Wheat in Australia’s top grain growing state became – briefly – the world’s priciest, as expectations for the newly-started harvest took a further hit, and underpinning forecasts of a sharp drop in exports.
A price of Aus$330.00 a tonne hit by Western Australia wheat futures – equivalent to $340.00 a tonne, or $9.25 a bushel – meant the grain "is now the most expensive in the world", Commonwealth Bank of Australia analyst Luke Mathews said.
In fact, a rise in Minneapolis wheat, high protein, in early deals on Wednesday to $9.30 a bushel ($341 a tonne) reaffirmed its place as among the world’s dearest on traded markets, ahead too of the E258.00 ($338) a tonne at which Paris wheat for November was trading, or E256.60 a tonne for January delivery.
The rise in Western Australian wheat prices to some $40 a tonne ahead of the value of east coast supplies came amid fresh market ruminations over the competitiveness of supplies from different origins, as Egypt’s state grain authority flagged a lack of clarity over offers of Black Sea grain.
Ukraine grain traders have stockpiled 540,000 tonnes of wheat for export, in addition to the 3m tonnes shipped already in 2012-13, for fear of government trade curbs to protect domestic supplies, Kiev-based consultancy ProAgro said.
‘Declining production prospects’
However, prices of Western Australian wheat are being elevated by ideas of further yield damage to dry weather, after key early-October period which represented the last chance for crop revival passed without the rains needed to boost grain fill.
"The strength in Western Australian wheat is related to declining production prospects," Mr Mathews said.
"Minimal rainfall has been recorded through the Western Australian wheatbelt in October, resulting in further reductions in yield potentials."
Some analysts "are now talking about a 5.5m-6.0m tonne Western Australian wheat crop", well below the CBA forecast of 7m tonnes, and the 11.7m tonnes achieved last year, he added.
‘Yield estimates reduced’
A harvest at the lower levels being suggested would likely see Western Australia surrender its title as the country’s top wheat growing state, with the New South Wales crop pegged by state officials at 6.88m tonnes.
And the weakening harvest prospects, and high prices, come at a time of lowered expectations for Australia’s wheat exports in the newly-started 2012-13 season, with the US Department of Agriculture last week slashing its estimate to 18.0m tonnes, a 28% drop year on year.
Separately, ideas of further damage to Western Australian crops were supported by a 45,000-tonne downgrade, to 860,500 tonnes, by the Australian Oilseeds Federation to its estimate for the state’s canola harvest.
"While crops in the north have fared better than initially anticipated, crops in the southern areas have had yield estimates reduced," thanks to "poor" rains, the federation said.
The group made a small upgrade, to 2.74m tonnes, in its estimate of the total Australian crop, reflecting "well-needed rains" in many areas.
Statistics: Posted by yoda — Wed Oct 17, 2012 11:58 am
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Latest wave of financial industry cuts could eliminate 21,000 jobs, rivaling the financial crisis.
FORTUNE –Perhaps the only thing more broken than Wall Street’s business model is its staffing strategy.
After adding thousands bankers in the past two years, financial firms again appear to be on the verge of cutting that many positions and then some. Consultants and Wall Street recruiters say banks could eliminate nearly 21,000 jobs from their securities divisions in New York alone. Worldwide cuts could be even larger. Recruiters say big banks are in the process of finalizing their downsizing plans, and that layoffs could start soon.
The latest round of job cuts could rival those that happened during the financial crisis. Back then, which was less than four years ago, Wall Street eliminated 28,000 positions. But that round of downsizing included the collapse of Bear Stearns and Lehman Brothers, and the biggest crisis in the financial markets since the Great Depression. By comparison, the stock market is up this year, and just last week banks reported better than expected earnings for the first quarter. What’s more, at the same time large firms are firing, many smaller investment banks have been staffing up. As a result, overall employment on Wall Street might not drop as much as it did after the financial crisis.
"Hiring is going on, it’s just not by the big banks," says a top Wall Street recruiter Gary Goldstein, who runs Whitney Partners.
Nonetheless, consultants say the big Wall Street firms are coming to the conclusion that they have more workers than they need. Last week, Boston Consulting Group released a report that predicted banks would eliminate 12% of their workforce in the "short-term." Recruiters say those numbers sound similar to what they are hearing from the large firms.
"The estimate is possibly low," says veteran financial industry recruiter Steve Potter at Odgers Berndtson. Potter says not only are the firms competing for few deals, but with their clients. More and more large firms are adding investment bankers to their staffs to save on Wall Street fees. "Large layoffs are a virtual certainty."
Perhaps the biggest problem at the banks is that they didn’t cut enough jobs last time around. Mergers and acquisition activity also has not bounced back as expected, leaving a number of high paid bankers idle. What’s more, new regulations appear to already be significantly curtailing the banks’ trading operations. Also weighing on the banks is the fact that debt watchers Moody’s and Standard & Poors say they are likely to soon downgrade the bond ratings of the firms. The nation’s five largest banks have estimated that the downgrades could cost them $22 billion in additional costs or collateral requirements.
"There hasn’t been enough action on the cost front to keep up with the revenue short falls," says Chandy Chandrashekhar, a partner at BCG who helped to produce the recent report. And unlike other rounds of layoffs, Chandrashekhar says many of the people who lose their jobs this time around could be senior bankers. For those that remain, compensation is likely to be down this year as well. In all, BCG expects Wall Street compensation expenditures to drop by as much as 30%. "Banks need to revisit whether they need all of their management layers."
Recruiters say one of the firms likely to cut the most is Credit Suisse. The firm’s investment banking division has struggled recently. Last year, Credit Suisse said that it plans to eliminate 3,500 jobs, across the whole bank, not just its Wall Street business. About 2,000 of those job cuts have already been completed. Sources say a majority of the remaining cuts will come from the firm’s investment bank, and that the bank may end up cutting more workers than earlier announced. Credit Suisse declined to comment.
Other firms that sources say are likely to make deep job cuts in their investment banking divisions are Bank of America, which bought Merrill Lynch during the financial crisis, and Barclays, which acquired the U.S. investment banking division of Lehman Brothers out of bankruptcy. But recruiters say that all of the big banks, including Goldman Sachs, appear to be on the verge of making cutbacks.
"Banks haven’t come up with a model that makes up the profits they used to get from propriety trading, CDOs and other structure deals they used to do," says Goldstein. "I have heard about a lot of people who didn’t get the promotions they were expecting. That’s usually a sign that banks are getting ready to get rid of people."
Statistics: Posted by yoda — Mon Apr 30, 2012 6:18 am
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As foreign drug companies began cutting high-paying jobs in Quebec in recent years, Sandoz International GmbH looked like it was bucking the trend.
After paying $565-million for Quebec generic drug maker Sabex Holdings in 2004, Sandoz, a division of Swiss pharma giant Novartis International AG (NVS-N56.59-0.02-0.04%), was positioned to become a leader in one of the fastest-growing areas in the global pharma business: generic injectable drugs.
It invested close to $100-million between 2007 and 2009 to build new facilities at Sandoz Canada’s base in Boucherville, Que. and made the plant, home to 800 workers, a “worldwide centre of excellence for injectable products” within Sandoz.
Today, Sandoz Canada’s reputation lies in tatters after chronic problems at its state-of-the-art plant on Montreal’s south shore caught the eye of U.S. regulators. Much of its production is halted as it tries to fix the problems, leaving pharmacists and health-care providers alarmed at what could be months of shortages of injectable medications that treat everything from nausea among cancer patients and abnormal heart rhythms to endometrioisis.
Last week, Sandoz told Canadian health-care providers it would discontinue certain products and temporarily suspend production of other injectable products on the heels of a scathing “warning letter” from the U.S. Food and Drug Administration three months ago that criticized the plant’s “ineffective quality system.”
“As we progress with our remediation activities, all production processes will be affected, significantly reducing output from our Boucherville plant and likely resulting in temporary supply disruptions,” Sandoz Canada president Michel Robidoux said in a Feb. 16 letter to pharmacists, obtained by The Globe and Mail. He didn’t specify how long the disruption would last, but that Sandoz Canada would focus on “optimizing” supplies of medically necessary drugs to the Canadian market and had halted production of ointments, ophthalmics, suppositories and all non-medically necessary drugs.
The FDA’s Nov. 18, 2011 letter to Novartis CEO Joseph Jimenez – which came a year after Sandoz began a company-wide quality improvement program – accused the Boucherville plant of sloppy, error-prone or incomplete documentation, validation and investigation practices. In three investigations during 2011, the FDA found Sandoz did not follow proper procedures “to prevent microbiological contamination of drug products purporting to be sterile,” nor had it thoroughly investigated “inconsistent and inaccurate” media fill tests, or simulated procedures drug companies carry out to ensure their normal manufacturing conditions are sound.
The FDA alleged Sandoz failed to adequately investigate after crystals appeared in some of its finished injectable liquid treatments released for distribution in the US – and that it “failed to adequately determine the cause of this crystallization problem.”
Furthermore, the company repeatedly failed to provide field alert reports that would have alerted the FDA to any contamination or related issues within the required three days. “We remind you that you are responsible for ensuring that your firm’s drug manufacturing operations comply with applicable requirements,” the FDA said, threatening to withhold approval of any new drug applications.
In a tightly-scripted statement to The Globe and Mail, Sandoz Canada said it was intensifying efforts “to ensure high quality standards” and stood behind the safety and efficacy of its products, none of which have been recalled. It said the decision to halt production was voluntary and related to efforts to restore “high quality standards in manufacturing operations” and said it had no plans to close the Boucherville plant. Sandoz didn’t respond to questions about how the problems developed or why they weren’t dealt with to the FDA’s satisfaction after they were first identified.
In total, Sandoz said it had committed a total of over $170-million (U.S.) to improve quality at the Boucherville plant as well as two other plants in Colorado and North Carolina that were also cited in the FDA letter. Sandoz said those “remediation” efforts were already under way when it received the FDA letter
Statistics: Posted by yoda — Sun Feb 19, 2012 8:27 am
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