Reliance Industries Ltd., India’s biggest company by market value, may add overseas energy assets after doubling its cash to $14 billion through the sale of stakes in domestic oil blocks to BP Plc, investors said.
BP will pay the Mumbai-based energy explorer $7.2 billion for a 30 percent interest in 23 oil and gas areas in India, Reliance Chairman Mukesh Ambani said on a conference call yesterday. Reliance said Jan. 21 it had cash and equivalents of 318.3 billion rupees ($7.1 billion) as of Dec. 31.
Billionaire Ambani and BP Chief Executive Officer Robert Dudley sealed two years of talks with a deal that may increase in size to $20 billion with future performance payments and investment. Reliance committed $3.4 billion to U.S. shale gas projects last year and has said it may buy fields in the Gulf of Mexico and Brazil to hedge the risk of investing in India.
“Reliance will certainly acquire more assets now,” said Taina Erajuuri, who helps manage the equivalent of $1.2 billion of emerging-market stocks, including Reliance shares, at Helsinki-based FIM Asset Management Ltd. “All that cash will come into the balance sheet and give the company that much confidence.”
Shares Gain
Reliance gained 3 percent, the most since Dec. 10, to 984.85 rupees at the close in Mumbai. BP fell 1.1 percent at 10:21 a.m. in London, extending yesterday’s 0.3 percent decline. Reliance’s $1 billion in 4.5 percent bonds due in 2020 rose above 93 cents on the dollar today for the first time since Jan. 28, according to ING Groep NV. The yield fell to 5.427 percent from 5.48 percent, ING prices show.
The investment by BP will accelerate development and production from Reliance’s fields in India, Ambani, the country’s richest man, said yesterday. He didn’t say how the company plans to use the money from the stake sale.
Reliance may get an additional $1.8 billion from London- based BP if the two companies discover more oil or gas in some of the blocks covered by the agreement, according to yesterday’s statements.
The transaction includes a stake in India’s biggest natural gas deposit, the KG-D6 block in the Bay of Bengal, where reduced pressure at the reservoir has forced Reliance to cut production and delayed a plan to reach its peak output. A technical review of the field is under way, Ambani said.
“Reliance is cashing in on assets in India which have been partially explored and production is behind schedule,” said Walter Rossini, who manages $350 million of Indian assets, including Reliance shares, at Aletti Gestielle SGR SpA in Milan. “Maybe Reliance is de-risking its India business and will use the money it gets to buy fields in other parts of the world.”
Refining, Diversification
Declining gas production at the KG-D6 block resulted in Reliance shares rising 0.7 percent in the past year, trailing the 13 percent gain in the Bombay Stock Exchange’s benchmark Sensitive Index. Reliance has the highest weight in the 30-stock index.
Reliance, which operates the world’s largest oil-refining complex, is relying on profits from fuel production to boost earnings and is diversifying its business after delays in increasing gas production.
Crude oil in New York jumped to the highest in more than two years as violence intensified in Libya. Crude for April delivery rose as much as $8.77 to $98.48 a barrel in electronic trading on the New York Mercantile Exchange and was at $98.07 at 8:55 a.m. London time. Reliance is shielded from government controls on fuel prices in India because it exports gasoline and diesel.
Atlas Venture
The company agreed to form a $1.7 billion venture in April with Atlas Energy Inc. to develop gas fields in Pennsylvania. On Jan. 10, Reliance wrote to Atlas’s directors that it was surprised at not being apprised of the negotiations that led to Chevron Corp.’s $3.6 billion offer for the company. Atlas shareholders approved Chevron’s takeover bid Feb. 16.
In addition to acquiring U.S. shale-gas assets, Ambani plans investments in telecommunications and power generation. Reliance has said it wants to bid for 4,000 megawatt power projects the government plans to auction in India, each requiring investments of about 160 billion rupees.
Reliance plans to spend $30 billion on petrochemicals, oil and gas exploration and telecommunications in the five years ending March 2015, said Sandeep Randery, an analyst with Brics Securities Ltd. in Mumbai, citing estimates given by Reliance in an investor conference this month. As much as $4.7 billion may be spent on telecommunications, he said.
Tuesday, February 22, 2011
Monday, February 21, 2011
Prorietary traders seen keen on F&O bets ahead of budget
MUMBAI: Proprietary desks of institutions and well-informed traders are readying bets in futures and options in the run-up to the Union Budget on Monday. While a section of them is sticking to simpler strategies by buying or short-selling stock futures or options of companies that may be impacted by announcements in the Budget, savvier traders, mainly proprietary, are using combinations of options to bet on sharp moves in the benchmark Nifty, either side, around the event.
“Proprietary traders are going long on volatility ahead of the Budget when implied volatility usually rises,” said Shshank Mehta, derivative strategist, Nirmal Bang Securities. Implied volatility, a key aspect of options’ premium pricing and measures traders’ expectations of nearterm risk in the market, usually rises ahead of events such as the Budget or outcome of general elections. This is because traders are willing to pay higher premiums to buy options against sharp movements in the market.
India’s Volatility Index, which indicates the expected volatility in Nifty options over the next 30 days based on prices, rose to 24.91% on Monday, the highest closing since early June 2010, showing traders have been paying higher premiums of late.
“Premiums of near-month contracts usually start dipping in the penultimate week of the expiration of the current month contracts (February in this instance), but March contracts have not seeing such a drop last week,” said Amit Gupta, derivatives strategist, ICICIdirect.
“This means people are buying options even at these premiums as a cushion against shocks in the Budget,” he said Traders, who don’t want to bet on the direction of the market before an event, create options strategies that would benefit from rise or fall in implied volatility, known as volatility or vol trading in market parlance.
Simultaneous purchase of put and call options of the same contract and expiry would bet on an increase in implied volatility. Traders use option combinations to bet on implied volatility, as there are no products for this purpose unlike in developed markets. Traders expect implied volatility to rise up to 27% ahead of the Budget.
“Proprietary desks will remain long on vols at the most till 11:30 on the Budget day when vols are expected to peak,” said Dharam Chand Sethia, a trader at Kolkatabased Kredent Brokerage. Finance Minister starts the Budget speech by 11:00.
“Proprietary traders are going long on volatility ahead of the Budget when implied volatility usually rises,” said Shshank Mehta, derivative strategist, Nirmal Bang Securities. Implied volatility, a key aspect of options’ premium pricing and measures traders’ expectations of nearterm risk in the market, usually rises ahead of events such as the Budget or outcome of general elections. This is because traders are willing to pay higher premiums to buy options against sharp movements in the market.
India’s Volatility Index, which indicates the expected volatility in Nifty options over the next 30 days based on prices, rose to 24.91% on Monday, the highest closing since early June 2010, showing traders have been paying higher premiums of late.
“Premiums of near-month contracts usually start dipping in the penultimate week of the expiration of the current month contracts (February in this instance), but March contracts have not seeing such a drop last week,” said Amit Gupta, derivatives strategist, ICICIdirect.
“This means people are buying options even at these premiums as a cushion against shocks in the Budget,” he said Traders, who don’t want to bet on the direction of the market before an event, create options strategies that would benefit from rise or fall in implied volatility, known as volatility or vol trading in market parlance.
Simultaneous purchase of put and call options of the same contract and expiry would bet on an increase in implied volatility. Traders use option combinations to bet on implied volatility, as there are no products for this purpose unlike in developed markets. Traders expect implied volatility to rise up to 27% ahead of the Budget.
“Proprietary desks will remain long on vols at the most till 11:30 on the Budget day when vols are expected to peak,” said Dharam Chand Sethia, a trader at Kolkatabased Kredent Brokerage. Finance Minister starts the Budget speech by 11:00.
RIL-BP Deal: Analysts may de-rate RIL if value lower than expected
On the face of it, the decision of Reliance Industries to sell a 30% stake in its 23 exploration blocks in India to BP appears to be a great value-unlocking proposition. However, the implied valuation of these exploration blocks appears to be lower than what analysts had assigned to them earlier. If this really turns out to be the case, there is every possibility that analysts could de-rate the company in the near term. Reliance Industries controls 29 exploration & production or E&P blocks in India. The latest research reports put out by leading brokerages have pegged the net value of the domestic exploration portfolio at somewhere between Rs 450 - Rs 500 per share. However, the current deal values 80% of these assets at close to Rs 295 per share.
A report by Goldman Sachs dated Jan 17, 2011 has assigned a value of Rs 509 per share for RIL's exploration portfolio excluding the CBM and shale gas assets. In fact, the KG Basin D6 block alone is valued at Rs 250 per share. In its 21st January 2011 report on the company, brokerage firm Edelweiss assigned Rs 495 per share as value of its firm reserves and exploration upside.
The latest research report by HSBC on RIL is somewhat more conservative. It values the producing KG-D6 block at Rs 203 per share, other E&P blocks at Rs 68 and exploration upside at Rs 111, totalling at Rs 382 per share for assets excluding PMT and shale gas.
Analysts are miffed over the lower valuations, but are unable to explain further, as it was not immediately clear which 23 out of 29 blocks were part of the deal. So the 23 blocks could be predominantly exploratory, rather than in the development phase. Alternatively, the discount could be extended for gaining access to BP's technical expertise.
RIL had cash equivalent of nearly $7.1 billion on its books at the end of December 2010. When adjusted for cash, its net debt was close to $2.6 billion. The company's scrip, which gained 2.5% before this announcement was made, has been underperforming the broader markets for last several months. Since last February, RIL's scrip has lost around 2%, against a 13% gain in BSE Sensex
The deal, no doubt, unlocks a lot of value for the company by bringing in a chunk of cash towards future profits. However, investors should keep in mind the fact that this in itself may not prove to be a positive trigger for the company's scrip. Taken as a benchmark, this deal could lead to analysts lowering the value of the firm's exploration business as well as price targets.
A report by Goldman Sachs dated Jan 17, 2011 has assigned a value of Rs 509 per share for RIL's exploration portfolio excluding the CBM and shale gas assets. In fact, the KG Basin D6 block alone is valued at Rs 250 per share. In its 21st January 2011 report on the company, brokerage firm Edelweiss assigned Rs 495 per share as value of its firm reserves and exploration upside.
The latest research report by HSBC on RIL is somewhat more conservative. It values the producing KG-D6 block at Rs 203 per share, other E&P blocks at Rs 68 and exploration upside at Rs 111, totalling at Rs 382 per share for assets excluding PMT and shale gas.
Analysts are miffed over the lower valuations, but are unable to explain further, as it was not immediately clear which 23 out of 29 blocks were part of the deal. So the 23 blocks could be predominantly exploratory, rather than in the development phase. Alternatively, the discount could be extended for gaining access to BP's technical expertise.
RIL had cash equivalent of nearly $7.1 billion on its books at the end of December 2010. When adjusted for cash, its net debt was close to $2.6 billion. The company's scrip, which gained 2.5% before this announcement was made, has been underperforming the broader markets for last several months. Since last February, RIL's scrip has lost around 2%, against a 13% gain in BSE Sensex
The deal, no doubt, unlocks a lot of value for the company by bringing in a chunk of cash towards future profits. However, investors should keep in mind the fact that this in itself may not prove to be a positive trigger for the company's scrip. Taken as a benchmark, this deal could lead to analysts lowering the value of the firm's exploration business as well as price targets.
BP in $7.2bn partnership with Reliance
BP is to make a $7.2bn thrust into India by taking 30 per cent stakes in vast but difficult natural gas blocks controlled by Mukesh Ambani, the country’s richest tycoon.
The deal with Reliance Industries, potentially worth up to $20bn and subject to government approval, comes on the heels of a $16bn share swap with Rosneft, the Russian state oil company, and marks the latest stage of BP’s recovery since last year’s Gulf of Mexico disaster.
It also represents an endorsement of the prospects for continued rapid expansion of the world’s second-fastest growing major economy.
“This partnership will help unlock the huge potential of India’s vast but under-explored acreages,” Mr Ambani told reporters while unveiling the deal with Bob Dudley, BP chief executive, in London, ahead of a planned signing ceremony at 10 Downing Street with George Osborne, UK chancellor.
The deal is the biggest foreign investment in Indian energy and among the largest in any sector.
It further cements Anglo-Indian business ties, following Vodafone’s $10.7bn purchase of a 67 per cent stake in what became Vodafone Essar, India’s third biggest mobile operator, in 2007.
Mr Ambani, whose energy interests form the backbone of a conglomerate that has made him a fortune estimated by Forbes to be the world’s fourth largest at $29bn, said BP’s technical expertise would “accelerate” exploration.
All 23 blocks lie offshore, mainly off India’s east coast and at depths ranging from 400m to more than 3km.
The Indian group’s current output of 1.8bn cubic feet of gas per day – 40 per cent of India’s gas production – comes from the sole block that is in production.
BP agreed to pay an initial $7.2bn and additional performance-related payments of up $1.8bn. These payments and combined investment could amount to $20bn, the companies said.
“Reliance is a newcomer in this upstream business so it required a more experienced partner that could provide them the technology needed to extract deepwater oil and gas,” said an analyst with a global ratings agency.
The tie-up aims to supply the domestic market, where natural gas accounts for a small but growing share of energy consumption. BP forecasts that demand will more than double over the next 20 years.
The courtship between the two groups goes back five years. Since 2008 BP has operated a 50-50 joint venture with Reliance developing an offshore Indian oil block.
The blocks, covering a surface area the size of New Zealand, have an indicated resource of 15 trillion cubic feet of gas, Mr Dudley said.
Government approval is not necessarily a formality. The deal comes shortly after the Indian government blocked London-listed miner Vedanta’s efforts to buy the Indian assets of Cairn Energy for $9.6bn. BP shares in London closed down 0.7p at 492p.
The deal with Reliance Industries, potentially worth up to $20bn and subject to government approval, comes on the heels of a $16bn share swap with Rosneft, the Russian state oil company, and marks the latest stage of BP’s recovery since last year’s Gulf of Mexico disaster.
It also represents an endorsement of the prospects for continued rapid expansion of the world’s second-fastest growing major economy.
“This partnership will help unlock the huge potential of India’s vast but under-explored acreages,” Mr Ambani told reporters while unveiling the deal with Bob Dudley, BP chief executive, in London, ahead of a planned signing ceremony at 10 Downing Street with George Osborne, UK chancellor.
The deal is the biggest foreign investment in Indian energy and among the largest in any sector.
It further cements Anglo-Indian business ties, following Vodafone’s $10.7bn purchase of a 67 per cent stake in what became Vodafone Essar, India’s third biggest mobile operator, in 2007.
Mr Ambani, whose energy interests form the backbone of a conglomerate that has made him a fortune estimated by Forbes to be the world’s fourth largest at $29bn, said BP’s technical expertise would “accelerate” exploration.
All 23 blocks lie offshore, mainly off India’s east coast and at depths ranging from 400m to more than 3km.
The Indian group’s current output of 1.8bn cubic feet of gas per day – 40 per cent of India’s gas production – comes from the sole block that is in production.
BP agreed to pay an initial $7.2bn and additional performance-related payments of up $1.8bn. These payments and combined investment could amount to $20bn, the companies said.
“Reliance is a newcomer in this upstream business so it required a more experienced partner that could provide them the technology needed to extract deepwater oil and gas,” said an analyst with a global ratings agency.
The tie-up aims to supply the domestic market, where natural gas accounts for a small but growing share of energy consumption. BP forecasts that demand will more than double over the next 20 years.
The courtship between the two groups goes back five years. Since 2008 BP has operated a 50-50 joint venture with Reliance developing an offshore Indian oil block.
The blocks, covering a surface area the size of New Zealand, have an indicated resource of 15 trillion cubic feet of gas, Mr Dudley said.
Government approval is not necessarily a formality. The deal comes shortly after the Indian government blocked London-listed miner Vedanta’s efforts to buy the Indian assets of Cairn Energy for $9.6bn. BP shares in London closed down 0.7p at 492p.
Sunday, February 20, 2011
Blogs Wane as the Young Drift to Sites Like Twitter
SAN FRANCISCO — Like any aspiring filmmaker, Michael McDonald, a high school senior, used a blog to show off his videos. But discouraged by how few people bothered to visit, he instead started posting his clips on Facebook, where his friends were sure to see and comment on his editing skills.
“I don’t use my blog anymore,” said Mr. McDonald, who lives in San Francisco. “All the people I’m trying to reach are on Facebook.”
Blogs were once the outlet of choice for people who wanted to express themselves online. But with the rise of sites like Facebook and Twitter, they are losing their allure for many people — particularly the younger generation.
The Internet and American Life Project at the Pew Research Center found that from 2006 to 2009, blogging among children ages 12 to 17 fell by half; now 14 percent of children those ages who use the Internet have blogs. Among 18-to-33-year-olds, the project said in a report last year, blogging dropped two percentage points in 2010 from two years earlier.
Former bloggers said they were too busy to write lengthy posts and were uninspired by a lack of readers. Others said they had no interest in creating a blog because social networking did a good enough job keeping them in touch with friends and family.
Blogging started its rapid ascension about 10 years ago as services like Blogger and LiveJournal became popular. So many people began blogging — to share dieting stories, rant about politics and celebrate their love of cats — that Merriam-Webster declared “blog” the word of the year in 2004.
Defining a blog is difficult, but most people think it is a Web site on which people publish periodic entries in reverse chronological order and allow readers to leave comments.
Yet for many Internet users, blogging is defined more by a personal and opinionated writing style. A number of news and commentary sites started as blogs before growing into mini-media empires, like The Huffington Post or Silicon Alley Insider, that are virtually indistinguishable from more traditional news sources.
Blogs went largely unchallenged until Facebook reshaped consumer behavior with its all-purpose hub for posting everything social. Twitter, which allows messages of no longer than 140 characters, also contributed to the upheaval.
No longer did Internet users need a blog to connect with the world. They could instead post quick updates to complain about the weather, link to articles that infuriated them, comment on news events, share photos or promote some cause — all the things a blog was intended to do.
Indeed, small talk shifted in large part to social networking, said Elisa Camahort Page, co-founder of BlogHer, a women’s blog network. Still, blogs remain a home of more meaty discussions, she said.
“If you’re looking for substantive conversation, you turn to blogs,” Ms. Camahort Page said. “You aren’t going to find it on Facebook, and you aren’t going to find it in 140 characters on Twitter.”
Lee Rainie, director of the Internet and American Life Project, says that blogging is not so much dying as shifting with the times. Entrepreneurs have taken some of the features popularized by blogging and weaved them into other kinds of services.
“The act of telling your story and sharing part of your life with somebody is alive and well — even more so than at the dawn of blogging,” Mr. Rainie said. “It’s just morphing onto other platforms.”
The blurring of lines is readily apparent among users of Tumblr. Although Tumblr calls itself a blogging service, many of its users are unaware of the description and do not consider themselves bloggers — raising the possibility that the decline in blogging by the younger generation is merely a semantic issue.
Kim Hou, a high school senior in San Francisco, said she quit blogging months ago, but acknowledged that she continued to post fashion photos on Tumblr. “It’s different from blogging because it’s easier to use,” she said. “With blogging you have to write, and this is just images. Some people write some phrases or some quotes, but that’s it.”
The effect is seen on the companies providing the blogging platforms. Blogger, owned by Google, had fewer unique visitors in the United States in December than it had a year earlier — a 2 percent decline, to 58.6 million — although globally, Blogger’s unique visitors rose 9 percent, to 323 million.
LiveJournal, another blogging service, has decided to emphasize communities. Connecting people who share an interest in celebrity gossip, for instance, provides the social interaction that “classic” blogging lacks, said Sue Rosenstock, a spokeswoman for LiveJournal, which is owned by SUP, a Russian online media company. “Blogging can be a very lonely occupation; you write out into the abyss,” she said.
But some blogging services like Tumblr and WordPress seem to have avoided any decline. Toni Schneider, chief executive of Automattic, the company that commercializes the WordPress blogging software, explains that WordPress is mostly for serious bloggers, not the younger novices who are defecting to social networking.
In any case, he said bloggers often use Facebook and Twitter to promote their blog posts to a wider audience. Rather than being competitors, he said, they are complementary.
“There is a lot of fragmentation,” Mr. Schneider said. “But at this point, anyone who is taking blogging seriously — they’re using several mediums to get a large amount of their traffic.”
While the younger generation is losing interest in blogging, people approaching middle age and older are sticking with it. Among 34-to-45-year-olds who use the Internet, the percentage who blog increased six points, to 16 percent, in 2010 from two years earlier, the Pew survey found. Blogging by 46-to-55-year-olds increased five percentage points, to 11 percent, while blogging among 65-to-73-year-olds rose two percentage points, to 8 percent.
Russ Steele, 72, a retired Air Force officer and aerospace worker from Nevada City, Calif., says he spends up to three hours a day seeking interesting topics and writing about them for his blog, NC Media Watch, which covers local issues in Nevada County, northeast of Sacramento. All he wants is to have a voice in the community for his conservative views.
Although he signed up for Facebook this month, Mr. Steele said he did not foresee using it much and said that he remained committed to blogging. “I’d rather spend my time writing up a blog analysis than a whole bunch of short paragraphs and then send them to people,” he said. “I don’t need to tell people I’m going to the grocery store.”
“I don’t use my blog anymore,” said Mr. McDonald, who lives in San Francisco. “All the people I’m trying to reach are on Facebook.”
Blogs were once the outlet of choice for people who wanted to express themselves online. But with the rise of sites like Facebook and Twitter, they are losing their allure for many people — particularly the younger generation.
The Internet and American Life Project at the Pew Research Center found that from 2006 to 2009, blogging among children ages 12 to 17 fell by half; now 14 percent of children those ages who use the Internet have blogs. Among 18-to-33-year-olds, the project said in a report last year, blogging dropped two percentage points in 2010 from two years earlier.
Former bloggers said they were too busy to write lengthy posts and were uninspired by a lack of readers. Others said they had no interest in creating a blog because social networking did a good enough job keeping them in touch with friends and family.
Blogging started its rapid ascension about 10 years ago as services like Blogger and LiveJournal became popular. So many people began blogging — to share dieting stories, rant about politics and celebrate their love of cats — that Merriam-Webster declared “blog” the word of the year in 2004.
Defining a blog is difficult, but most people think it is a Web site on which people publish periodic entries in reverse chronological order and allow readers to leave comments.
Yet for many Internet users, blogging is defined more by a personal and opinionated writing style. A number of news and commentary sites started as blogs before growing into mini-media empires, like The Huffington Post or Silicon Alley Insider, that are virtually indistinguishable from more traditional news sources.
Blogs went largely unchallenged until Facebook reshaped consumer behavior with its all-purpose hub for posting everything social. Twitter, which allows messages of no longer than 140 characters, also contributed to the upheaval.
No longer did Internet users need a blog to connect with the world. They could instead post quick updates to complain about the weather, link to articles that infuriated them, comment on news events, share photos or promote some cause — all the things a blog was intended to do.
Indeed, small talk shifted in large part to social networking, said Elisa Camahort Page, co-founder of BlogHer, a women’s blog network. Still, blogs remain a home of more meaty discussions, she said.
“If you’re looking for substantive conversation, you turn to blogs,” Ms. Camahort Page said. “You aren’t going to find it on Facebook, and you aren’t going to find it in 140 characters on Twitter.”
Lee Rainie, director of the Internet and American Life Project, says that blogging is not so much dying as shifting with the times. Entrepreneurs have taken some of the features popularized by blogging and weaved them into other kinds of services.
“The act of telling your story and sharing part of your life with somebody is alive and well — even more so than at the dawn of blogging,” Mr. Rainie said. “It’s just morphing onto other platforms.”
The blurring of lines is readily apparent among users of Tumblr. Although Tumblr calls itself a blogging service, many of its users are unaware of the description and do not consider themselves bloggers — raising the possibility that the decline in blogging by the younger generation is merely a semantic issue.
Kim Hou, a high school senior in San Francisco, said she quit blogging months ago, but acknowledged that she continued to post fashion photos on Tumblr. “It’s different from blogging because it’s easier to use,” she said. “With blogging you have to write, and this is just images. Some people write some phrases or some quotes, but that’s it.”
The effect is seen on the companies providing the blogging platforms. Blogger, owned by Google, had fewer unique visitors in the United States in December than it had a year earlier — a 2 percent decline, to 58.6 million — although globally, Blogger’s unique visitors rose 9 percent, to 323 million.
LiveJournal, another blogging service, has decided to emphasize communities. Connecting people who share an interest in celebrity gossip, for instance, provides the social interaction that “classic” blogging lacks, said Sue Rosenstock, a spokeswoman for LiveJournal, which is owned by SUP, a Russian online media company. “Blogging can be a very lonely occupation; you write out into the abyss,” she said.
But some blogging services like Tumblr and WordPress seem to have avoided any decline. Toni Schneider, chief executive of Automattic, the company that commercializes the WordPress blogging software, explains that WordPress is mostly for serious bloggers, not the younger novices who are defecting to social networking.
In any case, he said bloggers often use Facebook and Twitter to promote their blog posts to a wider audience. Rather than being competitors, he said, they are complementary.
“There is a lot of fragmentation,” Mr. Schneider said. “But at this point, anyone who is taking blogging seriously — they’re using several mediums to get a large amount of their traffic.”
While the younger generation is losing interest in blogging, people approaching middle age and older are sticking with it. Among 34-to-45-year-olds who use the Internet, the percentage who blog increased six points, to 16 percent, in 2010 from two years earlier, the Pew survey found. Blogging by 46-to-55-year-olds increased five percentage points, to 11 percent, while blogging among 65-to-73-year-olds rose two percentage points, to 8 percent.
Russ Steele, 72, a retired Air Force officer and aerospace worker from Nevada City, Calif., says he spends up to three hours a day seeking interesting topics and writing about them for his blog, NC Media Watch, which covers local issues in Nevada County, northeast of Sacramento. All he wants is to have a voice in the community for his conservative views.
Although he signed up for Facebook this month, Mr. Steele said he did not foresee using it much and said that he remained committed to blogging. “I’d rather spend my time writing up a blog analysis than a whole bunch of short paragraphs and then send them to people,” he said. “I don’t need to tell people I’m going to the grocery store.”
India May Decide on 500,000 Tons Sugar Sale This Week
India, the biggest sugar user, may permit exports of 500,000 metric tons as output tops demand for the first time in three years and after food inflation slowed to a two-month low, industry officials said.
The government may take a decision as early as this week, Jonathan Kingsman, managing director of broker and researcher Kingsman SA, and Abinash Verma, director general of the Indian Sugar Mills Association, told a conference in Dubai today.
Supplies from the country may help cool food costs, which reached a record in January, according to the United Nations’ World Food Price Index. Raw sugar soared to 36.08 cents per pound in New York on Feb. 2, the highest level since 1980, on concern that global supplies will lag demand after a storm in Australia and drought in Russia crimped harvests.
The global market “has become viable for exports from India at a time when the country has a surplus,” said Verma. “We are pretty positive that the government will take a decision this week” as food inflation has eased, he said.
May-delivery raw sugar fell 1.5 percent to close at 28.42 cents a pound on ICE Futures U.S. in New York on Feb. 18. Prices have still doubled since the end of May.
India allowed the shipment of 500,000 tons under the so- called open general license in December and then kept the plan on hold because of high food costs. An index measuring wholesale prices of farm products including rice and vegetables rose 11.05 percent in the week ended Feb. 5 from a year earlier, the trade ministry said in a statement last week. The measure gained 13.07 percent the previous week.
Group Meeting
A ministerial group may meet tomorrow to decide on allowing exports, the Press Trust of India reported today, citing no one.
“India should first allow 500,000 tons and then look at permitting at least 1 million ton more,” Vinay Kumar, managing director of a producers’ group that accounts for almost half of the nation’s output, said in an interview at the conference.
The country’s production may total 24.5 million tons, more than the demand of 23 million tons, for the season ending Sept. 30, according to the government. Output for the period may be 25 million tons, exceeding consumption of 22.1 million tons, Verma said, matching Kumar’s forecast. There may be a surplus of 6.7 million tons at the end of September, of which 5 million tons will be carried over to the new season from Oct. 1, Verma said. That leaves 1.7 million tons for sales overseas, he said.
Production was 26.4 million tons in 2007-2008, the last time that output surpassed consumption, data from ISMA show.
The government may take a decision as early as this week, Jonathan Kingsman, managing director of broker and researcher Kingsman SA, and Abinash Verma, director general of the Indian Sugar Mills Association, told a conference in Dubai today.
Supplies from the country may help cool food costs, which reached a record in January, according to the United Nations’ World Food Price Index. Raw sugar soared to 36.08 cents per pound in New York on Feb. 2, the highest level since 1980, on concern that global supplies will lag demand after a storm in Australia and drought in Russia crimped harvests.
The global market “has become viable for exports from India at a time when the country has a surplus,” said Verma. “We are pretty positive that the government will take a decision this week” as food inflation has eased, he said.
May-delivery raw sugar fell 1.5 percent to close at 28.42 cents a pound on ICE Futures U.S. in New York on Feb. 18. Prices have still doubled since the end of May.
India allowed the shipment of 500,000 tons under the so- called open general license in December and then kept the plan on hold because of high food costs. An index measuring wholesale prices of farm products including rice and vegetables rose 11.05 percent in the week ended Feb. 5 from a year earlier, the trade ministry said in a statement last week. The measure gained 13.07 percent the previous week.
Group Meeting
A ministerial group may meet tomorrow to decide on allowing exports, the Press Trust of India reported today, citing no one.
“India should first allow 500,000 tons and then look at permitting at least 1 million ton more,” Vinay Kumar, managing director of a producers’ group that accounts for almost half of the nation’s output, said in an interview at the conference.
The country’s production may total 24.5 million tons, more than the demand of 23 million tons, for the season ending Sept. 30, according to the government. Output for the period may be 25 million tons, exceeding consumption of 22.1 million tons, Verma said, matching Kumar’s forecast. There may be a surplus of 6.7 million tons at the end of September, of which 5 million tons will be carried over to the new season from Oct. 1, Verma said. That leaves 1.7 million tons for sales overseas, he said.
Production was 26.4 million tons in 2007-2008, the last time that output surpassed consumption, data from ISMA show.
Sugar Market May Have Surplus Next Year, Kingsman Says
Global sugar production may exceed demand for the first time in four years if “normal weather conditions” return to the biggest growing nations, broker and researcher Jonathan Kingsman said.
The market may have surplus of 5.61 million metric tons in the year from April 1, compared with a deficit of 102,000 tons this season, as farmers in China, Brazil, Russia and Thailand boost acreage, Kingsman, managing director of the Switzerland- based company, told a conference in Dubai today.
Excess production may help cool global food costs which reached a record in January according to the United Nations’ World Food Price Index. Raw sugar soared to 36.08 cents per pound in New York on Feb. 2, the highest level since 1980, on concern that global supplies will lag demand after a storm in Australia and drought in Russia crimped harvests.
“Prices of over 25 cents for more than half of the last 18 months should have given strong signals to producers to expand production,” Kingsman said. “More normal growing conditions in 2011-2012 should allow for some relief for supplies, but that may take until late in 2011 before stocks turn the corner.”
A forecast for the sugar market swinging into surplus is in contrast to deficits in other crops, including wheat, which have helped push up prices and contributed to political unrest in nations in North Africa and the Middle East. Wheat has jumped 71 percent in the past year, corn is near the highest since July 2008 and soybeans have jumped 45 percent in the past 12 months.
Sugar for delivery from May 2011 through October 2013 is in backwardation, reflecting expectations that prices may ease in the coming months, Kingsman said in an interview Feb. 18. Backwardation occurs when near-term contracts are more expensive than those further out.
Weak Demand
“Given that recent sugar prices are at their highest since 1981, we expect there to be some loss of consumption, and at least some tempering of expected consumption increments in many countries,” Kingsman said. Demand will expand 1.48 percent in the 2011-2012 season, compared with the normal annual increase of 2 percent, he said.
Global production may expand by 8.15 million tons to 173.2 million tons, while consumption may grow by 2.44 million tons to 167.6 million tons, Kingsman said. The biggest gain in output will come from China, where production may climb by 1.85 million tons, followed by Russia and Brazil’s Center South region, which may boost harvests by 1.52 million tons and 1.19 million tons.
Kingsman in December predicted a deficit of 369,000 tons for the current year ending March. Estimates for 2011-2012 are made with “the assumption of normal global weather conditions, which haven’t tended to be all that common of late,” he said.
Stockpiles will stay low for the next year and the deficit may last for the first six months of 2011, Kingsman said today.
Cyclone Damage
Tropical Cyclone Yasi hit northern Queensland in Australia, a region growing a third of the country’s cane, cutting output potential in the area by about 50 percent, producers’ group Canegrowers said Feb. 4. That may keep exports from the world’s third-biggest supplier at a two-decade low of 2.2 million tons in 2011, according to Queensland Sugar Ltd.
“We’re still in the middle of the cyclone season and the uncertainty on the crop outlook isn’t over yet,” Queensland Chairman Alan Winney said in an interview at the conference. Production won’t return to normal levels of 4.2 million to 5 million tons until 2012-2013, he said.
Queensland Sugar accounts for more than 90 percent of Australia’s overseas sales of the commodity.
Frost damaged about 1.9 million mu (126,667 hectares) of cane in China’s Guangxi province, the China News Service said on Jan. 12, citing the local agricultural authority. The nation’s central bank Feb. 18 raised reserve requirements for lenders for the second time this year to counter inflation.
The market may have surplus of 5.61 million metric tons in the year from April 1, compared with a deficit of 102,000 tons this season, as farmers in China, Brazil, Russia and Thailand boost acreage, Kingsman, managing director of the Switzerland- based company, told a conference in Dubai today.
Excess production may help cool global food costs which reached a record in January according to the United Nations’ World Food Price Index. Raw sugar soared to 36.08 cents per pound in New York on Feb. 2, the highest level since 1980, on concern that global supplies will lag demand after a storm in Australia and drought in Russia crimped harvests.
“Prices of over 25 cents for more than half of the last 18 months should have given strong signals to producers to expand production,” Kingsman said. “More normal growing conditions in 2011-2012 should allow for some relief for supplies, but that may take until late in 2011 before stocks turn the corner.”
A forecast for the sugar market swinging into surplus is in contrast to deficits in other crops, including wheat, which have helped push up prices and contributed to political unrest in nations in North Africa and the Middle East. Wheat has jumped 71 percent in the past year, corn is near the highest since July 2008 and soybeans have jumped 45 percent in the past 12 months.
Sugar for delivery from May 2011 through October 2013 is in backwardation, reflecting expectations that prices may ease in the coming months, Kingsman said in an interview Feb. 18. Backwardation occurs when near-term contracts are more expensive than those further out.
Weak Demand
“Given that recent sugar prices are at their highest since 1981, we expect there to be some loss of consumption, and at least some tempering of expected consumption increments in many countries,” Kingsman said. Demand will expand 1.48 percent in the 2011-2012 season, compared with the normal annual increase of 2 percent, he said.
Global production may expand by 8.15 million tons to 173.2 million tons, while consumption may grow by 2.44 million tons to 167.6 million tons, Kingsman said. The biggest gain in output will come from China, where production may climb by 1.85 million tons, followed by Russia and Brazil’s Center South region, which may boost harvests by 1.52 million tons and 1.19 million tons.
Kingsman in December predicted a deficit of 369,000 tons for the current year ending March. Estimates for 2011-2012 are made with “the assumption of normal global weather conditions, which haven’t tended to be all that common of late,” he said.
Stockpiles will stay low for the next year and the deficit may last for the first six months of 2011, Kingsman said today.
Cyclone Damage
Tropical Cyclone Yasi hit northern Queensland in Australia, a region growing a third of the country’s cane, cutting output potential in the area by about 50 percent, producers’ group Canegrowers said Feb. 4. That may keep exports from the world’s third-biggest supplier at a two-decade low of 2.2 million tons in 2011, according to Queensland Sugar Ltd.
“We’re still in the middle of the cyclone season and the uncertainty on the crop outlook isn’t over yet,” Queensland Chairman Alan Winney said in an interview at the conference. Production won’t return to normal levels of 4.2 million to 5 million tons until 2012-2013, he said.
Queensland Sugar accounts for more than 90 percent of Australia’s overseas sales of the commodity.
Frost damaged about 1.9 million mu (126,667 hectares) of cane in China’s Guangxi province, the China News Service said on Jan. 12, citing the local agricultural authority. The nation’s central bank Feb. 18 raised reserve requirements for lenders for the second time this year to counter inflation.
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