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Commodities Briefing - Archive | January, 2013

Opec upbeat on 2013 crude oil price

Posted on 29 January 2013 by VRS  |  Email |Print

Opec has struck an an upbeat tone about the oil market for this year, anticipating prices of around $110 a barrel on average for 2013. Abdalla El-Badri, Opec secretary-general, added that the oil cartel, which accounts for 40 per cent of global oil supplies, would probably keep its production stable for the time being, after member countries cut output in November and December.
“As of now I think the situation is really improving,” he said. Speaking about the outlook for the oil market, he added: “When I see growth in China is improving, growth in India is improving, when I see growth in the US is improving, I think that unless something dramatic happens in 2013, it will be a repetition of 2012.”……………………………………….Full Article: Source

Oil trades near four-month high as OPEC sees no price collapse

Posted on 29 January 2013 by VRS  |  Email |Print

Oil traded near the highest level in four months in New York on signs of economic growth in the U.S. and after OPEC Secretary General Abdalla El-Badri said prices are unlikely to drop this year. Futures were little changed after climbing 0.6 percent yesterday. U.S. durable goods orders last month rose by more than the highest forecast in a Bloomberg survey, Commerce Department data showed.
Federal Reserve policy makers start a two-day meeting today to discuss continuing asset purchases to boost the economy. The oil market is well-balanced and the Organization of Petroleum Exporting Countries doesn’t “envision a price collapse” in 2013, El-Badri said in London………………………………………..Full Article: Source

Will “Saudi America” become a reality?

Posted on 29 January 2013 by VRS  |  Email |Print

U.S. energy independence has been a dream since the oil embargoes of the 1970s. But this vision of a “Saudi America” has always been just a dream. Investors and non-investors alike started talking in earnest about realizing that dream last November. That was after the International Energy Agency’s (IEA) latest World Energy Outlook said that the U.S. would overtake both Saudi Arabia and Russia in oil output by the second half of this decade.
Its forecast calls for the United States to be producing 11.1 million barrels a day in 2020 compared to Saudi Arabia’s 10.6 million barrels a day. The IEA’s Outlook went on to say that by 2035 the United States could be almost self-sufficient in energy, and talks about “Saudi America” began to surface………………………………………..Full Article: Source

Can diamonds outlive India’s gold obsession?

Posted on 29 January 2013 by VRS  |  Email |Print

India’s obsession with gold is well documented. Jewellery collections here are often never complete without the yellow metal and no savings plan is perfect for an average Indian avoiding a piece of gold, irrespective of how appealing and profitable it may be.
While the country’s fascination for gold has its fair share of critics, Indians, of late, have developed a major interest in a related section - diamonds. According to the Global Diamond Industry Report 2012 released by business consultant firm Bain & Company in collaboration with Antwerp World Diamond Centre (AWDC), India is world’s third-largest diamond market, with $8.5bn annual revenue, and is growing rapidly………………………………………..Full Article: Source

Gold bearish,FOMC Meet, US non-farm payrolls to set price trajectory: Barclays

Posted on 29 January 2013 by VRS  |  Email |Print

Gold prices tumbled last week failing to breach $1700 per ounce levels triggering profit taking amid improving market sentiments, according to Barclays Research.
The solidity of the physical market will set the downside for prices, while buying in China has been strong ahead of the Lunar new year, it will need to be coupled with a pickup in other regions to provide strong support. This week’s FOMC meeting and US non-farm payrolls will be key in setting gold’s price trajectory………………………………………..Full Article: Source

Precious metals see bullish medium-term implications

Posted on 29 January 2013 by VRS  |  Email |Print

The recent situation in the currency markets is exactly what precious metals investors like to see – for some time now we have been witnessing the strength in euro and weakness in the U.S. dollar. Unfortunately, what we did not see was the usual rally in gold, silver and other precious metals that normally accompanies such a set-up. That is mainly because of the unnatural state of correlations that we already discussed before.
But there were exceptions, such as the rally at the beginning of January, sparked by a plunge in dollar………………………………………..Full Article: Source

Tin beating all metals on fourth year of shortages

Posted on 29 January 2013 by VRS  |  Email |Print

Indonesia, the biggest tin supplier, is poised to ship the least metal in a decade, extending shortages into a fourth year at a time when surpluses are emerging for most other industrial metals.
Sales will drop 24 percent to 75,000 metric tons because most smelters won’t meet a higher purity standard that starts in July and ore reserves are diminishing, according to the median of 13 exporter and analyst estimates compiled by Bloomberg. Prices will rise 18 percent to $28,750 a ton on the London Metal Exchange this year, the median of 14 forecasts shows………………………………………..Full Article: Source

China stands on threshold of gold ETF introduction

Posted on 29 January 2013 by VRS  |  Email |Print

China Securities Regulatory Commission (CSRC) has published provisional rules for the operation of gold ETFs, which pave the way for introduction of gold ETFs into China’s financial markets. China Daily quoted an official from the CSRC Saturday who said that there is no specific timetable for the listing of gold ETFs in China.
The move is part of the Chinese Central Government’s effort to promote the development of China’s gold and capital market. China is the world’s largest gold producer and consumer according to the China Gold Association………………………………………..Full Article: Source

Surprises among EM ETFs, commodities in 2013

Posted on 29 January 2013 by VRS  |  Email |Print

Not even full month into the new year and an arguably surprising theme has been seen with emerging markets ETFs that track nations viewed as raw materials plays. The theme being that some of these ETFs have shown little correlation to price action in the commodities traders view the ETFs as often being highly correlated to.
Interestingly, this theme is playing out to the advantage of some ETFs and to the disadvantage of others. Said differently, some emerging markets funds that have a reputation for being highly correlated to a particular commodity are outperforming that commodity by wide margins………………………………………..Full Article: Source

There are two currencies now that everyone hates

Posted on 29 January 2013 by VRS  |  Email |Print

By now you must already know the deal with the sagging Japanese yen. Japan has a new Prime Minister who has embarked on a promise of aggressive fiscal and monetary easing in order to beat deflation. The yen has been plummeting since November. That’s one currency that everyone’s bearish on.
The other story, and this is just getting started in the last few weeks is the British pound. Last week, the country came out with a negative GDP print, and people are talking about a “triple-dip” recession………………………………………..Full Article: Source

EU’s carbon trading hopes rest on Germany

Posted on 29 January 2013 by VRS  |  Email |Print

In more than three years of a crisis that has threatened the very existence of Europe’s single currency, one thing has become evident: no meaningful action – be it a multibillion-euro bailout or new fiscal rules – can go forward without the consent of Angela Merkel, Germany’s chancellor.
As policy makers, traders and companies mull the fate of the EU’s carbon market, the world’s largest, they are discovering the same may hold true here………………………………………..Full Article: Source

Carbon tax impact must be stopped: Abbott

Posted on 29 January 2013 by VRS  |  Email |Print

A survey that shows businesses have estimated a 14.5 per cent jump in energy costs due to the carbon tax underlines why the impost must be scrapped, Tony Abbott says.
The federal opposition leader says the Australian Industry Group (Ai Group) survey shows company power price rises are well above the 10 per cent increases the federal government has so far been prepared to concede. He says the additional cost is an example of how the carbon tax is worsening job uncertainty and elevating the cost of living………………………………………..Full Article: Source

Hedge funds boost bullish bets by most since July: Commodities

Posted on 28 January 2013 by VRS  |  Email |Print

Hedge funds increased bullish commodity bets by the most in six months as accelerating growth from China to the U.S. boosted prices for a seventh week.
Speculators raised net-long positions across 18 U.S. futures and options by 11 percent to 758,048 contracts in the week ended Jan. 22, the biggest gain since July 3, U.S. Commodity Futures Trading Commission data show. Bullish crude- oil bets reached a four-month high, while those for soybeans climbed by the most since March. Investors are the most bullish on cotton since February 2011………………………………………..Full Article: Source

Death of commodities super-cycle? Not quite

Posted on 28 January 2013 by VRS  |  Email |Print

The slowdown in the world’s largest economies last year, particularly in China, led to warnings that the end of the commodities super-cycle was near, as prices of key resources plummeted. However, a flood of government stimulus unveiled in recent months has reversed that trend, prompting one expert to say the commodities bull run that began in 2002 is here to stay.
“(The super cycle) is still intact. The combination of the economic recovery, especially with China powering ahead, and continuing support from central banks…It’s going to be a good year for commodities,” Eugen Weinberg, global head of commodities research at Commerzbank told CNBC, pointing to the Bank of Japan’s commitment to open-ended easing this week………………………………………..Full Article: Source

How the 14 major commodities will do for the next two years

Posted on 28 January 2013 by VRS  |  Email |Print

Despite recent hiccups in gold prices, if you’re investing in commodities, it is still the best, safest bet, according to Morgan Stanley’s commodities team led by Hussein Allidina.
Silver offers a little more risk and reward than gold; Allidina expects it to outperform gold in 2013. he report also favors soybeans and corn as demand for them is accelerating faster than supply………………………………………..Full Article: Source

8 commodities you should be investing in

Posted on 28 January 2013 by VRS  |  Email |Print

Morgan Stanley, in its newly released Commodity Manual, just delivered good news for anyone investing in commodities in 2013. The report gives a bullish outlook in 2013 and 2014 for eight of 14 commodities it evaluated. Estimated two-year gains range from 3.05% to 17.3%.
Money Morning Global Resources Specialist Peter Krauth agrees most commodities will perform well. In fact, he projects even higher growth than Morgan Stanley’s outlook. “With central banks on their virtually uninterrupted fiat money-printing spree bound to continue for the next few years, hard assets remain a great place to be,” Krauth says. “That being said, some commodities will undoubtedly do better than others.”……………………………………….Full Article: Source

OPEC cannot sustain high oil prices forever

Posted on 28 January 2013 by VRS  |  Email |Print

OPEC’s influence on oil prices is very visible in the short run, but it is less certain that its pricing power can be maintained in the long term, according to a thoughtful review published by Bassam Fattouh and Lavan Mahadeva of the Oxford Institute for Energy Studies.
Fattouh and Mahadeva examine how OPEC’s strategy and power over oil prices have varied over time depending on market conditions and the interaction among OPEC members……………………………………….Full Article: Source

Oil trades near highest level in four months on economic outlook

Posted on 28 January 2013 by VRS  |  Email |Print

Oil traded near the highest level in four months in New York, after posting the longest run of weekly gains since April 2009, amid speculation a global economic recovery will boost fuel demand.
West Texas Intermediate crude was little changed after climbing for a seventh week. Chinese industrial companies’ profits rose for a fourth month in December, the National Bureau of Statistics in Beijing said……………………………………….Full Article: Source

Commodities: Diamond prices stabilise and market moves into a stronger position

Posted on 28 January 2013 by VRS  |  Email |Print

Diamond prices have probably finished their correction and a return to a bull market is close at hand, according to Japanese broker Nomura. “The diamond market has progressed through a tremendous dislocation since the global financial crisis in 2008. Prices fell sharply, followed by a rebound that pushed rough diamond prices through record levels and beyond equilibrium levels.
The market corrected in 2012, but we see a reasonably strong holiday period as likely signalling the end of the downturn,” Nomura explains………………………………………..Full Article: Source

Bank of Japan holds key to gold’s direction

Posted on 28 January 2013 by VRS  |  Email |Print

Gold prices are likely to rule range-bound, looking for direction from the Bank of Japan that is set to decide on ways to boost the Japanese economy. Though India has raised the import duty on gold by two percentage points, it is unlikely to have any effect on demand. Already, the global market has ignored the impact of the duty rise, made to overcome the current account deficit.
Despite the duty hike, prices in the domestic bullion market were unchanged on Monday evening at Rs 30,415 for 10 gm of gold for jewellery (99.5% purity). Pure gold, too, was unchanged at Rs 30,555………………………………………..Full Article: Source

China “clearly” now world #1 for gold buying

Posted on 28 January 2013 by VRS  |  Email |Print

China has finally overtaken India as the world’s largest end-market for Buying Gold according to analysis of the latest data, and is now “clearly” the world No.1. Despite India importing more gold than China did in 2012, “China is [also] the world’s biggest miner of gold,” writes Nic Brown at French investment bank and bullion dealer Natixis’s office in London.
India has no domestic gold mining output. Its private demand for gold – the world’s heaviest on official data since the early 1990s, and most likely the No.1 for centuries before that – has been blamed for the country’s huge trade deficits of 2011 and 2012………………………………………..Full Article: Source

Why a stronger US economy would be inconvenient for gold

Posted on 28 January 2013 by VRS  |  Email |Print

According to UBS, the prospect of a stronger US economy is currently gold’s biggest risk. Writing in its latest Precious Metals Daily note, the bank said that “with US economic data holding up of late, if not beating consensus, the prospect of a stronger US economy is certainly gold’s biggest risk right now – not only from a perspective of dollar strength, but more importantly because of the impact this would have on monetary policy expectations.”
Of course, the likelihood that the US economy is out of the woods, or indeed, even on the right path through the thicket is by no means a certain one, a point UBS makes clearly but it says, “the market is currently determined to stay optimistic, and as long as US data holds up, gold will be prone to downward pressure.”……………………………………….Full Article: Source

If China likes silver, maybe we should too

Posted on 28 January 2013 by VRS  |  Email |Print

Silver’s drawing more and more attention as an investment these days, especially from China. That appetite has made silver bulls giddy and lifted prices closer to a record.“Investment demand, not industrial demand, is what drives silver prices right now,” said Mark Thomas, author of email-alert service provider SilverPriceAdvisor.com. “World investment demand is starting to really pick up.”
Chinese citizens are “now buying silver because gold topped out in 2011 and silver is much more affordable,” said Thomas, a silver bull who has recently tripled his exposure to the white metal………………………………………..Full Article: Source

Silver: The honest capital

Posted on 28 January 2013 by VRS  |  Email |Print

A basic issue with silver investing for many people is that the actual metal is scarce, valuable and increasingly vulnerable to explicit and implicit confiscation. Yet silver is not only an investment vehicle. It also acts as an alternative savings vehicle to saving wealth in fiat currencies.
Silver remains both literal and symbolic of the principles here. Furthermore, the physical possession of silver requires a different kind of investor strength and resolve, and it involves directly confronting market risk, storage risk and confiscation risk………………………………………..Full Article: Source

Q2 2013 may see $9,000/t Copper: Deutsche Bank

Posted on 28 January 2013 by VRS  |  Email |Print

Deutsche Bank expects that, despite high copper stocks, net copper imports into China will likely remain elevated in the first half of 2013, with some re-stocking taking place at the consumer level.
“This may result in copper prices approaching USD9,000/t in Q2 in our view.” Deutsche Bank said in a report. Meanwhile, in 2013 Deutsche Bank economists expect Chinese growth to accelerate to the end of the year, averaging 8.2% after 7.7% in 2012………………………………………..Full Article: Source

Likely Rio Tinto, BHP Billiton production cuts may wipe out Nickel, Aluminium surplus: Barclays

Posted on 28 January 2013 by VRS  |  Email |Print

Nickel and aluminium markets have been in surplus for some time on account of production indiscipline, but the forecasted surplus for 2013 may be wiped away on account of potential write downs Rio Tinto and BHP Billiton, according to Barclays Research.
Both Rio Tinto and BHP Billiton have been impacted by high costs and lower prices. In the event of a write down on nickel assets at BHP Billiton, it will wipe out 43 kt of surplus, Barclays said………………………………………..Full Article: Source

Miners rein in unbridled expansion plans

Posted on 28 January 2013 by VRS  |  Email |Print

Sam Walsh’s first message to his employees could have been directed at the mining sector at large. The new chief executive of Rio Tinto referred to a need for “greater accountability and responsibility”, adding “we must treat the company’s money like it is our own and act like owners of our businesses not managers”.
Mr Walsh – whose elevation to CEO followed the surprise departure of Tom Albanese ten days ago – had good cause to press his staff for a change of thinking………………………………………..Full Article: Source

Soros says Euro to stay as nations seek weaker currencies

Posted on 28 January 2013 by VRS  |  Email |Print

George Soros, one of the most outspoken critics of Germany’s proposed austerity policies to solve the European debt crisis, said the euro is here to stay and will gain as other nations seek to devalue their currencies.
Soros, who made $1 billion shorting the British pound in 1992, said that while the causes of the euro crisis haven’t been solved, the acute phase of the turmoil is over………………………………………..Full Article: Source

Euro may be the ‘rock star’ of currencies

Posted on 28 January 2013 by VRS  |  Email |Print

In many ways, things are better than in 2012. Though unemployment remains high in some countries and the global recovery looks fragile, some big political uncertainties (like the U.S. election) are off the table, and the dysfunctional U.S. Congress has stepped back twice from the fiscal brink.
But most important, the euro zone doesn’t look like it’s going to implode. In fact, the Economist reported, “the invalids in Europe’s medical ward are making a remarkable recovery.”……………………………………….Full Article: Source

Farming: Exodus raises fears for future of commodities

Posted on 28 January 2013 by VRS  |  Email |Print

While child labour remains a cause for concern in coffee and cocoa production in the developing world, global buyers of these commodities are also worried about the ageing workforce. Many smallholder farmers are growing older and their offspring are abandoning rural areas, and the question is how to make commodities farming appealing to younger people.
Most statistics point to a demographic shift in rural areas. In one study for Cadbury, on cocoa farmers in the Ashanti, western, south and eastern regions of Ghana, the average age of the farmers was 51………………………………………..Full Article: Source

Europe’s carbon trading market hits new low

Posted on 28 January 2013 by VRS  |  Email |Print

The carbon market is the lynchpin of EU climate policy. And from this article in Speigle Online, it appears the market is down for the count: For those involved in European Union climate policy, the German regional election in Lower Saxony on Sunday was a nail-biter.
The hope for many was that Germany’s pro-business Free Democratic Party (FDP) would suffer defeat and leader Philipp Rösler, who has been under pressure within his party for weeks now, would be forced to step down as economics minister. But that didn’t happen. Instead, Rösler ended up in a stronger position than before, and the flagship project of Europe’s climate policy settled deeper into a lifeless coma………………………………………..Full Article: Source

Trillions of dollars worth of oil found in Australian outback

Posted on 25 January 2013 by VRS  |  Email |Print

Up to 233 billion barrels of oil has been discovered in the Australian outback that could be worth trillions of dollars, in a find that could turn the region into a new Saudi Arabia. The discovery in central Australia was reported by Linc Energy to the stock exchange and was based on two consultants reports, though it is not yet known how commercially viable it will be to access the oil.
The reports estimated the company’s 16 million acres of land in the Arckaringa Basin in South Australia contain between 133 billion and 233 billion barrels of shale oil trapped in the region’s rocks………………………………………..Full Article: Source

OPEC to cut shipments as Asian demand ebbs, Oil Movements says

Posted on 25 January 2013 by VRS  |  Email |Print

The Organization of Petroleum Exporting Countries will reduce shipments through to early February as late winter demand fails to materialize in Asia, according to tanker tracker Oil Movements.
The group that supplies about 40 percent of the world’s oil will export 23.7 million barrels a day in the four weeks to Feb. 9, down 150,000 barrels, or 0.6 percent, from the previous period, the researcher said today in an e-mailed report. Shipments normally climb at this time of the year with the last phase in winter demand in the northern hemisphere, according to the consultant. The figures exclude Angola and Ecuador………………………………………..Full Article: Source

China 2013 crude oil demand growth at 468000 bl/day: Deutsche Bank

Posted on 25 January 2013 by VRS  |  Email |Print

Deutsche Bank has revised up its Chinese oil demand growth projection for the year to about 5% at 468000 bl/day in comparison to 392000 bl/day for the past year.
“Our China economists believe that key drivers of this year’s economic recovery will be corporate and infrastructure investments, which should prove positive for raw materials demand.” the Bank said in a report. Chinese oil demand ended the year on a high note as data for the final months of 2012 reflected a sharp recovery………………………………………..Full Article: Source

Why coal isn’t going anywhere

Posted on 25 January 2013 by VRS  |  Email |Print

The coal industry has taken a beating in recent years. The discovery of natural gas in the U.S. has reduced the role of coal in the electric power industry: In 2012, the demand for coal has declined and coal companies, such as Arch Coal, have suffered from this drop in consumption. So, is it time to count out coal? I think this sentiment is premature.
During 2012, the consumption of coal in electric power industry declined compared to previous years: in the first nine months of 2012, total consumption reached 615 million short tons; during the same time in 2011, consumption reached 722 million short tons………………………………………..Full Article: Source

Gold seen by Morgan Stanley extending rally as QE3 runs to 2014

Posted on 25 January 2013 by VRS  |  Email |Print

Gold will rally this year and into 2014 as U.S. Federal Reserve policy makers will probably maintain asset purchases for two more years to buttress the recovery of the largest economy, according to Morgan Stanley.
The metal, which rose for a 12th year in 2012, may average $1,830 an ounce in the final quarter from $1,715 in the first, $1,745 in the second and $1,800 in the third, analysts Peter Richardson and Joel Crane said in a report today. Prices will be supported by investment and central-bank buying, they wrote………………………………………..Full Article: Source

A shakeout in India’s $27bln gold loan market

Posted on 25 January 2013 by VRS  |  Email |Print

India’s $27 billion gold loan market is undergoing a shakeout, with the new norms being put in place by the stock market regulator and the apex bank. With gold demand from India rising from 462 tonnes in 2000 to an estimated 1,079 tonnes in 2012, both gold exchange traded funds and gold loans have come under the scanner.
The Securities and Exchange Board of India, the country’s stock market regulator, has proposed allowing gold exchange traded funds (ETFs) to park up to 20% of their gold holdings with commercial banks. The move aims to put the gold corpus of ETFs to productive use and help curb India’s huge gold imports………………………………………..Full Article: Source

Copper seen extending rally with China accelerating

Posted on 25 January 2013 by VRS  |  Email |Print

Copper traders are bullish for a third consecutive week as the fastest expansion in Chinese manufacturing in two years boosts confidence that the biggest buyer of the metal is leading a global recovery.
Eleven analysts surveyed by Bloomberg expect prices to rise next week, six were bearish and a further five were neutral. ETF Securities Ltd. said $28 million went into its ETFS Physical Copper exchange-traded product last week, the most since its introduction in 2010………………………………………..Full Article: Source

2013 will be a dynamic year for iron ore

Posted on 25 January 2013 by VRS  |  Email |Print

2013 is shaping up to be an interesting a year for iron ore. As prices hit US$150/t in January – an 80% increase over the lows in September of last year – optimism briefly returned to the market. In the Pilbara, BHP Billiton’s Jimblebar expansion remains on track for first production in the March 2013 quarter and the company expects to reach a production rate of 183Mt in FY2013, up 5% from 2012.
Rio Tinto is targeting production of 290Mt by early 2014, compared to 253Mt in 2012. FMG has restarted the development of its Kings deposit and remains committed to reach 155Mtpy production this year………………………………………..Full Article: Source

Here’s what 14 major commodities will do for the next two years

Posted on 25 January 2013 by VRS  |  Email |Print

Despite recent hiccups in gold prices, if you’re investing in commodities, it is still the best, safest bet, according to Morgan Stanley’s commodities team led by Hussein Allidina. Silver offers a little more risk and reward than gold; Allidina expects it to outperform gold in 2013.
The report also favors soybeans and corn as demand for them is accelerating faster than supply. However, the report warns commodities investors away from aluminum and sugar, two commodities that are acutely oversupplied at the moment………………………………………..Full Article: Source

Chinese import growth in key commodities continues

Posted on 25 January 2013 by VRS  |  Email |Print

China boosted imports of several premium agricultural commodities in 2012, as an emerging middle class and growing wealth in the country continues to guide a shift in consumer tastes.
Purchases of coffee, cocoa powder and olive oil by the world’s most populous nation all reached record levels last year………………………………………..Full Article: Source

Rising commodity prices on menus in 2013

Posted on 25 January 2013 by VRS  |  Email |Print

Prices are expected to remain high this year for many major commodities, according to research from the US Department of Agriculture and the National Restaurant Association. NRA’s 2013 Restaurant Industry Forecast states that in 2012 higher food prices continued to squeeze operators’ bottom lines and they will likely increase again in 2013.
“After jumping 8.1 percent in 2011, the strongest annual increase in more than three decades, average wholesale food prices rose by more than 2 percent in 2012,” said Hudson Riehle, senior vice president of the association’s Research & Knowledge Group. “During the last six years, we’ve seen average wholesale food prices jump nearly 30 percent with the only decline – a 4 percent drop – occurring in 2009, so rising food costs have and will continue to be a challenge for restaurant operators.”……………………………………….Full Article: Source

US is helping stoke global commodity demand

Posted on 25 January 2013 by VRS  |  Email |Print

The United States is becoming a global standout for rising commodity demand, which is likely a sign of underlying economic growth, the Financial Times reports. As the U.S. economy is picking up steam, it is pushing up demand for everything from copper to corn and crude oil, according to commodities traders interviewed by the Times.
“The U.S. is doing very nicely. Demand is up,” said one New York commodities executive………………………………………..Full Article: Source

The best currencies to invest in for 2013

Posted on 25 January 2013 by VRS  |  Email |Print

The best currencies to invest in for 2013 come from Asia, South America, Australia - but not the United States. The Federal Reserve’s misguided insistence on a loose monetary policy, ongoing resistance to government spending cuts, and another increase in the U.S. debt ceiling will all conspire to boost inflationary pressures and restrain the value of the U.S. dollar.
That will, of course, impact domestic market performance and cut into real returns on dollar-denominated investments - but it will also provide major opportunities for U.S. investors who can target issues denominated in the strongest foreign currencies………………………………………..Full Article: Source

EU carbon price crashes to record low

Posted on 25 January 2013 by VRS  |  Email |Print

Price of a permit to emit a tonne of carbon fell to €2.81 after an EU vote against a proposal to support the struggling market. The European Union’s flagship climate policy, its emissions trading scheme (ETS), saw the price of carbon crash to a record low on Thursday after a vote in Brussels against a proposal to support the struggling market.
The price of a permit to emit a tonne of carbon dioxide fell 40% at one point to €2.81 today, far below its record high of €32, before recovering to more than €4 later in the day………………………………………..Full Article: Source

EU carbon-tax plan just a ‘patch’: French economist

Posted on 25 January 2013 by VRS  |  Email |Print

The collapse of Europe’s controversial market for carbon emissions rights is “an extremely serious” matter and an EU Comission proposal to freeze a related auction for 2013-2015 is simply a “patch” for the problem, a French economist warned lawmakers on Wednesday.
“We are in an extremely serious situation regarding the development of the European quotas market,” Christian de Pertuis told the French Senate’s finance commission in a hearing………………………………………..Full Article: Source

Go for commodities market to diversify investments

Posted on 24 January 2013 by VRS  |  Email |Print

Commodity markets are picking up. If you want to diversity your investment portfolio, you’d better turn to commodities. But when you do that, take an informed decision after having a thorough knowledge on commodities, experts advised investors.
They were giving a bird’s eye view of the commodities market, with a focus on agriculture commodities and gold, at a stakeholder awareness and education seminar on the subject………………………………………..Full Article: Source

What does 2013 hold for commodities?

Posted on 24 January 2013 by VRS  |  Email |Print

It might seem churlish to complain about the mediocre returns delivered by commodities during 2012 given the consistently strong performance of this asset class over the past decade. Still, this is not what we were told to expect by bulls who sold investors the idea of the commodities “super cycle” - they promised us it would last a great deal longer.
Commodities investors would benefit from a unique confluence of positive factors, those bulls predicted, with huge demand from the industrialisation and urbanisation of the BRIC (Brazil, Russia, India and China) economies combined with two decades of under-investment holding back supply………………………………………..Full Article: Source

How to play commodities in 2013

Posted on 24 January 2013 by VRS  |  Email |Print

It is possible to invest directly in commodities, trading raw materials through specialist brokers or through the derivatives markets. Many investors, however, feel uncomfortable with the volatility associated with direct investment - and the minimum deal sizes that are often required.
Instead, says Philip Challinor, of independent financial adviser Chatfield Private Clients, “the most straightforward way to capture returns from commodities is via an exchange traded product (ETP), which is simple, low cost and liquid should you wish to sell.” BlackRock-owned iShares, Deutsche Bank-owned db-x and ETF Securities are the three biggest ETP providers in the UK………………………………………..Full Article: Source

Can OPEC maintain high oil prices into the future?

Posted on 24 January 2013 by VRS  |  Email |Print

OPEC is probably the single most powerful organisation in the oil industry, able to influence the price of oil to help its member states; however a review by Bassam Fattouh and Lavan Mahadeva of the Oxford Institute for Energy Studies suggests that whilst OPEC is able to influence prices in the short term, it has less success over the long term.
That leaves the question as to whether OPEC will be able to maintain oil prices of around $110 a barrel for the coming decade or so? The answer … unlikely. Fattouh and Mahadeva suggest that OPEC only works effectively to “avoid oil prices falling below some level deemed acceptable by its members, rather than to prevent oil prices from rising above certain levels or to set a price ceiling.” In other words it has less power to maintain high oil prices, as it does to prevent low oil prices………………………………………..Full Article: Source

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