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Commodities Briefing 31.Oct 2012

Posted on 31 October 2012 by VRS |  Email |Print

Europe is missing out on the natural gas boom that is transforming energy use in the U.S. and Asia, instead burning cheaper, dirtier coal imported from America. Global gas consumption may rise 19 percent by 2017 from 2010 levels as demand surges in Asia and the U.S. while Europe’s usage drops 1.6 percent, according to the International Energy Agency.
Increasing coal-fired generation in Europe has cut gas demand by 3 billion cubic feet a day, according to Sanford C. Bernstein & Co., about 7 percent of consumption. The IEA last year predicted a golden age for the fuel with new exports from America to Australia………………………………………..Full Article: Source

Posted on 31 October 2012 by VRS |  Email |Print

Strong oil prices will ally with high production to boost OPEC’s crude export earnings to an all-time high of more than $one trillion in 2012 after breaking a historical record in 2011, according to official US figures The income will boost the cumulative15-year oil export earnings of the 12-nation Organization of Petroleum Exporting Countries to a whopping $6.7 trillion since 1998.
More than half the income has been achieved during 2008-2012 when oil prices were at their highest level and the organization was pumping at nearly capacity………………………………………..Full Article: Source

Posted on 31 October 2012 by VRS |  Email |Print

The prices of crude oil and products is set to drift lower through the fourth quarter and the first half of next year, as the fiscal headwinds in Europe and the US will weigh on the global economy leading to weaker demand, according to Societe Generale.
“For (the) near term, we are actually bearish on energy (prices), particularly oil and products, as the demand growth is moderate and the supply is sufficient right now,” Jeremy Friesen, commodity strategist at Societe Generale Corporate and Investment Banking, told a press conference on Tuesday………………………………………..Full Article: Source

Posted on 31 October 2012 by VRS |  Email |Print

Gold is likely to rule steady on Wednesday, caught between rising prices of the yellow metal in the global market and a drop in the dollar value. Festival buying, on the other hand, will cap any likely fall in the precious metal.
Any drop in the dollar will make imports cheaper and exports costly. Gold opened higher in Singapore at $ 1,711.09 an ounce but the dollar fell against the euro in the aftermath of Hurricane Sandy lashing New York………………………………………..Full Article: Source

Posted on 31 October 2012 by VRS |  Email |Print

Despite having publicly declared his bullishness on gold when it was trading below $300, Frank Giustra is still bullish on gold at the present levels. In case you do not know who Frank Giustra is, he comes with extraordinary credentials. Precious metals investors need to listen when he speaks.
Frank Giustra founded Lionsgate Films, but more important to precious metals investors he is the genius behind numerous resource companies—most notably Wheaton River Minerals, Silver Wheaton, Petro Rubiales and Urasia Energy. In 2002, he moved heavily into gold and published, “A Tarnished Dollar Will Put the Shine on Gold.” Today, gold remains the largest investment in his portfolio………………………………………..Full Article: Source

Posted on 31 October 2012 by VRS |  Email |Print

Asian physical gold demand is showing signs of life, said analysts. According to UBS, the physical demand is looking somewhat rejuvenated of late, but it’s not a consistent trend. The volumes last week of around 36.2 metric tons were the highest turnover since late September.
According to Barclays Capital, Our flows to India indicated some days of strong demand last week, but continue to lack consistency. The key thing to watch for in India is if hefty levels are sustained, especially now that we are in the traditionally busy wedding season, or if demand remains erratic, as has been the case for most of the year. That the rupee is weakening as the week starts will act as an obstacle………………………………………..Full Article: Source

Posted on 31 October 2012 by VRS |  Email |Print

Investors in China are seeking out silver as an alternative value investment with the economy cooling for a seventh quarter. Research from Beijing Antaike notes that demand for silver is set to jump as much as 10% in 2013, with investors seeking to preserve their wealth.
Consumption may climb to 7,700 metric tonnes after gaining 6-8% in 2012, Shi Heqing, an analyst at Beijing Antaike, told Bloomberg recently. Even for China, this would be a record level. China is the world’s second biggest user of the metal………………………………………..Full Article: Source

Posted on 31 October 2012 by VRS |  Email |Print

Growing popularity and awareness among consumers are set to drive platinum demand by 50% in India for the next couple of years. Moreso, aspiring customers’ desire for a change from the perennial gold with higher possibility of returns on their investment is likely to pull platinum demand in India.
Jewellers believe India’s platinum demand today at around 15 tonnes. But, its popularity is increasing day – by – day as the metal is considered as rare with estimated returns higher than gold. Since, platinum price has been sustainable lower than gold for the last over two years, its price may surpass gold soon which holds higher possibility of returns……………………………………….Full Article: Source

Posted on 31 October 2012 by VRS |  Email |Print

Though global economic growth is still hinged on the crisis in Europe and the sluggish U.S. job markets, rising food prices have become a major concern in the economies the world over. The world food prices including cereals, oilseeds, dairy, meat and sugar are surging to new highs due to the scorching heat and the worst U.S. drought in nearly a half-century.
The bad weather has also resulted in the worst wheat harvest since the late 1980s. In fact, harvest levels of this key crop dropped 14% on average this year further underscoring the issues that this corner of the market is seeing………………………………………..Full Article: Source

Posted on 31 October 2012 by VRS |  Email |Print

Agribusiness exchange traded funds give investors exposure to the constant rise in food consumption, as populations multiply and emerging middle classes can afford to purchase more. Demographic shifts over the next 20 years support the case for the Market Vectors Agribusiness ETF.
“MOO offers a serious way for investors to address these concerns. It provides global exposure to the agriculture industry by investing in companies that sell agricultural equipment, chemicals, and seeds. Agriculture commodity prices have a significant impact on the performance of most agriculture businesses because their customers’ income and demand for inputs, such as tractors and fertilizer, is tied to grain prices,” Alex Bryan for Morningstar wrote………………………………………..Full Article: Source

Posted on 31 October 2012 by VRS |  Email |Print

South Africa is the largest economy of Africa, and it accounts for almost one-quarter of the continent’s GDP. The path to this status has not been an easy one, however, as the country languished under sanctions in the 1980s tied to the government’s apartheid policies.
While South Africa has a relatively well-developed manufacturing sector by the standards of African economies (and developing economies in general), a meaningful percentage of the country’s economy still revolves around commodities………………………………………..Full Article: Source

Posted on 31 October 2012 by VRS |  Email |Print

A more efficient system should be in place to facilitate the increasingly wide use of the yuan in global transactions, according to a report by SWIFT, the communication platform among international banks.
Global use of the currency has surged. In August the renminbi rose to 14th in the table of payment currencies, up from 35th in October 2010, according to a report by the Society for Worldwide Interbank Financial Telecommunication. Most other currencies remained flat or moved marginally during that period………………………………………..Full Article: Source

Posted on 31 October 2012 by VRS |  Email |Print

The commodity cocoa, refers to cocoa beans, which are the dried seeds from the, Theobroma Cacao, or cocoa tree. The tree is native to the Americas, specifically the Southern Hemisphere, and has been a major part of the area’s history, though now the vast majority of the trees exist in West Africa.
In fact, cocoa beans were used as a common currency in many areas prior to the Spanish conquest. Now, cocoa is used all over the world to create chocolate, and other products such as cocoa butter. Many consume cocoa beans because of the benefits associated with them, as they are thought to have positive effects on cardiovascular health among other things. As an investment, cocoa has become a popular commodity for investors looking to cash in on the sweet gains it can provide………………………………………..Full Article: Source

Posted on 31 October 2012 by VRS |  Email |Print

Global business leaders have been warned of a “carbon bubble” that will pop as nations accelerate their move into renewable energy and send the value of coal miners and other fossil fuel industries tumbling.
Paul Gilding, an Australian environmental activist and former head of Greenpeace, told the opening of the World Business Council for Sustainable Development (WBCSD) that Asia was leading a drive into solar and other renewable energy sources that would leave countries dependent on coal exposed………………………………………..Full Article: Source

Posted on 31 October 2012 by VRS |  Email |Print

The Clean Development Mechanism, the United Nations-overseen carbon market beset by record low prices, is set for revamps next year as initial commitments under the Kyoto Protocol expire.
“Everything is on the table” for making the program more effective, Niclas Svenningsen, manager of strategy and policy development at the UN Framework Convention on Climate Change, said today at an emissions conference in Bangkok………………………………………..Full Article: Source

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