It can take years for organisations to get organised, if indeed they ever do. The oil producers’ club OPEC was founded in 1960, but only became a force to be reckoned with in the 1970s when the Arab oil embargo cut off supplies to the world’s biggest energy consumer the United States and oil prices rocketed.
The much less high profile Gas Exporting Countries’ Forum, which dates back to 2001, is still struggling to get its statutes in order.
Since last December it has had a charter. It has also commissioned reports and held irregular meetings.
The latest gathering took place this week in the sandy and very hot Qatari capital and agreed little. Notably, it failed to decide on one stand-out item on the modest agenda: who should be the group’s secretary general?
So far the only country to have submitted a candidate is Iran.
In the gas exporters’ club, Iran is the second biggest reserve holder after Russia, but on occasions has reneged on its export commitments, so it’s perhaps understandable the GECF decided to extend the application period.
Candidates now have until October to submit their C.V.s and the GECF should agree a secretary general at its next ministerial meeting, which takes place in December — in theory. Before this week’s session, the GECF had last meet last December after repeated rescheduling.

The stage is set for plenty of fireworks in the coming week for U.S. grain markets.

The U.S. Department of Agriculture will release two key reports on Tuesday morning. One will reveal how many soybeans are still in U.S. storage bins as of June 1. The second will report how much corn, soybeans and spring wheat farmers planted this season after an unusually wet spring in the eastern Midwest, a bellwether for world grain exports each year.

“The one that has the potential for immediate fireworks going into the Fourth of July is the soybean stocks,” said Don Roose, an analyst with U.S. Commodities in West Des Moines, Iowa.

Typically, stocks levels at this time of the season do not garner such huge attention. USDA’s acreage numbers released on June 30 tend to steal the show, since so much guesswork has been done for months on when, where and what farmers plant.

But this year’s outlook for U.S. soy stocks on hand to hit a 32-year low before the September harvest amid strong Chinese soybean demand is keeping the heat on soybean figures.

“Any time you get into a tight-balance-sheet years there is plenty of uncertainty in the quarterly stocks numbers for beans. That could be the biggest unknown or uncertainty going into this report: the bean stocks,” said Randy Mittelstaedt, an analyst with Chicago brokerage R.J. O’Brien.

Analysts are estimating that USDA will report June 1 U.S. soybean stocks at 559 million to 620 million bushels — down from a year ago when June 1 stocks were 676 million bushels.

But the acreage numbers could also spark some excitement given the unusual planting season across the heartland. Heavy rains pounded the southeastern Midwest, where some 6 million acres intended for soybean were yet to be planted last week with fields too wet to seed. Late planting — which also hurt corn seeding — puts yield losses in greater play.

USDA in March said total intended plantings forecast for major U.S. row crops — corn, soy, wheat, cotton — were down about 4 million acres from 2008. Higher prices since then has  some private analysts expecting bigger plantings on Tuesday.

“Is it an outlook-altering report? That’s the question,” said Dan Cekander, a grains analyst with Newedge USA, LLC.

The U.S. government’s estimate last week for U.S. soybean stocks to reach a 32-year low by September will continue to dominate action in U.S. grain markets in the coming week — and perhaps all summer.
   
USDA forecast the supply of U.S. soybeans by Aug. 31 to reach 110 million bushels, less than a two-week supply for domestic processors who make vast amounts of soymeal for animal feed and soyoil for food and biofuels. Chicago Board of Trade soybean prices shot to nine-month highs on Thursday after the estimate before pulling back in volatile trading on Friday as speculators cashed profits for the weekend.
   
But the biggest question on the minds of traders remains in place: Will the United States, the world’s single largest grower and exporter of soybeans, run out of beans this summer?    
“The answer to that rests on how many more soybeans China sources from the U.S.,” said Rich Feltes, senior vice president at MF Global Research. “Are they going to defer old crop to new crop, whether or not they have cancellations?” 
   
China, the world’s largest soy importer, has been buying soybeans at a record pace this season to meet both its domestic crushing needs and build its state reserves. According to the latest customs figures issued just last week, China’s soy imports in the first five months of the year rose 27 percent from a year ago to 17.38 million tonnes, with most of those sourced from the United States.
    
More than half of U.S. soy exports are headed to China this season. In fact, U.S. soy exports are now just shy of USDA’s full-season projection with 2-1/2 months left to go before harvest. China’s competition is squeezing U.S. processors so much some may have to shut down at a time of soaring meal and oil prices, having run out of beans. Unless, of course, China eases its red-hot import pace. 
    
Traders said that may be happening. USDA’s weekly export report on Thursday reported China canceled a purchase of 55,000 tonnes of soybeans for this season. “Unknown destinations,” a category that traders often assume is China, also canceled 73,500 tonnes — while booking 226,500 tonnes for delivery in the new season starting Sept. 1.
   
“This is exactly what has to happen,” said Roy Huckabay, an analyst at The Linn Group in Chicago. “You have to do something to stretch the remaining supplies. We can’t run out.” 
   
SOYMEAL PRICES DRIVING THE CRUSH 
The last thing processors want right now is to run out. 
Hugely profitable crush margins — near $1 a bushel in central Illinois last week, versus 84 cents a year ago — have processors Cargill, ADM and Bunge churning out meal and oil. 
   
Soymeal prices have risen above $400 a ton for the first time since July 2008. If the 2003/04 marketing season is any indication, traders could be in for wild ride this summer as the poker game between domestic processors and Chinese importers plays out. In 2004, U.S. soybean stocks slipped to 112 million bushels after a short crop in 2003. 
   
In 2009, the tug of war for beans is widening the July/Nov. soybean spread — with July rising to $1.94 a bushel last week over November, its largest in this marketing year. So more volatility is expected during the coming week and through July 14 when CBOT July soybeans go off the board. 
   
“As we get closer and closer to July delivery and fewer people in that spread, it has the potential to go really ballistic,” one cash-connected CBOT trader said.

PHOTO: Newly emerged corn in north central Illinois.

Given the roller-coaster ride in Chicago grains last week as the dollar fell and rose, more volatility is likely in the coming week as investors weigh the health of the economy with the weather outside. Added to the mix will be the U.S. Department of Agriculture’s updated forecasts for the amount of grain and oilseeds left in storage bins this fall and a year from now. 
 
“Last week has shown us the dramatic impact the dollar and crude has had on our markets. We’ll continue to watch those markets very carefully,” said Rich Feltes, senior vice president at MF Global Research. 
 
As the dollar sank to its lowest level in 2009 on optimism the global economy is on the road to recovery, managed money flowed back into commodities, including the grains, rallying corn, soybeans and wheat to eight-month highs.  Demand for dollar-denominated commodities usually rises as the dollar falls. On the flip side, when the dollar rebounded on Friday, grain prices sank back on profit-taking. 
   
In the days ahead, aside from the dollar and other “outside” markets like Wall Street equities that will reflect sentiment about overall economic demand, grain traders will be focused on USDA’s monthly supply-and-demand report to be issued on Wednesday morning at 8:30 a.m. EDT. 
 
Analysts polled by Reuters expected the government to trim its key numbers: projected end-season stockpiles for soybeans and corn. Given strong export demand over the past month, U.S. soy stocks could slip near 100 million bushels, the lowest supply seen since August 1977, before the new harvest. 
 
MOTHER NATURE ADDS PREMIUM TO CBOT GRAINS
Dryness in the northwestern Corn Belt — Minnesota, South Dakota, northern Nebraska — coupled with constant rains in the southeastern Corn Belt remain supportive to Chicago Board of Trade grains as farmers struggle to get their new crop seeded and established. 
 
The biggest worry is the shrinking window to plant corn in two key states — Illinois and Indiana — putting at least a million acres of expected corn production into a possible last-minute switch to soybeans, a faster maturing crop. 
 
Those two states, which produce a quarter of the American corn crop, had some 3.4 million acres of corn yet to plant last week at a time when all seedings are usually complete. Southern areas of the states were the furthest behind. USDA will issue its next crop progress report Monday afternoon.
“Agronomically, farmers can plant corn in the southern part of the state until the end of the month. But we know that corn planted that late simply has a lower yield potential,” said Bob Nielsen, extension agronomist at Purdue University in Indiana.
 
Farmers are now also bumping up against crop insurance deadlines, raising the stakes to make a firm decision. In Illinois and Indiana, June 5 was the deadline for farmers to decide whether to cash in full value on their insurance, plant corn, or switch to soybeans. Soybean farmers have until June 20.
 
The northern Plains is another worry, plagued not only by saturated fields after spring floods but chilly temperatures, dipping to below freezing in recent days. That could mean replanting as well as lost acreage for the year.
Photo: Newly emerged corn in field near Gilman, Illlinois.

From the start, "green shoots of recovery" was not necessarily the British government's wisest choice of words and after a few months of being on everyone's lips, has given way to a more lowly metaphor.
Business Minister Baroness Vadera raised the hackles of the political opposition in January when she spotted "a few green shoots" on a day of large-scale job losses and collapsing share prices.
Evidence of economic revival is still elusive, but there are ever louder hints that we have at least seen the worst -- or bottomed, to use the mot du jour.
Bottom as a noun and a verb was widely brandished by speakers attending Reuters Global Energy Summit this week, who based on their analysis on a slight increase in available credit, a tentative pick up in energy demand and rising commodity prices.
OPEC Secretary General Abdullah al-Badri has an interest in spotting the kind of confidence that has driven oil prices up from a low below $35 a barrel in December to almost double that.
"I have no doubt that the recession has bottomed out, but is it a V shape or a U shape?" he asked during a Reuters summit session.
Others were less convinced and the most bearish of them all was a representative of the very oversupplied tanker market, where freight rates have sunk to their lowest levels in decades, with not a green shoot in sight.
"We have seen lower than the bottom," said Erik Ranheim, a manager at oil tanker association Intertanko.

Policitians are often scared to use the "R" word, because a recession makes them unpopular. Investment bankers dislike the "R" word too, but in this case it stands for regulation.
Regulation and lots of it is being cooked up in Washington and Brussels in response to the excessive risk-taking that helped bring on the credit crisis.
Credit derivatives are in the firing line as the bad guys of the credit crisis and derivatives in energy and commodities could get caught in the cross-fire.
Oil could also take a hit after rampant speculation was blamed for driving the price to a record of nearly $150 a barrel last year.
Although the quest to get rid of excesses is driven by good intentions, industry insiders say there will be unintended consequences and argue the regulators could have underestimated the difficulty of their task.
"It's not easy to bring back the genie into the bottle," Libya's top oil official Shokri Ghanem told the Reuters Global Energy Summit.

Interesting take on the rise in commodity prices from Julian Jessop, chief international economist at Capital Economics. The rise has little to do with the weaker dollar and everything to do with expectations of global economic recovery, he says.

The broad-based revival in commodity prices since March clearly reflects a combination of factors. One of these is the pure accounting effect of the depreciation of the dollar. Other things being equal, a fall in the U.S. currency will of course put upward pressure on commodity prices when measured in dollar terms - commodity producers with bills to pay in other currencies such as euros and pounds will require a higher price in dollars, while consumers outside the dollar bloc will be more able to pay that higher price. However, the movements in currencies have generally been small compared to the underlying movements in commodity prices.

Looking closely at the relative performance of different commodities, Jessop reckons the rally has primarily been led by oil and industrial metals, which are the most sensitive to the economic cycle. Inflation-driven commodities such as precious metals, including gold, have underperformed in the rally, he says.

Jessop takes all this to mean that higher commodity prices are just another manifestation of the growth in confidence about the global economic outlook. However, echoing investors who increasingly want to see concrete evidence, he warns that the anticipated pick-up in growth-based demand has yet to actually materialise.

Is it all just an illusion, then? Wishful thinking that allows for a rebuilding of depleted stocks?

Tullow Oil is the Manchester United of the energy world -- at least when it comes to recruiting the finest talent.
The oil industry has long complained of the difficulty of recruiting enough highly-qualified staff, but as Europe's largest independent oil explorer by market value, Tullow says it is a magnet for all those geologists ambitious to add discovering a new field to their CVs.
"If you are successful, you will always attract... like everyone wants to play for Manchester United," Aidan Heavey, chief executive of Tullow Oil, told the Reuters Global Energy Summit.
Many oil companies, he said, have ceased exploring, partly because of a difficult financial climate, partly because of a lack of opportunities.
Tullow's exploration successes include major finds in Uganda and offshore Ghana.
Apart from snapping up the finest geologists, Tullow has also been busy grabbing credit. Heavey said banks had made available $2 billion in credit in March this year.
"It's a huge achievement in the current market," Heavey said. "It's probably soaked up most of the credit available for small oil companies."

The United States may fondly dream of independence from imported oil, but it would do well to remember that the traffic is not one way.
OPEC Secretary General Abdullah al-Badri told the Reuters Global Energy Summit he had been hearing for years that the world's biggest oil consumer was seeking ways to avoid importing OPEC oil, but he was confident it would carry on burning fossil fuel for years to come.
"I am of an age when I can tell you I have been hearing this for the last 40 years," Badri said. "We will see another president, with two terms, before we see any change."
He also warned the U.S. it should be careful what it wished for.
"We would like to tell them they buy most of the resources of our member countries. We are sending them back more than 50 percent of that income to OECD countries, and the U.S. is one of them, to buy medicine, equipment, aeroplanes, spare parts, clothes."
"Don't forget the medicine," he added.

It’s crunch time for corn.

Grain traders are anxiously waiting USDA’s weekly crop progress report late Monday as it will tell the story of how U.S. corn was planted this season.

As of May 24, American farmers still had 15 million corn acres of a projected 85 million yet to plant as heavy spring rains in the eastern Corn Belt delayed planting by at least 10 days to two weeks in many areas. Midwest acres seeded after mid-May usually lose more than a bushel a day on yield.

“Analysts are wondering how many of the remaining 15 million acres will be planted to soybeans rather than corn,” Mike Woolverton, Kansas State University grain economist, said in his weekly newsletter. 

“The consensus guess is one million acres if it immediately stops raining in the eastern Corn Belt and Mid-south; up to two million acres if it stays wet,” he said. 

Midwest farmers are also bumping up against planting deadlines in their crop insurance plans. In Illinois — the No. 2 corn producer following Iowa and among the eastern Corn Belt states struggling the most — farmers have until June 5 to decide whether or not they are going to plant corn or cash-in on their insurance. 

Soybeans are also lagging. 

There were some 13 million acres of U.S. soybeans that should be in the ground that were not as of May 24, analysts said. The biggest concern was the amount of unseeded acres in the southern Midwest — an area that typically produces the first beans of season to relieve old-crop tightness. The good news is that soybeans are a quicker maturing crop so farmers still have some breathing room. Insurance plant dates range from June 15 to June 20 in the Midwest.

But the wettest region of U.S. crop belt is surely the Northern Plains, an area plagued by spring flooding and cool temperatures. North Dakota is particularly wet, which is also the top producer of the high-protein wheat that millers and exporters will pay high premiums for.

“The underlying threat to production from loss of acreage is real. The market is roughly penciling in a half million to three-quarter million acres of spring wheat in the U.S. as lost,” said Tim Emslie, analyst for Country Hedging in Minneapolis. 

The bottom line is that these late planting dates will mean tighter supplies of U.S. crops in the coming year, a worry as the United States is the largest food exporter.

Traders expect corn seeding at 93 percent, versus the 5-year average of 98 percent by June 1, and soybeans at 65-75 percent, compared to typical pace of roughly 80 percent. Monday will also be the government’s first word on the condition ratings of the just-seeded 2009 corn crop.