- Bloomberg reported that PT Provident Agro’s two largest shareholders are exploring a sale of their majority stake in the company. Provident Capital Partners and PT Saratoga Investments may start reaching out to buyers next month. The two shareholders own a combined stake of 88.3% in Provident Agro, which has a market capitalisation of US$339mil (share price of Rp640). Provident Agro has 44,475ha of planted landbank and 110,000ha of total landbank.

- Bloomberg also said that China will be easing pricing controls on corn and soybean. Sources said that China will be managing supply of some agricultural products including corn, soybean, cotton and rapeseed with market indicators while maintaining minimum purchasing prices for rice and wheat. There were no other details on this.

- Also, China’s imports of some agricultural commodities including palm oil have started improving. In June 2015, the country imported the biggest amount of corn in 10 years. Corn imports amounted to 872,928 tonnes in June 2015 compared with 404,102 tonnes in May 2015.

- After falling YoY in almost every month since last year, China’s palm oil imports climbed in May and June 2015. China’s palm oil imports rose by 19.3% YoY in May and 40.8% YoY in June. The country’s palm oil imports fell by 13.6% YoY in 1H2015 compared with 22.2% YoY in 5M2015.

- Bloomberg reported that Indonesia’s palm oil exports may miss the target of 21mil tonnes in 2015F due to the new export levy. There are administrative delays as the government has not given notice of the export levy to some custom offices at the ports.

- Australia’s Bureau of Meteorology said that all key El Nino monitoring areas have had temperatures, which were hotter by one degree Celsius above average in the past 10 weeks. The bureau said that El Nino is likely to strengthen and persist into early-2016F.

- Oil World said that soybean prices may fall below US$9.50/bushel unless US crop conditions deteriorate further. Buyers are expected to switch from US soybean to soybean from South America. As such, market share of US soybean is envisaged to decline in the first few months of the US soybean marketing year.

- In a related development, Bloomberg reported that USDA (US Department of Agriculture) plans to seek a federal disaster declaration to make farmers with flood-damaged crops eligible for assistance. The declaration will allow farmers to be eligible for loans and emergency funding. Illinois registered its wettest June this year. The weather has also been wet in July. More than half of Illinois’ soybean crops are in poor and fair conditions.

Source: AmeSecurities Research - 27 Jul 2015