India purchased 13 cargoes of diesel for July/August delivery partly to build contingency stocks against a potential escalation in its dispute with Pakistan on Kashmir, industry officials said on Thursday. But India does not hope to import more if the expected supply of diesel from Reliance Petroleum Ltd's (RPL) Jamnagar refinery came through in July, they said. "The large purchase was a contingency plan to ensure that there is a ready stock of diesel if the crisis in Kashmir escalated," an official, who did not want to be identified, said. Traders had expected state-run Indian Oil Corp (IOC) to award five to seven cargoes of diesel in its tenders to buy second half of July and first half of August deliveries. An oil company official, who requested anonymity, said: "No further imports would be required if Reliance supplied 100,000 tonnes of diesel in July."

HK spot gold ends higher

Hong Kong spot gold ended higher in quiet trading on Friday after physicalbuying and short-covering offset selling from Australia. Gold bullion ended at US$256.90/257.40 per ounce on Friday compared to New York's previous close at US$256.40/90 on Thursday. Australian selling in the morning was followed by European short-covering in the afternoon, traders said.``It looks like some physical demand and short-covering came at the US$256 level,'' a trader said. After Britain's auction of 25 tonnes of gold early in the week sent gold to new 20-year lows, the price was holding above US$255 at the week's end. ``People are waiting to see whether gold can break below US$255. The market has been quite steady at this low level,'' he said. Gold lease rates were higher, rising to about 2.5 per cent for one month from 0.75 per cent previously.``Maybe central banks are not prepared to lend that much in the market,'' a trader in Singapore said.

Dearer trend in tea auction

Dearer trend prevailed in the Coimbatore tea auction, with prices moving up by Rs three to Rs four for all categorieson Friday. According to trade sources, orthodox tea prices pushed up by Rs three following export enquiries from Libya, while that of ctc leaf quoted Rs two to Rs three higher compared to last level. Dust tea also generally behaved dearer, following good internal demands, they said. Out of about 2.90 lakh kg on offer, dust accounted for 1.22 lakh kg and about 95 per cent of total offer was reportedly sold, they said.

Genetically modified crops

European farmers are unwilling to plant genetically modified crops because consumers in Europe do not want GM food until scientific tests can prove it is safe, a conference heard on Thursday. "We produce mainly for the European market and at the end of the day the European consumer doesn't really want it (GM food)," a German farmer told a Brussels conference on the impact of gene technology on agriculture. Farmers at the conference, organised by the European Young Farmers' Association, told representatives of the US biotechnology industry they had seriousreservations about switching to GM crops. "We can't necessarily just leave the science to the scientists after BSE (mad cow disease). The consumer is king and they are the ones with the gold," a British farmer said. Farmers said biotechnology firms such as Monsanto had ignored consumer worries and tried to bring their products to market in Europe without the necessary scientific proof required to show they were safe.

US food advertisement

The US Food and Drug Administration on Thursday allowed manufacturers of cereals and breads rich in whole grains to advertise that the foods can help fight cancer and heart disease. An FDA official said the agency decided to accept arguments from manufacturer General Mills, the largest whole-grain cereal maker, that whole grains include not only fiber but other disease-fighting ingredients that make them good weapons against heart disease and certain cancers. The decision allows all makers of whole grain cereals and breads to carry the health claim. Foods must beat least 51 per cent whole grain to carry the claim, which says that diets rich in whole grains, and low in fat and cholesterol, "may reduce the risk of heart disease and certain cancers." General Mills said its boxes of Cheerios, Wheaties and Total will carry the new information starting in August. The company said the new label would help consumers spot products that are rich in whole grains. Only 1 per cent of what the average American eats now comes from whole grains, General Mills said, and only 7 per cent of the population eats three servings of whole grains a day.