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VRS - who has written 36199 posts on Opalesque Commodities Briefing.


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Goldman Sees Nickel Rising With Palladium to Beat Soy

Posted on 30 July 2014

Nickel and palladium are set to outperform iron ore and soybeans as supply outlooks for commodities diverge amid a tentative acceleration in global economic growth, according to Goldman Sachs Group Inc.

Commodity Prices Edge Down in June: Scotiabank

Posted on 30 July 2014

Scotiabank’s Commodity Price Index inched down by 0.7% month-over-month (m/m) in June, but has climbed 8.9% from last December’s low — led by stronger oil and gas prices. “The Metal and Mineral sub-Index retreated in June, but will rally sharply in July amid a spurt in base metal prices and steadier gold prices,” said Patricia Mohr, Scotiabank’s Vice President of Economics and Commodity Market Specialist.

Commodities: Probability of El Nino developing falls to 50%

Posted on 30 July 2014

The commodities complex saw few changes on Monday, although geopolitical concerns buoyed gold prices while oil futures traders stayed on the sidelines ahead of weekly supply data scheduled for release on Wednesday.

Commodity finance being done by Trading Houses

Posted on 30 July 2014

A story recently in Reuters talked about how the biggest trading houses are filling the traditional banks (and mostly European banks role) of funding traders. This got particular attention, especially in light of the Obama administrations sanctions on Rosneft and other big Russian commodity producers.

Is The Most Important Commodity About To Break Down?

Posted on 30 July 2014

Is Crude Oil about to follow in the footsteps of the yield on the bell weather bond and break support? The left chart above highlights that the yield on the 30-year bond is breaking down, below a two-year support line. The right chart highlights that Crude Oil and the yield on the 30-year bond have correlated a little bit over the past couple of years, with the 30-year breaking support.

Energy Economist: The amount of oil the world uses, seen through different eyes

Posted on 30 July 2014

How much oil does the world consume? You’d think this would be a fairly straightforward question, given its economic importance to the world economy, and indeed answers are not hard to find. The problem is those answers differ significantly. Even with the development of the Joint Organisations Data Initiative–an evolving beast designed to bring improved transparency to oil markets–oil market data remains messy, inaccurate and opaque.

US & Russia Dominating The Natural Gas Sector

Posted on 30 July 2014

The US continues to dominate both natural gas production (and consumption). In 2013, the US set a new all-time high production record for the third straight year, with gas production rising to 66.5 Bcfd to lead all countries. In fact this was once again more natural gas than any country has ever produced in one year.

Saudi Arabia oil and gas market to 2023

Posted on 30 July 2014

Business Monitor International has released a new report, ‘Saudi Arabia Oil & Gas Report Q3 2014’, in which it indicates the view that crude production in the country will remain elevated by historical standards in 2014 and 2014.

China oil demand rises 2.7% vs year ago

Posted on 30 July 2014

China’s apparent oil demand* in June turned directions from May and climbed 2.7% versus the same month a year ago to 41.94 million metric tons (mt) or an average 10.25 million barrels per day (b/d), according to a just-released Platts analysis of Chinese government data. On a month-over-month basis, apparent oil demand was up 8.6% from May.

Energy Regulators Say EPA’s Climate Rule Poses Grid Challenges

Posted on 30 July 2014

President Barack Obama’s proposed rule to curb carbon emissions from the nation’s power plants could raise costs and affect reliability in the U.S. electricity system, federal regulators told Congress.

Why Coal Deserves Your Attention Right Now

Posted on 30 July 2014

Fossil fuels have had a banner year so far. Both prices for oil and natural gas have surged on the backs of higher demand and a dose of geopolitical tension. Likewise, oil and gas stocks – as represented by the Energy Select Sector SPDR ETF (XLE) – have also produced some hefty returns this year.

Gold price holds above $1,300, focus on Fed policy meeting

Posted on 30 July 2014

Gold was little changed just above USD 1,300 an ounce on Tuesday, supported by geopolitical tensions in the Middle East and Ukraine, with investors also focusing on U.S. jobs data and a Federal Reserve policy meeting this week.

We’re Ready to Profit in the Coming Gold Price Correction—Are You?

Posted on 30 July 2014

Sometimes I see an important economic or geopolitical event in screaming headlines and think: “That’s bullish for gold.” Or: “That’s bad news for copper.” But then metals prices move in the opposite direction from the one I was expecting. Doug Casey always tells us not to worry about the short-term fluctuations, but it’s still frustrating, and I find myself wondering why the price moved the way it did.

Who will run the gold fix next?

Posted on 30 July 2014

The banks that conduct the century- old gold fixing and the London Bullion Market Association will seek proposals next month for a new administrator to run a revamped process for the benchmark by year-end.

Can We Trust Silver’s Leadership Over Gold?

Posted on 30 July 2014

While gold has been nabbing the bulk of the recent commodity headlines, investors have missed what has been — and will likely continue to be — the better long-term, safe-haven holding. Surprise! Silver has actually outpaced gold since both hit a short-term bottom on June 2. Specifically, even with last week’s tumble, the iShares Silver Trust (SLV) is still up 10% since that point, while the SPDR Gold Trust (GLD) is only up 4.9% for the nearly-two-month timeframe.

HK expected to stay ahead as Asian precious metals hub

Posted on 30 July 2014

Hong Kong will maintain its status as an Asian precious metals hub in the face of competition from Shanghai and Singapore, according to Brink’s Co, which is opening a new vault in the city. The Richmond, Virginia-based maker of surveillance systems and armored trucks should finish the vault early in the fourth quarter, Guy Bullen, senior vice-president for Asia Pacific, said in an interview last week. That will double Brink’s gold and silver handling capacity in the city, Mr Bullen said, without elaborating.
China overtook India as the largest gold consumer [...]

Zinc, lead buoyed as value hunters tune into global growth story

Posted on 30 July 2014

Zinc prices matched three-year highs hit the session before on Tuesday and lead inched to a new 17-month top as investors ploughed into metals that have lagged this year and appear undervalued on prospects of reviving global growth.

Aluminium gains industrial lustre

Posted on 30 July 2014

When it comes to conductivity, copper is king of the industrial metals. Thanks to its low level of resistivity – how strongly a material opposes the flow of current – the red metal’s main use is in electrical applications.

Global mining sector on the way up, but recovery still slow

Posted on 30 July 2014

Global mining activity showed steady signs of improvement in the first half of the year, but recover is still expected to be slow, the latest study by SNL Metals Economics Group published Tuesday shows.

Mining industry confidence at five year low

Posted on 30 July 2014

As the mining boom ends, confidence in the industry has hit a new five year low. An annual study of mining bosses has found they think the industry is out of their control, raising the prospect of a big shake up. Commodity prices and Chinese demand are expected to keep falling.

Goldman unit eyes foray into China amid metals financing scandal

Posted on 30 July 2014

Goldman Sachs Group Inc’s metals warehousing unit is exploring its first foray into China, and privately held C Steinweg has expanded capacity there, sources said, as a financing scandal in a major Chinese port fuels a scramble for market share.

Navigating an Uneven Market for Commodities ETFs

Posted on 30 July 2014

Commodity exchange traded funds help diversify an investor’s portfolio, but traders can also dive into the market to pick and select potential opportunities while avoiding duds. According to the Goldman Sachs Group, nickel and palladium are set to outperform in an uneven global economy, reports Glenys Sim for Bloomberg.

5 Most Popular New ETF Launches

Posted on 30 July 2014

Issuers have brought to market 110 new ETFs so far this year, offering exposures that run the gambit—and few resemble what we would consider “plain vanilla” strategies. But only a handful of these new funds have gathered any traction with investors.

Shanghai FTZ will launch a commodities exchange; will debut with copper

Posted on 30 July 2014

The Shanghai free trade zone (FTZ) will get a physical commodity trading exchange towards the end of this year, and copper will be its first product, market sources told Metal Bulletin.

Brazil Real Intervention Out of Sync With Slowdown, IMF Says

Posted on 30 July 2014

The International Monetary Fund said Brazilian central bank President Alexandre Tombini shouldn’t shore up the real as Latin America’s largest economy stalls and inflation accelerates.

How to Blend In a Currency Hedge

Posted on 30 July 2014

Looking across developed markets today, a common thread is that central bank policies have pushed interest rates to very low levels to support their economies. Looking at the major central banks—the U.S., the European Central Bank (ECB) and the Bank of Japan (BOJ)—it appears that Europe and Japan are still expanding their accommodative policies, while the U.S. is reducing and is anticipated to be the first among these banks to raise interest rates.

California eyes southern border for ETS expansion

Posted on 30 July 2014

California Governor Jerry Brown and Mexican environmental officials signed a pact on Monday aimed at reducing greenhouse gas emissions, an agreement that could eventually expand the market for carbon credits.

Combet urges ‘climate war’ to continue

Posted on 30 July 2014

The man Julia Gillard wanted to become her successor as prime minister, Greg Combet, says Labor must again go to war with Tony Abbott on carbon - but this time win the politics. Speaking at the launch of his book The Fights of My Life, the former climate change minister said Mr Abbott’s abolition of the carbon tax was only a temporary setback.

Commodities Trading At Banks: Going, Going, Gone?

Posted on 29 July 2014

While on a visit to the commodities unit of a major investment bank in New York roughly seven years ago, one was enveloped by a sense of exuberance on the trading floor. No less than three executives claimed their institution was among the “few banks” with separate units dealing in paper crude oil barrels, as well as loading and dispatching the physical stuff on to tankers somewhere off a foreign shipping terminal.

Shock as commodities hedge fund performs reasonably well

Posted on 29 July 2014

Commodities hedge funds have not being doing well lately. Clive Capital shut its doors last year, so did Higgs Capital, Arbalet Capital and Schroders’ Opus commodities fund. Armajaro Asset Management, the coffee and chocolate specialist hedge fund, has not been without its problems – it biggest fund lost nearly 25% of assets in the first quarter – but it’s actually done surprisingly well.

Inflation - Are Commodities Talking to Us?

Posted on 29 July 2014

Markets often do talk to us, if only we would listen. Our ears serve as only part of listening. An open mind is also required. Regrettably, minds receptive to new thoughts and questions have been somewhat outmoded in the investment world for many years. Why else do so many seem to ignore what commodities are saying?

EIA: OPEC’s 2013 oil export revenues fall 7%

Posted on 29 July 2014

According to recent estimates from the US Energy Information Administration, members of the Organization of the Petroleum Exporting Countries, excluding Iran, earned about $826 billion in net oil export revenues in 2013, a 7% decrease from 2012 earnings. But this was still the second-largest earnings totals during 1975-2013—the timespan of how long EIA has tracked OPEC oil revenues.

Forecasts for higher oil prices misjudge the shale boom: Kemp

Posted on 29 July 2014

“The world of energy may have changed forever,” according to Professor James Hamilton of the University of California. “Hundred dollar oil is here to stay.” Hamilton, who is one of the most respected economists writing about oil, made his bold prediction in a paper on “The Changing Face of World Oil Markets”, published on July 20.

Obama’s Offshore Energy Policy Could Rescue Oil And Gas Explorers

Posted on 29 July 2014

Has the BP Deepwater Horizon disaster run its course? The Obama administration may think so, having shifted gears in recent weeks and removed potential barriers to more drilling off the coast of the Atlantic Ocean. This is in addition to earlier moves that eased the steps for developers to pursue oil and gas deposits in the Gulf of Mexico and possibly off the coast of Alaska.

Fracking: British government opens the way for energy firms to explore for shale gas

Posted on 29 July 2014

Energy firms will be able to bid for licenses Monday to explore for shale gas in Britain, three years after the controversial fracking process caused seismic tremors which led the government to suspend operations.

Gold Price In 2014 Consolidating Above Major Support Area

Posted on 29 July 2014

So far, the gold price in 2014 in the first six months has been trading in a tight range between $1190 and $1390. The yellow metal had one significant rally in February / March and one moderate rally starting in June.

Must-know facts about the silver rally

Posted on 29 July 2014

First, it’s worth putting silver’s recent rise in context. Here are three important facts about the recent rally. 1. While the metal has had a respectable run over the past month, silver is still playing catch-up after losses earlier this year. Between late February and early June, silver prices fell roughly 15%.

Should you jump on the silver bandwagon?

Posted on 29 July 2014

After rising nearly 12% from its June lows, silver has been garnering some attention lately, leaving many investors wondering whether they should raise their allocations to the precious metal. Russ explains why now probably isn’t the best time to allocate more to either silver or gold.

Guide to Small Cap Growth ETFs Investing

Posted on 29 July 2014

Small cap investing has been out of investors’ favor this year, giving up all its gains made last year. While large caps are clearly leading the broad market rally, small caps are lagging after their past 15 years of outperformance. This indicates a trend reversal after a long-standing preference for small caps.

American Funds ETF Filing A Very Big Deal

Posted on 29 July 2014

On Friday, a new petition seeking the right to offer non-transparent active ETFs titled “The Capital Group ETF Trust” went into the regulatory pipeline at the Securities and Exchange Commission. It might be the biggest ETF story of the year.

Yuanta to launch Taiwan’s first commodity futures ETF

Posted on 29 July 2014

Yuanta Securities Investment Trust Company (Yuanta SITC) is reportedly poised to launch the first commodity futures ETF in Taiwan as early as the fourth quarter this year, according to a report from Commercial Times.

The Japan Exchange to break into commodities and OTC

Posted on 29 July 2014

The Japan Exchange plans to build a new derivatives trading system with Nasdaq OMX and Japanese software vendor NTT Data Corporation, as part of a medium-term strategy to grow trading and prepare for swap market reforms.

India: FY15 agriculture growth to remain muted, says Crisil

Posted on 29 July 2014

The country’s agriculture growth is likely to remain muted at 1 per cent in FY’2015 largely due to strong statistical base-effect, rating agency CrisilBSE -2.60 % said.

States debate regulating digital currency

Posted on 29 July 2014

Now that consumers can use digital currencies like bitcoin to buy rugs from Overstock.com, pay for Peruvian pork sandwiches from a food truck in Washington, D.C. and even make donations to political action committees, states are beginning to explore how to regulate the emerging industry.

Global Currency Trading Falls Amid Volatility Drop, Market Probe

Posted on 29 July 2014

Foreign-exchange volumes in the U.S., U.K. and Australia fell in April from a year earlier, according to reports from the world’s biggest central banks, amid subdued price swings and a probe into trading activity. Average daily currency turnover in North America was $811.1 billion, a 20 percent drop from a record $1 trillion in April 2013 and a 0.6 percent decline from October, the Federal Reserve-sponsored Foreign Exchange Committee said in a statement on its website, citing a twice-yearly survey.

Japan, Mexico sign carbon trade deal

Posted on 29 July 2014

Japan and Mexico have signed a deal for Japanese companies to earn carbon credits by investing in technology to cut greenhouse gas emissions in Mexico - in Japan’s 12th bilateral carbon agreement. The programme, known as the Joint Crediting Mechanism (JCM), lets companies in Japan, the world’s fifth-biggest greenhouse gas emitter, use lower-cost emission cuts abroad to help meet domestic targets.

Korea: Fine-tune carbon scheme

Posted on 29 July 2014

The government’s plans to launch a carbon emissions trading scheme next year have become a hot subject of national debate because of the strong call from industries to delay it until 2020. New Deputy Prime Minister Choi Kyung-hwan’s pro-business stance is adding to the intensity of the debate.

Australian Repeal Deals Blow to Global Carbon-Emission Plans

Posted on 29 July 2014

Australia’s repeal of a pioneering tax on carbon emissions has dealt a sharp blow to struggling international efforts to coordinate on global warming and comes ahead of key climate-change talks next year.

Fundamentals are driving commodity markets

Posted on 28 July 2014

Commodities performance in Q2 and in the beginning of Q3 has been a mixed bag. We have the grains and oilseeds plunging into a bear market, rallies in the softs and better returns in energy and precious metals. These commodity asset classes are re-aligning and being driven by their own fundamentals rather than broad macro-economic drivers. A whole range of factors, especially from the supply side including weather, export bans, unplanned outages and geopolitical risk, are starting to have more influence on commodity prices than announcements from the Fed.

Industrial metals emerge stronger in 2014, bullion, energy weakness continues

Posted on 28 July 2014

Industrial metals have emerged stronger in 2014 while weakness continues in energy and bullion complex that emerged recently. The gains in base metals have been driven by increased speculation about a rising supply deficit in aluminum over the coming two years as demand keeps rising at a time where some fo the major producers outside China have reduced production, noted Ole S Hansen, Head of Commodity Strategy at Saxo Bank.

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