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Commodities Briefing - Category | Market Moves more

Will China’s crash trigger a new global recession?

Posted on 13 July 2015 by VRS  |  Email |Print

The weak post-2008 recovery in the global economy is drawing to a close. Greece, China, falling bond and equity prices, all point to trouble ahead. With one of the world’s most open economies, we in Ireland will be among the first to feel the draft.
Following the stunning success of the “no” camp in last Sunday’s referendum all eyes have been focused on Greece. Will the Mediterranean country be able to agree a package with its creditors that allows it to stay in the euro or is ‘Grexit’ finally upon us? If Greece does become the first country to exit the single currency what, if any, will be the consequences for the rest of the eurozone?……………………………………….Full Article: Source

The Cost of Insuring Against a Commodities Crash Is Rocketing

Posted on 10 July 2015 by VRS  |  Email |Print

China’s stock slump has played havoc with the commodities market as traders fret that the economy driving global demand for raw materials is about to tank. The Bloomberg Commodity Index, which includes 22 commodities, everything from live cattle to natural gas, traded near a 13-year low this week as industrial metals and oil tumbled. Nickel plunged 9 percent in a single day.
The increase in volatility has sent the cost of buying options to insure against bigger drops in the price of some commodities soaring………………………………………..Full Article: Source

China wants to steal gold-market ‘reins’ from New York, London

Posted on 10 July 2015 by VRS  |  Email |Print

China has been making it very clear that it wants more control over the global gold market, but it’ll have to go through New York and London first. “Given that China is the epicenter of the physical gold market, it does make sense that the Chinese government would want its physical Shanghai gold market to supplant the Comex derivative market (and others) as the primary global price-setting mechanism,” said Anthem Blanchard, chief executive officer of online precious-metal retailer Anthem Vault.
China is, after all, the world’s largest producer and one of the biggest buyers of the metal, often running neck and neck with India as the globe’s top consumer. Last month, the Bank of China became the first Chinese bank to join the group of lenders that set the London Bullion Market Association’s gold price benchmark, and two more Chinese banks are reportedly working to become members………………………………………..Full Article: Source

China retains world’s largest spot gold trading market for 8th year

Posted on 10 July 2015 by VRS  |  Email |Print

China has retained its lead as the world’s largest market for spot gold trading for the eighth year, as growing participation by offshore investors fueled trade growth, the Shanghai Gold Exchange said Thursday. Trading of gold surged 166 percent during the first half this year to 17,520 tonnes, while that for silver jumped 151 percent during the same period to 380,000 tonnes.
Trading of bullion and silver totalled 4,764 and 525 tonnes respectively at an international board set up for offshore investors in the Shanghai Free Trade Zone in September. The World Gold Council estimates demand for bullion from China and India, the world’s top two buyers, will stand between 900 to 1,000 tonnes this year………………………………………..Full Article: Source

Citigroup Ordered to Pay Commodities Trader $14 Million Over Asian Deals

Posted on 10 July 2015 by VRS  |  Email |Print

A London court has ordered Citigroup Inc. to pay about $14 million to commodities trader Mercuria Energy Group in a dispute over a series of Chinese metal deals that turned sour. Justice Stephen Phillips of London’s High Court ordered Citi to pay Switzerland-based Mercuria $13.6 million plus interest for damages related to a transaction in which the bank failed to deliver metal paid for by Mercuria last year.
The judge also ordered Citi to pay 50% of Mercuria’s legal fees, including an immediate payment of £323,000, or roughly $500,000, according to a court order seen by The Wall Street Journal………………………………………..Full Article: Source

Market Turbulence Worries BRICS as Volatility Stalks Oil, China

Posted on 10 July 2015 by VRS  |  Email |Print

The BRICS group of developing nations, meeting in Russia to bolster ties, said they’re disturbed by the turbulence that’s roiled global markets from energy to stocks. “We’re concerned about instability in the markets, the high level of volatility in the prices of energy and raw materials, and the accumulation of sovereign debt of a number of major countries,” Russian President Vladimir Putin said in the city of Ufa, 800 miles east of Moscow.
“All these structural imbalances directly affect growth.” The summit of leaders from Brazil, Russia, India, China and South Africa also discussed creating their own credit-ratings company and nurture direct investments between each other………………………………………..Full Article: Source

China’s troubles hit commodities prices

Posted on 09 July 2015 by VRS  |  Email |Print

China is once again at the center of the commodities story, but not in a good way this time. The country’s stock-market slump and concern over Greece’s economic crisis have helped send commodities toward multiyear lows, choking off a nascent recovery in prices from oil to iron ore, and dragging down shares in resource companies and currencies of producing nations.
Though prices stabilized somewhat Tuesday after a broad selloff on Monday, commodities as an asset class have fallen into an extended funk this year, as fears about an excess of products like aluminum and coal have taken hold. The S&P GSCI–an index that tracks a diversified basket of commodities–is down 36% over the past year, and had fallen 6.4% this month as of the close of trading on Monday………………………………………..Full Article: Source

China funds target commodities after slump in equities

Posted on 09 July 2015 by VRS  |  Email |Print

Chinese hedge funds have been big short sellers of locally traded commodities, including iron ore, steel and rubber, after redeploying cash from tumbling equity markets where authorities have slapped curbs on trading, fund managers and traders said.
The Chinese equity market rout, which has persisted despite a raft of unprecedented policy measures, appears to be the chief factor driving the sell-off in commodities. There had been forced liquidation on China’s commodities markets due to margin calls tied to stock market exposure, as well as some short sellers taking advantage a flight of international investors from local markets, they said………………………………………..Full Article: Source

Oil market: The Iranians are coming

Posted on 09 July 2015 by VRS  |  Email |Print

The decade-long standoff between the West and Iran, with respect to its nuclear programme, is about to enter a new phase of possible resolution - although the July 7 deadline has been extended to the 10th to reach an agreement. This is the second time a deadline has been missed and there may be a bumpy road ahead.
The permanent members of the Security Council plus Germany have been negotiating with Iran since December 2013 and they arrived at a framework for a final deal last April. It was supposed to be finalised by the end of June, then July 7, and now July 10………………………………………..Full Article: Source

Gold market returns to net dehedging in Q1

Posted on 09 July 2015 by VRS  |  Email |Print

Following a year of net hedging in 2014, when hedging contributed 3.33-million ounces to gold supply, the first quarter of 2015 saw the market return to net dehedging, with the global producer gold hedge book contracting by 80 000 oz. This return of activity to the demand side of the market came after 1.45-million ounces of net hedging in the last quarter of 2014, Société Générale and Thomson Reuters GFMS revealed in the Global Gold Hedge Book Analysis for the first quarter on Wednesday.
The report further noted that the volume of the global producer hedgebook ended the quarter at 6.21-million ounces, with 29 companies becoming net dehedgers, and 16 companies adding to their delta-adjusted hedge positions over the three months………………………………………..Full Article: Source

Gold has done ‘worse than nothing’ in 2015

Posted on 09 July 2015 by VRS  |  Email |Print

Gold is losing its status as a safe haven asset. Markets have been jittery over the past few weeks with all that’s going on in Greece and China. In moments like these, gold usually benefits as one of the safer commodities to be invested in. But gold has been all over the place, and after a selloff on Tuesday, it sank even further to a fresh three-month low.
In a note Wednesday, Macquarie analysts ask, “What is left of gold’s status as a safe-haven?” Here’s more (emphasis added): Put simply, this year feels as if has had more than its share of drama - terrorist attacks, airline crashes, conflict in the Middle East and most recently a plunge in the Chinese stock market and the now very real prospect of Greece defaulting on its debts and being forced to leave the Eurozone………………………………………..Full Article: Source

When China sneezes, metals catch a cold

Posted on 09 July 2015 by VRS  |  Email |Print

A sharp fall in Indian metal shares on Wednesday—the S&P BSE Metal Index was down 3.9%—raises fears of more trouble ahead. The fall follows plummeting global metal prices, which, in turn, is a reaction to the meltdown in Chinese equities.
What’s the connection? Beijing’s clumsy handling of the situation in Chinese equities appears to have caused panic that is spreading to other assets. There’s also a worry that falling stocks could have knock-on effects on the Chinese economy………………………………………..Full Article: Source

Copper, Zinc Jump on Bets Skid in Industrial Metals Was Overdone

Posted on 09 July 2015 by VRS  |  Email |Print

Copper jumped the most in five months and zinc posted the biggest gain in a year on speculation that the slump in industrial metals to the lowest since the global financial crisis was overdone.
Bellwether copper’s 14-day relative-strength index, a gauge of price momentum, fell below 30 on Tuesday, with other metals around the threshold. That’s a signal to analysts who study charts that metals may have fallen too fast. Traders with bearish bets have been making purchases to unwind those positions, Bank of China International Ltd said………………………………………..Full Article: Source

China’s Troubles Hit Commodities

Posted on 08 July 2015 by VRS  |  Email |Print

China is once again at the center of the commodities story, but not in a good way this time. The country’s stock-market slump and concern over Greece’s economic crisis have helped send commodities toward multiyear lows, choking off a nascent recovery in prices from oil to iron ore, and dragging down shares in resource companies and currencies of producing nations.
Though prices stabilized somewhat Tuesday after a broad selloff on Monday, commodities as an asset class have fallen into an extended funk this year, as fears about an excess of products like aluminum and coal have taken hold. The S&P GSCI—an index that tracks a diversified basket of commodities—is down 36% over the past year, and had fallen 6.4% this month as of the close of trading on Monday………………………………………..Full Article: Source

Why oil could revisit its lows and then some

Posted on 08 July 2015 by VRS  |  Email |Print

After another volatile session, oil looks increasingly set to test its lows of the year, and that could mean a temporary decline of near 20 percent. Analysts say crude futures could continue to trade lower for now if the twin pressures on risk markets from Greece and China continue, and Iran succeeds in striking a nuclear deal that would ultimately mean more oil would hit an already oversupplied crude market.
On Tuesday, West Texas Intermediate futures for August traded higher early in the session and then plunged, touching the psychologically key $50 area before again reversing course. Already about 8 percent lower than at the start of the week, WTI futures lost just 20 cents Tuesday to finish at $52.33 per barrel………………………………………..Full Article: Source

China Rapidly Changing International Gold Market

Posted on 08 July 2015 by VRS  |  Email |Print

Since 2007 China has the largest domestic gold mining output, since 2011 the Shanghai Gold Exchange has been the largest physical gold exchange and in 2013 and 2014 China was the largest importer. Now the Chinese seek to escalate pricing power. From the beginning of the liberalization of China’s gold market in 2002, the governor of the People’s Bank Of China has been strikingly honest – compared to his Western colleagues – regarding his view on gold.
At the LBMA conference in 2004 governor Zhou Xiaochuan stated gold is a currency, an indispensable investment tool and the gold market – together with the securities and foreign exchange market – constitute the main part of the financial market. As of today, China has fully developed its domestic gold market and is aiming to further integrate with the international gold market – inter alia to support the internationalization of the renminbi – as was planned more than a decade ago……………………………………….Full Article: Source

Markets hedge gold bet on US Fed

Posted on 08 July 2015 by VRS  |  Email |Print

In 2011, when Europe was spiralling into crisis, gold soared, helped by the perception of US dollar “money printing” by the US Federal Reserve. Last weekend, Greek voters cleaved a serious schism in the eurozone facade, threatening the stability of the world’s second-biggest economic block. But instead of roaring higher, gold barely whimpered as it slipped to near five-year lows.
“The lack of influence that the euro crisis is having on gold is particularly noteworthy as the yellow metal continued its recent price decline, underlining again how gold’s main role in financial markets at present is as a proxy for the timing and likelihood of a Fed rate hike,” Barclays commodity strategists said………………………………………..Full Article: Source

Oil, Commodities Tumble as Investors React to Greek Vote

Posted on 07 July 2015 by VRS  |  Email |Print

Risk aversion dominated energy and commodity markets in Asian trade Monday as prices fell sharply, led by oil and industrial metals, on heightened fears of Greece’s exit from the eurozone. Even gold, traditionally viewed as a safe-haven by investors, failed to live up to that epithet as a broad-based selloff hit the markets.
On Sunday, Greeks overwhelmingly voted against their international creditors’ conditions for further bailout aid, adding to uncertainty around the country’s eurozone membership and heightening risks of market contagion. “Markets are due for a bumpy ride as the face-off ensues,” Singapore-based Phillip Futures said………………………………………..Full Article: Source

Looking Ahead into Commodities

Posted on 07 July 2015 by VRS  |  Email |Print

As the second half of the year gets underway, commodities king Dennis Gartman has his eyes on one market that he believes is poised to surge: agriculture. Corn, wheat and soybean prices saw a massive rally this last week after the USDA reported that grain prices could rally in 2015 and 2016 as a result of crop damage and harvest delays due to excessive rainfall.
Corn and wheat soared to year-to-date highs and soybean hit its highest levels since January.“Usually we get rallies in June and July on drought conditions, but this year we’re getting rallies in the grain markets on excess of rain conditions,” Gartman said last week on CNBC’s “Futures Now.”……………………………………….Full Article: Source

Oil crushed by worries on Europe, Iran

Posted on 07 July 2015 by VRS  |  Email |Print

Oil is expected to spiral even lower, as concerns about global growth collide with record production and the potential for more supply from Iran. West Texas Intermediate crude futures plunged 7.7 percent Monday and were in official correction territory, with a decline of more than 11.5 percent since July 1. Brent was more than 6 percent lower.
Oil plummeted on fresh worries that Greece’s anti-austerity referendum could lead to its exit from the euro zone, creating negative fallout across the region’s economy. “The drop in oil is going to stop, but not for now,” said Francisco Blanch, head of global commodities and derivatives research at Bank of America Merrill Lynch. “You’ve got every cylinder pointing south. You don’t want to try to grab this falling knife.”……………………………………….Full Article: Source

Copper hit by China equity swings

Posted on 07 July 2015 by VRS  |  Email |Print

Copper was hit hard by China’s volatile stock market on Monday, sliding to its lowest level in five months as prices of other commodities tied to the world’s biggest consumer were also pressured.
The Bloomberg Commodity Index that includes energy, agricultural commodities and metals, fell 2.2 per cent, its biggest one-day drop since February and a sign that mounting losses for Chinese equity investors are spilling over into other financial sectors. In London, shares of copper miners fell, with Glencore and Antofagasta both down 1.5 per cent………………………………………..Full Article: Source

China’s reduced appetite for commodities won’t be offset by India

Posted on 06 July 2015 by VRS  |  Email |Print

The decade-long commodity demand “super-cycle” induced by China’s unique, resource-intensive economic growth model is nearing an end, analysts say, and that will not change even if India changes course to follow suit. That means global demand for commodities will grow more slowly in the years ahead as India, despite a similar population to China, will not make up for China’s slowdown.
“Even if India were to emulate China’s growth path, it will take a long time before the country can compensate for the slowdown in Chinese demand for commodities due to India’s small base,” Vanessa Lau, a senior analyst at American brokerage Sanford Bernstein, said in a research report………………………………………..Full Article: Source

Opportunity In Commodities In Response To Greek Referendum

Posted on 06 July 2015 by VRS  |  Email |Print

With the Greeks voting on Sunday on whether to accept creditor proposals and another bailout, the commodity markets are likely to fall either way. When the 2010 bailout was approved, commodities fell and gold rose. The same could happen this time if the Greeks vote Yes on accepting another bailout. If they vote No, Grexit becomes more likely, making the commodity decline more protracted.
A resolution to the situation in Greece - or lack thereof - has long been at the forefront of financial media reporting. So much so, that we are now seeing markets turning somewhat dissolute towards the outcome of the situation, and we have ended up with two distinct groups - one that stands firmly behind the idea that Greece is an individual unit and - as a result - the rest of the global economy is relatively insulated from any potential exit from the Eurozone………………………………………..Full Article: Source

Russia Seen as Biggest Oil-Market Loser When Iran Comes Back

Posted on 06 July 2015 by VRS  |  Email |Print

In Iran’s push for a nuclear deal, it’s had few better allies than Moscow. But if an agreement is reached this week, President Vladimir Putin’s regime will have at least one reason to reflect on its support.
Russia, which vies with Saudi Arabia and the U.S. to be the world’s largest oil producer, has the most to lose when Iran returns to the global energy market, according to a dozen analysts and executives at oil companies, banks and trading houses interviewed by Bloomberg. “Iran is going to be competing in Europe head-on with Russia,” said Ed Morse, head of commodities research at Citigroup Inc………………………………………..Full Article: Source

Gold fails Greece test

Posted on 06 July 2015 by VRS  |  Email |Print

Worries about the Greek sovereign default are, surprisingly enough, not adding much sheen to gold. The yellow metal has failed to display any safe-haven attributes in this entire Greece drama. Instead it has been completely driven and influenced by movements in the US dollar. This is a repeat of the situation during strikes on Syria and the Russia-Ukraine crisis last year. Although financial markets are nervous, investors seem to be shunning gold as a safe haven and rushing into the dollar instead.
The global spot gold price tumbled in the past week from its high of $1,188 per ounce on Monday to record a low of $1,157 on Thursday despite the brewing crisis at Greece. However, weak US jobs data rescued the yellow metal as the dollar gave up some of its gains. Gold prices reversed a bit higher to close the week at $1,168.7, down 0.6 per cent for the week. Among the other precious metals, silver closed 0.7 per cent lower at $15.7 per ounce while platinum closed almost flat at $1,083 per ounce………………………………………..Full Article: Source

Commodity markets diverge as supply and demand come to the fore

Posted on 03 July 2015 by VRS  |  Email |Print

Divergence was the name of the game for commodities markets in the second quarter as gasoline and iron ore jumped but coffee and nickel plunged and money flowed into index investments and out of exchange traded funds. Led by crude, commodities enjoyed a strong start to the quarter but the rally fizzled out as oil prices moved sideways and the US dollar stabilised, bringing fundamentals such as supply and demand to the fore.
The S&P GSCI total returns index — which includes the gains or losses on rolling over positions and interest on collateral is up 9 per cent on the quarter with gasoline up 20 per cent and coffee down 25 per cent. “It has been a mixed bag for the asset class as a whole,” said Aakash Doshi, analyst at Citigroup in New York………………………………………..Full Article: Source

China and commodities: Cornering the markets

Posted on 03 July 2015 by VRS  |  Email |Print

The world’s biggest consumer of commodities is no longer just an insatiable buyer of everything from coal to gold. A richer, slower-growing and choosier China is becoming an exporter as well as importer. It is also using its clout to change the way commodities are traded, bringing markets closer to home and drawing up rules that suit its needs instead of those of producers and Western financiers.
This week, for example, Chinese regulators gave the go-ahead for foreigners to trade crude-oil futures in Shanghai. When that starts—probably by November—it will be the first time that outsiders have been allowed to buy and sell a listed Chinese futures contract. This is part of a clear plan to change the way commodities are traded, says Owain Johnson of the Dubai Mercantile Exchange (DME)………………………………………..Full Article: Source

‘New normal’ in Australia commodities – low prices and strong volumes

Posted on 03 July 2015 by VRS  |  Email |Print

The big picture is that Australia is receiving less money for its commodity exports, with the value dropping 11 per cent to A$174 billion (US$133.8 billion) in the 2014-15 fiscal year. “New normal” is a term coined about China’s transition to slower but hopefully more sustainable economic growth, but it can be equally applied to many commodity markets.
This reality was well illustrated by the Australian government’s latest set of forecasts for the country’s commodity exports, which highlighted we are now in an era of low prices but strong volumes. Australia’s official forecasts carry weight because the country is the world’s largest exporter of iron ore and metallurgical coal, and will become number one in liquefied natural gas (LNG) within the next few years………………………………………..Full Article: Source

New oil bull market in sight as Brazil, Iraq cut output targets

Posted on 03 July 2015 by VRS  |  Email |Print

Massive downward revisions to oil output in Brazil and Iraq have increased the risks for oil markets of going from the current feast to famine within just a few years, leading to a price spike that would give a new boost to the U.S. shale industry.
Brazil and Iraq had been expected to add over 2 million barrels per day to global supply by 2020 and another 2.5 million by 2025, becoming the two biggest contributors to help meet rising global demand, according to the long-term forecast of the International Energy Agency………………………………………..Full Article: Source

Oil Oversupply Meets Rising Demand in Quietest Market Since 2013

Posted on 03 July 2015 by VRS  |  Email |Print

The sleepiest oil market since 2013 will probably limp through the second half of the year as well. Crude traded in a $5 range in June, the narrowest in 19 months. Volume was the lowest since December and open interest - - the number of futures contracts outstanding — was the least since January.
New York-traded futures, which have swirled around $60 a barrel for the past two months, will average about $59 in third quarter and $63 in the fourth, according to forecasts of 22 analysts compiled by Bloomberg. Neither the potential return of Iranian crude to the market nor the long-anticipated decline in U.S. production is stirring a reaction………………………………………..Full Article: Source

A Test Of $1,163 Is In the Cards For Gold– MKS

Posted on 03 July 2015 by VRS  |  Email |Print

While some commodity analysts have noted that the gold market hasn’t benefited from the ongoing Greek financial crisis as the price have continued to slide and remain near a three-week low, one analyst says it is important to shift your perspective .
Jessica Fung, commodity analyst at BMO Capital Markets, said that while gold hasn’t befitted from the crisis, it has helped support the market. She notes that gold is trading about $30 below the key psychological level of $1,200 an ounce. “That is really nothing,” she says. “You should look at it this way: if Europe wasn’t close to falling apart where would gold prices be right now?”……………………………………….Full Article: Source

Iron ore in biggest daily fall since March

Posted on 03 July 2015 by VRS  |  Email |Print

Iron ore suffered its biggest one day percentage drop since March, falling by more than 5 per cent, as shipments of the steelmaking ingredient heading to China continued to pick-up. Iron ore was one of the top performing commodities in the second quarter rising more than 20 per cent. One trigger for the rally was a late buying spree by Chinese steel producers ahead of the peak summer demand period. But another factor was lower than expected volumes from Australia.
Analysts believe a prolonged wet season in the Pilbara region of Western Australia affected output, in particular at mines owned by Rio Tinto, the world’s second-biggest producer of iron ore………………………………………..Full Article: Source

Finding Investment Opportunities in Emerging Markets

Posted on 03 July 2015 by VRS  |  Email |Print

Within emerging markets the Asian region provided the main winners in 2014 thanks to the sharp decline in the oil price. But what can investors expect from 2015? Emerging market investors had a difficult time in 2014, with returns lagging developed markets. Over the year as a whole the MSCI AC World Index showed a total return of 8.6% in sterling terms against a meagre 1.4% return for the MSCI Emerging Markets Index.
Within emerging markets the Asian region provided the main winners, with the sharp decline in the oil price seen in the latter part of the year being beneficial for the majority of countries in the region as they are net oil importers………………………………………..Full Article: Source

Russia has no gold market, expert says

Posted on 02 July 2015 by VRS  |  Email |Print

European investors have been buying gold coins actively against the background of the intensifying financial crisis in Greece. Restriction on cash withdrawals in Greece led to a sharp increase in demand for investment coins in Germany, France and in Greece. Pravda.Ru interviewed Finam’s analyst at the department for international markets, Vadim Sysoev, about the current state of affairs on the market of gold.
“Gold continues to consolidate near the level of approximately $1,200, even though many are fed up with the Greek story. Even if there were risks of default in Greece, gold was not growing in price. On the contrary, gold prices slide and do not show any signs of life………………………………………..Full Article: Source

Investing in the Next Silver Bull Market

Posted on 02 July 2015 by VRS  |  Email |Print

There was a recent article on the SilverSeek website. It states that the paper market for silver futures is now over one billion ounces, most of which represents a naked short position in silver. The article says that the Comex silver market is the most corrupt in history, which is obviously quite subjective and a pretty tough accusation to prove.
As with many websites and articles that specialize in silver, it says that there is extreme manipulation in the silver market. The interesting part about this article was its case that the big banks are orchestrating something that will end up in a Comex default………………………………………..Full Article: Source

Aluminium, zinc rebound on hopes for demand, Greek deal

Posted on 02 July 2015 by VRS  |  Email |Print

Most base metals rebounded on Wednesday on brighter prospects for a Greek bailout deal and after solid U.S. economic data that spurred hopes for stronger demand. Many investors scrambled to close out short positions after profiting from sharp falls over the past two days when some metals hit multi-year lows.
“The short-term downtrend has been broken,” said Gianclaudio Torlizzi of consultancy T-Commodity in Milan. “Aluminium, zinc and lead look nice on the charts, they will likely see nice short-covering over the next few weeks,” he told Reuters Global Metals Forum………………………………………..Full Article: Source

Commodities Jump Most Since February as Corn, Soybeans Rally

Posted on 01 July 2015 by VRS  |  Email |Print

The outlook for smaller crop supplies sent corn and soybean prices surging, spurring the biggest gain for raw-material prices since February. The Bloomberg Commodity Index of 22 components rose 1.9 percent to 102.69 as of 3:30 p.m. in New York, on pace for the largest advance since Feb. 3. Corn soared the most since 2010, climbing 7.7 percent, the biggest gain among the asset class on Tuesday.
Heavy rains have slowed crop planting across the U.S. Midwest, while expanding livestock herds mean that there’s more grain being used in feed supplies. American farmers planted fewer corn acres than estimated three months ago, and domestic inventories as of June 1 were smaller than analysts were forecasting, a report from the U.S. Department of Agriculture showed Tuesday………………………………………..Full Article: Source

Basic Materials: China Slowdown Weighs on Commodities (With One Exception)

Posted on 01 July 2015 by VRS  |  Email |Print

We expect coal, copper, and iron ore prices to remain below long-term averages as China continues to shift away from an investment-led economy. The basic materials sector is trading close to our aggregate fair values at a median price/fair value of 0.97 compared with a market price/fair value of 0.99.
Mined commodity prices tied to China’s sun setting infrastructure and housing boom are unlikely to recover, but we see uranium as an exception to this story as China builds out its fleet of nuclear reactors. While we expect China’s housing market to eventually falter, the outlook for U.S. residential construction is better than most think, with implications for lumber and coatings companies………………………………………..Full Article: Source

New oil bull market in sight as Brazil, Iraq cut output targets

Posted on 01 July 2015 by VRS  |  Email |Print

Massive downward revisions to oil output in Brazil and Iraq have increased the risks for oil markets of going from the current feast to famine within just a few years, leading to a price spike that would give a new boost to the U.S. shale industry.
Brazil and Iraq had been expected to add over 2 million barrels per day to global supply by 2020 and another 2.5 million by 2025, becoming the two biggest contributors to help meet rising global demand, according to the long-term forecast of the International Energy Agency………………………………………..Full Article: Source

Is there a huge investing opportunity in the oil markets?

Posted on 01 July 2015 by VRS  |  Email |Print

A rare occurrence now happening on oil markets might be a huge opportunity for investors who play it right, says Tim Pickering, president and chief investment officer at Auspice Capital Advisors Ltd.
Pickering said Canadian crude prices are currently in “backwardation,” which means the future price is expected to be lower than the spot price, but every other crude oil market in the world is in contango, meaning the future price is expected to be higher than the spot. “For long-term investors in oil, this is a positive thing because it means they will not lose money as the market rolls over time,” he said in a commentary to clients………………………………………..Full Article: Source

Nickel Slides to 6-Year Low as Shanghai Eases Constraint

Posted on 01 July 2015 by VRS  |  Email |Print

Industrial metals from aluminum to tin capped the longest run of quarterly losses since 2001 on concern that a sputtering economy will erode demand in China, the world’s top consumer, while turmoil in Greece mounts.
This quarter, the London Metal Exchange’s gauge of six prices fell 5.5 percent, the fourth straight decline and the longest slump since September 2001. On June 27, China’s central bank cut its benchmark lending rate to a record and lowered reserve-requirement ratios for some lenders after equities plunged and local government bond sales drained liquidity………………………………………..Full Article: Source

Commodities Drop as Greek Turmoil Spurs Concern Demand Will Wane

Posted on 30 June 2015 by VRS  |  Email |Print

Commodities fell the most in a week on concern that Greece’s deepening financial crisis will threaten global economic growth and demand for energy and metals. The Bloomberg Commodity Index of 22 raw materials lost as much as 0.9 percent, the most since June 19. Energy products and industrial metals led declines, with crude oil dropping to a three-week low and nickel slumping to the lowest since 2009.
Greece shut its banks and imposed capital controls in a bid to avert the collapse of its financial system, increasing the risk that it will be forced out of the euro. After failing to reach a deal with creditors, the country will vote in a July 5 referendum on proposals needed to restore bailout aid………………………………………..Full Article: Source

Greece and China weigh on commodities

Posted on 30 June 2015 by VRS  |  Email |Print

Commodities did not escape the market turmoil caused by Greece’s capital controls and a hefty drop in Chinese equities, with the stronger dollar and risk aversion hitting raw materials led by oil and metals. ICE August Brent, the international benchmark that has traded within a tight range of $61-$66 a barrel for several weeks, fell $1.41 a barrel to $61.86. In the US, Nymex August West Texas Intermediate fell $1.23 a barrel to $58.40.
On the London Metal Exchange, amid a sea of red for industrial metals prices, nickel plumbed a six-year low. The metal, an ingredient for stainless steel, fell 4.6 per cent to $11,855 a tonne, while aluminium was off 1.5 per cent, copper fell 0.5 per cent, and tin dropped 2.5 per cent………………………………………..Full Article: Source

How Will An Iran Deal Impact The Global Oil Market?

Posted on 30 June 2015 by VRS  |  Email |Print

Analysts at Morgan Stanley Research recently polled 299 investors about the impact that a potential Iranian nuclear deal would have on the global oil market. Analyst Haythem Rashed summarized the survey results and noted important upcoming deadlines for oil investors to watch when it comes to the Iran negotiations.
Morgan Stanley asked poll participants how much Iranian oil exports will increase by the end of 2015 and into 2016. The most popular choice for 2015 was an incremental Iranian export increase of 200kb/d. Nearly 40 percent of respondents anticipate Iranian exports to increase by 200-300kb/d, while 15 percent of those polled see no change to Iran’s oil exports this year………………………………………..Full Article: Source

Jim Rogers Gold Correction Forecast

Posted on 30 June 2015 by VRS  |  Email |Print

A Jim Rogers gold prediction is taken seriously by investors. And today (Friday) we got a fresh Jim Rogers gold prediction courtesy of a MarketWatch interview. “Gold is in a correction, and the correction has gone on for four years,” Rogers said.
“Although I am not buying gold, I am expecting an opportunity to buy gold sometime in the next year or two. For instance, if gold goes under $1,000, I hope I’m smart enough to buy a lot more gold.” When Jim Rogers speaks, he is taken seriously by investors – and for good reason………………………………………..Full Article: Source

India: Agri commodities decline on higher acreage, favourable monsoon

Posted on 29 June 2015 by VRS  |  Email |Print

Prices of agri commodities declined by upto 14% so far this month on prospects of bumper output this kharif season following better than forecast monsoon rainfalls and higher acreage. While soybean price fell by 14% to trade at Rs 3444 a quintal in Indore mandi, chana slumped by 13% to Rs 4162 a quintal in New Delhi market. Jeera prices in Unjha (Gujarat) slipped by 11% to Rs 16035 a quintal. Others commodities also followed suit.
As per latest sowing data released by the Ministry of Agriculture, total area sown till June 26 stood at 16.56 million hectares, up by a staggering 23% from the same time last year. Kharif crop sowing picked up during last week following spread of rainfalls. While pulses sowing moved up by 80%, cereals and oilseeds sowing rose by 15% and 427% respectively………………………………………..Full Article: Source

Saudi Kingdom, Russia vie for global oil market foothold

Posted on 29 June 2015 by VRS  |  Email |Print

In the rapidly changing geopolitical environment, Saudi Arabia and Russia are forging ahead - fostering a closer relationship - in major sectors including the all important energy sector. When the Saudi Deputy Crown prince Mohammad bin Salman, accompanied not only by the Foreign Minister Adel bin Jubeir but also the Petroleum Minister Ali Al-Naimi called on Russian President Vladimir Putin in St. Petersburg on June 18, six major deals were signed between the world’s two top crude producers.
The deals ranged from agreement in defense sector to enhanced cooperation in energy development. It also covered greater cooperation on nuclear energy development. Citing unnamed sources, Al-Arabiya reported the kingdom planned to build 16 nuclear reactors and Russia has agreed to play a significant role in operating them………………………………………..Full Article: Source

US becomes biggest oil producer in 2014, surpasses Saudi Arabia

Posted on 29 June 2015 by VRS  |  Email |Print

The United States has overtaken Saudi Arabia as the world’s biggest oil producer in 2014 while India has recorded the highest growth in energy consumption among major economies. The US produced 15.9 per cent more oil in 2014 at 11.6 million barrels of oil per day to topple Saudi Arabia’s 11.5 million bpd production, according to BP Plc’s Statistical Review of World Energy released on Wednesday.
Russia with 10.8 million bpd oil production was placed third. The US surpassed Russia as the world’s largest producer of oil and gas, producing 1,250.4 million tons of oil and oil equivalent natural gas in 2014. This compared with Russia’s 1,062 million tons of oil equivalent. BP said the US shale revolution helped it overtake “Saudi Arabia as the world’s biggest oil producer and surpass Russia as the world’s largest producer of oil and gas.”……………………………………….Full Article: Source

This could be the tipping point for oil prices

Posted on 29 June 2015 by VRS  |  Email |Print

Record oil production meeting a wave of surprisingly strong demand has reined in world oil prices, creating a delicate balance that could be tipped either way—and the most immediate catalyst may be Iran’s nuclear talks.
The market has been awaiting the outcome of the negotiations ahead of a June 30 deadline, as an agreement could put 1 million barrels of Iranian crude back on the market eventually. U.S. crude futures have been locked between $57 and $62 per barrel—since late April………………………………………..Full Article: Source

OPEC crude market share shrinks to 12-year low

Posted on 29 June 2015 by VRS  |  Email |Print

Booming U.S. shale production helped cut OPEC’s global crude market share to a 12 year low last year. According to OPEC’s Annual Statistical Bulletin, the group’s share of the global crude market sank to 41.8 percent in 2014, down from 43.3 percent the year before.
The 1.5 percent slide marks OPEC’s lowest crude market share level since 2003, Bloomberg News said. According to the bulletin, Libya accounted for over half of OPEC’s output decline as two rival governments continue to fight for control of the oil rich country………………………………………..Full Article: Source

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