UPDATE 1-Australia says trade agreement with Indonesia on track despite Israel comments

(Adds comment from Arab ambassadors)

By Colin Packham

SYDNEY, Oct 17 (Reuters) - Australian Prime Minister Scott Morrison said on Wednesday a billion-dollar free trade agreement with Indonesia will be signed this year, despite Indonesian concern over an Australian proposal to recognise Jerusalem as the Israeli capital.

Morrison said on Tuesday he was open to Australia moving its mission from Tel Aviv to Jerusalem, as the United States did in May to the delight of Israel but to the fury of Palestinians.

Grub infestation may be the fix to India's sugar problem its farmers do not want

* White grubs infest cane crop in Maharashtra, Karnataka

* Scanty rainfall accelerates white grub infestation

* India's 2018/19 sugar output seen at 32.4 mln T vs pvs estimate of 35.5 mln T- trade body

* Maharashtra's sugar output seen at 9.7 mln T vs pvs estimate of 11.5 mln T-trade body

* India's 2019/20 sugar output seen at 29.2 mln T-trade body

By Rajendra Jadhav

WADWAL, India, Oct 17 (Reuters) - India may have found a fix to its sugar problem but the answer will not make its cane farmers happy.

China minister urges more oversight of large pig farms amid disease epidemic

BEIJING, Oct 17 (Reuters) - China's vice agriculture minister Yu Kangzhen said on Wednesday local governments should step up their oversight of large-scale pig farms and breeding farms in their efforts to control the spread of the highly contagious African swine fever.

Yu's comments, published on the website of the Ministry of Agriculture and Rural Affairs, came after a 20,000-head pig farm in northeast Liaoning province reported an outbreak of the disease earlier this week. It was the first large-scale farm to report an outbreak.

China reports new African swine fever outbreak in Liaoning province

BEIJING, Oct 17 (Reuters) -

* China reported another new African swine fever outbreak in the city of Panjin in Liaoning province, the agriculture ministry said on Wednesday

* The new outbreak has infected and killed 43 pigs in a farm in the city which holds 161 pigs, the Ministry of Agriculture and Rural Affairs said in a statement published on its website

Malaysia's biodiesel output, exports set to hit records -industry body

* Malaysia 2018 biodiesel output could rise 25 pct on-year -assoc

* Exports for 2018 set to double to a record of 475,000 T -assoc

* Says Malaysia could produce 1.2 mln T of biodiesel in 2019

* Country uses palm oil as biofuel ingredient

By Emily Chow

KUALA LUMPUR, Oct 17 (Reuters) - Malaysian biodiesel production is likely to hit record levels this year and next, with 2018 exports on track to double from 2017, pushed up as higher oil prices boost the appeal of biofuels, the head of an industry association said on Wednesday.

Philippines buy 55,000 tonnes of Australian feed wheat

HAMBURG, Oct 17 (Reuters) - A group of importers in the Philippines purchased about 55,000 tonnes of animal feed wheat to be sourced from Australia in a deal last week, European traders said on Wednesday.

It was purchased at about $283 a tonne c&f for January/February 2019 shipment.

"It looks like a comeback for Australian wheat in the Philippines as prices continue to rise in the Black Sea region," one trader said. (Reporting by Michael Hogan, Editing by Sherry Jacob-Phillips)

Ukraine 2019 winter grain sowing 89 pct complete

KIEV, Oct 17 (Reuters) - * Ukrainian farmers have sown 6.43 million hectares of winter grains for the 2019 harvest so far, or 89 percent of the expected area of 7.2 million, the agriculture ministry said on Wednesday.

* Farms sowed 5.6 million hectares of winter wheat, 713,000 hectares of winter barley and 113,000 hectares of winter rye as of Oct. 16, it said in a statement.

* Ukraine sowed around 7.24 million hectares of winter grains for the 2018 harvest. (Reporting by Pavel Polityuk; Editing by Sunil Nair)

Ukraine has harvested 49.3 mln tonnes of grain so far this year - ministry

KIEV, Oct 17 (Reuters) - Ukraine's agriculture ministry announced the following data on the 2018 harvest on Wednesday:

* Farmers in Ukraine had harvested 49.3 million tonnes of grain as of Wednesday, with a yield of 4.00 tonnes per hectare. By the same date last year Ukraine had harvested 45.8 million tonnes.

* Farmers have threshed 12.3 million hectares of grains out of a total area of 14.84 million hectares.

* Farmers have harvested 14.4 million tonnes of corn from 2.2 million hectares, 49 percent of the sown area. The yield averaged 6.46 tonnes per hectare.

GRAINS-Soybeans ease as dry weather seen boosting U.S. harvest

* Soybeans slid for second day from two-month top

* Wheat dips; strong demand for U.S. supplies limit losses (Adds details, quote)

By Naveen Thukral

Oct 17 (Reuters) - Chicago soybean futures slid for a second session on Wednesday as a bumper U.S. crop harvest is expected to gather pace after forecasts of dry weather in parts of the U.S. Midwest.

Wheat dropped but expectations of strong demand for U.S. cargoes provided a floor under the market.

GRAINS-Soybean prices extend losses as US harvest pace expected to pick up

SYDNEY, Oct 17 (Reuters) - U.S. soybean futures fell for a second session on Wednesday as forecasts of dry weather in parts of the United States indicated farmers there would be able to pick up the pace of harvesting. FUNDAMENTALS * The most active soybean futures on the Chicago Board of Trade were down 0.1 percent at $8.83-3/4 a bushel by 0042 GMT, having closed down 0.8 percent on Tuesday. * The most active corn futures dropped 0.1 percent to $3.75 a bushel, after closing down 0.9 percent in the previous session.

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