relations not only for the next four years, but for the next generation.
Christopher Sabatini is the editor-in-chief of Americas Quarterly, published by the Americas Society/Council of the Americas (AS/COA). He would like to thank Andreina Seijas of the AS/COA for her research.
Click here to read the complete article
[Source] : The Economist
The Expanding Middle
Nov 10th 2012
A decade of social progress has created a bigger middle class—but not yet middle-class societies
JAMMED onto a spit of land that juts into the azure Atlantic near the centre of Recife, in Brazil’s north-east, Brasília Teimosa was until a couple of decades ago a favela of wooden fishermen’s huts. Now its streets are lined with brick houses, some of three stories and clad in decorative tiles but others jerry-built. It has seafood restaurants, shops and a couple of bank branches, but also piles of uncollected rubbish. Many marketing types and economists would hail its residents as members of Brazil’s burgeoning “new middle class”, who have become avid consumers.
That is not how Francisco Pinheiro, a community leader who was born in Brasília Teimosa, sees it. “Economically, it’s much better off than it was,” he says. “But a middle-class person is someone who lives in Boa Viagem”—a smart beachfront residential suburb close by—“with a car, an apartment and an income of 3,000 reais ($1,500) a month.” In Brasília Teimosa, he adds, the majority earn less than two minimum wages ($613)—often shared among a family of four or more.
Click here to read the full article direct from The Economist
US – Latin America: Obama and Romney forget Latin America
Latin America – China: Los latinoamericanos de origen chino (parte I)
Latin America – China: El Libro Blanco chino sobre América Latina y el Caribe
Peru – China: Perú comienza a pensar en el turismo chino
[Source] : Bloomberg
By Matt Craze and Mario Sergio Lima - Sep 13, 2012 4:00 PM GMT+0800
Leonildo Bares, a soybean grower near the Amazon farming frontier town of Sinop, said he’s so confident prices for the commodity will stay near record highs that he’ll extend his crop to neighbors’ boggy cattle pastures.
Confined by Brazil’s crackdown on logging in the Amazon, the farmer talked his neighbors into growing soybeans on their cleared land and sharing the profit. Bares, whose 420-hectare (1,038-acre) farm in the center-western state of Mato Grosso extends on what was untouched rainforest in the 1970s, plans to boost planting to 650 hectares. About 1 million hectares of the state’s pastures, an area the size of Jamaica, probably will be converted to soybean crops in coming years, he predicts.
“The pastures of Mato Grosso can be turned into soybean plantations and probably will,” Bares, who’s also the president of Sinop’s farmers association, said in a telephone interview from the city. “Anyone with the knowledge and money who’s willing to come here and do it, can do it.”
South American farmers like Bares have become the counterpoint to the worst drought in the U.S. Midwest in 76 years as they sow record crops during a global shortage of the oilseed used as animal feed in Asia. Brazil, Argentina, Paraguay, Bolivia and Uruguay will boost output by 34 million metric tons to 148.5 million in the 2012-2013 season, more than offsetting a decline of about 11.5 million tons to 71.7 million in the U.S., the Department of Agriculture said yesterday.
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Being distracted by the blitzkrieg onslaught of “news stories,” makes it quite easy to get distracted in this day and age. To name a few headlines from around the world sucking in people’s limited attention span we have –>
This entry is about a new book which has just hit the presses: The Final War: Avoiding It through a New Harmonic Society. Co-authored by Fernando Morote Solari (a military hero, expert in geopolitics, professor), Dr. Sofia Morote (his daughter and also a professor and expert in geopolitics), and a colleague of theirs Patricia Bowens McCarthy.
I am a professor at Dowling College (www.internationalprofessor.com), and I wrote this book in a team with my father Fernando Morote Solari (a military hero, expert in geopolitics, professor) and my colleague Patricia Bowens McCarthy.
The first part of the book discusses the role of several countries in a possible World War and why we may have one. The second part, discusses a way to impending a world war through creating a new Harmonic Society. The book also praises China president statements in the UN about Harmonious World, instead of dismissing them as US Media often does as simply political jargon.
The authors initially discuss the precarious and ongoing situations throughout the Middle East- Israel – Pakistan and finally how the emergence of China begins to factor in. It also encompasses Africa, Central and South America (Latin America), where Chinese interests are growing. The authors asset that the projected confrontation can be avoided by The Law of Universal Harmony, which is undergirded by Judeo-Christian precepts, Eastern concepts and principles such as dynamic balance, static equilibrium, ascending and descending transformation, and synchronized movements.
The goals are objects of Universal Harmony as discusses in the book are achievable when nations take ownership for development strategies, policies and programs. In sum, The Final War: Avoiding It through a New Harmonic Society, reveals the realities of what a confrontation could mean for the world, and offers solutions and steps which can be taken to prevent. Overall a very worthwhile and interesting read for geopolitical intellectuals out there, specifically ones interested in transpacific relations.
The book is currently available through multiple mediums in both English and Spanish. Please visit the home of the page of the book http://thefinalwar.net/ to learn how to purchase wither E-Book or hard copies ranging from $7 USD – $20 USD in price.
Give a few minutes of your day to participate in a survey from Asuntos Del Sur
The survey’s goal is to attract and organize young entrepreneurs in Latin America. Asuntos del Sur is conducting the project they have aptly names “more with less” which seeks to strengthen emerging leaders in Latin America.
The aim is to transfer and share knowledge and experiences of young innovative leaders interested in exchanging their experiences throughout the region, to create a network of interaction between young people with vision throughout the region, and encourage good practices and mutual reinforcement for change.
To this end, Asuntos del Sur has gained the support from the Secretariat General Iberoamericana “Citizenship 2.0″ to take the the initiative of the. Asuntos del Sur are identifying innovative projects in the region that have a low investment requirement for its creation and impact. That is why we would like to know your ideas and experience by telling how your organization, project, project or activity can create added value and sustainable development for the region. Please take a few minutes of your day to answer the questions in the following query.
[Source] : Seeking Alpha
Click here to read part 1 of this story
China’s economic soft-landing has had a significant impact on economic growth across the globe and particularly in Latin America where mining and commodities production are key drivers of economic activity. In the first article of this series the linkage between Latin American economic growth, commodities exports and Chinese economic growth was illustrated. This showed that China’s slowing economy and decreased demand for commodities has been a key catalyst for the fall in economic growth across the region. It has also been a key catalyst for the plunging share prices being experienced by many resource companies, which include some of Latin America’s largest publicly tradable companies like Vale (VALE) and Petrobras (PBR).
Market outlook on commodities growing more optimistic
However, markets have been taking a more optimistic view of China and commodities over the last month. This growing optimism is based on signs that the contraction in Chinese economic activity is easing along with increasing speculation that the Chinese government will take action to boost growth. This has led to considerable speculation that there will be a recovery in commodities prices, which should see a renewal of economic growth in Latin America.
One of the key drivers of this growing optimism has been the slowing contraction of the Chinese manufacturing sector, with the Chinese purchasing managers’ index (PMI), rising in July to a five month high. There has also been renewed confidence in the iron ore mining sector with Australia’s third largest iron ore producer Fortescue Metal’s Group (FSUMF.PK) recently reporting an 8% increase in profit, along with positive statements from both Rio Tinto (RIO) and Vale concerning the future direction of iron ore prices. However, with the exception of crude oil it appears that this optimism is misplaced with commodity and basic materials prices continuing to fall.
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