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Sales of previously owned homes rose to an 11-month high in December and the supply of properties on the market tumbled to a near 7-year low, pointing to a nascent recovery in the housing market.

The National Association of Realtors said on Friday existing home sales increased 5 percent month over month to an annual rate of 4.61 million units.

November’s sales pace was revised down to a 4.39 million-unit pace, previously reported as a 4.42 million-unit rate.

Economists polled by Reuters had expected sales to rise to a 4.65 million-unit sales pace. Sales in December were up 3.6 percent from a year ago. A total of 4.26 million homes were sold in 2011, up 1.7 percent from the prior year.

“A sector of the economy that has been a large weight on growth has started to stabilize over the last few months and we will continue to look for momentum in 2012,” said John Doyle, currency strategist at Tempus Consulting in Washington.

The third straight month of gains in sales added to hopes that a tentative recovery in the housing market was starting to take shape, but progress will be painfully slow given a glut of unsold properties that is weighing down on prices.

Data this week showed single-family home starts rose for a third straight month in December and optimism among builders this month was the highest in four-and-a-half years.

But the sector, responsible for the 2007-09 recession, remains challenged by an oversupply of homes amid an 8.5 percent unemployment rate. In addition, declining prices have left many Americans with homes that are worth less than their mortgages.

But there are tentative signs of improvement. There were 2.38 million unsold homes on the market last month, the fewest since March 2005. That represented a 6.2 months’ supply at December’s sales pace, the lowest since April 2006, and compared to 7.2 months’ supply in November.

However, the inventory of unsold homes tends to decline in winter. A supply of 6 months is generally considered as ideal and anything above indicates further declines in house prices. The median sales price fell 2.5 percent to $164,500 from a year ago.

Sales last month rose across all four regions, with gains in both the multifamily home and single-family home segments.

Single family home sales rose 4.6 percent, while multi-family dwellings advanced 8.7 percent.

But the road to recovery will be bumpy. Distressed properties, foreclosures and short sales which typically occur at deep discounts, accounted for 32 percent of overall sales last month, little changed from November.

A third of pending existing home sales contracts were canceled, the NAR said.

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Several times each year, the nation faces a widespread, food borne illness crisis. But there’s an easy, cheap technological solution that could stop scares and outbreaks in their tracks.

A relatively simple system of QR codes — those funny-looking, two-dimensional barcodes you see everywhere today — could instantaneously link a product sold on store shelves back to the farm where it was grown or raised with a snap of a smartphone camera. It would no longer take days or weeks to determine what food is safe and what isn’t.

The system could even prevent the contaminated food from reaching store shelves in the first place.

IBM (, Fortune 500) has developed a technology called the InfoSphere Traceability Server, which assigns unique barcodes to every step of the food distribution chain.

The farms, slaughterhouses, food palates, shipping containers, trucks, grocery stores and individual products that are using InfoSphere are all affixed with QR codes and tracked. Even specific animals are being tagged and scanned, so you could find out which specific cow your milk came from or which pig became your pork.

Using this system, the orange juice crisis could have potentially been avoided. Rather than halting all shipments of orange juice to test for a fungicide and testing OJ at grocery stores, as the U.S. Food and Drug Administration has done, the juice could have been scanned and instantly linked back to a particular farm.

How RFID tags will change the future

"Someday soon, this will become the minimum requirement to participate in the food supply chain," said Paul Chang, IBM’s traceability program director.

But the system has yet to be widely adopted. There are some high hurdles to mass-adoption, most notably that for the system to work, every actor in the supply chain has to participate. And participation requires some level of investment in order to feed data into the network and extract results.

IBM already has a small handful of large retailers in the United States and Europe on its system, including Germany’s Metro Group, the third-largest food retailer in the world. But IBM believes it has found a way to get even the smallest mom & pop shops and farms on board as well.

IBM developed the InfoSphere system as a cloud-based service, meaning the only infrastructure needed to operate it is an Internet connection and a smartphone.

Though IBM’s Chang wouldn’t get specific about pricing, he said the costs are "minimal," pointing to the fact that that there are already small, rural farms in Thailand using the system no fax needed payday loans.

"We’ve developed the technology in such a way that it’s just a nominal cost to share and access information," Chang said. "We’re at an inflection point where this could be deployed more broadly."

But even if the majority of vendors, farms, shipping companies and grocery stores adopt it, it would really take everyone to join in to link your OJ to a particular farm.

To make such a global food traceability network a possibility, the food industry has developed an open standard for data recording and tracking. That means customers using IBM rivals’ systems could communicate with the InfoSphere server so a farm, a supplier and a grocery store all doing business with one another would not necessary need to be using the same system.

IBM says a very small percentage of companies in the food industry have adopted the technology so far. But with recalls happening on a weekly basis, and costs of technology falling, some regulators are becoming tempted to impose requirements that companies adopt traceability systems. IBM said is currently working with a small number of government regulators from around the world.

If widespread adoption does occur, it may help stop outbreaks before they start.

Today, testing products for contamination is a difficult and ineffective process. Food companies can’t test every batch, so choosing which ones to test is essentially random.

For instance, Coca-Cola (, Fortune 500) tested its batch of orange juice and found that the fungicide was present. But it also noticed that competitors’ juice was contaminated as well and had gone unnoticed.

Using advanced analytics, companies could know exactly which batches to test. As an example, a sensor in a shipping container of tomatoes that is several degrees warmer than normal could tip off the company to check the product that was shipped on that vessel. With QR tags, testers could know which palates were on that container and test them before they reach store shelves.

The technology is cheap and easy to implement. But until everyone adopts it, contaminated food outbreaks will continue. 

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Prime Minister Vladimir Putin has been calling for Russia, the world

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China Shougang Group has tied up with Malaysia’s Hiap Teck to build a 1.8 billion ringgit ($573 million) steel mill, its first such investment outside of China.

A joint statement says the mill in Malaysia’s northern Terengganu state will produce 700,000 metric tons of steel slabs a year to cater to Southeast Asia’s growing markets when completed in mid-2013. It said Monday the mill, run by a joint venture called Eastern Steel, will later be expanded to raise output to 1.5 million metric tons.

Shougang, one of China’s top steel makers, controls 40 percent of Eastern Steel. Hiap Teck holds 55 percent.

Officials say there is strong demand in Southeast Asia, which imports more than 4 million metric tons of steel slabs annually, mostly from eastern Europe.

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U.S. builders started slightly fewer homes in October but submitted plans for a wave of apartments, a mixed sign for the struggling housing market.

Builders broke ground on a seasonally adjusted annual rate of 628,000 homes last month, down 0.3 percent from September. That’s roughly half the 1.2 million homes that economists say must be built to sustain a healthy housing market.

Building permits, a gauge of future construction, rose nearly 11 percent. The increase was spurred by a 30 percent increase in apartment permits, which reached its highest level in three years.

New-home construction and sales are in the midst of one of its worst years in history. Demand for new homes is weak and historically-low mortgage rates and plunging home prices have done little to help.

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Stock futures are rising on hopes that a solution will be found to expand Europe’s financial rescue program.

Slovakia rejected a bill Tuesday that would have increased the powers of the regional rescue fund. The 16 other countries that use the euro have already signed off on the bill, but the measure requires unanimous support. Still, there are ways around Slovakia’s opposition, and investors expect the bill to ultimately pass before a meeting of European leaders next week.

About 90 minutes before the opening bell Wednesday, Dow Jones industrial average futures are up 86 points, or 0.8 percent, at 11,416. Standard & Poor’s 500 index futures are up 8, or 0.7 percent, at 1,198. Nasdaq 100 index futures are up 21, or 0.9 percent, at 2,310.

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In a boost to the region’s moribund auto industry, General Motors will inject $380 million into its Wentzville assembly plant, adding 1,850 jobs and a new pickup line as part of a proposed new labor contract, the United Auto Workers announced Tuesday.

The announcement is part of GM’s commitment to invest a total of $2.5 billion in facilities nationwide and create or retain 6,400 jobs over the life of the four-year contract, according to the UAW.

The union and GM reached an agreement Friday, but did not reveal details of expansion plans until Tuesday. The 48,500 union members working for GM nationwide must still ratify the contract next week.

UAW Local 2250 Chairman Mike Bullock said the contract called initially for the Wentzville plant to add a second production shift of between 400 and 700 people in the first quarter of 2012. Local 2250 represents hourly workers at the Wentzville plant, which produces Chevrolet Express and GMC Savana full-size vans. About 1,300 people in one production shift currently work at the Wentzville facility.

“This will be a real shot in the arm for Wentzville and the St. Louis area,” Bullock said in a phone interview. “This really is a tribute to the men and women who work at the Wentzville assembly center and produce the best quality product at the best cost.”

The local automotive industry has been devastated in recent years. Closures included the Ford plant in Hazelwood five years ago and Chrysler’s two Fenton plants in 2008 and 2009. Multiple local automobile suppliers that feed those plants with parts also closed. In 2009, GM eliminated a shift at the Wentzville plant, affecting more than 800 workers.

Some were laid off, and some took voluntary transfers to GM facilities elsewhere.

Some of those transferred and laid-off employees could be eligible for rehiring, according to UAW officials. Sixteen former Wentzville GM employees were transferred to GM’s Fairfax assembly plant in Kansas City, Kan., and 27 laid-off employees remain on Local 2250’s recall list.

GM also will be offering openings to unemployed GM union workers nationally who have recall rights. The number of such workers was unavailable.

Additionally, there are 350 people on a local referral list who could be tapped for the new jobs, Bullock said.

The investment by GM would pay for a 500,000-square-foot addition to the Wentzville’s current 3.7 million-square-foot facility, improvements to its paint department and other upgrades. The new contract also details plans for a midsize pickup to be produced in Wentzville. More than 1,000 workers would start working on that new line in 2013 for a 2014 model pickup, Bullock said.

“We’ve been waiting patiently a long time to hear this news,” said Tom Brune, UAW communications coordinator for Local 2250.

As Joe Gurrieri, 31, of O’Fallon, Mo., used a mechanical arm to swing dash panels into place on a steady stream of Chevy Express vans Tuesday, he said he was hopeful current workers would have more job security. Gurrieri, a 12-year employee, said he had returned to work in November after being laid off. “It’s good to be back, and it’s good to know we’ll be here for a while,” he said.

Some analysts have speculated that GM will shift production of its Chevrolet Colorado or GMC Canyon pickups, which currently are made in Shreveport, La., to Wentzville. The Shreveport assembly facility, which employs more than 900 people, is not owned by GM and had previously been slated to close as part of GM’s emergence from bankruptcy in 2009. A GM spokesman declined to comment on the pending contract or expansion details.

Last week, plant manager John Dansby told the Post-Dispatch that he believed Wentzville had been selected for expansion because of the plant’s emphasis on producing high quality vehicles at low costs.

“We’ve been working really hard at the plant to try to position ourselves to be very competitive,” Dansby said.

Last year, the plant forecast production of 80,000 vehicles and ended the year producing nearly 100,000.

“Our volumes are increasing, and the buying public has done a great job supporting our product,” he said.

TAX BREAKS

To help finance the expansion, Wentzville’s board of aldermen approved last week partial tax abatement for GM if it expands. As part of the deal, GM would make “payments in lieu of taxes” to local school districts, and have 75 percent of its property taxes for the new development abated for 10 years.

Wentzville Mayor Paul Lambi said he was hopeful the new jobs would bring back what was lost when the GM plant downsized in 2009. “There was an unbelievable ripple effect,” Lambi said, describing the closure of nearby restaurants and retailers two years ago. “Every business that relies on retail sales was affected. Bringing back a second shift is extremely good news.”

A couple of miles from the plant, Dan Strantz, owner of Mama’s Grill, also welcomed the news. The diner’s location near the intersection of Highway 40 and Interstate 70 opened about a month and half ago, he said, but his family has been in the restaurant business since 1972. “It’ll be good that there will actually be people with money to go out and spend,” he said.

If the expansion proceeds, GM is likely to pursue state incentives. The automaker has been in talks with Gov. Jay Nixon’s office and Department of Economic Development officials for a year, according to the governor’s spokesman, Sam Murphey. The automaker has not yet applied for any state incentives.

“We are strongly encouraged by the recent steps GM has taken, and we look forward to continuing to work closely with GM throughout this process,” Murphey said in a statement Tuesday.

The UAW outlined investments proposed by GM at several other plants nationwide, including plans to invest $925 million at three Michigan factories that will generate 900 jobs during the life of the contract. GM also plans to invest in plants in Spring Hill, Tenn., which had been idled, and Fort Wayne, Ind., that will generate or preserve a combined 3,700 jobs.

Gerrion Grim, 53, of O’Fallon, Mo., has worked at the Wentzville plant for about 18 months. He said he was laid off for a while and returned to work in April. Now, he said, he would like to see job security. “I’m definitely hoping for some longevity,” he said. “I just hope it all goes well.”

Shane Anthony of the Post-Dispatch contributed to this report.

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WASHINGTON