GLG News by Sugar Experts

Philip CorzineGeneral ManagerSouth American Soy LLC

Agricultural fertilizer will remain in a demand-driven up-swing for the short-term

December 31, 2007

Analysis of:Potash Corporation: The Best Value in Agriculture Stocks Today | seekingalpha.com

Demand from the biofuels industry, not feed-based demand, is driving the rally in the commodities markets.  Soybean prices have been high before, but high prices will eventually "fix" the supply shortage concerns.  The weak US Dollar vs. the Brazilian Real is also one reason behind the high commodity prices, but with current prices, and assuming the Brazilian Real holds near its current level, Brazil may start to "fill the gap" on world soy production in the next 12 months.  What happens in the biofuels industry here in the US is probably "the" key factor in predicting where commodity prices will be headed over the next 12-24 months.

Philip CorzineGeneral ManagerSouth American Soy LLC

Past expansions in acreage in Brazil are just the tip of the iceberg

December 31, 2007

Analysis of:Brazil's Cropland Grows by 83.5% Over 1996-2006 | soyatech.com

The expansion in planted area in Brazil over the past ten years is impressive, but the potential exists to add 300-400 million more "new" acres in that country.  The expansion has been held back by low domestic prices for soy, but that may be coming to an end.  Prices for soy in Tocantins are only five Reals per sac below what we sold for in 2003, and there is now, the opportunity to turn a profit again in this sector.  If conditions, ie: the exchange rate and soy prices on the CBOT, hold, we should expect a significant expansion in soy area in Brazil for the crop to be planted in the third quarter of 2008.

Philip CorzineGeneral ManagerSouth American Soy LLC

Monsanto continues to do the right things to extend their lead in the race for market share.

December 31, 2007

Analysis of:Seed Controversy Sprouts: Some Say USDA's Insurance Break for Monsanto Customers Unfair | soyatech.com

A couple of dollars per acre might not seem like a lot of money, but on US operations that can cover several thousand acres, it can add up to several thousand dollars per year, and all for buying a product that they have already found to be a good investment for their operations.  So although it seems small, it points out a company that is continuing to do all the right things, to command significant market share in the race to supply seed genetics to agricultural producers.

Gary DrimmerChief Executive OfficerWorld Ag Associates LLC

Energy and Farm Bills Renew Renewable Fuel Enthusiasm and Stocks

December 17, 2007

Analysis of:Alternative energy shares rally after Senate passes scaled-back energy bill | money.cnn.com

Many ethanol and biofuel stocks, along with the overall alternative energy sector took a nice bounce after the Senate passed its energy bill. Farm bill also has finally been passed and both will need working before being sent to the President, who might just not sign them. Corn ethanol stocks have been hurting this year as corn prices were rising and ethanol prices were dropping as the outlook for inventories and production of the two were going in opposite  directions.  With a 15 billion gallon a year mandate for corn to ethanol use by 2022, it does not appear that corn to ethanol has room to expand much beyond plants that are in production and under construction. Cellulosic ethanol has additional monetary incentives under both bills as well as a 21 billion a year mandate for use by 2022 (including other alternative liquid fuels such as biodiesel). These fuels have a longer road to becoming economical.

Gary DrimmerChief Executive OfficerWorld Ag Associates LLC

Food Prices Rising- Corn, Soybean and Wheat Prices Are Ready to Set Record Prices in 2008-

December 13, 2007

Analysis of:PRICES FOR 2008 CROPS MOVE TO NEW HIGHS | www.farmdoc.uiuc.edu

There has been a paradyne shift in commodity prices. It is hard to think of a return to $20 a barrel oil. In the same way grain and oilseed prices are now at a new level as demand has grown and will outstrip supplies for the next few years. Higher prices and possibly new record prices are likely in 2008. Biofuels and growth in food demand have driven down inventories and weather around the world (with the exception of North America so far) has also contributed to reduced supplies. The latest USDA ending inventory estimates for the current crop year show how tight things are in the US and the rest of the world. Wheat inventories in the US will be the lowest in the past 60 years. Now that is scary.

Gary DrimmerChief Executive OfficerWorld Ag Associates LLC

Corn, Soybean and Wheat Prices Are Ready to Set Record Prices in 2008- Impact on Food Prices

December 12, 2007

Analysis of:PRICES FOR 2008 CROPS MOVE TO NEW HIGHS | www.farmdoc.uiuc.edu

There has been a paradyn shift in commodity prices. It is hard to think of a return to $20 a barrel oil. In the same way grain and oilseed prices are now at a new level as demand has grown and will outstrip supplies for the next few years. Higher prices and possibly new record prices are likely in 2008. Biofuels and growth in food demand have driven down inventories and weather around the world (with the exception of North America so far) has also contributed to reduced supplies. The latest USDA eneding inventory estimates for the current crop year show how tight things are in the US and the rest of the world. Wheat inventories in the US will be the lowest in the past 60 years. Now that is scary.

Philip CorzineGeneral ManagerSouth American Soy LLC

Ethanol producers face continued challanges on both costs and revenues.

December 10, 2007

Analysis of:Has The Ethanol Boom Ended? | www.econ.iastate.edu

Lack of infrastructure is creating price-gluts, and low or negative margins for ethanol producers.  This situation could continue for another two years, as improvements in infrastructure struggle to keep up with expansions in production of ethanol.  Corn acreage is already at its highest level since 1944, and with the current price relationships, will have a hard time gaining more acres in the US.  Regardless, expansion of ethanol capacity continues in the US, as there are more plants online, under construction, and in planning stages, than there was just 3 months ago.  Iowa continues on the part to become a "corn deficit state", and basis levels have been turned on their ear all over that state.

Gary DrimmerChief Executive OfficerWorld Ag Associates LLC

Corn ,Soybeans and Wheat Resume Climb of Argentine and Brazilian Weather - How High Can They Go?

December 10, 2007

Analysis of:Oil : Oil futures drop as hopes fade of 0.5% rate cut | www.taipeitimes.com

Argentina is becoming dry, and Brazil could follow. This is pushing soybean up towards record high prices, with corn returning to five month highs. Spring wheat, which is yet to be planted in North America is reaching for the sky as Argentina imposes export controls and Canada confirms a smaller harvest. Major processors and exporters such as Cargill, ADM, Bunge, LDC and Corn Products International might see a drop in their South American profits next year.

Gary DrimmerChief Executive OfficerWorld Ag Associates LLC

Major Jatropha to Biodiesel Project in the Philippines

December 4, 2007

Analysis of: Bionor to invest $200 million in jatropha plantations in the Philippines | biopact.com

What might be the largest single project for jatropha production has just been announced by Bionor in the Philippines. With soy oil prices reaching record high prices and the cry against food to fuel and for sustainable farming, is this the agriculture project of the future? How soon will we see that future?

Philip CorzineGeneral ManagerSouth American Soy LLC

US Farm Programs Need To Focus On Stabilizing, and Stop Subsidizing

November 30, 2007

Analysis of:Editorial: Struggling farm billionaires | www.naplesnews.com

US farm programs have lost their focus, and are providing subsidies to farmers during a year of record incomes.  In addition, a continued focus by the US government on expanding biofuels will do more to stimulate agricultural production in other countries, than it will here in the US.

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