Fri, Jul 1, 2016
A A A
Welcome vaishu
RSS

Commodities Briefing - Category | Trends more

Commodities rally: False dawn or new beginning?

Posted on 11 April 2016 by VRS  |  Email |Print

After a turbulent start to the year, Asian equities have made a comeback. This optimism can be credited to fading risks of a sharp Chinese yuan depreciation, US recession, and weakening regional currencies. But the most surprising development in a month of reversals has been the commodities rally, which has helped drive Asian equities up about 16 per cent since its January lows.
Commodity prices have roared to life after four years in the doldrums. Gold climbed 19 per cent to reach its recent peak and outperformed all other asset classes this year. Oil prices hit a three-month high in March. Industrial metals, led by iron ore prices - up nearly 45 per cent from last December’s low - have rallied as well. Some believe the storm has passed, pointing to an unexpected surge in Chinese construction activity as evidence for a sustained commodities rebound………………………………………..Full Article: Source

Commodity groups confront new reality

Posted on 11 April 2016 by VRS  |  Email |Print

Downturn is forcing change and, for some businesses, 2016 will be about ‘being boring’. When the world’s most powerful commodity traders and executives gather on the shores of Lake Geneva this week, they will reflect on a market that has tested their businesses to the limit.
One year ago at the Financial Times Commodities Global Summit, some of the delegates were prepared to bet that the worst of the commodity downturn was over. But on Tuesday and Wednesday at the Beau Rivage Hotel in the Swiss city of Lausanne, they will debate how to respond to a prolonged slide that has dragged oil down to $40 a barrel and copper to its lowest since the financial crisis………………………………………..Full Article: Source

Gold Sees Safe-Haven Demand on European Union Worries

Posted on 08 April 2016 by VRS  |  Email |Print

A feature in the world marketplace Thursday is the rally in the gold market. Safe-haven demand has again surfaced for the yellow metal as a referendum in the Netherlands on European Union-Ukraine trade relations has failed, prompting more concerns about the U.K. referendum in June to opt out of the European Union.
A U.K. exit from the European Union could spell the eventual doom for the EU. A weaker U.S. dollar index that hit a nearly eight-month low Thursday is also a positive for the precious metals markets on this day. June Comex gold was last up $14.70 at $1,238.30 an ounce. May Comex silver was last up $0.166 at $15.22 an ounce………………………………………..Full Article: Source

Why oil price slump hasn’t boosted global economy – yet

Posted on 07 April 2016 by VRS  |  Email |Print

Goldman Sachs predicts rise back to $70 a barrel by the end of decade will drive improved growth. A steep and prolonged fall from grace for the international oil price, from around $115 a barrel in the summer of 2014 to as low as $27 earlier this year, was expected by the International Monetary Fund (IMF) to be a “shot in the arm” for the global economy, reports the Financial Times.
Oil has been stuck around $40 a barrel in recent weeks and was a little shy of $39 this morning. Last year, the IMF predicted a 0.5 per cent boost for every $20 drop. Instead, the fund this week warned that the already underwhelming global economic recovery is running out of momentum………………………………………..Full Article: Source

Brace for big commodities drop, traders warn

Posted on 05 April 2016 by VRS  |  Email |Print

After a great few weeks for the commodities trade, it’s now time to get out, some strategists say. The commodities trade is “not only being hit cyclically, but it’s also being hit fundamentally, so I would expect a decline over the next month,” Phillip Streible of RJO Futures said Friday on CNBC’s “Trading Nation.”
Strong gains across oil, copper, gold and other commodities have made for a very profitable month for bulls. In fact, March was the first positive month for the S&P GSCI total return commodities index since October, and the best March since 2006………………………………………..Full Article: Source

Commodities show signs of recovery hope

Posted on 04 April 2016 by VRS  |  Email |Print

Have we hit the bottom yet? That seems to be the question of the moment. No one knows, although there are signs of hope. And there are also signs that this nascent mood of optimism is spilling over into commodities.
What to make of a week when one headline screams “Dow posts biggest quarterly comeback since 1933” (another version was: “The Dow is doing something it hasn’t done since 1933”)? They were talking about the fact that, in the last week of March, the Dow and the S&P 500 wiped out their losses for the quarter. Quite a performance, and thanks largely to the Federal Reserve more than hinting it was going dovish on further rate rises. So ZIRP (zero interest rate policy) and NIRP (that’s negative interest rate policy) seem to be the new normal………………………………………..Full Article: Source

Economy will take years to adjust to tumbling commodity prices, says BoC

Posted on 01 April 2016 by VRS  |  Email |Print

The Bank of Canada says poor prices for oil and other resources could become the “dominant source of drag” on the economy. Using its “best guess,” the Bank of Canada predicts the economy will take more than two years to fully adjust to the commodity price shock.
Lynn Patterson, the central bank’s deputy governor, said in a March 30 speech that tumbling oil and other resources prices have translated into losses of about $1,800 for every Canadian………………………………………..Full Article: Source

Where are Gold Prices Headed?

Posted on 31 March 2016 by VRS  |  Email |Print

The best performing precious metal for the week was platinum, however still down -2.35 percent. Price action was driven by increased auto demand in the European Union, reports Market Realist, which rose 14 percent in February. Platinum and palladium is used in the production of catalytic converters.
Germany announced this week that it wants half of its gold reserves back by the year 2020, reports Bloomberg. Bundesbank, the country’s central bank (which has gold in London and New York), has repatriated 1,400 metric tons, or 41.5 percent, of Germany’s gold reserves to Frankfurt………………………………………..Full Article: Source

Commodities may tumble amid ‘rush for exits’, says Barclays

Posted on 30 March 2016 by VRS  |  Email |Print

Commodities including oil and copper are at risk of steep declines as recent advances aren’t fully grounded in improved fundamentals, according to Barclays Plc, which warned that prices may tumble as investors rush for the exits. Copper may slump to the low $US4000s a tonne, from $US4945 in London last week, while oil could fall back to the low $US30s a barrel, analyst Kevin Norrish said in a note.
The risk for raw materials is that investors seek to liquidate bets on gains quickly and in unison, with potentially highly negative consequences, Norrish wrote in the note entitled Buffalo Jump, a term that describes a cliff where North American natives herded bison to their death………………………………………..Full Article: Source

Commodities rebound seen faltering as demand stalls

Posted on 30 March 2016 by VRS  |  Email |Print

Prices for copper and oil are poised to fall, according to a new report that adds to the growing skepticism around the great commodity revival. Kevin Norrish, a widely followed analyst with Barclays PLC, warns that raw materials prices could get trampled if the buyers who have piled into the commodity sector during recent weeks decide to simultaneously rush for the exits.
“Investors have been attracted to commodities as one of the best performing assets so far in 2016,” he said. “However, in the absence of any concerted fundamental improvements, these returns are unlikely to be repeated in the second quarter, making commodities vulnerable to a wave of investor liquidation.”……………………………………….Full Article: Source

China investors drive gold price spike as bullion beats jewellery

Posted on 30 March 2016 by VRS  |  Email |Print

Chinese investors have been snapping up gold bars and coins, overshadowing the usual purchases of gold jewellery and contributing to the metal’s price rise of about 15 per cent from six-year lows in December.
Typically, gold purchases in China are strongly associated with jewellery buying around the Lunar New Year holiday, which this year fell in early February. But uncertainty confronting global economies along with forces in Chinese markets have driven up gold demand from a different sort of buyer: the hard-nosed investor………………………………………..Full Article: Source

Barclays warns of a “rush for the exits” on commodities

Posted on 29 March 2016 by VRS  |  Email |Print

Analysts at Barclays have warned of a “rush for the exits” as investors back away from commodities, resulting in price levels for oil and copper dropping as much as 25pc. A note issued by the bank said that although investors have been attracted to commodities as one of the best performing assets so far in 2016, returns are unlikely to be sustained in the second quarter of the year.
“This could make commodities vulnerable to a wave of investor liquidation that we estimate could, in a worst case scenario, knock as much as 20-25% from current price levels,” the note said. This would take the price of oil back to the low $30s and copper to the low $4,000s, the analysts said………………………………………..Full Article: Source

Bears are fleeing the oil market at a record pace, but that’s no reason to be bullish

Posted on 29 March 2016 by VRS  |  Email |Print

Oil enthusiasts haven’t been jumping on board the latest rally. As crude has soared 50 per cent since Feb. 11, the number of bets on increased prices has barely budged. Instead, the upward pressure on prices appears to have come from traders cashing out of bearish wagers at an unprecedented pace.
The liquidation of short positions during the last seven weeks covered by data from the U.S. Commodity Futures Trading Commission was the largest on record. “The rally has come from shorts getting scared out of their positions, and you’re not seeing a lot of money coming in on the long side,” said John Kilduff, partner at Again Capital LLC, a New York hedge fund focused on energy. “It really calls into question the fortitude and staying power of the rally.”……………………………………….Full Article: Source

China mutual funds turn to commodities, bet on reforms

Posted on 29 March 2016 by VRS  |  Email |Print

China’s mutual fund industry is pushing to develop investment products linked to local commodity futures, betting that plans to fight chronic oversupply in the country’s mammoth resource sector will drive up prices for raw materials.
The funds want to branch out beyond their traditional focus on stocks and fixed-income, with no immediate upturn in sight in the wake of turmoil last year that pulled down share markets by nearly 50 per cent and forced bond yields to multi-year lows………………………………………..Full Article: Source

Commodities rebound outruns fundamentals

Posted on 24 March 2016 by VRS  |  Email |Print

Commodities have always been cyclical, but already this year we have seen two distinct mini-cycles — down in January, recovering in February and March. Of course, fundamentals do not change that quickly, but sentiment certainly can. In particular, Chinese sentiment has turned around sharply — from the lowest point in the history of Macquarie’s China steel and copper surveys in January into positive territory.
So how should we view what has happened recently? Have fundamentals improved? Yes, from an extremely low base in December and January there has undoubtedly been a demand recovery………………………………………..Full Article: Source

Commodity Volatility to Continue –Citi

Posted on 24 March 2016 by VRS  |  Email |Print

A tightening oil market and shifting sentiment on commodities in China is lifting all markets, but a rough ride ahead is still in the cards, Citigroup says.
Supply disruptions and the first monthly draw on storage levels in a year in February helped oil. And commodities got a broad boost from “perplexingly huge imports” for oil, copper, iron ore and other raw materials in China, Citi says………………………………………..Full Article: Source

Rally to gather pace for industrial commodities

Posted on 24 March 2016 by VRS  |  Email |Print

Will the recovery in industrial commodity prices be sustained, asks Julian Jessop, chief global economist at Capital Economics.
The London-based research boutique, which for several months has been bullish on the sector, thinks that though “the foundations of the recovery still look a little shaky and some temporary pullbacks may be inevitable . . . the conditions for additional gains over the remainder of this year and next are gradually falling into place”………………………………………..Full Article: Source

Commodity bulls twisting in the wind

Posted on 24 March 2016 by VRS  |  Email |Print

On Wednesday investors curbed their enthusiasm for commodities, sending everything from copper and gold to oil and iron ore sharply lower. But despite nervousness returning to metals and mining markets this week, 2016 is still looking decidedly better for the sector. Year to date gold is holding onto 15% gains, silver and platinum are up 10% while bellwether copper’s trading nearly 15% higher than its January lows.
Industrial metals have all advanced in 2016 led by zinc which has jumped by more than 20% in three months while volatile iron ore is the best performer with a 33.5% gain this year………………………………………..Full Article: Source

Oil price stuck as IEA brands supply deal ‘meaningless’

Posted on 24 March 2016 by VRS  |  Email |Print

Global watchdog doubtful about April meeting while Commerzbank says market expectations are ‘hopelessly excessive’. The oil price is stuck at around $40 a barrel and may even move lower in the next month or so as optimism in the market rests on a deal to freeze supplies that the global energy watchdog has warned could be “meaningless”.
Since hitting multi-year lows early last month, oil has rallied by around 50 per cent. International benchmark Brent crude hit $27 a barrel on 11 February and has hit several new 2016 highs in the past two weeks, with the latest coming on Tuesday, when it peaked at just shy of $41.80………………………………………..Full Article: Source

Positive signs for gold as markets tumble

Posted on 24 March 2016 by VRS  |  Email |Print

Gold outperformed most other assets as global equity markets took a beating at the start of 2016, according to State Street Global Advisors. “We see encouraging signs that may support the gold market this year,” the firm said in a recent research note.
While interest rate hikes often exert some pressures on gold as bond yields rise and become more attractive to investors, the outlook of US rates remains uncertain after the first hike for nine years in December last year………………………………………..Full Article: Source

Cramer: Commodity rally could head higher

Posted on 23 March 2016 by VRS  |  Email |Print

Since the market bottomed in mid-February, commodities have dramatically rebounded from their lows. Jim Cramer has watched as everything from copper, iron ore, aluminum to oil have worked their way higher. While the rally took a break on Tuesday, commodities have been on the decline for years, leading Cramer to ask if this is a genuine rally or simply a long overdue, oversold bounce.
Cramer turned to the help of Carley Garner to look at the charts and assess what the future of the commodity complex could look like. Garner is a technician and commodities expert who is the co-founder of DeCarley Trading and a colleague of Cramer’s……………………………………….Full Article: Source

How Commodity Prices Could End the Year Where They Started

Posted on 22 March 2016 by VRS  |  Email |Print

Commodities have flummoxed investors by swinging wildly in recent months, but prices could end the year right back where they began if global growth and the dollar stabilize, according to the Federal Reserve Bank of New York.
The Dow Jones Commodity Index is now up 3.4% this year, though it’s down 17.5% over the past 12 months. Commodity prices have also been influential in the movement of other assets, with many looking at the connection between stocks and oil………………………………………..Full Article: Source

Is now the time for commodity fans to use leveraged products?

Posted on 22 March 2016 by VRS  |  Email |Print

Increasing numbers of investors are being tempted to dip their toe into the energy markets – and oil specifically – following the dramatic decline in commodity prices over the past 18 months.
Crude oil and natural gas prices more than halved as fears over slowing global growth, climbing inventories and a lack of intervention from oil cartel Opec have combined to push energy down to multi-year lows. With prices now at levels not seen since the early 2000s, investors have been increasing their exposure, in particular to oil which is one of the most accessible commodities………………………………………..Full Article: Source

Are all commodities heading higher?

Posted on 21 March 2016 by VRS  |  Email |Print

A massive run-up in several groups of raw materials has traders, speculators, and the producers of commodities wondering if our U.S. economy has finally turned the corner. Instead of focusing on fears of deflation, the focus has shifted to the opposite investment debacle – how to adjust and invest as prices rise.
The value of gold, the world’s benchmark for inflation, is up a whopping $200 per ounce since mid-December with the rise in silver and copper not far behind. Crude oil, the foundation of most of the Western world’s economies, bottomed around $26 per barrel in January and exploded over 50 percent in value as of Friday at $40………………………………………..Full Article: Source

Kenya moves away from commodities

Posted on 21 March 2016 by VRS  |  Email |Print

Africa is the most commodity-dependent continent on earth, but in the East African Community, Kenya is the least dependent. Africa’s economies increasingly need to create a hospitable environment for companies in the manufacturing and services sectors, Michael Armstrong, the Regional Director, Institute of Chartered Accountants in England and Wales (ICAEW) for Middle East, Africa and South Asia said last week.
He said this will drive growth, as the old models of growth driven by exports of raw materials are out-dated. Within the East Africa Region, Kenya’s economy should expand by around 6% during the 2017 to 2020 period thanks to its relatively diversified economy and comparatively low commodity dependence bonding well with the country’s economic growth outlook………………………………………..Full Article: Source

OPEC’s Futile Freeze

Posted on 21 March 2016 by VRS  |  Email |Print

Next month’s gathering of oil ministers from OPEC and non-member countries is fixating traders. But the real re-balancing in the market is already underway — and much of it is taking the form of involuntary production cuts from OPEC members.
Speculation that the meeting in Doha will lead to a production freeze has been a boon for oil, helping to drive a 40% rise in Brent since the idea was first mooted just over a month ago, to more than $42 a barrel………………………………………..Full Article: Source

Commerzbank, HSBC: Silver Starting To Outperform Gold

Posted on 21 March 2016 by VRS  |  Email |Print

Silver has been outperforming gold lately, causing a decline in the gold-silver ratio, say HSBC and Commerzbank. This ratio measures how many ounces of silver it takes to buy an ounce of gold. Early Friday, Comex May silver hit a high of $16.17 an ounce that was its most muscular level since October.
Silver has been helped lately by dollar weakness and improvement in industrial base metals, Commerzbank says. “Because silver has noticeably outperformed gold of late, the gold-silver ratio has decreased from almost 84 at the end of last month to a good 78, its lowest level since early February,” Commerzbank says in an early-Friday research note. As of a late-Thursday HSBC report, the ratio was at 79. “We think it may narrow further, implying that silver will gain on gold,” HSBC says………………………………………..Full Article: Source

The Shine Is Off Diamonds and Gold

Posted on 21 March 2016 by VRS  |  Email |Print

The adage that a diamond can be a best friend has lost some sparkle in recent years. Dampened by dollar appreciation, an increase in stocks of rough stones and weakened consumer demand, the global diamond market has hit headlines of late, thanks to tumbling prices.
In fact, the average, inflation-adjusted price of top-quality stones has weakened by as much as 80 percent in the past 30 years, according to the Rappaport Index, an industry benchmark, suggesting that the free fall in a material once considered a timeless store of value has been in effect for some time. The prospects for gold, also long considered a haven for investors, are not glittering either………………………………………..Full Article: Source

Fed stance shifts gold target

Posted on 21 March 2016 by VRS  |  Email |Print

So far this year, gold has been the frontrunner in the rally by precious metals. It has also performed in line with our beginning-of-the-year forecasts. The first upside target for gold for the year at $1,155/ounce and the second at $1,200 have been hit, though more quickly than expected.
Gold has (year-to-date) delivered 19 per cent returns while silver is up 16 per cent. Oil prices, which were at $37/barrel when we wrote the 2016 outlook for gold, slipped to $26/barrel by February and are now at $40/barrel, up 8 per cent. The US dollar index has dropped 4 per cent to 94.8. So where is the metal headed?……………………………………….Full Article: Source

The blockbuster bullion bull, will it last?

Posted on 18 March 2016 by VRS  |  Email |Print

According to many chart analysts, the rally in gold prices this year may be the start of a prolonged uptrend for the metal, which is already up nearly 20 percent in 2016. Wednesday’s decision by the Federal Reserve to reduce its forecast for a multiple rate increases sent the U.S. dollar tumbling and lit a fire under gold because of its perceived “store of value” property.
“Investors have lost confidence in central bank ability to assure stability of currencies and economies,” futures trader, market analyst and author Jake Bernstein told CNBC Pro. “Gold is still seen as the quintessential safe haven.”……………………………………….Full Article: Source

Cash out, commodities up: global fundie survey

Posted on 17 March 2016 by VRS  |  Email |Print

Fund managers are finally spending their cash hoardings, according to Morgan Stanley’s global fund manager survey for March - with commodities a favourite target. The survey was taken between March 4 and March 10, when global markets were rallying, risk was back in favour, and commodities had seemingly bottomed.
The top ten survey takeaways, as judged by Morgan Stanley, were: Cash holdings fell from 5.6 per cent in February - the highest figure since November 2001 - to 5.1 per cent. The allocation to commodities went from net 29 per cent underweight to net 13 per cent underweight - the biggest month-on-month jump since records began in 2006. The current figure, a nine-month high, is still 0.6 standard deviations below the long-term average………………………………………..Full Article: Source

Managers make record increase to commodity allocations

Posted on 17 March 2016 by VRS  |  Email |Print

Fund managers made their largest month-on-month increase in commodities allocations on record in March, the Bank of America Merrill Lynch fund manager survey shows. Allocations to commodities have jumped to a nine-month high, rising to a net 13 per cent underweight from a net 29 per cent underweight last month.
The rise is the biggest month-on-month jump on record since 2006, the survey finds. Allocations to real estate also jumped to a net 11 per cent overweight from a net 1 per cent overweight in February………………………………………..Full Article: Source

Australia: Commodities boom to bust: are we there yet?

Posted on 17 March 2016 by VRS  |  Email |Print

The end could be in sight for the crash in commodities, but there is still the potential for downside to mining capital expenditure (capex) and more jobs losses to come. Up to 40,000 jobs might still go in the shakeout that has been a drag on incomes, spending and employment for several years, said Commonwealth Bank (CBA) chief economist Michael Blythe in a note.
The boom-bust commodity story is central to understanding the Australian economy over the past decade, the “boom” ending with commodity prices at record highs in 2011 and mining capex at 150-year highs in 2012………………………………………..Full Article: Source

Investors’ take bullish bets on commodities to record highs

Posted on 16 March 2016 by VRS  |  Email |Print

After some relative calm seen in the price of oil, fund managers are putting some of their money back to work in commodities, new data on Tuesday showed. Global investors added to their allocation of commodities this month, according to a survey carried out by Bank of America Merrill Lynch, which said the jump in exposure to commodities in March was the largest ever on record.
This comes after investors hoarded money in cash at the start of the year amid one of the worst starts to the year on record for equities. While many managers are still technically “underweight” on the commodity benchmarks, bullishness on the sector has dramatically improved in the last month as oil prices have climbed closer to $40 per barrel and iron ore prices have soared………………………………………..Full Article: Source

Demand Shows More Pain Ahead for Commodities (Video)

Posted on 16 March 2016 by VRS  |  Email |Print

Paras Anand, head of European equities at Fidelity, discusses the impact of currency and demand on commodities producers and where he sees opportunities in the sector. He speaks on “Bloomberg Surveillance.”.………………………………………Full Article: Source

Commodities rally ‘overdone’ – Barclays

Posted on 15 March 2016 by VRS  |  Email |Print

The sharp rally in oil prices may be have come “too far, too fast,” analysts at Barclays have warned. Oil prices have surged by around 40 per cent in just a few weeks, as investors have taken a more bullish stance on the global economy and the supply dynamic for the market after a torrid start of the year.
“While there are grounds to believe markets may have bottomed, to us the scale of recent price gains looks overdone,”analysts at Barclays said. The analysts noted that some of the automatic balancing that would have come from very low oil prices may dissipate as US and Brent crude oil prices hover around the $40 a barrel mark………………………………………..Full Article: Source

OPEC trims 2016 outlook for its oil

Posted on 15 March 2016 by VRS  |  Email |Print

OPEC expects lower demand for its oil in 2016 than it previously forecast. The oil cartel’s crude demand forecast was revised down by 100,000 barrels per day for the full-year, slightly lower than its estimate last month, according to a report released Monday.
“In 2016, demand for OPEC crude is expected to stand at 31.5 million barrels per day, 0.1 mb/d, lower than last month, and representing an increase of 1.8 mb/d over the previous year.”……………………………………….Full Article: Source

Is Palladium starting to play catch-up?

Posted on 15 March 2016 by VRS  |  Email |Print

Palladium, the worst performing precious metal this year, has started to play catch-up to its peers. This after acting more as an industrial metal and following overall market trends instead of trends in precious metals.
The metal fell more than 17% to a five-year low of around $470/oz in early January, when data showed that Chinese car sales increased at the slowest pace in three years. The main use of palladium in China, the biggest consumer of the metal, is in the fabrication of autocatalytic converters which reduce harmful emissions………………………………………..Full Article: Source

Here’s why commodity prices are rallying… and why the rally may continue

Posted on 14 March 2016 by VRS  |  Email |Print

Iron ore saw its biggest one-day jump in value ever last week, reports Bloomberg. The price soared by a stunning 19% at one point. It’s partly down to hopes that China might be up for more “stimulus”. But there’s also an increasingly convincing case to be made that we’ve seen the worst of the commodities bear market.
And that’s going to create some interesting dilemmas for the world’s central bankers… Goldman Sachs reckons that the iron ore rebound won’t last. And certainly, after you see these sorts of rapid rebounds, you tend to get some sort of pullback………………………………………..Full Article: Source

Oil Price Rise Could Be Its Own Undoing

Posted on 14 March 2016 by VRS  |  Email |Print

The slide in oil prices has paused after crude fell more than 70% from its 2014 peak. Now the question is whether the recent rise itself could spark another downward spiral.
U.S. oil prices are up more than 45% from a 13-year low in February, boosted by talks among Saudi Arabia, Russia and other major producers about capping their output. A temporary reduction in global crude supply following outages in Nigeria and Iraq also helped buoy the market………………………………………..Full Article: Source

Which way are world commodities headed?

Posted on 11 March 2016 by VRS  |  Email |Print

It’s the best of times in commodities markets, it’s the worst of times in commodities markets. Iron ore jumped by the most on record on Monday, while Brent crude broke through $40 a barrel for the first time in three months. Market prices are prone to speculation, momentum trading and short squeezes, all of which could explain some of the movement in iron ore and oil.
Here are five indicators worth watching for a clearer picture on where commodities are headed, reports. A benchmark for rates to charter the ships that carry iron ore, coal, and grain, the index is currently at particularly depressed levels thanks to a global glut of cargo capacity. As it tracks real prices being paid to book ships, there’s no speculative element here………………………………………..Full Article: Source

Don’t believe the recession hype – or this commodities boom

Posted on 11 March 2016 by VRS  |  Email |Print

All in all, this is an odd moment for an outburst of high spirits: not from me — I’m as phlegmatic as ever — but from commodity investors. The price of a barrel of oil has rallied from $27 to $40 after talks between Saudi Arabia and Russia about restricting supply; one pundit called that ‘meaningless theatre’ but others expect a climb back to $50.
In a similar mood, copper prices have risen by almost a fifth — reflecting producer cutbacks combined with a belief that the Chinese downturn in demand might not be so severe as was first feared. Likewise iron ore, which surged so fast at the beginning of this week that one analyst called it ‘berserk’, while the biggest player in global steel, the Indian tycoon Lakshmi Mittal, declared that ‘things should continue to improve’………………………………………..Full Article: Source

Commodities looking for equilibrium

Posted on 10 March 2016 by VRS  |  Email |Print

A sentiment-driven commodities rally is in a base-forming stage and “looking for some sort of equilibrium price”. While prices can go lower from here in the short term, due to producers hedging in futures or profit taking, revising of the previous lows seen a few months earlier might be a distant thing, analysts believe.
On Tuesday, international metals prices, along with share prices of these companies, saw a big fall; these stabilised on Wednesday. Brent crude oil is back to $40 a barrel and copper stabilised at $4,880 a tonne. Nickel fell sharply on Tuesday and rose on Wednesday by three per cemt. Gold, however, remained low………………………………………..Full Article: Source

Don’t let the rally fool you: Commodity companies are headed for a massive debt cliff

Posted on 10 March 2016 by VRS  |  Email |Print

If you think commodity producers are out of the woods as markets rally, here’s a reality check: many are still grappling to contain debt. Another year of belt-tightening hasn’t kept pace with an earnings slump after prices collapsed. One gauge of leverage among mining, energy and agriculture companies continued to rise in the fourth quarter and is more than double year-earlier levels.
While raw materials have rebounded in the past month, they are still well below levels of even two years ago — 28 per cent in the case of copper and 64 per cent for crude………………………………………..Full Article: Source

China Is Now In Control Of Global Silver Prices

Posted on 10 March 2016 by VRS  |  Email |Print

China has been an unofficial price-setter for most metals over the past decade. And this week, the country became an official participant in setting prices for one of the world’s most important precious metals markets.
That’s the London Bullion Market silver price. Where one of China’s largest banks just became a member of an elite group of players that controls fluctuations in this key metal. CME Group, which runs the process for price setting of silver in London, said Sunday that China Construction Bank will officially join as a member of the silver price process………………………………………..Full Article: Source

Rout in global steel prices puts brakes on platinum recycling

Posted on 10 March 2016 by VRS  |  Email |Print

Recycling rates for autocatalyst metals platinum and palladium, have been driven lower in the past year not only by a price slide in the metals themselves, but also by a crash in the value of another raw material - steel.
With steel prices forecast to remain under heavy pressure this year in the face of over-supply and tepid demand, that could limit an expected rebound in the rate at which platinum group metals are recovered from catalysts. Recycling slowed last year as more scrapped cars were stockpiled by recyclers awaiting better prices, and as fewer cars, which use platinum in their autocatalysts, were scrapped………………………………………..Full Article: Source

Reasons to be cautious over commodity optimism

Posted on 09 March 2016 by VRS  |  Email |Print

The stunning rally in iron ore and mining stocks has turned commodity pessimism into a bout of optimism overnight. But there are still reasons for caution before relegating low commodity prices to history.
The increase in Chinese steel prices has driven a record 19 per cent rise in iron ore prices this week. But analysts see few signs that steel demand will pick up soon in the world’s largest consumer of the metal………………………………………..Full Article: Source

Here’s why commodity prices are rallying

Posted on 09 March 2016 by VRS  |  Email |Print

Iron ore saw its biggest one-day jump in value ever yesterday, reports Bloomberg. The price soared by a stunning 19% at one point. It’s partly down to hopes that China might be up for more “stimulus”.
But there’s also an increasingly convincing case to be made that we’ve seen the worst of the commodities bear market. And that’s going to create some interesting dilemmas for the world’s central bankers………………………………………….Full Article: Source

How far can the commodities rally go?

Posted on 09 March 2016 by VRS  |  Email |Print

As is the trend these days, where the miners go, the FTSE 100 is sure to follow. So, unsurprisingly, profit-taking in the commodities sector is the main reason why London’s blue-chip index is nursing losses Tuesday. With many miners having surged by 50% or more since mid-January, investors are rightly wondering how far the rally has to run.
The timing and breadth of the upturn certainly caught many investors off guard. Anglo American was the proverbial falling knife until January, since when its share price is up more than 160%. Glencore, once everyone’s favourite dog to kick, is up 126% in the past seven weeks………………………………………..Full Article: Source

Two signs that oil prices may have bottomed

Posted on 09 March 2016 by VRS  |  Email |Print

Oil prices may have finally hit a bottom, Jodie Gunzberg, global head of commodities and real assets at S&P Dow Jones Indices, said Tuesday. “There’s two things … that show us that it could have bottomed,” Gunzberg said.
“The energy stocks are outperforming the energy bonds by the most since October, and that shows a lot of optimism in the market. The other one is we saw a historically big runup in oil of 15 percent in three days last month. That has an additional 20 percent return.” Crude prices have been under pressure all year amid an oversupplied oil market and global growth concerns………………………………………..Full Article: Source

banner
July 2016
S M T W T F S
« Jun    
 12
3456789
10111213141516
17181920212223
24252627282930
31