• Bloomberg cited a weather expert as saying that a developing La Nina coupled with planting delays at the start of this season may increase the risk for lower corn and soybean yields in Brazil and Argentina. The possibility of a La Nina has increased, which will bring drier weather to central Brazil and northeast Argentina in the coming three months. La Nina may also increase the risk of a drought in the US Midwest in 2018F.

• Bloomberg also reported that China's COFCO International plans to increase soybean purchases from Mato Grosso, Brazil from 4mil tonnes currently to 7.2mil tonnes in five years' time. Also, COFCO's soybean crushing activities are expected to rise after the acquisition of two soybean processing plants in the state. Additionally, Chinese groups plan to finance the construction of 30 grain terminals in Mato Grosso for 1.5bil reais (US$457.5mil). Grain storage deficit in Mato Grosso is estimated to be 19mil tonnes currently.

• www.agriculture.com quoted a survey from AgRural as saying that Brazilian farmers have planted half of their 2017F/2018F soybean crop. As of last Monday, about 57% of the areas have already been planted compared with 43% in the previous week. Mato Grosso led the pace of plantings in Brazil with 91% of its areas planted with soybeans. However, there are risks. AgRural said that the irregular rainfall in October may have a negative effect on yield productivity in the coming months.

• Provinces in Indonesia have announced their minimum wages for 2018F. On average, theminimum wage rose by 8.7% in 2018F (2017: 8.2%). The minimum wage in Central Kalimantan is Rp2,421,305 (RM748/month) in 2018F vs. Rp2,222,986 in 2017F while that in West Kalimantan is Rp2,046,900 (RM632/month) in 2018F compared with Rp1,883,900 in 2017F. The minimum wage in Jakarta is Rp3,648,035 (RM1,126/month) in 2018F. In Malaysia, the minimum wages are RM1,000/month in Peninsular Malaysia and RM920/month each in Sabah and Sarawak.

• According to the Solvent Extractors Association of India, stocks of edible oils at the major ports in India stood at 884,000 tonnes as at 1 November 2017. This was 9.7% lower than the 979,000 tonnes recorded as at 1 October 2017. At the pipelines, stocks of edible oils amounted to 1.46mil tonnes as at 1 November vs. 1.61mil tonnes as at 1 October. Overall, inventory of edible oils in India declined from 2.589mil tonnes as at 1 October to 2.344mil tonnes as at 1 November 2017.

• Reuters reported that Sawit Sumbermas Sarana has withdrawn a US$300mil bond after a weaker backdrop dampened risk appetite of investors. Investors were said to be more cautious during bookbuilding. A banker said that the issuer was unlikely to return to the bond markets in the near term. Marketing for the bonds started around the 7.25% level. Sawit Sumbermas has 70,603 hectares of oil palm estates in Indonesia.

Source: AmInvest Research - 20 Nov 2017