High-end consumers to be hit as products like plasma TVs, smartphones will cost more. In a major blow to high-end consumers, the prices of rare earth minerals have almost doubled in the second quarter of the current calendar year from the first quarter, mainly on account of various restrictions imposed by the Chinese government.
Rare earth minerals are used extensively for manufacturing plasma televisions, smartphones and energy-saving light bulbs, among a growing number of items. Almost the entire world supply comes from China……………………………………….Full Article: Source

Oil is set to keep outperforming copper due to tighter supply and the potential of OPEC production cuts, but it would likely slump along with the benchmark industrial metal if the world falls into a recession.
Both commodities, key inputs for the global economy, are strongly exposed to faltering growth, but their performances have diverged sharply……………………………………….Full Article: Source

The euphoria that gripped oil markets Tuesday — on news that leaders are putting together a concrete plan for saving the eurozone — is likely to be promptly snuffed out.
West Texas Intermediate light sweet crude oil for November delivery was popping $3.64 to $83.88 a barrel on the reports, and the December Brent crude contract was up $2.49 to $104.99. ………………………………………Full Article: Source

Iraq can produce as much as 5 million barrels a day of oil without needing to ask for OPEC’s permission, as this is a sovereign decision, the chairman of the Iraqi parliament’s oil and energy committee said.
“I don’t think OPEC is a constraint” to output of such a level, Adnan Al Janabi said today at the Iraq 2011: Future Energy conference organized by The Energy Exchange in Istanbul……………………………………….Full Article: Source

Amid the second-largest gold sell-off since 1983, the casual observer could be forgiven for thinking that investors were dumping bullion in droves.
Initial data suggests otherwise. The loss of confidence that caused gold prices to fall 10 percent in the four days through Monday has not yet unnerved investors in the leading gold exchange traded fund, nor caused futures traders to close out positions en masse, figures show……………………………………….Full Article: Source

The recent sell-off in gold may not be enough to make some hedge funds with long-term bull positions change their views that the metal is still one of the best bets for profit in a perilous global economy.
Gold has droppped around 11 per cent since the start of last week as liquidity-strapped investors scrambled to convert gold into cash amid fears over Greece’s near-bankruptcy, likely hitting a number of hedge funds which have profited from its bull run in recent years……………………………………….Full Article: Source

The potential sale of the London Metal Exchange, home to the city’s last open-outcry trading, means Metdist Ltd., Goldman Sachs Group Inc. (GS), MF Global (U.K.) Ltd., UBS Ltd. and Sucden Financial Ltd. have the most at stake.
The five companies are among the biggest shareholders in the 134-year-old bourse, according to a filing to the U.K.’s Companies House a year ago. The exchange told members in a notice on Sept. 23 that it had received “several expressions of interest” and would begin a process that may lead to “an acceptable offer for the company being received.”………………………………………Full Article: Source

India’s commodity exchanges are poised for steady growth over the next few years after annual turnover more than quintupled to $2.5 trillion since futures trading started in 2003, but political hurdles hinder more dramatic development.
While a bill to strengthen market oversight and free up entry of financial institutions and the launch of new products has hung fire since 2005, government moves such as bans on some agricultural futures trading have fed regulatory uncertainty……………………………………….Full Article: Source

Annual turnover on India’s commodity exchanges has more than quintupled to $2.5 trillion since futures trading started in 2003, but political hurdles hinder further development.
A bill for tougher oversight and freer entry of financial institutions and new product launches has waited for lawmakers’ approval since 2005, while government bans on trading in some agricultural futures have fed regulatory uncertainty……………………………………….Full Article: Source

A client having a demat account with a commodity futures broker can now trade on commodity spot exchanges so long as the broker maintains a separate ledger account for clients on either market, issues separate contract notes and meets the capital adequacy and networth criteria of each exchange.
A futures market allows a client to give or take delivery of an asset at a fixed price on a future date, while a spot exchange, in this context , entails delivery a day after a trade is executed or t+2 basis……………………………………….Full Article: Source

In troubled times, money tends to take flight from currencies perceived as risky and seeks shelter under the wings of traditional safe havens. The US economy may have plenty of issues of its own but there is a distinct lack of choice when it comes to financial safe havens these days, and the greenback seems to be the safest port in a storm.
Growing fears that governments are running out of tools to avert another global recession have knocked emerging market and commodity-linked currencies……………………………………….Full Article: Source

As the world gears up for the next round of United Nations climate-change negotiations in Durban, South Africa, in November, evidence has emerged that a cornerstone of the existing global climate agreement, the international greenhouse-gas emissions-trading system, is seriously flawed.
Critics have long questioned the usefulness of the Clean Development Mechanism (CDM), which was established under the Kyoto Protocol……………………………………….Full Article: Source

Airlines denounced on Tuesday an EU plan to charge them for carbon emissions, warning it would cost the industry 17.5 billion euros ($23.8 billion) over eight years.
Three major airline associations charged that the European Commission was “grossly misleading” by stating the scheme could actually translate into 20 billion euros in revenue over the next decade……………………………………….Full Article: Source

Speculators cut bets on rising commodities prices by the most in 19 months as raw materials tip into their first bear market since 2008 and investors anticipate more losses.
Money managers cut the combined net-long position across 18 futures and options by 20 percent in the week ended Sept. 20, the most since February 2010, data from the U.S. Commodity Futures Trading Commission show. The Standard & Poor’s GSCI commodity gauge ended last week down 21 percent from the almost three-year high in April, the common definition of a bear market……………………………………….Full Article: Source

Commodities rose from the lowest since December as European officials considered plans to curb the region’s sovereign-debt woes.
The Standard & Poor’s GSCI index of 24 raw materials climbed 0.2 percent to settle at 600.37 at 3:46 p.m. in New York, snapping a three-session slump. Earlier, the gauge slumped as much as 2.6 percent to the lowest since Dec. 1……………………………………….Full Article: Source

Europe’s debt crisis has sparked cuts to forecasts for Australia’s top commodity exports as fears grow that Asian economies could be held back by the market turmoil.
As a wave of pessimism dragged the sharemarket to a two-year low, economists at National Australia Bank yesterday pointed to risks that cooling growth in emerging economies would cause iron ore and coal prices to fall……………………………………….Full Article: Source

The meat export sector looks like it will remain robust for some time, but economists warn that the boost from other high commodity prices is set to falter.
Statistics NZ figures out yesterday showed August’s exports rose $313 million, compared with the same 2010 month. Imports rose even more, up $523m, mainly because of a big oil shipment……………………………………….Full Article: Source

Urbanization is the driving force behind global commodities demand. As a general rule, the most successful man in life is the man who has the best information.
We have crossed a critical threshold. The demand we are now placing on our planets resources appears to have begun to outpace the rate at which they can be supplied……………………………………….Full Article: Source

An exodus from commodity markets has led to heavy losses for Australian mining companies in the past week. But although the sector’s near-term outlook remains uncertain, there could be some reason for optimism in the longer term.
Miners are sitting on steep losses so far this month, with iron ore producer Fortescue Metals Group down 24 per cent, Rio Tinto falling 17 per cent and BHP Billiton down 14.6 per cent……………………………………….Full Article: Source

China is trying to make itself magnetic to industrial consumers of rare-earth elements, and it may attract a key customer.
Beijing produces the vast majority of rare earths – shorthand for 17 metals crucial for making everything from glass to laptop batteries – giving it virtual control of the business……………………………………….Full Article: Source

China said Monday it has launched an inter-provincial operation to better regulate the production of light rare earth metals in its latest effort to rein in illegal rare earth exploration.
The local governments of three regions where most of China’s light rare earth metals exist will jointly crack down on the illegal exploration and production of light rare earths, the Ministry of Land and Resources said in a statement on its website……………………………………….Full Article: Source

Kazakhstan, fresh from becoming the world’s top of uranium producer, plans to produce a first batch of 1,500 metric tons of rare earths next year as it enters the race to compensate the shortfall of Chinese exports, a senior official said Monday.
The 15-odd rare earths “will be in the form of bulk concentrate” assembled at a joint venture called Summit Atom Rare Earth Company (SARECO) that was established last year with Japan/s Sumitomo Corp. (SSUMY), said Sergey Dara, director of strategic development at Kazatomprom, the state nuclear company that also oversees rare earths and rare metals……………………………………….Full Article: Source

The copper producer also sees a recovery in demand in China, higher copper cathode imports in July and August, lower inventory, and tightening availability of copper scrap.
Copper has joined the base metals pack in its tumble. The metal is called Dr Copper as it is believed to forecast the world’s economic health. Judging by its volatility, it seems it is unable to make up its mind……………………………………….Full Article: Source

Gold prices will likely average $2,025 a troy ounce in 2012 as investors are expected to continue to rush to safe-haven assets amid continuing concerns over the health of the euro-zone economy, Paul Bloxham, HSBC’s chief economist (Australia and New Zealand), said Monday.
However, prices will likely ease over the next five years to $1,500/oz levels as fundamentals take over from global financial concerns, he said………………………………………Full Article: Source

Gold ended below $1,600 for the first time since late July, while silver posted mild losses, as the urge to raise cash curbed interest among some cautious buyers.
The most actively traded gold contract, for December delivery, settled $45.00, or 2.7%, lower at $1,594.80 a troy ounce on the Comex division of the New York Mercantile Exchange……………………………………….Full Article: Source

As the media would have you believe it, gold is on an unstoppable downward spiral and no one is ever going to buy gold again. That’s utter nonsense. Gold has been one of the best-performing assets over the last year. In fact it’s been one of the top-performers in the last five years.
Let’s just use the popular ETF Gold Trust (GLD) as a benchmark. As of 09/24/2011 it’s up 28.31% versus the S&P 500’s rise of 0.96%. Over the last five years, GLD is up 174% while the S&P 500 is down -13.57%……………………………………….Full Article: Source

As Gold prices crashed from $1900 to below $1600, Marc Faber says that if gold prices do not bottom out at $1500, we could see prices fall to $1100-$1200 levels.
“Both equity markets and gold markets have become very oversold, and I think a rebound is occurring. Following this rebound, which I expect to get underway this week, there will be a longer slowdown”, Marc Faber said……………………………………….Full Article: Source

Silver futures on Friday dropped 17.7% to log their biggest one-day percentage decline since least 1984, according to data from FactSet Research dating back to November 1984. Platinum futures also fell the most in a single day since May 20, 2010.
The metals market suffered from a “massive, no-holds barred flight from risk to cash and the U.S. bond and dollar market,” said Tim Murray, general manager of precious metals marketing at Johnson Matthey……………………………………….Full Article: Source

Investors are infatuated with price targets for gold and exchange traded funds tracking the precious metal, but many valuation techniques favored by analysts are faulty, says a portfolio manager at ETF provider State Street Global Advisors.
“I’m bullish on gold, but let’s just be intellectually honest on valuing it,” said State Street’s Chris Goolgasian at the recent Morningstar ETF Invest Conference in Chicago……………………………………….Full Article: Source

The iShares Silver Trust ETF (SLV) took quite a hit this week, down nearly 24% since September 19th closing. Making its gold counterpart SPDR Gold Trust ETF (GLD), 10% downward move seem tame in comparison.
While it’s hard to quantify a “fair value” for either gold or silver, the ratio of prices between the price of the two commodities can be instructive. The below chart shows the ratio of price per share of SLV to GLD since the beginning of 2007 (note these are ratios of the cost of one share of each ETF, not ratios of one ounce of each metal)……………………………………….Full Article: Source

Hedge funds boosted bearish natural gas bets to a record on speculation falling temperatures and a faltering U.S. economy will sap demand for power-plant and industrial fuel.
The funds and other large speculators raised short positions, or wagers on dropping prices, 5.9 percent and reduced long positions, or bets on gains, 3.7 percent in the week ended Sept. 20, according to data from the Commodity Futures Trading Commission’s Commitments of Traders report……………………………………….Full Article: Source

Headquartered in Mumbai, Multi Commodity Exchange of India Ltd (MCX) is a state-of-the-art electronic commodity futures exchange. The demutualised Exchange set up by Financial Technologies (India) Ltd (FTIL) has permanent recognition from the Government of India to facilitate online trading, and clearing and settlement operations for commodity futures across the country.
Having started operations in November 2003, today, MCX holds a market share of over 80% of the Indian commodity futures market, and has more than 2100 registered members operating through over 1, 80,000 trading terminals, across India……………………………………….Full Article: Source

The South Korean currency fell more than 12 percent to the U.S. dollar in September compared with two months ago on the global recovery woes, making it the worst performer among major 21 currencies, data showed Tuesday.
The Korean unit closed at 1,195.80 won per dollar on Monday, depreciating 12.1 percent compared with July 26, according to data by the Bank of Korea (BOK). The depth of the won’s depreciation was the largest among major currencies……………………………………….Full Article: Source

The Indian rupee recovered sharply in a choppy session Monday, after positive comments from European policymakers on resolving the euro zone debt crisis improved sentiment and bolstered the euro and emerging currencies.
The dollar was trading at INR49.45 late in the session, compared with INR49.43 late Friday. The dollar rose to INR49.78 intraday……………………………………….Full Article: Source

All asset classes slumped during the week, and commodities were no exception, as investors felt policy makers in the US and Europe are running out of options to halt another global recession. Even safe havens such as gold and silver lost ground.
Metals were the worst performers due to increasing demand concerns. Copper, nickel, lead and tin lost over 10% each. In the agriculture commodities’ pack, sugar dropped the most on speculation of a better-than-expected harvest……………………………………….Full Article: Source

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Recent equity market moves imply both spot commodity prices and future expectations for these prices are sharply overdone, but this view is not shared by Macquarie. The broker continues to believe in at least a partial disconnection between the equity and physical markets, as the range of potential outcomes continues to broaden due to ongoing concerns about the future of European and US economic growth.
The key for Macquarie is how these events impact on Chinese raw material demand, as it is this that ultimately will drive commodity prices. Looking forward, Macquarie expects persistent Chinese inflationary pressures will ease in coming months, something that would allow for a relaxing of domestic credit tightening measures……………………………………….Full Article: Source

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Last week was one more extraordinary week that witnessed humungous sell-off in the global commodity markets in a condition of panic. Crude, base metals, precious metals and agriculture almost everything was swept away by a strong wave of negative sentiment.
In what was described as exaggerated sentiment, crude prices fell, while across the complex prices of base metals plunged as broad weakness in macro data drove fears of a global slowdown……………………………………….Full Article: Source

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For almost two years, every news was good news for gold and silver, and for good reasons: They are good bets against a falling dollar, inflationary expectations, and soaring sovereign debt—all being clear and present in the last two years; and they have been rewarding to investors on the long-side of the trade:
As of two weeks ago, SPDR gold shares was up 20 percent over last year, close to 50 percent over 3 years, and close to 100 percent over 5 years; ishares Silver Trust was up 86 percent over last year, 76 percent over 3 years, and 125 percent over 5 years……………………………………….Full Article: Source

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Gold prices continued to plunge Friday, despite the market turmoil that often drives investors to the traditional safe haven. Gold tumbled $101.90, or 5.9%, in regular trading to $1,639.80 an ounce. It’s the second straight day of steep declines for the precious metal.
According to the Chicago Mercantile Exchange, Friday marked the first $100 daily price drop since Jan. 22, 1980, when gold plunged $143.50 to $682 the day after having spiked to a record high……………………………………….Full Article: Source

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Gold prices declined by almost 6 per cent, or $102 (Dh375) per ounce, on Friday in the yellow metal’s steepest one-day percentage drop in five years.
Spot gold price settled at $1,637.70 per ounce this Friday compared with a close of $1,812.10/oz last Friday (September 16), resulting in a weekly decline of 11 per cent for the bullion, and about 15 per cent down from its all-time high of $1,920.30 made on September 6, 2011……………………………………….Full Article: Source

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Look for gold at $1662 an ounce to continue its retreat tomorrow in the wake of last week’s rout and the coup de grace of another rise in margin on gold futures speculation at the commodity exchanges.
As gold began the year at $1400 an ounce and rose spectacularly to almost $1900 an ounce– a run-up of $500 or about 35%– there are evidently plenty of margin buyers who got in the game between $1400 and $1662 who are feeling edgy about getting margin calls just at the very moment Europe is in a swoon, and the stock markets everywhere are under great pressure……………………………………….Full Article: Source

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“At some point, however, we will see a correction, perhaps a sizable one. After all, even strong bull markets never move up in straight lines. I would not be surprised to see gold stumble - falling back $100, $200, or even $300 - before prices begin working their way higher once again.” That was my view published here on Mineweb in late August.
Gold has certainly taken a dive - and could stumble further in the days immediately ahead - but I think we will see the yellow metal begin its comeback sooner rather than later, possible in the next few days……………………………………….Full Article: Source

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Chinese gold demand will probably rise by another 10% this year, the World Gold Council (WGC) said this week. Chinese people are buying precious metals in order to protect their savings and wealth against inflation. Many are also growing increasingly concerned by the potential for a collapse in the country’s property and stock markets.
Many financial analysts are convinced that Chinese housing and stock markets are huge bubbles waiting to pop, an event that could have serious ramifications for the country’s banks……………………………………….Full Article: Source

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In the first part of this series of articles we pointed out the developing banking crisis and why we felt that was happening. When and how gold will have a central bank-approved role depends on the political agenda on both sides of the Atlantic.
Commercial banks are already harnessing their gold to lower the cost and availability of international loans! Since the first part of this essay, there have been dramatic banking developments. Each of these has brought gold close to the day when it will have an active role in the global monetary system……………………………………….Full Article: Source

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Base metal was the main discussion this weekend among the investors as its prices plummeted by more than ten percent in last week as traders liquidated their positions because of downgraded global economic outlook by Fed and IMF.
Bears took charge and heavy selling was seen in industrial metals last week due to supply pressure and reduced global demand. LME 3 Month Copper, Lead Nickel fell by approximately 17 percent last week and made twelve months low. LME 3 Month Zinc went down by more than ten percent while Aluminum was trading down by more than seven percent last week……………………………………….Full Article: Source

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Arab hydrocarbon exporters are carrying out mega projects to expand their oil production capacity to meet growing global demand but they need assurances from consumers on demand security to push ahead with such plans.
Despite current political turmoil in some Arab nations, crude supplies from the region would not be largely affected given the high output capacity of Gulf countries and the massive proven oil reserves in the Middle East, the 10-nation Organisation of Arab Petroleum Exporting Countries (Oapec) said……………………………………….Full Article: Source

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The magic word at the Morningstar ETF Invest Conference here last week was “granular.” That word seemed to be on the lips of everyone in the exchange-traded fund business attending the conference. Granular in this case means that in virtually any investment premise or concept, there’s an ETF waiting to happen.
It’s why investors can buy an agricultural commodities fund or one that invests solely in corn. They can buy Europe, or take a chance on the companies making up the stock market in Bulgaria……………………………………….Full Article: Source

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An Australian-based exchange for precious metals is set to start operations next month and aims to allow buyers and sellers to trade online as well as offering storage in its Brisbane vault.
The Australian Bullion Exchange, scheduled to open on Oct. 24, will cater for trade in investment-grade gold, silver and platinum, Chief Executive Officer Thomas Coughlin said in an interview. The privately held exchange is targeting institutions as well as smaller investors, Coughlin said………………………………………Full Article: Source

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A stronger dollar may actually bode further weakness. The greenback has been on a tear lately, jumping more than 6% in the past four weeks to reach its highest level since January against a trade-weighted basket of currencies. Politicians may like to talk up a “strong dollar,” but investors know that in fact a rising currency can be a head wind for economic growth and a drag on corporate earnings.
Moreover, sharp upward moves in the dollar tend to happen during periods of financial turmoil, as a side effect of the global flight-to-safety trade……………………………………….Full Article: Source

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Asian currencies weakened, led by South Korea’s won, on concern that Europe will fail to contain its worsening debt crisis, damping the outlook for Asian exports and reducing demand for emerging-market assets.
The Bloomberg-JPMorgan Asia Dollar Index fell toward an eight-month low as the MSCI Asia-Pacific Index of shares dropped for a third day. Failure to combat the Greek-led turmoil threatened “cascading default, bank runs and catastrophic risk,” U.S. Treasury Secretary Timothy F. Geithner warned in Washington over the weekend……………………………………….Full Article: Source

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