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Commodities Briefing 21.Feb 2013

Posted on 21 February 2013 by VRS |  Email |Print

Commodities tumbled on Wednesday amid speculation a hedge fund had been forced to liquidate positions across metals and oil markets, and gold fell to more than a seven-month low on worries that the U.S. economic stimulus may soon dry up.
Already under pressure from ongoing concerns about global supply and demand, commodity markets tumbled in high volume trade just before 11 a.m. EST (1600 GMT), with oil and gasoline prices dropping about 2 percent each……………………………………Full Article: Source

Posted on 21 February 2013 by VRS |  Email |Print

Commodities fell, capping the biggest loss in more than two months, as metals and energy tumbled amid speculation that a hedge fund was selling. The Standard & Poor’s GSCI Spot Index of 24 raw materials declined 1.1 percent to settle at 668.28 at 3:49 p.m. New York time, the largest drop since Dec. 6. Silver futures led the losses, retreating as much as 4 percent. Crude oil fell the most since November, and gold slumped to $1,558.10 an ounce, the lowest since July.
“You have a sort of mini perfect storm hitting commodities today,” Dave Lutz, the head of exchange-traded fund trading and strategy at Stifel Nicolaus & Co. in Baltimore, said…………………………………..Full Article: Source

Posted on 21 February 2013 by VRS |  Email |Print

Gold dipped below $1,600 last week, falling to a six-month low, much to the chagrin of gold investors. I find the timing of the correction peculiar, given the G20 Finance Ministers Meeting taking place over the weekend.
There’s been a growing debate over Japan’s move to devalue its currency to stimulate growth, with reaction from the G-7 leaders stating that “domestic economic policies must not be used to target currencies,” reports Reuters……………………………………Full Article: Source

Posted on 21 February 2013 by VRS |  Email |Print

The series of government measures to contain gold imports seems to have paid off. Gold shipments has fallen nine per cent to 860 tonnes last year against 969 tonnes in 2011, according to the World Gold Council.
While gold imports dipped, supply through recycled gold increased substantially as consumers made the most of sharp jump in prices. Domestic supply by way of recycled gold nearly doubled to 117 tonnes last year against 59 tonnes registered in the preceding year……………………………………Full Article: Source

Posted on 21 February 2013 by VRS |  Email |Print

The price of gold has started off the year on a negative note and has lost nearly 3.9% of its value (year to date). Moreover, gold hasn’t done well in 2012. Is the big gold rally of 2006-2010 over? Is it time to change our way we consider gold as an investment that will sharply appreciate over time?
Due to the weakness in the gold market, major gold companies have suffered from it, as it reflected in their financial reports. What’s up ahead for the major bullion companies? Let’s take a closer look at these issues and try and figure what is up ahead for both gold and bullion companies……………………………………Full Article: Source

Posted on 21 February 2013 by VRS |  Email |Print

Why would anyone want to own gold? It’s a safe haven during times of crisis and things are getting better, and it doesn’t pay a dividend and George Soros is selling 100 million of his gold holdings.
Negative real interest rates is supportive of gold bullion going forward and also there is still uncertainty in the currency markets and gold is an alternative form of currency. Don’t forget it was only a few years ago when Obama took office and gold was around $900/oz……………………………………Full Article: Source

Posted on 21 February 2013 by VRS |  Email |Print

Aluminum inventories in China’s main trading regions are estimated to have climbed to a record as supply growth outpaces demand in the largest user and producer, adding to a global glut of the lightweight metal.
Reserves expanded to 1.119 million metric tons from 750,000 tons a year ago, according to a survey of warehouses in four cities by data provider SMM Information & Technology Co. Stockpiles in six hubs including Shanghai increased to 1.156 million tons, according to Li Xun, an analyst at Myyouse.com, researcher Mysteel.com’s sister website, citing their survey……………………………………Full Article: Source

Posted on 21 February 2013 by VRS |  Email |Print

World crude steel production has gained 0.8% Year-On-Year (Y-o-Y) at 125 mn tons, according to World Steel Association (worldsteel). The data is based on reports from 62 countries reporting to worldsteel.
China’s crude steel production for January 2013 was 59.3 Mt, up by 4.6% compared to January 2012. Elsewhere in Asia, Japan produced 8.9 Mt of crude steel in January 2013, an increase of 2.7% compared to the same month last year. South Korea’s crude steel production was 5.8 Mt in January 2013, -0.4% lower than January 2012……………………………………Full Article: Source

Posted on 21 February 2013 by VRS |  Email |Print

Over the years the world’s biggest mining companies have proved to be spectacular investments, but have very much underperformed over the past 4-5 years as corporate dealmaking, largely entered into when the companies’ boards took on CEOs who would embrace big merger deals and huge capital projects when the mining sector seemed to be headed onwards and upwards.
The first real halt to the upwards progression came with the Great Financial Crisis of 2007/8 which decimated the values of many mining sector companies. …………………………………..Full Article: Source

Posted on 21 February 2013 by VRS |  Email |Print

China is on track to produce enough crude oil outside its borders to rival Opec members such as Kuwait and the United Arab Emirates, after its state-owned oil companies spent a record $35 billion buying foreign rivals last year.
In the first tally of the impact of China’s recent overseas oil investments, the International Energy Agency calculates China’s national oil companies will produce 3 million barrels a day abroad in 2015, double their 2011 overseas output of 1.5 million b/d and equivalent to Kuwait’s annual output……………………………………Full Article: Source

Posted on 21 February 2013 by VRS |  Email |Print

BofAML (Bank of America Merrill Lynch) now forecasts Iraqi oil production to average 4.9 million b/d in 2017, compared to a government target of 9-10 million b/d.
Given the uncertain prospects for capacity growth in OPEC-11, Iraq’s output is becoming increasingly critical for global oil supplies. Crude production has increased at a phenomenal pace, recently rising to a record high of 3.2 million b/d from an average of 2.4 million b/d in 2010……………………………………Full Article: Source

Posted on 21 February 2013 by VRS |  Email |Print

Times may be tough for energy commodities, but Encompass Fund Managers Malcolm Gissen and Marshall Berol are hard-core survivors. In this interview with The Energy Report, the dynamic duo share their tactics for winning in 2013 after decades of experience investing in uranium, oil and gas, coal, hydroelectric and geothermal energy.
There are more than 1,200 ETFs on the market. They can be worthwhile, but Wall Street is slicing and dicing sectors and industries into really thin tranches to create somewhat non-transparent indexes. ETFs are not per se better than mutual funds or individual stocks. Investors must look under the hood of any ETF to see if it is investing in stocks, futures contracts or bullion. With that said, we do look at ETFs and have commodity ETFs in our separately managed accounts……………………………………Full Article: Source

Posted on 21 February 2013 by VRS |  Email |Print

Commodity trading advisor funds have become an increasingly rewarding asset class, but their computer-driven strategies present a number of challenges to selectors.
Compared to other Alternative Ucits strategies, commodity trading advisor (CTA) funds have done well during the long and windy post-crisis period. Since 2007 they have maintained second place in terms of assets under management behind the long/short equity peer group and are now slowly gaining ground……………………………………Full Article: Source

Posted on 21 February 2013 by VRS |  Email |Print

Just as President Barack Obama is trying to persuade Americans that a cap and trade system is the way to curb carbon emissions, the world’s flagship program in Europe is in danger of failing. The price of carbon traded in Europe has collapsed to around 5 euros per metric ton compared with 30 euros a few years ago, as I discuss in my Green column.
The EU Emissions Trading System is intended to set a price on greenhouse gas emissions in order to force polluters like steel mills and power stations to clean up their acts……………………………………Full Article: Source

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