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Commodities Briefing - Archive | November, 2012

UN blames food price rises on trading in agricultural commodities

Posted on 30 November 2012 by VRS  |  Email |Print

UN conference on trade and development (UNCTAD) says trade in futures contracts causes the most damage. The United Nations has laid the finger of blame for food price rises on trading in agricultural commodities, but says it is the trade in futures contracts – an agreement to buy at a set price sometime in the future – rather than the actual food stocks that causes the most damage.
David Bicchetti, associate economic officer at UN conference on trade and development (UNCTAD), said “enormous, humongous” amounts of money are traded on commodities that don’t actually exist. “Over $400bn [of paper money] is traded – that’s 20-30 times the physical production of the commodity.”……………………………………….Full Article: Source

Global food prices stable but still high: World Bank

Posted on 30 November 2012 by VRS  |  Email |Print

Global food prices remained stable, though close to 2008 record levels, the World Bank said on Thursday, as it warned that a “new norm” of costlier food was setting in and threatening to increase hunger and malnutrition in the world’s poorer regions.
In an update of its quarterly “Food Price Watch” report, the World Bank said the absence of “panic policies,” such as food export restrictions, had helped stabilize commodity prices since price spikes in July………………………………………..Full Article: Source

Commodities boom over: UBS

Posted on 30 November 2012 by VRS  |  Email |Print

The super-cycle that drove a huge boom in commodity investment over the last decade is well and truly over, according to UBS’s Mark Rider. The Australian head of investment strategy, who has also worked for the Reserve Bank of Australia as head of economic activity and forecasting, says that the combined forces of supply and demand which contributed to the sector’s explosion over the last decade are now driving prices lower.
“On the demand side, China is settling into a more moderate pace of economic growth, while developed economies struggle with deleveraging headwinds,” he said………………………………………..Full Article: Source

A simple way to capture commodities’ next move

Posted on 30 November 2012 by VRS  |  Email |Print

Since Election Day, when the correction in equities started accelerating in earnest, commoditieshave outperformed stocks. Today let’s look at why this trend looks set to continue, and an easy way to potentially capture commodities’ next move.
Commodities enjoyed a nice rally last week, rising 2 percent on improving fiscal-cliff sentiment, a weaker U.S. dollar and dovish comments by multiple Federal Reserve governors, including Ben Bernanke. As of Monday’s close, commodities were 1 percent higher than the Election Day close, while equities remain multiple percentage points lower………………………………………..Full Article: Source

Commodities rise on budget talks, economic news

Posted on 30 November 2012 by VRS  |  Email |Print

Most commodity prices rose Thursday as back-and-forth negotiations continued over the U.S. budget. Gold, industrial metals, oil and soybeans ended higher on the day. Natural gas, wheat and corn fell.
Investors hope the Obama administration and Congress can agree on a new budget by the end of the year, preventing automatic cuts to government spending and steep tax increases from going into effect………………………………………..Full Article: Source

Changing Middle-East dynamics a game changer for oil?

Posted on 30 November 2012 by VRS  |  Email |Print

A political crisis in Egypt heralds a new phase of instability in the Middle East that will keep worries about oil supplies from the region intact putting upward pressure on prices, commodities analysts said.
A controversial decree by Egypt’s President Mohamed Mursi has plunged the country into a crisis and ensured that tensions in the Middle East will remain firmly in focus just as last week’s ceasefire between Israel and Hamas ended eight days of fighting in the Gaza strip and bought some relief to investors………………………………………..Full Article: Source

Oil prices may fall next year

Posted on 30 November 2012 by VRS  |  Email |Print

Oil prices are expected to fall slightly over the next year as high production feeds softening demand at a time of slowing global economic growth, a poll shows.
An oil price survey of 29 analysts forecasts North Sea Brent crude oil will average $107.50 per barrel in 2013, down $1.30 from the forecast in the October poll and compared with an average of around $111.90 so far in 2012. Five analysts now expect Brent to average less than $100 in 2013, compared with three in last month’s poll………………………………………..Full Article: Source

OPEC to keep oil target unchanged

Posted on 30 November 2012 by VRS  |  Email |Print

High oil stockpiles, slowing demand growth and a fragile world economy would normally give OPEC reason to consider supply cuts when it meets next month.
But with turmoil in the Middle East keeping the price of oil well into triple digits, OPEC delegates say the 12-member group is expected to stick with an output target of 30 million barrels per day agreed a year ago………………………………………..Full Article: Source

Opec oil output falls in November, says survey

Posted on 30 November 2012 by VRS  |  Email |Print

Opec crude oil output has declined in November to its lowest since January because of disruptions to Nigerian output and reduced supplies from Angola and Libya, a Reuters survey found.
Supply from the 12-member Organisation of the Petroleum Exporting Countries has averaged 31.06m barrels per day (b/d), down from 31.15m b/d in October, the survey of sources at oil companies, Opec officials and analysts found………………………………………..Full Article: Source

UK landmark energy reforms cushion heavy industry

Posted on 30 November 2012 by VRS  |  Email |Print

Britain is considering exempting industrial users from extra costs arising from landmark energy reforms announced on Thursday while consumers face higher bills as the country replaces ageing capacity with low-carbon power.
Britain’s Energy Bill, introduced to parliament on Thursday, aims to ensure the EU’s second-largest economy can keep the lights on and diversify its energy mix in view of legally binding carbon targets………………………………………..Full Article: Source

Citigroup Inc.’s energy outlook for 2013

Posted on 30 November 2012 by VRS  |  Email |Print

Considering this year’s rather volatile performance, one thing can be agreed upon by almost all investors – commodity investing is essentially a crap shoot. This year’s unprecedented summer drought and escalated geopolitical tensions in the Middle East have wreaked havoc on commodity markets, leaving some lucky investors with profitable returns and others with steep losses.
Overall, however, commodities have been experiencing a steady uptrend for quite some time, as global demand has continuously inched higher despite the recent economic slowdown. In a recent statement, global head of commodities research at Citigroup Edward Morse warned that the “commodity super-cycle” is over and that “no longer will a pure long-only strategy bring the returns expected in 2002 to 2008, nor will conditions approximating those of the last decade return anytime soon”……………………………………….Full Article: Source

Expect gold to deliver another record in 2013

Posted on 30 November 2012 by VRS  |  Email |Print

No two bull markets are ever the same, and gold is no exception. During the last secular gold bull market in the 1970s, gold rose from $35 in 1968 all the way to $200 by late 1974.
Then the unthinkable happened. Between late 1974 and mid-1976, gold prices were cut in half, dropping from about $200 to $100. At the time, many gold investors sold out in disgust, never to return. But then a funny thing occurred. Gold prices started to climb again, rising from $100 in mid-1976 all the way to $800 by January 1980………………………………………..Full Article: Source

Upside for silver to crest $50/oz in 2013 – GFMS

Posted on 30 November 2012 by VRS  |  Email |Print

As a result of significant investor demand for silver as an alternative investment metal in the current uncertain global economic environment, precious metals consultancy GFMS on Thursday said the price for the white metal could top $50/oz in 2013.
During a webcast to present the preliminary findings of the ‘GFMS Inetrim Silver Report’, global head of metal analytics Phillip Klapwijk pointed to strong investment demand, albeit in a small market, and the rising intertwined gold price would lift the price of silver to between $33/oz and $47/oz, with a 25% probability for significantly higher prices………………………………………..Full Article: Source

Silver outperforming gold may signal inflationary rally

Posted on 30 November 2012 by VRS  |  Email |Print

We may be on the verge of another major breakout as the precious metals market may be once again pricing in the next Keynesian move.
We are approaching the end of the year where investors are facing a confluence of mixed signals such as tax loss selling, fiscal cliff discussions, the Greek bailout, future Fed actions and Middle Eastern geopolitical turmoil. Short term shakeouts like yesterday’s early morning drop in precious metals should be expected………………………………………..Full Article: Source

Would a physical copper ETF be a bad idea?

Posted on 30 November 2012 by VRS  |  Email |Print

Over the past two years, a number of issuers like iShares and JP Morgan have filed for a physical copper ETF; something investors have been wanting for quite some time.
At first glance, it seems like a solid idea; after all, GLD and SLV are two of the most popular ETFs in the world, and each of them offers physical exposure to their respective metals. But despite the popularity of the physical structure, it may not make much sense for this industrial metal to be adopted into such an ETF……………………………………….Full Article: Source

Time to put on retail ETFs?

Posted on 30 November 2012 by VRS  |  Email |Print

Holding to true seasonal tendencies, select retail stocks and the ETFs that track them have been performing well over the past month. Digging deeper into the retail space, investors may want to consider ETFs that are heavy on apparel makers, according to a research note published by S&P Capital IQ. The research firm apparel retailers have benefited from slumping cotton prices.
“Higher cotton prices and rising manufacturing costs drove retail prices up last fall (2011) and this spring,” said S&P Capital IQ………………………………………..Full Article: Source

Takeover approved for Metal Exchange

Posted on 30 November 2012 by VRS  |  Email |Print

Regulators approved the planned takeover of the London Metal Exchange (LME) by Hong Kong Exchanges and Clearing (HKEx). This means the deal to buy one of the City’s oldest – and certainly its most unusual – trading venues could complete as early as 6 December, bringing to an end 135 years of member-ownership.
LME is one of the few venues in the world that still practises open outcry trading and visitors to its Leadenhall Street offices can still see traders enter the ring and use arcane hand signals to buy and sell copper, aluminium, lead, nickel, tin and zinc………………………………………..Full Article: Source

Ethiopia: Is ECX at it again? ECX’s upcoming procurement bid

Posted on 30 November 2012 by VRS  |  Email |Print

The Ethiopia Commodity Exchange (ECX) is currently conducting a high-ticket international procurement - the first of its kind since a multi-million dollar bid was busted in 2010 due to alleged fraud and corruption during the bidding process.
The bid for the supply, installation, and maintenance of a futures trading software that ECX floated back in 2010 was marred by dishonest maneuvering, seemingly to favor the Sri Lanka based company, Millennium IT, and World Bank withdrew ECX’s award proposal and cancelled the loan. The loan was part of what the government had borrowed from International Development Association (IDA) for the purposes of financing the Rural Capacity Building project………………………………………..Full Article: Source

Barclays to exit crop trading biz?

Posted on 30 November 2012 by VRS  |  Email |Print

Barclays Plc. is contemplating a retreat from trading in agriculture commodities, according to a Reuters report. The move comes as the company gears up for a strategic revamp of its overall business as well as to avoid any threat to its reputation.
Notably, trading in agricultural commodities has received much criticism in the recent years as the speculation activity has been blamed for a shoot up of prices. This has had severe consequences in the undeveloped countries, leading politicians as well as common people to raise their voices in protest………………………………………..Full Article: Source

FAO raises 2012 global paddy production forecast to 729 mn tons

Posted on 30 November 2012 by VRS  |  Email |Print

The Food and Agriculture Organization of the United Nations (FAO) has raised its July forecast of global paddy production in 2012 by 4.2 million tons to 729 million tons (486 million tons, milled) because of the progression in the crop.
Prospects have improved especially for India, but also Egypt, the Democratic Republic of Korea, the Philippines, the United States and Vietnam, while they worsened in Myanmar, Colombia and Senegal………………………………………..Full Article: Source

Palm oil may tumble next year as production climbs, Mistry says

Posted on 30 November 2012 by VRS  |  Email |Print

Palm oil may trade in a range in the next three months before slumping into a bear market as global production peaks in the second half of next year, according to Dorab Mistry, director at Godrej International Ltd.
Futures on the Malaysia Derivatives Exchange will trade between 2,300 ringgit ($755) and 2,600 ringgit a metric ton until February, keeping inventories high in Indonesia and Malaysia, the top producers, Mistry told a conference in Bali, Indonesia today. Prices will drop below 2,200 ringgit in August or earlier as a pickup in output expands inventories, he said………………………………………..Full Article: Source

Combating climate change on credit

Posted on 30 November 2012 by VRS  |  Email |Print

Nations around the world have signed up for a CO2 ‘cap-and-trade’ system, but questions abound over its effectiveness. Can the carbon market attain enough credits to help halt global climate change? How, with its diversity of climate mitigation efforts, can carbon contracts be kept feasible enough for the markets to grow? And are there costs to biodiversity and indigenous people living in or near forests?
Under the 1997 Kyoto Protocol, 193 countries committed to reduce their annual rate of greenhouse gas emissions by four per cent compared to 1990 levels. One of their suggested methods for implementing the goal was a “cap-and-trade” market………………………………………..Full Article: Source

World economy in best shape since 2011 investors

Posted on 29 November 2012 by VRS  |  Email |Print

The world economy is in its best shape in 18 months as China’s prospects improve and the U.S. looks likely to avoid the so-called fiscal cliff, according to the latest Bloomberg Global Poll of investors.
Two-thirds of the 862 surveyed described the global economy as either stable or improving. That’s up from just over half who said that in September and is the most since May 2011………………………………………..Full Article: Source

$5.5 trillion reasons why the biggest profits have yet to come from commodities

Posted on 29 November 2012 by VRS  |  Email |Print

It’s true that the United States and most American citizens are in a truly terrific amount of debt. But the market is infinitely more complicated than most people think. And in one of those strange twists, while the whole world seems to be circling the drain in debt – American savings deposits are through the roof.
Don’t get too excited – the current debt levels still dwarf our saving. But with the fiscal cliff looming, and a variety of other “uncertainties” plaguing the market, people seem to want to save in the safest way possible……………………………………….Full Article: Source

Rabobank 2013 commodities outlook

Posted on 29 November 2012 by VRS  |  Email |Print

Rabobank 2013 Commodities Outlook: Agri markets to remain volatile as fundamentals ‘rebalance on a tightrope’. Volatility in agri commodity prices looks set to continue into 2013, according to a report from Rabobank’s Agri Commodity Markets Research department. This will be particularly true for grain and oilseeds markets, with a supply squeeze in the first six months expected to push prices higher, before an expected production rebound leads to a weakening in prices in the second half of the year.
The report says soymeal is the commodity likely to show the largest price decline by the end of 2013. In contrast, Rabobank analysts expect palm oil to be the strongest performer, as Chinese imports and biofuel demand drive prices higher after the sell-off in 2012………………………………………..Full Article: Source

IEA sees Canadian dominance in oil

Posted on 29 November 2012 by VRS  |  Email |Print

Canada needs to capitalize on its booming oil sector to maintain a leadership position in an evolving energy market, the IEA’s top economist said.
The U.S. Energy Department’s Energy Information Administration states that Canada has the third-largest amount of oil reserves in the world behind Saudi Arabia and Venezuela. About 98 percent of Canadian reserves exist as oil sands, which the EIA said accounts for 170 billion barrels worth of oil………………………………………..Full Article: Source

Oil markets falling off the cliff on OECD concerns

Posted on 29 November 2012 by VRS  |  Email |Print

Oil prices declined this week following a report from the Organization for Economic Cooperation and Development that major world economies were expected to make an “uneven recovery” over the coming years. In early November, OPEC said ongoing concerns about the sovereign debt crisis in European economies, coupled with problems with other leading economies, would be a drag on commodity markets.
In the United States, meanwhile, partisan rancor over the so-called fiscal cliff means the world economy is nowhere near a post-recession climate………………………………………..Full Article: Source

World Energy Report 2012: The good, the bad, and the really, truly ugly

Posted on 29 November 2012 by VRS  |  Email |Print

Rarely does the release of a data-driven report on energy trends trigger front-page headlines around the world. That, however, is exactly what happened on November 12th when the prestigious Paris-based International Energy Agency (IEA) released this year’s edition of its World Energy Outlook. In the process, just about everyone missed its real news, which should have set off alarm bells across the planet.
Claiming that advances in drilling technology were producing an upsurge in North American energy output, World Energy Outlook predicted that the United States would overtake Saudi Arabia and Russia to become the planet’s leading oil producer by 2020………………………………………..Full Article: Source

Coal-reliant Poland to host U.N. climate talks after OPEC’s Qatar

Posted on 29 November 2012 by VRS  |  Email |Print

Coal-dependent Poland is set to host next year’s U.N. talks on slowing climate change after OPEC member Qatar in 2012, a move dismaying environmentalists who say both oppose action to reduce use of fossil fuels.
Poland formally submitted its offer for Warsaw to host the talks on Wednesday to almost 200 nations at this year’s meeting in Doha. No other countries made an offer at a planning session on Wednesday, making its selection pretty much automatic………………………………………..Full Article: Source

The commodity investor: What’s the future of natural gas?

Posted on 29 November 2012 by VRS  |  Email |Print

The natural gas market has been facing a generational shift over the last several years. A technological revolution that began in the United States has unlocked billions of tons of previously unreachable natural gas, both in the US and abroad.
These technological improvements are signs of a paradigmatic shift in the natural gas industry, and that shift is having repercussions on the energy industry globally. In this week’s report, the Commodity Investor examines this technological revolution and its deep impact on the natural gas industry………………………………………..Full Article: Source

Copper shortage seen extending as China accelerates: Commodities

Posted on 29 November 2012 by VRS  |  Email |Print

Copper supply shortages will extend into the first half of next year as an accelerating Chinese economy more than doubles the pace of growth in global consumption even as mines extract a record amount of metal.
Demand will outpace supply by 316,000 metric tons in the first six months, more than all copper in London Metal Exchange warehouses, before a surplus emerges in the second half, Barclays Plc estimates. Production has lagged behind consumption since 2010, according to the International Copper Study Group………………………………………..Full Article: Source

Global mining and metals deal values and volumes down

Posted on 29 November 2012 by VRS  |  Email |Print

Global mining and metals deal values and volumes are down, with Canadian numbers falling in the first nine months this year, advisory firm Ernst & Young’s (E&Y’s) seventh twice-yearly ‘Global Capital Confidence Barometer’ has found.
Deal values had declined by 43% year-on-year and volumes had declined by 16% year-over-year. “Our survey results reveal that only 38% of companies, down from 53% in April, are focused on growth in the next 12 months, while 27% are refocusing on business fundamentals, including cost reduction and operational efficiency,” E&Y Canadian mining and metals leader Bruce Sprague said on Wednesday………………………………………..Full Article: Source

Global platinum mining capacity to increase 38,000 kg by 2015—U.S. Geological Survey

Posted on 29 November 2012 by VRS  |  Email |Print

A U.S. Geological Survey scientific investigations report forecasts that South Africa, Russia, Canada, and Zimbabwe will continue to be the principal sources of PGM for at least the next decade.
Global platinum mining capacity is expected to increase by 24,000 kg in South Africa, 9,000 kg in Russia, 3,000 kg in Russia and 2,000 kg in Zimbabwe from 2011 to 2015, according to the report authored by David R. Wilburn………………………………………..Full Article: Source

Australia: Mining investment hits record high

Posted on 29 November 2012 by VRS  |  Email |Print

Several huge liquefied natural gas projects have pushed committed investment in the resources sector to a record $268 billion, the government’s commodity forecaster says. But in a sign of the growing risks to the investment pipeline, the Bureau of Resources and Energy Economics has warned that cost blowouts and weak conditions could constrain future spending growth.
Figures published on Wednesday said there were 87 major projects in Australia worth a collective $268 billion that had been given the green light to proceed………………………………………..Full Article: Source

Gold price forecast for 2013: Rising value amid more global uncertainty?

Posted on 29 November 2012 by VRS  |  Email |Print

The Eurozone, whose economy contracted 0.1% in 2012´s third quarter, continues to show little sign of recovery, with France now looking like it could be dragged toward the PIIGS´ mire too and Spain grappling with the possibility of Catalonian independence while also trying to kickstart their economy.
What´s more Europe´s leaders failed to reach agreement yet again on how to assist Greece once more. In the United Kingdom, if the Euroskeptic Tories get their way, David Cameron may push Britain to “second-class membership” status of the EU before long, further weakening the bloc, amid difficult negotiations on the upcoming EU budget………………………………………..Full Article: Source

Gold rebounds on U.S. budget optimism, record investor holdings

Posted on 29 November 2012 by VRS  |  Email |Print

Gold rebounded from the biggest drop in more than three weeks as investor holdings expanded to a record and optimism returned that the so-called fiscal cliff in the U.S. will be avoided, hurting the dollar.
Gold for immediate delivery rose as much as 0.2 percent to $1,723.70 an ounce and traded at $1,720.35 at 11:58 a.m. in Singapore. The price dropped 1.3 percent yesterday, the biggest fall since Nov. 2, on concern that a U.S. deal won’t be agreed. Bullion for February delivery gained as much as 0.4 percent to $1,726 an ounce on the Comex, and was at $1,722.50………………………………………..Full Article: Source

Gold sees mild recovery after big sell-off

Posted on 29 November 2012 by VRS  |  Email |Print

Gold prices staged a mild rebound Thursday in Asia on relief buying after they were slammed overnight over a host of concerns, disregarding for the moment optimism over the U.S. fiscal-cliff talks that boosted other risk assets.
The yellow metal’s December futures rose $4.50, or 0.3%, to $1,721 an ounce in electronic trading. The mild recovery followed a convergence of technical selling, deflationary concerns and U.S. dollar strength that sank December futures by $25.80 during Wednesday’s regular session on the Comex division of the New York Mercantile Exchange. The contract had slumped as much as $36.80 at one point………………………………………..Full Article: Source

Gold to surge in 2013 as central banks print more money: Profit Confidential

Posted on 29 November 2012 by VRS  |  Email |Print

Gold prices may witness strong appreciation in 2013 as central banks print more of their respective prices which will push up prices of the yellow metal, according to Michael Lombardi, lead contributor and financial expert at Profit Confidential.
In a recent article in Profit Confidential, he pointed out that,“from 2008 to 2011 alone, the Federal Reserve has printed $2.3 trillion. Other central banks are doing the same,” notes Lombardi. He concludes, “…gold meets all the criteria to soar even higher. Uncertainty is still present, demand is increasing, and central banks are expected to continue printing fiat money.”……………………………………….Full Article: Source

Hmmm – is the gold really there?

Posted on 29 November 2012 by VRS  |  Email |Print

Following on from our recent article on China’s gold reserves – and everyone else’s for that matter – we were fascinated to read the most recent issue of Grant Williams’ (no relation) Things that make you go hmmm report which covers some of the same ground and much more – but in hugely more detail.
This not only broadly comes to some of the same conclusions, but many more as well, coupled with supporting charts and data, all of which have to be disturbing for those who still believe that Central Banks and governments are truly open in their pronouncements on the levels of their gold reserves – and in particular regarding the gold held in the big U.S. Fed and U.K. Bank of England gold repositories………………………………………..Full Article: Source

Silver may be ready for a rally above $44/oz by year end: TDS

Posted on 29 November 2012 by VRS  |  Email |Print

Silver may be ready for a rally above $44 an ounce by the end of this year, said TD Securities in a commodity snippet.
According to TDS, the combination of industrial consumption, investor demand and a poor primary silver production outlook next year prompts them to think that the metal could trend above $44 an ounce by the end of the year………………………………………..Full Article: Source

Global trends support outlook for agribusiness ETFs

Posted on 29 November 2012 by VRS  |  Email |Print

The recent rally in agricultural commodity markets, which has seen grain prices jump by 45.3% between 1 June and 30 August, serves as a stark reminder of the long-term global food supply/demand imbalance. For investors however, the greatest opportunities could lie among agricultural solution providers, so-called agribusiness, according to Allianz Global Investors.
This summer’s North American drought, the worst drought since the 1950s, has decimated fields across the US Farm Belt forcing the US Department of Agriculture (USDA) to slash corn and soybean yield estimates………………………………………..Full Article: Source

South African ETFs: Gold vs. equities

Posted on 29 November 2012 by VRS  |  Email |Print

As the fourth-largest producer of gold in the world, the fortunes of the South African economy are often viewed as hitched to the performance of the yellow metal itself. When it comes to ETFs, the correlations between gold and South African equities are not always as intimate as some investors think.
For example, in the past month, the iShares MSCI South Africa Index Fund (EZA) has slumped 0.7% while the SPDR Gold Shares (GLD) is higher by 0.2%. That indicates that EZA does not always move in lockstep with gold futures………………………………………..Full Article: Source

First platinum, silver ETFs launched in Hong Kong markets

Posted on 29 November 2012 by VRS  |  Email |Print

The first ETFs tracking platinum and silver were scheduled to debut today on the Hong Kong Stock Exchange (HKEx), while a third physical gold ETF is also launched.
The ETFs will be the first three launched by ETF Securities (Hong Kong) Ltd. (ETFS) on the HKEx. All three ETFs—ETFS Physical Silver ETF, ETFS Physical Platinum ETF, and ETFS Physical Gold ETF are designed to track the London benchmark precious metals prices………………………………………..Full Article: Source

China a currency manipulator? So is every other country

Posted on 29 November 2012 by VRS  |  Email |Print

Republican presidential candidate Mitt Romney vowed he’d do this as president. Senator Chuck Schumer (D-NY) has been a public advocate of it. But the White House says it would not label the nation’s largest trading partner — China — a currency manipulator.
In its semi-annual report to Congress on international economic and exchange rate policies, the Treasury Department says China has taken steps to appreciate its currency, the renminbi, and “Chinese authorities have substantially reduced the level of official intervention in exchange markets since the third quarter of 2011.”……………………………………….Full Article: Source

World corn production rising despite drought-like conditions

Posted on 29 November 2012 by VRS  |  Email |Print

World corn production may witness a significant growth this year drought like condition in major corn growing areas.
A recent data by the U.S. Grains Council shows that world corn production of 839 mn metric tons for the 2012-2013 marketing year will be the second highest on record, down 37 mn tons from 2011-2012 but up 8.2 mn tons from 2010-2011, according to the U.S. Department of Agriculture………………………………………..Full Article: Source

Speculators raise wagers first time in seven weeks: Commodities

Posted on 28 November 2012 by VRS  |  Email |Print

Speculators raised bullish commodity wagers for the first time since early October as signs of improving economic growth in the U.S. and China pushed prices higher for three straight weeks. Hedge funds and other money managers increased combined net-long positions across 18 U.S. futures and options by 9.6 percent to 846,321 contracts in the week ended Nov. 20, Commodity Futures Trading Commission data show.
That was the biggest gain since mid-August. Corn holdings rose the most since July, and those on silver reached a five-week high………………………………………..Full Article: Source

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New global energy picture

Posted on 28 November 2012 by VRS  |  Email |Print

A new report hails a crucial shift in the global economy. If current trends continue, the United States will surpass Saudi Arabia as the world’s largest oil producer by 2020. This development will not only transform the world’s energy picture, but geopolitics as well.
A new energy landscape has powerful implications for global political and economic power. The International Energy Agency (IEA), the top advisory body for the developed economies, notes in its authoritative annual report, “World Energy Outlook,” that changing U.S. production and consumption patterns will redraw the global energy map. A surge in U.S. production means that “by around 2020, the United States is projected to become the largest global oil producer.”……………………………………….Full Article: Source

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Is green growth possible?

Posted on 28 November 2012 by VRS  |  Email |Print

Clean tech jobs to power green growth is considered a no-brainer by progressive policy makers, NGOs and businesses, and the idea forms the core of the UN’s Year of Sustainable Energy For All (SE4ALL). But some economists, academics and environmental thinkers increasingly question its central premise.
Critiques of ‘green growth’ have often been articulated by business lobbies opposed to climate action, but also by environmentalists and socialists, who argue that infinite growth is impossible in a finite natural world. One EU official speaking to EurActiv on condition of anonymity said that achieving the emissions cuts needed to contain global warming to the UN’s 2 degrees Celsius target, while maintaining growth was an “outlandish” notion………………………………………..Full Article: Source

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Three dilemmas awaiting OPEC in the future

Posted on 28 November 2012 by VRS  |  Email |Print

OPEC faces a triple dilemma over the short, medium and long term, none of which have good outcomes for the cartel. The short term is simple; prices are likely to correct into 2013 below price bands that are deemed economically and politically comfortable. That strikes on OPEC’s medium term problem; the geological cost of production is now structurally out of sync with the geopolitical cost of survival.
When OPEC doesn’t get the petrodollars they need to appease restive populations, the default position will be tough political repression to tighten their grip on power. Whether that ‘works’ as an effective coping mechanism remains to be seen; political outages might well help to lift interim prices, but this merely highlights OPEC’s long term nadir………………………………………..Full Article: Source

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The end of oil and the coming electric economy

Posted on 28 November 2012 by VRS  |  Email |Print

To be sure, rumours of the impending death of oil are exaggerated and anticipate trends - but since 2001 the trend continues. Using IEA data, in 1973 the OECD countries sourced 53% of their total energy supply from oil, underlining that the post-2001 trend is anything but new.
What comes next is the real question. This decline of oil in the global economy easily explains why the weak rebound of global fossil energy demand since the 2008 debt-and-deficit or financial-economic crisis has given wings to, and grown legs along the world’s powergrids. These are increasingly fed by renewable-source power supplies………………………………………..Full Article: Source

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