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Fluctuating Commodities: How They Impact Businesses and What You Can Do

Posted on 14 June 2016 by VRS  |  Email |Print

The volatility of the commodities market can be extremely difficult to manage as a company. The cost of goods can fluctuate immensely, which can be devastating to those predicting profits. This can also eat away at profit margins slowly and a smaller company can quickly become unprofitable.
Most people do not realize the impacts that commodities have on everyday life. The prices of good we buy or ship are impacted on a daily basis along with the jobs that we have. The following are some ways to deal with fluctuating commodities in order to secure a business………………………………………..Full Article: Source

IMF Warns Canada Recovery Faces Commodity Risks

Posted on 14 June 2016 by VRS  |  Email |Print

Canada is undergoing a modest economic recovery but faces increased risks from a long period of lower commodity prices and a possible housing downturn in two of the country’s biggest cities, the International Monetary Fund said Monday.
For now, Canada is adjusting to the recent drop in the price of crude oil, a top Canadian export, the IMF said in its latest update on the country’s economy. However, the agency said uncertainty about future oil prices and further turbulence in China are the biggest external headwinds for the Canadian economy. It warned the fallout from lower commodity prices continues to play out………………………………………..Full Article: Source

How OPEC lost its iron grip on oil prices

Posted on 13 June 2016 by VRS  |  Email |Print

When his final press conference as secretary-general of the Organization of the Petroleum Exporting Countries came to an end last week, Abdallah Salem el-Badri finally addressed the whispers that have been circulating throughout the oil markets.
Energy industry observers are howling that “OPEC is dead,” El-Badri acknowledged, after the group again failed to reach an agreement to cap oil production that would bolster sagging prices. His frustration was evident. “I have heard this comment maybe five, six times in my career,” he told reporters in Vienna. “Don’t take that notion that OPEC is dead. OPEC is alive. OPEC will be a very important segment of the economy, of the world.”……………………………………….Full Article: Source

Billionaire Investors Back A Gold Price Rally In 2016

Posted on 10 June 2016 by VRS  |  Email |Print

It wasn’t so long ago that some of the more famous investor gurus were shrugging off gold as nothing more than shiny trinkets with no investment value. They were wrong. This safe haven is back, the recovery is clear, and there have been some very big changes of heart.
The biggest gold producers in the world have seen their share prices double this year. Not only are gold prices soaring, but producers are cutting costs and slimming down debt as they pave the way for gold to return to the top of the favored commodities list………………………………………..Full Article: Source

Gold is sending a warning signal: Bouroudjian

Posted on 10 June 2016 by VRS  |  Email |Print

The recent action in the gold market is sending out a big warning signal that investors need to heed, veteran industry insider Jack Bouroudjian said. That “red flag” is the acceleration of the move higher in gold over the last couple of months, which he believes is telegraphing a loss of confidence in central banks.
“It may have started out as a reinflation trade, but right now it is turning into that flight to quality and flight to safety. It is one of those things that is more than likely going to stop any kind of a move in equities,” the co-founder and director of UCX said……………………………………….Full Article: Source

Agri-Commodities Winning in 2016

Posted on 10 June 2016 by VRS  |  Email |Print

The inevitable just seems to keep coming around. That over time food would become scarcer in our world has been well known for decades. Simply put, global demand for food continues to expand. Inevitable scarcity of food for the world is occasionally hidden by short-term bursts of exceptionally good harvests. But, exceptionally good is not a normal state for world’s Agri-Food production.
For much of the past year farmers have suffering financially from inadequate prices for their production. In 2016, that situation is apparently changing. Simply put, a stash of soybeans or sugar in the bowl on your table have outperformed equity markets. As can be observed in the lower part of chart, the average(mean) gain thus far is almost ten percent………………………………………..Full Article: Source

Record fall in global coal consumption driven by low oil price

Posted on 09 June 2016 by VRS  |  Email |Print

Global consumption of coal fell by a record amount last year thanks to waning Chinese demand and increasing use of cheaper gas and oil, according to data from BP. The energy giant said that demand for oil, gas and renewable energy all increased last year despite sluggish economic growth but that there was a distinct shift away from coal, the most polluting of energy sources.
Oil increased its market share of global primary energy consumption for the first time since 1999, to 33pc, as low prices spurred demand………………………………………..Full Article: Source

World Bank cuts global growth forecast on weak demand, commodity prices

Posted on 08 June 2016 by VRS  |  Email |Print

The World Bank slashed its 2016 global growth forecast on Wednesday to 2.4 percent from the 2.9 percent estimated in January due to stubbornly low commodity prices, sluggish demand in advanced economies, weak trade and diminishing capital flows.
Commodity-exporting emerging market countries have struggled to adapt to lower prices for oil, metals, and other commodities, accounting for half of the downward revision, the multilateral lender said in its latest Global Economic Prospects report. It expects these economies to grow at a meager 0.4 percent pace this year, a downward revision of 1.2 percentage points from the January outlook………………………………………..Full Article: Source

Oil and iron ore surge in commodities ‘renaissance’

Posted on 08 June 2016 by VRS  |  Email |Print

Analysts are calling a “renaissance” in commodities after oil climbed to a 10-month high overnight and as iron ore prices jumped further above the US$50-a-tonne threshold. On Tuesday night iron ore climbed a further 2.8 per cent to $US52.54, and is now up 9 per cent since after slumping to $US48.18/tonne last Thursday. Brent crude oil jumped 1.9 per cent overnight to $US51.49/barrel, as the US dollar continued to ease.
“It’s all about energy today, with US crude breaking out again and looking like a thing of beauty,” IG Markets strategist Chris Weston said Wednesday morning. “Further disruptions in Nigeria were cited, but the American Petroleum Institute’s weekly inventory print released this morning showed a massive drawdown of 3.56 million barrels.”……………………………………….Full Article: Source

Commodities break into bull market, turning TSX into a global leader

Posted on 07 June 2016 by VRS  |  Email |Print

Commodities from oil to gold have ended their epic swoon – and, in the process, turned Canadian stocks into some of the world’s hottest offerings. The Bloomberg Commodity Index, which tracks 22 raw materials, finished Monday more than 20 per cent above its low on Jan. 20, meeting the most common definition of a bull market.
The new exuberance in raw materials prices has shaken the Canadian stock market out of last year’s slump and transformed it one of the best-performing exchanges in the world so far in 2016. Monday’s trading extended the winning streak in the S&P/TSX composite index, which entered a bull market of its own late last week………………………………………..Full Article: Source

4 Reasons Commodities Will Push Higher

Posted on 07 June 2016 by VRS  |  Email |Print

The bear turns bull. Here’s reason one the commodity bull will remain strong: markets overshoot. Reason two is that global interest rates remain low. Reason three lies in the economics of commodities. Reason four lies in the explosive population growth vs. finite raw materials.
Commodity markets are cyclical in nature. Each raw material market has its individual characteristics. So many factors contribute to whether the price of a commodity moves higher or lower. While commodity production is often a localized affair, consumption is ubiquitous………………………………………..Full Article: Source

Shale producers eye comeback with oil @ $50 sweet spot

Posted on 07 June 2016 by VRS  |  Email |Print

Range of $50-$60/b marks sweet spot for global economy – good for consumers, industry, oil producers alike. Global oil prices slipped more than 1 per cent from above $50 to below that psychological mark as US drillers reopened some oil rigs last week – only the second time they’ve done so this year.
According to Baker Hughes data, US added 9 oil rigs last week, taking the number of active oil rigs in the country to 325 from 316 in the previous week. While the number still remains almost half of what it stood a year earlier (642 oil rigs in the US), it does suggest that the current oil prices are encouraging for shale oil producers to remain in business………………………………………..Full Article: Source

Sluggish Chinese manufacturing data weigh on commodity prices

Posted on 06 June 2016 by VRS  |  Email |Print

Sluggish manufacturing data from China as well as renewed weakness of the renminbi weighed on commodity prices, fuelling concerns over the country’s demand for raw materials. Further evidence of slowing growth in China’s manufacturing sector unnerved investors, who have been hoping that the latest stimulus measures would help reboot activity in the second quarter.
The unofficial Caixin purchasing managers’ index, which provides a snapshot of operating conditions in the country’s industrial sector, fell 49.2 in May, slightly lower than the previous month, and below the neutral 50 level for the 15th successive month………………………………………..Full Article: Source

Saudi Arabia And Iran Are Getting Ready For The Next Epic Battle In The Oil Market

Posted on 06 June 2016 by VRS  |  Email |Print

For several months, long time enemies Saudi Arabia and Iran have been caught in an epic battle, and it has been taking oil prices on a roller coaster. Back in December and January, Saudi Arabia let markets perform their magic, drive oil prices to the mid-twenties, undermining Iran’s re-entry to the world oil markets; and shutting down a few dozen American oil rings in the process.
That was the first epic battle. With less oil flowing out of American rigs markets did their magic again, driving oil prices close to $50. Now Saudi Arabia and Iran are gearing up for the next big battle. Saudi Arabia wants OPEC to perform its old magic and drive oil prices higher, to pave the way for the Aramco IPO launch………………………………………..Full Article: Source

Global oil giants seek inroads into India’s retail fuel market

Posted on 06 June 2016 by VRS  |  Email |Print

Global oil majors including Saudi Aramco and Total plan to tap the retail fuel market in India, its oil minister said on Friday, reflecting the expanding role of the world’s fastest-growing large economy on the global crude landscape.
India’s fuel markets could be a lucrative prize for the world’s oil majors as they seek outlets for their gasoline and diesel. India posted the fastest oil demand growth in the world in the first quarter of 2016 and is replacing China as the driver of growth globally, the International Energy Agency said in its latest report………………………………………..Full Article: Source

OPEC states that wanted production cuts buckle under the new oil order

Posted on 02 June 2016 by VRS  |  Email |Print

Saudi Arabia engineered OPEC’s policy to kill off U.S. shale oil production. The plan was straightforward: Keep pumping oil, maintain market share and outlast the Americans. But the plan is also producing casualties within the cartel itself: Angola, Nigeria and a Venezuela that’s on the verge of implosion.
Six months after OPEC left its high-production policy in place, some of the cartel members who called loudest for output cuts are feeling the most pain. Inflation is soaring and currencies have plummeted in lesser petro states, as top exporter Saudi Arabia continues to dictate policy………………………………………..Full Article: Source

Oil Price Forecasts Get More Bullish as Oversupply Concerns Ease

Posted on 01 June 2016 by VRS  |  Email |Print

Analysts are again raising their oil-price forecasts, in a reflection of falling concerns over the glut in crude supply. That helps relieve the pressure on members of the Organization of the Petroleum Exporting Countries—who are set to meet on Thursday—following months of fervent debate over production levels within the cartel.
Investment banks surveyed by The Wall Street Journal raised their price forecast for the third consecutive month in May, predicting that Brent crude, the international benchmark, would average $43 a barrel in 2016. That is up $2 from April’s survey………………………………………..Full Article: Source

Why the commodity slump could be a good thing for Africa

Posted on 31 May 2016 by VRS  |  Email |Print

There is an urgent need for diversification of Africa’s economies and while it is having an immediate negative effect, the recent commodities slump is beginning to drive change. For example, some investors in Nigeria who have historically thrown their lot behind the oil and gas industries are now looking to buy large tracts of agricultural land in a bid to mitigate the effects of the slump in the commodities sector.
After many years in the wilderness, the agricultural sector is fast emerging as one of the most attractive investment opportunities on the continent – and a sector where innovation and supportive policies can be harnessed to drive growth and jobs, so sorely needed across the continent since the Chinese and global economic slowdowns knocked commodity export opportunities………………………………………..Full Article: Source

Does organic agriculture boost local economies?

Posted on 30 May 2016 by VRS  |  Email |Print

For the first time, there is now evidence linking organic agriculture and economic health. The organic industry is one of the fastest-growing sectors of the United States food industry. Organic food sales grew 11 percent to almost US$40 billion in 2015, according to the Organic Trade Association (OTA), while the food market as a whole had a 3 percent growth rate.
This growth is partly because organic crops command a premium price over conventional crops—as demand for organic food rises, so does the interest in organic production from farmers and producers………………………………………..Full Article: Source

Oil States Expected to Stick With Saudis : OPEC Reality Check

Posted on 30 May 2016 by VRS  |  Email |Print

OPEC members gathering in Vienna June 2 are expected to go along with a Saudi Arabia-led policy focused on squeezing out rivals amid signs the strategy is working. That means the meeting may be less fraught than the previous summit in December, which ended with public criticism of the Saudi position from Venezuela and Iran.
By allowing prices to fall, high-cost producers are being forced out, easing the supply glut and spurring a rally of 80 percent since January to about $50 a barrel. All but one of 27 analysts surveyed by Bloomberg said the Organization of Petroleum Exporting Countries will stick with the strategy. An alternative proposal — to freeze output — was finally rejected in Doha last month………………………………………..Full Article: Source

Are commodities signaling a Lehman-sized meltdown? Japan’s Abe thinks so

Posted on 27 May 2016 by VRS  |  Email |Print

Only hours after Brent oil prices shot past $50-a-barrel for the first time in months, Japanese Prime Minister Shinzo Abe warned that the past few difficult years for commodities in general could be a red flag for another global financial crisis. Abe made the comments while hosting a meeting of the Group of Seven leaders on Thursday in Ise-Shima, Japan, according to a report from Reuters.
Abe showed his fellow leaders data charting a 55% drop in global commodity prices between June 2014 and January 2016. He said that’s similar to how much prices fell between July 2008 to February 2009 after Lehman Bros. went bankrupt and triggered a global financial crisis………………………………………..Full Article: Source

This is what makes OPEC even less relevant

Posted on 27 May 2016 by VRS  |  Email |Print

A series of unexpected disruptions in the world oil market has driven crude to the $50 per barrel level more swiftly than expected — a factor that makes OPEC and its meeting next week less relevant. Both international Brent and West Texas Intermediate crude futures crossed above $50 Thursday, though analysts expect prices to temporarily head lower again in the next couple of months as some supply returns and demand drops off as it does every year after summer driving season peaks.
By year end, however, $50 or above is expected to be the norm. Oil production in the last several weeks has dropped by several million barrels a day due to everything from forest fires in Canada to rebel attacks in Nigeria………………………………………..Full Article: Source

China Wants to Set Prices for the World’s Commodities

Posted on 26 May 2016 by VRS  |  Email |Print

China has put the world’s traditional financial centers on notice that it wants to develop its raw material markets as hubs for setting prices, seeking to marry the country’s commercial heft with a much greater say in determining how much commodities cost.
“We’re facing a chance of a lifetime to become a global pricing center for commodities,” Fang Xinghai, vice chairman of the China Securities Regulatory Commission, said at the Shanghai Futures Exchange’s annual conference in the city on Wednesday. “On the way to realize this goal, we’ll see very intense competition. We have the advantage of trading size and economic growth, but our legislation is still not sound and we lack enough talent.”……………………………………….Full Article: Source

Commodities on the rise?

Posted on 24 May 2016 by VRS  |  Email |Print

Are commodities finally on the rise after years of being in the doldrums? We would all agree that prices in the grocery store continue to rise on many things, but commodity tracking indexes show quite a different story.
The most common method of tracking commodity prices is the CRB commodity index, a commodities future price index which presently tracks 19 common commodities, which include aluminum, cocoa, coffee, copper, corn, cotton, crude oil, gold, heating oil, lean hogs, live cattle, natural gas, nickel, orange juice, silver, soybeans, sugar, unleaded gas and wheat………………………………………..Full Article: Source

Are Weak Commodities Prices the New Normal?

Posted on 23 May 2016 by VRS  |  Email |Print

Along with an increasingly optimistic outlook for commodities, especially for coal and base metals, this has led to some analysts claiming that both stocks will continue to rally. In fact, some analysts have gone as far as to claim that Teck’s price could even double over the course of 2016, making now the optimal time to invest. While there have been some positive developments for both companies and other mining stocks, the outlook is not as rosy as some analysts would have you believe.
The key driver for both of these companies’ recent rally and improving outlook is the price of commodities. Teck is highly dependent on the prices of metallurgical coal and copper to drive its financial performance. It obtains two-thirds of its revenue from those products………………………………………..Full Article: Source

Gold Fever: Why Investors Rush to Buy Gold

Posted on 23 May 2016 by VRS  |  Email |Print

Demand for gold rose by 21 percent in the first quarter of 2016. Recently, billionaire George Soros invested nearly $390 in gold stocks, having decreased investments in other assets. Shortly after, large hedge-funds followed the example of the legendary US investor.
Between January and March 2016, Soros Fund Management established by George Soros increased investments in gold market assets, according to the company’s data. Particularly, the fund bought shares worth $264 million in Canada’s company Barrick Gold, one of the world’s leading gold producers. It also bought an option for nearly 1.05 million shares ($123 million) in SPDR Gold Trust, the world’s biggest gold exchange fund………………………………………..Full Article: Source

Saudi Kills US Shale Oil Industry and Buys it for Pennies

Posted on 20 May 2016 by VRS  |  Email |Print

The Saudi Kingdom saw American oil companies invest in the research and development of oil fields and fracking, and then crashed the market so they could scavenge US natural resources and technology on the cheap.
In 2015, the world stared into a global economic recession, with startling downgrades for Chinese economic growth due to an explosion in their stock market, fueled by speculative excess. While the Chinese economy roiled, unrest brewed in much of the world, including in the war-torn Middle East and on European shores, upon which refugees descended en masse. Even the US economy, once stoked by a shale oil renaissance, was not spared the effects………………………………………..Full Article: Source

What Does The Next OPEC Meeting Have In Store?

Posted on 20 May 2016 by VRS  |  Email |Print

The next OPEC meeting on the 2nd of June will act as little more than a forum for continued altercations between Saudi Arabia and Iran. The 2 June 2016 OPEC meeting will be held amid a backdrop of oil prices near $50 per barrel, a sharp drop in Nigerian production due to sabotage, turmoil in Venezuela, Saudi Arabia operating with a new oil minister, and Iran aggressively pumping close to pre-sanction levels.
OPEC interactions have become a direct altercation between Saudi Arabia and Iran, with the remaining members reduced to mere observers………………………………………..Full Article: Source

Gold Bulls Could Lead M&A Stampede

Posted on 20 May 2016 by VRS  |  Email |Print

Gold producers have a new spring in their step following a rebound in the value of the precious metal, and it is an optimism that could trigger deals. The price of gold has risen more than 18% since the turn of the year, filling the coffers of producers whose balance sheets had already been strengthened by a focus on debt repayments and years of cost cutting following a downturn in prices in 2013.
“Gold has been one of the best performing commodities this year, as investors have sought safe havens amid equity market volatility and as expectations of a US rate hike have been pushed out,” Goldman Sachs analysts noted in a report that upgraded their gold price forecasts to $1,200 an ounce by the end of the year, up 4%………………………………………..Full Article: Source

Goldman Sachs Upgrades Commodities

Posted on 19 May 2016 by VRS  |  Email |Print

Goldman Sachs downgraded equities to “neutral” over a 12-month time-frame on growth and valuation concerns, but upgraded commodities to “neutral” on a three-month basis saying there was less downside potential to oil prices.
Goldman Sachs said commodities had rallied on the back of a dovish U.S Federal Reserve, Chinese economic data and supply disruptions. It upgraded commodities, saying that such supply disruptions should support oil prices………………………………………..Full Article: Source

Iron Ore Faces Second-Half Slump as Frenzy Cools, Supply Builds

Posted on 19 May 2016 by VRS  |  Email |Print

After last month’s speculative rally, iron ore is likely to extend declines because of rising supply from the major producers and faltering demand in China, the biggest buyer. “Supply is likely to increase in the second half, so market conditions may ease further,” Rajiv Mukerji, group director of strategic procurement at Tata Steel Ltd., said.
He’ll be speaking at a conference in Singapore on Thursday that’s being attended by producers including BHP Billiton Ltd. and Vale SA. Iron ore has retreated from a 15-month high after widespread predictions the frenzy in China that propelled prices upward in April wouldn’t endure as regulators clamped down and the rallies induced higher production………………………………………..Full Article: Source

The Chinese keep piling into commodities

Posted on 17 May 2016 by VRS  |  Email |Print

From the Dutch tulip craze of 1637 to America’s dot-com bubble at the turn of the century, history is littered with speculative frenzies that ended badly for investors. But rarely has a mania escalated so rapidly, and spurred such fevered trading, as the great China commodities boom of 2016.
Over the span of just two wild months, daily turnover on the nation’s futures markets has jumped by the equivalent of $183 billion (Dh672.15 billion), outpacing the headiest days of last year’s Chinese stock bubble and making volumes on the Nasdaq exchange in 2000 look tame………………………………………..Full Article: Source

Gold prices could hit $US1400 by year’s end

Posted on 16 May 2016 by VRS  |  Email |Print

US gold prices are up 17 per cent since the start of the year and if the pundits are right, prices could be knocking on the door of $US1400 ($1917) an ounce come the end of the year.
Canada’s BMO Capital is among those that reckon the charge from the current spot price of $US1272 an ounce to the $US1400 an ounce level is on the cards, saying it is predicated on uncertainty in the global economy persisting through the remainder of the year. That will drive incremental “safe haven’’ demand………………………………………..Full Article: Source

Africa Investors Look East as Commodity-Driven Boom Withers

Posted on 13 May 2016 by VRS  |  Email |Print

Investors targeting Africa are looking east, as depressed commodity prices and slowing growth in China put the brakes on a two-decade growth surge in the world’s poorest continent. Kenya, Tanzania and host Rwanda are the countries in vogue at the World Economic Forum’s annual confab of Africa’s business and political leaders that began Wednesday in Kigali.
All three economies should expand at least 6 percent this year, double the sub-Saharan Africa average, according to the International Monetary Fund. Growth in Ethiopia, the investors’ darling at last year’s WEF Africa summit, is set to slow to 4.5 percent this year, from 10.2 percent in 2015, as a drought curbs farm output………………………………………..Full Article: Source

Global oil demand surprises on the upside: Kemp

Posted on 13 May 2016 by VRS  |  Email |Print

Global oil consumption is growing much faster than most analysts expected at the start of the year but increases in demand remain very uneven geographically and by fuel.
World oil demand increased by 1.4 million barrels per day (bpd) in the first three months of 2016 compared with the same period in 2015, the International Energy Agency said on Thursday (”Oil Market Report”, IEA, May 2016). First-quarter consumption grew faster than the agency predicted at the end of last year, when it forecast growth of 1.2 million bpd between January and March (”Oil Market Report”, IEA, December 2015)………………………………………..Full Article: Source

Iraq overtakes Saudi Arabia as biggest oil exporter to India in April

Posted on 13 May 2016 by VRS  |  Email |Print

Iraq overtook Saudi Arabia as the top crude exporter to India in April for the first time since December, according to data compiled by Reuters, as the two biggest OPEC producers fight for market share in Asia’s fastest growing oil market.
Saudi Arabia also lost its top spot in China, Asia’s biggest oil consumer, last month when Russia overtook the world’s biggest crude exporter due to strong purchases by Chinese independent refineries. Overall, April oil imports by India rose 6 percent from March and are up 9.9 percent in the first four months from a year ago………………………………………..Full Article: Source

China: Commodities trading: Trading account applications up 30%

Posted on 12 May 2016 by VRS  |  Email |Print

Many retail investors in China are trying to get into the commodities market as a rebound in prices continues. And, not too surprisingly, brokerage firms in China are enjoying a jump in account applications.
One needs to complete a web-based video verification as part of the application to open a commodity futures trading account. It’s a process that more and more people are lining up for as they seek to get into the game. Futures brokers say their systems are a bit overloaded with new applications and only one in five people can get through right now………………………………………..Full Article: Source

What OPEC Has To Fear From The New Saudi Oil Minister

Posted on 11 May 2016 by VRS  |  Email |Print

In a surprise move, Saudi Arabia sacked its long-time oil minister over the weekend, an event that illustrates the near-total control that the new young Saudi prince has obtained over the country’s energy industry.
For many years, Ali al-Naimi, the outgoing Saudi oil minister, was the voice of Saudi Arabia’s oil industry and policy. Even seemingly insignificant remarks from al-Naimi could move oil prices up or down. But the 80-year old oil minister has seen his power eclipsed by the 30-year old Deputy Crown Prince Mohammed bin Salman………………………………………..Full Article: Source

Iron ore market in downswing amid speculation-fueled volatility

Posted on 11 May 2016 by VRS  |  Email |Print

Heavy Chinese speculation is roiling the iron ore market, with the upturn in futures trading leading to volatile spot rates. The spot price of Australian ore headed to China surged above $70 per ton at the end of April, up more than 60% from the end of 2015.
Plans revealed at China’s National People’s Congress in March for transport infrastructure investment of more than 2 trillion yuan ($306 billion) per year caused prices of rebar and other steel materials to skyrocket. Ripples then spread through the Asian market overall, raising prices of products such as hot-coil steel………………………………………..Full Article: Source

Oil ouster: Three things Saudi Arabia needs to do now

Posted on 10 May 2016 by VRS  |  Email |Print

Ali al-Naimi, who was Saudi Arabia’s oil minister for more than 20 years, was virtually the face of the oil markets during that time. His ouster over the weekend roiled the oil market.
For many in the industry, al-Naimi represented stability and moderation in the inherently chaotic ebbs and flows of oil markets. The minister championed Saudi interests, but always within an eye to balancing the needs of OPEC producers and the world’s consumers………………………………………..Full Article: Source

China: Commodities imports drop

Posted on 09 May 2016 by VRS  |  Email |Print

China’s imports of commodities fell in April from the previous month as domestic demand weakened, data released yesterday by the General Administration of Customs showed.
Copper imports fell 20.5 percent month on month while those of steel, coal and iron ore dropped 13.4, 4.57 and 2.7 percent respectively. Copper imports fell as China accounted for 78 percent of the global supply and domestic demand eased………………………………………..Full Article: Source

Commodities recovery is ‘probably a little bit too fast’

Posted on 09 May 2016 by VRS  |  Email |Print

This year’s respite from the commodities rout is a “bit overdone” and investors should watch out for further retracement, the CEO of one of the world’s largest natural resources companies said.
Crude oil prices have largely rallied since mid-January, after a steep and lengthy rout from June 2014 onwards hit commodities across the board. Other commodities such as zinc, copper and iron ore have also pared some losses this year………………………………………..Full Article: Source

Gold to retain its uptrend

Posted on 09 May 2016 by VRS  |  Email |Print

Bullion prices got a breather in the final trading session last week. This was thanks to the weak US Non-Farm Payroll (NFP) data which failed to meet market expectations. The global spot gold had begun the week on a negative note and was on a downtrend all through the week. But the US NFP data on Friday halted this fall and triggered a reversal from the low of $1,269 per ounce.
The yellow metal closed at $1,289 per ounce on Friday, down 0.35 per cent for the week, recovering some of its losses. Among other precious metals, platinum closed at $1,080 per ounce and was up 0.3 per cent. Silver was the worst hit as it tumbled 2.1 per cent and closed at $17.47 per ounce………………………………………..Full Article: Source

Junk investors scramble after commodities rally

Posted on 06 May 2016 by VRS  |  Email |Print

The commodities rally has flummoxed junk-bond investors who bet on the sector staying soft this year, hurting returns at dozens of funds that did not foresee the rebound in energy and metals.
Oil, mining, steel and gas bonds have delivered whopping sector returns this year up to 27%, wrong-footing those who moved underweight after high-yield lost almost 5% in 2015. Investors who were heavy in commodities last year, as the sector was pummeled, but then got out before the bounce-back in recent months, have now been hit coming and going………………………………………..Full Article: Source

Is China fueling a new commodities bubble?

Posted on 06 May 2016 by VRS  |  Email |Print

Remember the massive plunge in commodity prices last year? For some investors in China, it already appears to be a distant memory. Steel and iron ore prices have buoyed in recent weeks. Other commodities — including cotton and even eggs — are also reported to have seen startling surges on Chinese futures exchanges. The moves have prompted some experts to worry that a new bubble is forming.
Higher iron ore prices, for example, have “triggered speculative trading in iron ore futures in China,” said Rajiv Biswas, Asia-Pacific Chief Economist at IHS Insight. But the rally “may falter due to continued excess supply in world iron ore markets,” he warned………………………………………..Full Article: Source

China’s commodities trading frenzy fades

Posted on 06 May 2016 by VRS  |  Email |Print

The fever that’s gripped Chinese commodity markets is easing. Speculators who traded 1.7 trillion yuan ($336-billion) futures in a single day last month have retreated as fast as they advanced. Trading volumes across the country’s three biggest exchanges are more than half of what they were at their peak on April 22 and back to levels similar to a year ago, according to data compiled by Bloomberg.
The amount of money changing hands on a daily basis has shrunk to $114-billion (U.S.). The slowdown marks a return toward normality after a frenzy that drew comparisons with the credit-driven stock market rally last year that preceded a $5-trillion rout………………………………………..Full Article: Source

Iran May Be Ready for Joint Action With Opec Within Months

Posted on 06 May 2016 by VRS  |  Email |Print

Iran said it may be ready for joint action with members of the Organization of Petroleum Exporting Countries in as little as one or two months, once it regains the market share it had before sanctions were imposed.
Iran, which refused to join other nations in a push to freeze output last month, could reach pre-sanctions export levels of 2.2 million barrels in one to two months or by the end of the summer, National Iranian Oil Co. Managing Director Rokneddin Javadi said in Tehran. Exports averaged 2.1 million barrels daily last month out of total production of 3.7 million, he said………………………………………..Full Article: Source

Can gold’s spectacular 2016 run continue?

Posted on 06 May 2016 by VRS  |  Email |Print

After a pretty miserable few years, it seems that gold’s long bear market is finally over. Gold enjoyed its best start to a year in more than three decades. In the first quarter of 2016, it gained just over 16%. So can it continue? And what’s the best way to profit from it if it does?
Gold has been one of the best investments of 2016 so far. But one sector has outstripped even gold – the gold miners. Back at the start of December, Ed Chancellor wrote a cover story for MoneyWeek magazine suggesting that gold miners had finally hit absolute rock bottom, and that they were ripe for a fresh bull market………………………………………..Full Article: Source

Commodities - Will The Rally Continue?

Posted on 05 May 2016 by VRS  |  Email |Print

The recent rally in commodity prices has surprised many market participants and has greatly supported the stock market’s rebound. It has also made bulls out of a number of former stock market bears, as one of its side effects was to cause an improvement in market internals. But does the rally actually make sense?
As always, there are arguments both for and against the idea. We will take a look at several of them below. First of all, it is widely held that the “commodity super-cycle” as it used to be called (i.e., the secular bull market that started in 1998) is definitely over………………………………………..Full Article: Source

Gold price at two-year high, demand to see new lows

Posted on 05 May 2016 by VRS  |  Email |Print

Gold demand in India, the world’s second-biggest user, will probably shrink in the second quarter as a surge in local prices to the highest in two years deters buying for a festival next week and weddings this month.
Purchases may slide to about 100 metric tonnes in the three months through June from 125 tonnes in the period to March and 154.8 tonnes a year earlier, said Bachhraj Bamalwa, a director with the All India Gems & Jewellery Trade Federation………………………………………..Full Article: Source

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