Tag Archives: funds
Agriculture Funds Ponder The 14 Billion Bushel Question
By: Jonathan Boyd 05 Aug 2013 Latest projections that the US will have its first ever 14 billion bushel harvest of corn in 2013 has helped drive prices on the Chicago Board of Trade exchange to their lowest since November 2010. The price fall comes as organisations such as the International Grains Council confirm that this year will see a sharp rebound in output of crops such as corn and wheat in the Northern Hemisphere, following a poor harvest in 2012. Globally, this recovery means that the world’s overall corn harvest should be high this year, ensuring a level of supply that is currently pushing down prices for forward delivery. One bushel of corn is 56lbs, or 25.4kg. According to the International Grains Council: – With record crops expected in the US, China, and Ukraine, world production is forecast to increase by 10% y/y in 2013/14 – As consumption is seen rising by 5% y/y, world stocks will be rebuilt in 2013/14, with inventories in the four main exporters forecast at a nine-year high – Global trade is forecast at a six-year high, with China a much larger buyer, but is unlikely to match the 2007/08 record as good crop prospects in some countries will cap overall import needs. Reviewing data from FE for products that invest in agriculture, some 281 funds are identified. Stripping out specialist products that invest in hogs, wheat, soybeans, sugar or other non-corn soft commodities, leaves some 219 funds. Reviewing these over a three-year period it is clear that corn has delivered some solid positive returns through products such as UBS CMCI Corn (up about 52%), ETFS Daily Leveraged Corn (50%), Source S&P GSCI Corn Total Return (43%), and ETFS Corn (40%). However, in the short term it is clear that the asset has lost pace: their respective 3-month returns are -15%, -33%, -17% and -17%. Leveraged corn has, in other words, done worst in the past few months, reflecting the downward price trend. Corn versus broader agriculture 1m 3m 6m 1yr 3yr 5yr 10yr UBS CMCI Corn USD in US -6.78 -15.47 -23.00 -28.35 52.60 ETFS Daily Leveraged Corn in EU -18.32 -33.46 -42.80 -58.87 45.90 -76.64 Source S&P GSCI Corn Total Return in US -8.71 -17.25 -23.87 -30.61 43.40 ETFS Corn USD in US -8.62 -17.09 -23.73 -30.35 40.14 -28.40 ETFS Leveraged Corn USD in US -17.20 -32.37 -46.86 -55.55 38.29 -74.93 Robeco SAM Sustainable Agribusiness Equities D EUR in EU 1.29 -1.29 2.36 8.10 28.31 CFS Wholesale Global Soft Commodity Share TR in AU 3.19 9.17 8.14 27.31 28.29 First State Global Agribusiness A GBP Acc in GB 0.75 -2.19 -2.69 10.18 28.25 KBI Inst Agri A EUR in EU -2.49 -8.63 -6.32 -1.70 28.17 34.11 Allianz Global Agricultural Trends AT USD in US 3.93 -0.75 -9.73 1.44 24.62 -3.29 Birla Sun Life Commodities Equities Global Agri Ret Gth in IN 0.23 2.41 -4.05 3.91 23.61 BlackRock Global Funds World Agriculture A2 USD in US 0.25 -1.32 -6.57 4.92 23.07 Skandia USD Allianz Global Agricultural Trends USD in US 2.48 -4.07 -11.39 -1.67 22.77 Source: FE Continue reading
France May Redirect Carbon Revenues To Power-Hungry Firms
Reuters 26/06/13 France is considering switching its use of revenues raised from carbon permit auctions next year, possibly giving funds to large, energy-intensive companies as Germany already does, sources with knowledge of the matter have told Reuters. France currently allocates its portion of revenues from the sale of European Union permits to the insulation of homes, but sources have told Reuters that may change in 2014. One source said the government is weighing the idea of compensation for such companies and noted the government’s emphasis on helping France’s struggling industrial champions. “The government said it will not compensate (costs for energy-intensive companies) in 2013, but did not rule out anything from 2014,” a second source said. Such state aid for companies is permitted under EU rules aimed at preventing so-called “carbon leakage”, or the outsourcing of activities and jobs to avoid CO2 taxes. Finance Ministry data shows there are 520 “sites” in France which qualify as electricity-intensive and therefore would qualify for the funds. Based on current carbon prices, revenues from permit sales in France would amount to about €300 million, Reuters calculations show. Germany currently uses part of the revenues from carbon permit sales to help energy-intensive companies. German government data shows that over 2,200 firms benefit. The carbon-derived payments must go into energy efficiency measures. The German government also offers such companies exemptions from network fee payments and from renewables support. France’s energy-intensive companies, such as Air Liquide , pay 30 per cent more for power than their German peers, reflecting both the refunds on permit sales and other exemptions, according to Uniden, the French union of energy-using industries. Power for delivery next year currently costs €37.50 ($53) a megawatt hour in Germany and €42.0 in France. Rio Tinto’s Saint-Jean-de-Maurienne aluminium plant in the French Alps is one plant threatened with closure because of high energy costs. Its 30-year electricity contract with French utility EDF expires in 2014 and its bill will rise as it catches up with current market prices. European power producers, among Europe’s main polluters, from this year have had to buy carbon permits in auctions under a scheme meant to reduce European carbon emissions. Continue reading
Agriculture Minister: 5 bln Euros In EU Funds Effectively Enter Romanian Beneficiaries’ Accounts
Tuesday, May 14, 2013 Romania has so far drawn nearly 5 billion euros worth of the European Union funds earmarked under the National Rural Development Programme, with such money having effectively entered the beneficiaries’ accounts and having been repaid by the European Commission, Minister of Agriculture and Rural Development Daniel Constantin told AGERPRES in an interview on Monday. ‘Last year, the absorption under the National Rural Development Programme amounted to 3.7 billion euros and today it has reached 5 billion euros. We’ve recorded 1.3 billion euros increase over a year and I think it is a significant increase, for only one programme, the more so since the money has been paid the beneficiaries and repaid by the European Commission to Romania’, Constantin stressed. He underscored that his ministry, last year, managed to get an additional 100 million euros, given that the Romanian agriculture was hit by a droughty span and 6 billion lei was injected via the Agriculture Payments Agency. ‘We managed to get an additional 100 million euros to the ministry budget last year, an unprecedented fact since 1989. The Government has proved it is concerned with the agriculture not only when harvesting the crops, there are collections to the budget and we have economic growth. The fact we gave 100 million euros in a year when we did not have a very good crop was a very good signal for me, I think, but for the farmers first and foremost. This year we finalised all the payments via the Payments Agency in only two months, namely March and April, which means there was an inflow of six billion lei to the Romanian farming, although I would say it was to the Romanian economy, because such an amount was invested and bolstered the consumption and also the payment of taxes and duties to the budget. If things look well now, it is also due to the money inflow via the Payments Agency. It is for the first time that the Agency manages to pay all the funds it had available so fast’, Constantin explained. According to figures supplied by the Agency for Rural Development and Fisheries Payments (ADFP), European funds for investment projects amounting to 17.92 billion euros had been claimed by end-April, with around 141,000 projects having been filed. The funds committed via the National Rural Development Programme for the rural area’s development total 5.21 billion euros, while there are as many as 65,193 contracted projects for being financed by EU funds. As much as 4.94 billion euros has entered the beneficiaries’ accounts, with 2.78 billion euros of it being for investment projects and 2.16 billion euros for the compensatory payments made by the ADFP. Continue reading
