Unstructured Finance

U.S. grain traders turn focus to South America

November 30, 2008

Now that the U.S. harvest is over Chicago grain traders have turned their attention to South America where farmers are busy planting corn and soybeans.
    Argentina and Brazil toppled the United States a few years ago as the top exporters of soybeans, representing 49 percent of the world’s soy trade this past season versus the United States at 40 percent. But Brazilian plantings are expected to be down this year as credit pressures are deterring farmers from planting more.
    The world grain trade is counting on South America to produce big soybean crops this season — taking up some of the slack from the United States where soy stocks have slipped to historically low levels given strong demand and a short crop in 2007.
    Dryness in Argentina raised crop concerns and underpinned Chicago Board of Trade grain and oilseed prices early last week. But as the No. 3 soy exporter saw scattered rains, worries eased and the focus turned to southern Brazil.
    Parana and Rio Grande do Sul, the second and third largest Brazilian soy states, are the driest. Both are expected to see light, scattered showers by Tuesday.
    “That rain next week is going to be an important event,” said Mike Palmerino, DTN Meteorlogix forecaster.
    While South America needs rain, Australia is for once struggling with too much. Farmers are trying to put away this year’s wheat crop but constant rains have stalled their efforts and likely reducing the quality of the crop.
    More poor quality wheat will only add to already big global supplies of feed wheat, which is cutting into demand for U.S. corn. Export sales of corn have been under 500,000 tonnes for the past five weeks and off to their slowest pace since 2002. U.S. corn exports last season totaled nearly 62 million tonnes, or 65 percent of the global corn exports.
    The final U.S. government supply-and-demand report of the year will be issued on Dec. 11, with many analysts expecting USDA to shave its 2008/09 U.S. corn export figure to reflect the slowed pace. But traders will have to wait until USDA’s Jan. 12 crop report for final 2008 production numbers.
    While the supply outlook is having a little more play on CBOT prices, the global economic slowdown is hurting employment and food spending and will undoubtedly continue to loom over the markets.
    Grains and oilseeds have traded sideways for weeks as investors moved to the sidelines, unwilling to take on fresh  positions. Cash grain traders are also still finding it tough to finance purchases from farmers amid continued tight or frozen credit markets.
    “We are in the de-leveraging process,” one CBOT cash-connected trader said this week. “No reason to think that will change before year’s end, especially as the markets move into their annual slow holiday period.”
    But grain traders in the coming week will still keep an eye on Wall Street for economic signs.
    Weekend retail sales following the U.S. Thanksgiving holiday, typically the biggest shopping period of the year will be one key economic indicator. More critical will be the government’s November jobs report, issued on Friday, which will likely provide more evidence of a deep economic downturn and possible additional interest rate cuts, which grain traders always welcome.

An American Girl Christmas?

November 30, 2008

Los Angeles shoppers weren’t in much of a splurging mood, except when it came to buying dolls and doll clothes at American Girl. The Grove shopping center is home to one of six American Girl stores in the United States and parents said its dolls are on every girl’s wish list. Here’s what we captured on camera:

Recession Sells: Chicago’s dinosaurs

November 29, 2008

On Chicago’s State Street, I found these dinosaurs creeping up on a Christmas tree at the FAO Schwarz section inside Macy’s:

Shoppers’ High Anxiety

November 29, 2008

As we talk to more and more shoppers over the holiday weekend, the high level of personal anxiety over the future of the economy comes into focus. We have read, and written about, the numbers on consumer confidence and retail sales performance, but these quotes give us a more individual view. Below are some of the ways in which people described for reporters Aarthi Sivaraman and Ben Klayman their fears, or even a change in attitude, regarding money, jobs and family.

Recession Sells: Brooklyn style

November 29, 2008

Every city has it’s way of dealing with recession. In Brooklyn, where “going out of business” sales may seem like a marketing tactic employed in good and bad times, it looks like shops are dead serious now. And they are getting more creative. We liked the VIP gift bag and the one-year deferred financing, photos via our own Martinne Geller:

Bank crunch hits end-of-year festivities – oh, and more jobs

November 28, 2008

Ahh, just when you could use a stiff drink on the company’s tab to kill the sobering mood wrought by this year’s financial carnage, you find out you’ll be coughing up for the bill yourself at the annual holiday shindig. Such is the case for scores of London’s financial workers. As Reuters’ Olesya Dmitracova reports, employees at some of the biggest names in town – Goldman Sachs, BNP Paribas, Barclays and so on – will be on the hook for their own year-end parties. A reasonable cost-cutting measure, it seems, during these often unreasonable times. Too bad, though, for those who get stuck drinking swill should their annual bonus get slashed too.

“High School Musical” — On the cheap

November 28, 2008

Wal-Mart wasn’t the only place where people waited hours in line to get special Black Friday deals. More than 100 Disney Stores opened at midnight, drawing parents in droves.

Job Bank – Nov. 28

November 28, 2008

The following financial services industry appointment was announced on Nov. 28, linked where possible to personal profiles on LinkedIn. To inform us of other job changes, please e-mail moves@thomsonreuters.com.

Neuberger action moves to court

November 28, 2008

The sale of the Neuberger asset management arm of Lehman might have been agreed back in September, but it’s not quite a done deal.

Shopping for Black Friday deals at bankrupt retailers

November 28, 2008

Our own Emily Chasan visited two bankrupt retailers — Circuit City and Tweeter etc– in Burlington, Massachusetts, on Black Friday. She sent photos and this report: