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Rabobank Report Projects Better Commodity Prices Ahead?

Posted on 30 November 2016 by VRS  |  Email |Print

A recent Rabobank report projects a rise in global demand should bring a three-year decline in commodity prices to an end. Nebraska Farm Bureau Senior Economist Jay Rempe says that outlook should give hope to farmers and ranchers who have been struggling through the downturn in the farm economy.
He agrees with Rabobank officials that global demand for U.S. commodities is improving, especially for beef and pork as the income and diets of consumers improves around the world. Rempe is hoping the incoming Trump administration will work with ag commodity groups to expand export markets………………………………………..Full Article: Source

China money back into commodities

Posted on 29 November 2016 by VRS  |  Email |Print

In China, money flow is tightly controlled and capital markets are relatively underdeveloped, meaning the economy works like squeezing a balloon. You press it in one place, and it bulges in another. Policy-maker moves to cool one expansion only serve to inflate another.
Now that “gyration of bubbles,” according to Société Générale SA’s chief China economist Wei Yao, has been heating up the commodities market again. Earlier this month, thermal and coking coal futures hit a record high since their debut in 2013 while zinc soared to the highest since 2011. Steel rebar, nickel, tin, iron ore and rubber futures also climbed to multi-year highs………………………………………..Full Article: Source

Hey Oil Market: Forget About OPEC for a Second

Posted on 29 November 2016 by VRS  |  Email |Print

The oil market’s attention is focused overwhelmingly on figuring out which OPEC member is going to cut what. The bigger question it shouldn’t lose sight of is this: Who will replace China?
Looking back over 50 years, oil demand has gone through three broad phases: pre-1970s industrialization in the OECD countries, retrenchment after the oil shocks, and then renewed growth through 2015. If the International Energy Agency’s latest long-range forecasts are right, then we stand on the edge of another slowdown in demand growth — a big one………………………………………..Full Article: Source

Trump Administration to Rev Up Global Growth, Says OECD

Posted on 29 November 2016 by VRS  |  Email |Print

If all goes according to plan, a group of international economic experts believe President-elect Donald Trump’s incoming administration will help the world economy grow faster than anticipated over the next few years.
The Organisation for Economic Cooperation and Development on Monday revised its growth outlook for the U.S. and the world economy as a whole. Thanks in part to expected tax cuts, fiscal policy revisions and infrastructural investments, the group now expects the American economy to grow 2.3 percent in 2017 and 3 percent in 2018………………………………………..Full Article: Source

Speculation and fundamentals drive resources rally

Posted on 25 November 2016 by VRS  |  Email |Print

The extraordinary rally in commodities is being driven both by fundamentals and speculation, but experts are divided as to its sustainability. The last time Fortescue Metals Group shares traded above $6 a share five years ago, iron ore was selling at close to $US120 a tonne, well above the current price of $US75 a tonne. The roaring return for Australian mining stocks has outpaced the recovery of their respective commodities.
Driving investors into the stocks is a heady combination of Chinese fiscal and monetary stimulus supporting demand for steel, optimism that President-elect Donald Trump will push through infrastructure spending quickly, and a return to favour in the value end of the market, in which resources sector sits………………………………….Full Article: Source

As the commodity mega-boom winds down, the mini-boom gathers steam: Russell

Posted on 25 November 2016 by VRS  |  Email |Print

As the once-in-a-lifetime commodity boom winds down, a key concern has been what is going to replace the mega-projects built to feed China’s appetite for natural resources. The huge minerals and energy projects that were both the solution and the demise of the China-inspired commodity super-cycle are unlikely to be repeated any time soon, but developments in Australia show it’s not all doom and gloom.
Australia was one of the biggest beneficiaries of the dramatic rise in China’s demand for commodities, with more than A$400 billion ($300 billion) being spent in the last decade………………………………….Full Article: Source

China’s reserves a ‘striking wild card’ for agri-commodities

Posted on 24 November 2016 by VRS  |  Email |Print

How Beijing handles its reserves of soft commodities will help shape markets in 2017. China’s handling of its state reserves of raw materials such as cotton and sugar will be a key factor shaping the direction of agricultural commodities in 2017, according to a major lender to agribusinesses.
China is “the most striking wild card” that will drive agricultural markets, said Stefan Vogel, head of agri commodity markets at Rabobank, the Dutch lender that is a leading financier to farmers and agribusinesses around the world…………………………………Full Article: Source

Commodity bulls may be about to hit a wall

Posted on 24 November 2016 by VRS  |  Email |Print

Rampant speculation and exaggerated hopes of a Trump-led boom have fuelled a blistering rally in industrial metal prices. Oil is perking up and talk of a new commodity super cycle is suddenly on everybody’s lips.
It is as if we were returning to the glory days of breakneck industrialisation in China and the rising powers of Asia, but this time the bulls risk bitter disappointment. A hauntingly strong dollar is watching like Banquo’s ghost over the party. Sceptics warn that the market is already starting to fray at the edges, and signs are growing China’s latest recovery is about to fade…………………………………Full Article: Source

Commodities Surge Is China, Not Trump: Ed Morse (Video)

Posted on 24 November 2016 by VRS  |  Email |Print

Ed Morse global head of commodities research at Citigroup, looks at China as the driver of a rally in the copper and iron ore markets. He speaks on “Bloomberg Daybreak: Americas.”.……………………………….Full Article: Source

New Swiss rules to force commodities groups to disclose payments to officials

Posted on 24 November 2016 by VRS  |  Email |Print

Big commodities groups in Switzerland will have to publish any six-figure payments to public officials under draft anti-corruption legislation announced on Wednesday. Switzerland, which hosts some of the world’s biggest commodities trading groups, aims to make financial flows in the sector more transparent as a way to promote “responsible corporate behaviour”, the government said after a cabinet meeting that approved legislation amending corporate law.
The cabinet submitted a bill requiring commodity groups reveal payments to public officials of more than 100,000 Swiss francs ($98,863) per fiscal year…………………………………Full Article: Source

Gold loses most liquid asset status

Posted on 24 November 2016 by VRS  |  Email |Print

Gold has traditionally been considered this country’s most liquid asset — at any time, people were prepared to give cash against it. After the demonetisation, that has changed.
Scrap gold dealers appear to be gradually shifting to cheque payment or net banking fund transfer. And, customers are not ready for this — selling against cheque means it shows in the account book and long-term capital gains tax is applicable. The concept of gold as an asset capable of getting anytime money is evaporating…………………………………Full Article: Source

Challenges to the global economy

Posted on 24 November 2016 by VRS  |  Email |Print

In this tribute to their teacher, Prabhat Patnaik’s former students put together a volume that covers three major themes: the internal contradictions of capitalism, the growth of the Indian economy and the feasibility of socialism.
Prabhat Patnaik, a frequent contributor to Frontline, is currently Professor Emeritus at Jawaharlal Nehru University and has been one of India’s most renowned economists and public intellectuals. The volume under review contains essays contributed entirely by Patnaik’s former students, especially those whom he guided in their doctoral work…………………………………Full Article: Source

Are Commodities Stuck in a Bear ‘Super-Cycle’?

Posted on 23 November 2016 by VRS  |  Email |Print

Higher rates and a stronger dollar are weighing on commodities prices especially precious metals. Soon after Donald Trump won the presidential election expectations grew that inflation would rise along with bigger deficits as a result of prospective tax cuts coupled with increased spending.
Long-term Treasury bond prices fell as yields climbed, reaching a 12-month high of 2.35% by Friday, and the dollar surged as a result of higher rates. Gold, a traditional inflation hedge, however, lost 5% in price since the election and silver fell almost 9%. “Higher yields along with a sharply higher U.S. dollar are usually poison for gold,” explains Bart Melek, head of global commodity strategy at TD Securities………………………………………Full Article: Source

China-led commodities rally about to run out of steam

Posted on 23 November 2016 by VRS  |  Email |Print

All that Trump campaign chatter about making America great again has done wonders for the US dollar. This past week the greenback hit 13-year highs. Another asset class having a storming year: shares in mining companies. The MSCI world metals and miners index is up 90 per cent from its January low. Yet history suggests the two cannot rally in tandem for long.
The surge in metals and miners is largely down to China. Demand there is key to most metals, not least steel. At the start of this year, worry-worts moaned about an imploding Chinese steel industry exporting cheap steel elsewhere………………………………………Full Article: Source

Goldman Bullish on Commodities Amid Mining’s Accelerating Rally

Posted on 23 November 2016 by VRS  |  Email |Print

Commodities are back in favor, boosting oil producers and miners after their annus horribilis of 2015. The Bloomberg Commodity Index is set for its biggest three-day advance since June, led by gains in oil and industrial metals. That’s pushed shares of mining companies close to their highest this year, with Anglo American Plc and Glencore Plc gaining almost 5 percent on Tuesday. Energy companies also rose, with Tullow Oil Plc up 2.2 percent.
Goldman Sachs Group Inc. said investors should bet on higher prices in the next year as manufacturing picks up around the world, the first time the bank has recommended an overweight position for the asset class in more than four years………………………………………Full Article: Source

Resources rally a game-changer: Goldman’s Tim Toohey

Posted on 22 November 2016 by VRS  |  Email |Print

Goldman Sachs’ Australian chief economist Tim Toohey is predicting interest rate hikes and a stronger dollar as commodity prices continue to defy expectations. Coking coal is up 300 per cent this year, thermal coal up 100 per cent and iron ore 80 per cent, with most of the gains in the past two months amid economic stimulus, regulatory change and speculation in China.
The surge in bulk commodity prices has been one of the biggest surprises of 2016 and the degree to which it is sustained will make a big difference for the Australian economy. Based on Goldman Sachs’ upwardly revised commodity price forecasts, the increased value of coal and iron ore exports by the end of 2017 will be worth 1.4 per cent of GDP…………………………………….Full Article: Source

Growth forecasts for EM economies finally looking up

Posted on 22 November 2016 by VRS  |  Email |Print

Economic growth projections for emerging markets are finally starting to show signs of restoration from modest levels, having bottomed in the second quarter of this year. The ensuing rebound has steadily been translating into more positive earnings expectations after a lengthy period of net downward revisions.
The early signs of a breakout from these negative ranges have been encouraging, although the breadth of the breakout is likely to be a slow-burn process…………………………………….Full Article: Source

With Trump And Brexit, Is The Global Economy In Danger?

Posted on 22 November 2016 by VRS  |  Email |Print

The popular mobilisation in Europe has given an immense impetus to the conservative polity who maintain the status quo in the world. The rise of ‘protectionist’ politics through democratic and populist processes has questioned the effectiveness and sustainability of the neoliberal economic order.
Upon close observation, one can note how both Britain and the United States of America who have been the biggest players in the neoliberal economy are gradually seeking a different economic model. Both Brexit and the electoral victory of the infamous Donald Trump have exposed the inequities that the neoliberal economy had covered under the facade of a ‘competitive market economy’…………………………………….Full Article: Source

As China punishes speculators, billions of dollars exit commodities

Posted on 21 November 2016 by VRS  |  Email |Print

Billions of dollars in funds exited China’s commodities futures in less than a week, the most since February, as regulators curbed speculative trading in a display of Beijing’s power to swiftly cool markets.
But the large-scale retreat may prove to be temporary as cash-rich Chinese retail investors could soon return to jolt commodities futures, and given China’s size, again cause ripples in global markets. Many of these speculators have little investment experience but have loads of cash to gamble with, a combination that often leads to wild price swings……………………………………Full Article: Source

Oil demand growth could fall below 1% by 2018

Posted on 21 November 2016 by VRS  |  Email |Print

Impact investment firm Wermuth Asset Management (WAM), has said that regardless of whether oil prices rise around potential Organisation of Petroleum Exporting Countries (Opec) production-capping news, there is no long-term future for the hydrocarbon sector. Solar power is now available at $3 cent/kWh, which is equivalent to oil at $5/barrel.
According to WAM research, continued investment in oil and gas exploration would only make sense if oil majors and oil producing countries were to develop new projects that could output at less than $5/barrel……………………………………Full Article: Source

Sustainable Business Will Move Ahead With or Without Trump’s Support

Posted on 21 November 2016 by VRS  |  Email |Print

If we take the incoming president of the United States at his word, things look dire for the cause of sustainability. Donald Trump and many of his advisers appear hostile to action on climate change and to progress on many social issues that companies have already embraced, such as diversity and LGBT rights.
Even if Trump himself stays ambivalent on some of these issues, Republican leaders have much clearer aims, including extensive plans to slash environmental protections……………………………………Full Article: Source

Is Trump about to trigger a global trade war?

Posted on 21 November 2016 by VRS  |  Email |Print

President-elect Donald Trump said a lot of crazy things during the divisive election campaign, but few were crazier than his suggestion of launching a trade war with China. The Donald accused China of manipulating the yuan to make its exports more expensive and give it a favourable trading advantage.
He threatened to fight back by slapping a 45% tariff on Chinese imports to the U.S. and officially named the country a currency manipulator. He has also talked of a 35% import tariff on Mexico as well as smashing global trade agreements and even pulling out of the World Trade Organisation……………………………………Full Article: Source

Commodities set for rebound in 2017

Posted on 18 November 2016 by VRS  |  Email |Print

The commodities markets are rebalancing and the worst is over for the oil market, as a slowdown in production is setting prices up for a steeper rebound than predicted at the beginning of the year, Citigroup analysts said.
“Saudi and Russia are expected to spearhead the rebalancing efforts in the oil markets. With strong recovery in oil prices experienced in the past few moths we expect further recovery in 2017,” said Ed Morse, Global Head of Commodities at Citi……………………………………..Full Article: Source

Despite Current Prices, Copper, in the Medium Term, Remains Gloomy

Posted on 18 November 2016 by VRS  |  Email |Print

When commodity producers talk down the market you know prospects really aren’t very good for a price rise. Iván Arriagada, chief executive at Antofagastawas interviewed by the Financial Times while at the recent LME week and is quoted as saying Copper will continue to lag behind as other commodity prices rebound, adding the market is likely to remain oversupplied for at least the next three years.
While demand for copper in China will grow at around 3% next year, that growth will be outweighed by oversupply. Chinese demand this year has been bolstered by a surprise stimulus boost early this year but many are expecting that to fade by Q2 next year resulting in a surplus of 192,000 metric tons in 2017, up from 185,000 mt this year, according to Reuters……………………………………..Full Article: Source

Intellectus Partners: Trump Negative for Global Economy

Posted on 18 November 2016 by VRS  |  Email |Print

Ben Emons, chief economist and head of credit portfolio management at Intellectus Partners, discusses the impact of Donald Trump’s presidency on the U.S. and global economy, China’s debt level and the 10-year JGB yield. He speaks to Bloomberg’s Betty Liu and Yvonne Man on “Bloomberg Daybreak: Asia.”.……………………………………Full Article: Source

Oil demand won’t peak before 2040, despite Paris deal: IEA

Posted on 17 November 2016 by VRS  |  Email |Print

The International Energy Agency expects global oil consumption to peak no sooner than 2040, leaving its long-term forecasts for supply and demand unchanged despite the 2015 Paris Climate Change Agreement entering into force.
The Paris accord to cut harmful emissions seeks to wean the world economy off fossil fuels in the second half of the century in an effort to limit the rise in average world temperatures to “well below” 2 degrees Celsius (3.6 Fahrenheit) above pre-industrial times. But while demand for oil to power passenger cars, for example, may drop, other sectors may offset this fall………………………………………..Full Article: Source

Trump election to have implications for Commodities

Posted on 16 November 2016 by VRS  |  Email |Print

President-elect Donald Trump’s policies will eventually have important implications for commodity markets, said Barclays in a research note. “On the environment, he is a known climate-change denier and promises the country’s environmental agenda will be guided by ‘true specialists in conservation, not those with radical political agendas,’” the bank added.
“The U.S. energy sector is very likely to see a rolling back of environmental legislation affecting producers and consumers, but exactly how this plays out in markets and pricing, it is far too early to say. Likewise in metals, while an infrastructure surge could boost domestic metals demand, his plans to introduce import tariffs on many countries and the tit-for-tat that will go with it could lead to slower world GDP (gross-domestic-product) growth such that the net metals demand change from a global perspective is negative,” said analysts at Barclays………………………………….Full Article: Source

Gauging the Trump effect on global commodities

Posted on 16 November 2016 by VRS  |  Email |Print

There is perhaps no better reminder that the US presidency is a position of extraordinary power. Since the victory of US President-elect Donald Trump last week, businesses and governments have been working overtime to try to discern exactly what his presidency might mean for a range of important policy areas.
Across the world, every campaign statement, interview, tweet and early appointment by Trump’s transition team is now being carefully examined for clues as to how the newly-elected Republican will act once he moves into the White House………………………………….Full Article: Source

China needs a bigger hammer to beat down commodity prices: Russell

Posted on 16 November 2016 by VRS  |  Email |Print

China may need a bigger mallet to hammer the nation’s commodity investors and take the wind out of what Beijing believes is a speculative bubble in prices for natural resources.
A raft of new measures were announced last week aimed at increasing costs for investors using the domestic commodity exchanges, the latest salvo from the authorities in their ongoing attempts to control commodity markets. But evidence from the first week of the increased fees and margins is mixed as to how successful they have been………………………………….Full Article: Source

Russia Says Another Oil Crash Not Likely, But $40 Oil For Three Years

Posted on 16 November 2016 by VRS  |  Email |Print

Chairperson of Russia’s Central Bank Elvira Nabiullina said on Monday the probability of another drastic collapse in oil prices is low, though recovery won’t be substantially above current rates.
“We are considering several scenarios of economic development, our base scenario includes $40 per barrel in the next three years,” she said in remarks carried by Russia’s Tass News Agency………………………………….Full Article: Source

TD Securities: ‘Gold Is Down But Not Out’

Posted on 16 November 2016 by VRS  |  Email |Print

Gold is “down but not out,” says TD Securities. After an initial spike higher a week ago when it became apparent Donald Trump would be the next U.S. president, the precious metal has since turned lower. Prices fell as the market factored in ideas that U.S. fiscal stimulus will lift inflation expectations, move yields higher and boost the dollar.
“Higher yields along with a sharply higher USD are usually a very poisonous environment for gold,” TDS says, saying the metal could drop below $1,200 an ounce as the Federal Reserve prepares to hike interest rates. However, “while there are big downside risks for now, the future looks better for gold,” TDS says………………………………….Full Article: Source

Commodity prices show global recovery may be on the horizon

Posted on 15 November 2016 by VRS  |  Email |Print

In a major shift in economic trends, prices of raw materials started surging in October, possibly signaling that emerging economies are finally regaining strength after going through a distinctly rough patch. The shift may be behind the recent stock market rally and the jump in long-term interest rates in the U.S.
While the surprise outcome of the U.S. presidential election triggered wild movement in stock, bond and currency markets, commodities have been mostly insulated from its impact……………………………………..Full Article: Source

China trumps Trump over outlook for industrial commodities: Russell

Posted on 15 November 2016 by VRS  |  Email |Print

The election of Donald Trump as U.S. president has added froth to prices for metals and bulk commodities, but the real driver is, and will remain, the outlook for China. While price volatility associated with the somewhat surprising election of the brash real estate mogul was always likely, hopes for a Trump-led revival of industrial commodities and coal look way too optimistic.
Even if Trump can deliver a massive stimulus package as promised when he takes occupancy of the Oval Office in January next year, this alone would unlikely be enough to justify some of the extreme optimism now being priced into commodities……………………………………..Full Article: Source

Trump a boon for Aussie commodities

Posted on 15 November 2016 by VRS  |  Email |Print

Despite uncertainty around the ramifications of a Trump presidency, it appears Australian commodities could emerge the real winner from the US election. While details of his exact policies remain unknown, Donald Trump’s largely touted infrastructure spending would likely support commodities, particularly in Australia, according to HSBC chief economist Paul Bloxham.
“A Trump presidency looks likely to mean the Americans will be spending more on infrastructure which could very well lead to hard commodity demand and support for commodity prices,” Bloxham said……………………………………..Full Article: Source

Trump win raises global economy uncertainties

Posted on 14 November 2016 by VRS  |  Email |Print

Donald Trump’s promise to put America first helped propel him to the U.S. presidency. But he also unleashed uncertainty on the global economy by skewering trading partners and offering few specifics that might calm allies or businesses.
Financial markets reacted quickly and negatively to the unknowns of a Trump stewardship of the world’s largest economy. By Wednesday afternoon, though, stocks had rebounded, especially those involving drug companies, defense contractors and firms that rebuild infrastructure, which could benefit from a Trump administration…………………………………….Full Article: Source

Commodities’ outlook depends on if Trump reality matches rhetoric

Posted on 11 November 2016 by VRS  |  Email |Print

Beyond the short-term volatility as investors become used to the idea of President Donald Trump, the main risk for global commodities is how much of the campaign rhetoric translates into policy reality when the Republican victor moves into the White House.
The problem global commodity markets are currently grappling with is that the new U.S. president hasn’t articulated well-defined policies, rather his campaign was a series of slogans, threats and somewhat vague promises. Nonetheless, there is enough to suggest that Trump’s presidency holds both positives and negatives for commodity demand and prices…………………………………..Full Article: Source

Trump’s Revamp of America to Boost Commodities From Metals to Gas

Posted on 11 November 2016 by VRS  |  Email |Print

Donald Trump’s promise to revive American infrastructure means commodities used to build everything from airports to bridges will benefit under his presidency, according to Goldman Sachs Group Inc.
Spending by the Republican, who is set to enter the White House after defeating Hillary Clinton, will support construction activity and boost steel, iron ore, nickel, zinc and diesel, analysts including Damien Courvalin and Jeffrey Currie said in a Nov. 9 report. Trump’s proposal to roll back emissions-reduction targets could lift demand for natural gas as less uncertainty over policy boosts investment in an already competitive source for power and petrochemical production, according to the bank…………………………………..Full Article: Source

Volatility Hits Commodity Prices

Posted on 10 November 2016 by VRS  |  Email |Print

Coal sector is among those that could benefit from Trump’s win; picture for oil isn’t straightforward. Investors and analysts predicted further volatility for commodities from gold and oil to coal following Donald Trump’s election victory.
The effects could range from a boost to these U.S. dollar-denominated markets because of a weaker greenback to potential benefits for copper as a result of a possible rise in infrastructure spending………………………………………Full Article: Source

What’s Next For Gold After Trump’s Victory?

Posted on 10 November 2016 by VRS  |  Email |Print

Safe-haven gold was losing ground to a big rebound in the U.S. stock market after its strong overnight losses. ‘I wish I could tell you what happens next, but the markets need some time to reflect on the phrase, President Trump,’ said Kitco Metal’s global trading director, Peter Hug on Wednesday.
Throughout the night, markets saw extreme volatility across the board. Gold moved up some $80, from its low print to its high, and the stock market was at one point 800 points limit down, as it became clear that Democratic candidate Hillary Clinton was losing, Hug explained. The focus is now back on the expected Federal Reserve rate hike in December………………………………………Full Article: Source

The economic consequences of Donald Trump

Posted on 10 November 2016 by VRS  |  Email |Print

From late January, Donald Trump will have all the authority of the American executive, and the support of a unified Republican Congress, behind him. He will, therefore, be in a position to deliver profound and lasting change. The near-term economic effect of a Trump presidency is perhaps not of foremost concern to vulnerable racial and religious minorities in America, or to nervous Nato allies in eastern Europe.
But the economic consequences of Mr Trump’s presidency could be enormous, and costly. In the short run, the market reaction will receive most attention. Mr Trump will not be president until early in 2017, and so it falls to markets to anticipate, and price in, expected policy changes………………………………………Full Article: Source

China’s commodities imports slow to lowest in months

Posted on 09 November 2016 by VRS  |  Email |Print

China’s imports of commodities slowed to the lowest in months in October, as a week-long holiday closed factories, a weakening currency made foreign raw material more expensive and higher prices for products like crude oil hurt demand, analysts said.
Imports of copper by the world’s top producer and consumer fell to their lowest since February 2015, extending a six-month decline as domestic prices remained at a discount to the international market amid plentiful supplies…………………………………….Full Article: Source

How successful is China’s economic rebalancing?

Posted on 08 November 2016 by VRS  |  Email |Print

Over the past decade, there has been much talk of global imbalances, and of the need to correct them in an orderly way. But perhaps these imbalances are already moving towards some correction. The biggest sources of the imbalances were the large external deficits of the US economy, which have been reducing for several years now. But one counterpart of that deficit was large external surpluses in China, which were also associated with extremely rapid GDP growth.
China’s blistering pace of economic growth over the past three decades has certainly transformed both China and the global economy, but there are now clear signs that the pace is slowing………………………………………Full Article: Source

Can commodities end 2016 higher for the first time in six years?

Posted on 04 November 2016 by VRS  |  Email |Print

Agriculture is top contributor after October rally, beating precious metals and energy. With less than two months to go, a nail biting finish looms for investors: Will commodities finish 2016 higher for the first time in six years?
Over the past few years, the final quarter of the year has marked the moment when commodity markets have seen large outflows of funds. Investment withdrawals averaged almost $14bn the three years to 2015, while total returns on the widely followed Bloomberg Commodity Index (BCOM) averaged a drop of 8 per cent in the same timeframe………………………………………Full Article: Source

Commodity surge hasn’t quelled rating row

Posted on 04 November 2016 by VRS  |  Email |Print

Suddenly the path to budget repair has gotten murkier. Global ratings agencies like Standard & Poor’s raised concerns about the make-up of the Senate following the July 2 federal election and what it would mean for legislation.
Little did they expect the larger crossbench would have started dropping like flies, leaving a big question mark over future government legislation should Labor and the Greens join forces to oppose government bills. Bob Day finally officially stepped down as a Family First senator this week, but it could be weeks before his Senate vacancy is filled as the High Court scrutinises parliamentary financial arrangements surrounding the South Australian………………………………………Full Article: Source

Zinc and gold poised to break free of commodity slump

Posted on 04 November 2016 by VRS  |  Email |Print

Seasoned investors know that commodity cycles are long and slow affairs that build up to a really great party that ends with a long, lingering hangover. Right now, for most commodities, we are in the hangover phase.
Plenty of culprits can be blamed for the pain. We face a mine overcapacity, as operations that were financed in the boom times are now up and running. An aging population in most of the developed world is responsible for slowing consumption. Developing economies have slowed, headlined by China, which has been increasingly counted on as a global engine………………………………………Full Article: Source

Is the Roller-Coaster Commodities Ride Over? (Video)

Posted on 03 November 2016 by VRS  |  Email |Print

Global stocks fell toward a three-month low and bonds jumped as investors crowded into haven assets after polls showed Donald Trump gaining ground in next week’s U.S. presidential election.
The Bloomberg Industrial Metals Subindex fell for the first time in eight days, as zinc retreated from a five-year high in London and aluminum slid from its highest close since June 2015. Crude oil fell 1.6 percent to a one-month low in New York after industry data showed American inventories increased by 9.3 million barrels last week…………………………………….Full Article: Source

Why gold will be the ‘only clear winner’ among commodities if Trump wins

Posted on 03 November 2016 by VRS  |  Email |Print

An election win by Republican presidential candidate Donald Trump would fuel uncertainty in financial markets, but for commodities, the clear winner would be gold, according to Capital Economics.
“Whatever one’s personal views of the relative merits of Donald Trump and Hillary Clinton as president of the U.S., there can be little doubt that global business and investor confidence would suffer in the wake of a Trump win,” or even a disputed victory for Clinton, said Julian Jessop, head of commodities research at Capital Economics, in a Wednesday note…………………………………….Full Article: Source

US investors go for gold ahead of election

Posted on 03 November 2016 by VRS  |  Email |Print

Gold sentiment among Western investors leapt to a new three-and-a-half year high in October. Led by surging interest from the US ahead of next week’s bitter election for the White House, the Bullion Vault Gold Investor index – which measures the balance of private investors starting or growing their gold holdings over those reducing them – jumped to 56.8 last month from September’s 55.0 reading.
This beat the post-Brexit peak of 56.0 in August. The index would read 50.0 if the number of net buyers exactly matched the number of net sellers across the month…………………………………….Full Article: Source

The impact of shifting commodity prices

Posted on 02 November 2016 by VRS  |  Email |Print

After a dreadful 2015, commodity markets have shown signs of life this year, providing a boost for emerging economies. The main contributor has been crude oil, which dropped to about $35 a barrel in January before reaching almost $50 in the summer.
It is still a far cry from the levels of 2014, when oil prices hovered around $100, but the rebound has abated fears of a prolonged slump. Oil has not been the only beneficiary, as increased confidence in the Chinese and American economies has taken the cloud off several commodity sectors……………………………………Full Article: Source

Oil prices retreat as market waits for OPEC details: Kemp

Posted on 02 November 2016 by VRS  |  Email |Print

Oil prices are set to remain under pressure until Saudi Arabia and the rest of OPEC prove they can show how they will remove enough barrels from the market to accelerate the rebalancing process.
Benchmark Brent futures prices surged more than $8 per barrel over the course of nine trading sessions after OPEC members announced a surprise framework agreement on Sept. 28 to cut production. The agreement caught hedge funds and other money managers off guard with an unusually large number of short positions, which helped squeeze the market higher in a blistering short-covering rally……………………………………Full Article: Source

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