Thu, Jul 31, 2014
A A A
Welcome kbr175@gmail.com
RSS
Commodities Briefing 11.Jul 2013

Posted on 11 July 2013 by VRS |  Email |Print

The commodity market’s “supercycle” of strong growth is waning, OPEC said on Wednesday, with commodity prices currently in transition mode to slower growth rates. OPEC (the Organization of the Petroleum Exporting Countries) joined a chorus of analysts who have been warning for several months that the era of high prices for commodities is ending.
The group cited a slowdown in emerging economies, in particular China, coupled with decelerating foreign investment in those markets, as an explanation………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

Commodity traders are facing another supply squeeze as stockpiles concentrate in fewer cocoa depots, mirroring congestion at metals warehouses that means some buyers are paying record premiums for deliveries.
Warehouses in Antwerp, Belgium, held 61 percent of cocoa certified for delivery by the NYSE Liffe exchange on June 24, compared with 36 percent a year earlier, bourse data show. That mirrors the trend in metal stockpiles, with 73 percent of aluminum and 90 percent of copper tracked by the London Metal Exchange now held in three locations………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

Supply and demand are re-emerging as the main movers of oil, base metals and precious metals prices and a return to fundamentals may encourage investors to increase their holdings, a Societe Generale study said.
Speculation over the past 10 years saw volatile price swings characterize commodity markets. Investors increasingly had to consider external factors like macroeconomic developments, financial-market liquidity and fluctuations in the U.S. dollar when buying and selling. This reached a peak during the financial crisis of 2008………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

Financial trading has been “instrumental” in the growth of commodities markets and any move to ban categories of traders would be “inappropriate”, according to a report by two Brussels think tanks.
The report, published by the Centre for European Policy Studies and the European Capital Markets Institute, on price formation in commodities markets concludes that financial trading is now systemically important to commodities trading and provides liquidity to enable physical players to hedge………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

Commodities are up across the board this morning and we love to see green on our screens, especially early in the morning before North American trading desks have had the opportunity to flex their financial muscles.
It does cause concern for us as we are aware that the world and US economies have decoupled and with the growth in countries such as China, Brazil and India it takes a lot more from America to push the world growth needle. The world is becoming more diversified which is a good thing, but it requires far more research on our part………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

With stocks in an uptrend at the present time and nothing much new to report, we’re going to finish up what will now become at the very least a bimonthly review of the global macro picture. This morning we will take an executive summary look at Japan, Commodities, and Currencies.
Again, I do not pretend to suggest that the commentary provided this week is anything even remotely close to a thorough analysis of the various global macro categories. However, as someone who does run a portfolio that looks all over the world for performance, sometimes the K.I.S.S. method is all you need to get the really big moves right………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

It is well known that in an economy what goes up eventually comes down someday. And the possibility that the rise in commodity prices (raw materials) generated by a strong demand from China is coming to an end has Latin American economies on tenterhooks.
Commodities account for three quarters of exports in Latin American economies, according to the World Bank (WB), the International Monetary Fund (IMF) and the central banks of Latin America. And the last decade saw a great rise in China’s enormous appetite for these materials………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

While commodities are a controversial and problematic asset class to some investors, for others they are an ideal diversifier looking more attractive than ever. A mini-revival in commodity investing among US pension funds suggests the asset class may be enjoying a resurgence.
The Los Angeles Fire and Police Pension System, Municipal Retirement System of Michigan and Arizona State Retirement System have all recently upped their commodity holdings. Don Steinbrugge,managing partner of Virginia-based Agecroft Partners and investment advisory committee member of the $461-million City of Richmond Retirement System, says renewed interest in commodities is part of wider investment trends………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

Opec, the oil producers’ cartel, expects demand for its crude to hit a five-year low next year as the US shale boom continues to eat into its share of the global market. In its first outlook for 2014, the Vienna-based organisation forecast the strongest oil demand growth in four years on the back of improved prospects for global growth.
But its analysts said the increase in demand would be more than offset by higher output from non-Opec producers such as the US and Canada………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

The Organization of Petroleum Exporting Countries forecast the world will need less of its crude next year, even as global oil demand growth rebounds to its strongest pace since 2010, amid competing supply sources.
Demand for OPEC’s crude will slip by 300,000 barrels a day next year to 29.6 million a day next year, or about 2.6 percent less than the 12-member group is pumping now, the organization said in its first set of forecasts for 2014………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

World oil demand will pick up at a faster rate in 2014, the oil exporting cartel OPEC said, but also warned of the potential impact of economic troubles in Europe, the US and China.
In 2014, oil demand will average 90.68 million barrels per day (mbd), up from a revised 2013 estimate of 89.64 mbd “partially on the back of an improvement in global economic growth,” OPEC said in its monthly report. This would represent the biggest increase in demand since 2010, the Organisation of Petroleum Exporting Countries added………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

There’s always some corner of the market that’s making money for investors. Even in the tough times, when all the ink seems to be in the red, you can still track down a trade with a bit of good old-fashioned detective work. It may be more challenging than usual in today’s resource sector – but good opportunities still lurk out there.
The first place to start looking is in the energy sector. Even as the small resources index had a horror fall of 63% over the last eighteen months, one of my energy tips, Sundance Energy (SEA), went the other way, letting us lock in a gain of 63%………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

The headline summary of the new Medium-Term Renewable Energy Market Report 2013 from the International Energy Agency (IEA) has been well reported: Renewables will surpass natural gas for electricity generation globally by 2016, doubling nuclear output and coming in second only to coal in power generation.
Total renewable capacity is expected to grow from 1,580 gigawatts in 2012 to 2,350 GW in 2018, while renewable electricity generation grows from 4,860 terawatt-hours to 6,850 terawatt-hours. Renewable generation will be 50 percent greater over the six-year forecast period than it was over the six years from 2006 to 2012………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

Gold prices are oversold and should end the year higher as the market restructures itself, said Matthew Turner, precious metals analyst at Macquarie Commodity Research.
In an interview with Kitco News, Turner said the gold market has been volatile recently because it is in the midst of rebalancing away from investor demand and back into its more traditional role for jewelry demand. “This is a huge change for the market and its going to take time to find the right price,” he said………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

After all the fall in the gold price was hard and fast due entirely to the bear raid in the U.S. This started in mid-April after the sales from the SPDR gold ETF had begun more than a month ahead of that. The signal for the bear raid was given when Goldman Sachs issued a recommendation to their clients to go ’short’ of gold.
The fall was very dramatic and shook the gold world to its roots. The volumes of physical gold that were sold were enormous. Even the Central Bank Gold Agreement limitations on gold sales (when they occurred, pre-2009) were held at 4 - 500 tonnes a year. These sales took place over three months, with the 500 tonne bear raid happening in one week………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

Will gold prices rise in 2013, or will the bear market continue in the second half of the year?The bears have certainly been loud this year, as short-term bets against gold paid off in the first half of 2013. Gold lost 27% in Q1, the worst first-half performance since 1981.
Gold futures shed 23% in Q1, the most since Bloomberg data began in 1975. On June 28, gold futures hit $1,179.40, the lowest level since August 2010………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

Given the steep slide in commodity prices in the second quarter of 2013, there have been rumblings that in this current price environment, silver producers will struggle to keep up healthy, if any, profit margins.
There’s some debate about the cost of silver production. Some analysts peg the total cash cost to produce an ounce of silver at around $20 an ounce. That’s just above the current price of about $19………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

Precious metals and oil (DBO) seem to have reversed higher last week on the military coup in Egypt. Bernanke is scheduled to speak and the markets may already be pricing in some dovish statement to alleviate fears of tapering which could cause some short covering and bargain hunting.
Prices of platinum (PTM) and palladium (PALL) continue to outperform other metals such as gold (GLD), silver (SLV) and copper (JJC) over the past 9 months. For many months, I have been warning my readers about the growing risks to platinum and palladium supply as labor strikes intensify in South Africa………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

Will uranium ever be the new gold? Maybe… but not quite yet. Despite its recent plunge to below $40 per pound, which is the first time it has dipped that low since 2006, uranium inventories remain plentiful in the US and Europe. But that could soon change.
The new low looks like a low-risk entry point, as the long-term outlook for uranium is positive, supported by a renewed pro-nuclear movement on the near-term horizon. In Japan, concerns about air pollution and rising costs have quelled the nuclear opposition. Recently a pro-nuclear government was elected, so Japan’s 48 inactive reactors should come back online sooner than expected………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

Nickel is leading declines of the main industrial metals on the London Metal Exchange this year, with surpluses dragging down copper to aluminum and zinc.
Nickel production will exceed demand by 68,000 metric tons this year, and copper will have its first surplus since 2009, according to Standard Bank Group Ltd. Inventories of nickel in warehouses monitored by the LME rose 85 percent in the past year to a record, according to bourse data today. Aluminum and nickel are near four-year lows and copper last month was the cheapest in three years………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

Copper has taken a beating in recent months, along with gold and other commodities, now analysts warn there is more pain ahead for the red metal, with the slowdown in Chinese growth set to weigh further on prices.
China currently consumes around 40 percent of the world’s copper and as the metal is heading into a two-year surplus according to Goldman Sachs commodity analyst Roger Yuan, he advised investors that any further rallies in 2013 represented a good hedging opportunity………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

The value of assets in gold-backed funds in India, the world’s biggest consumer, fell for a third month in June as a bear market in bullion deepened. Holdings in exchange-traded funds, or ETFs, declined 9.2 percent to 96.1 billion rupees ($1.6 billion) as of June 30 from a month earlier, the Association of Mutual Funds in India said on its website, without giving data on volume.
The value of assets has lost 20 percent since reaching a record 120.6 billion rupees in January, association data showed. Gold fell 4.5 percent in rupee terms in June, falling for a 10th month………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

We have seen heavy activity in terms of fund flows that has persisted in Gold related ETFs, particularly GLD (SPDR Gold, Expense Ratio 0.40%) which remains the largest fund in the category in terms of assets under management $38.2 billion.
Gold prices have unquestionably bounced sharply off of their late June intraday lows, (reference price intraday low of $114.68 in GLD compared to current levels $121.13) but the steady asset outflows in GLD have continued. The fund has shed another $1 billion in terms of redemption flows in recent trading sessions, bringing the year to date total to a massive $19.36 billion in terms of net outflows………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

The blame for the current global economic mess should be borne not by any Federal Reserve Chief or for that matter anyone from his ranks, or even someone from the political class; the problem could basically be traced back to a leadership crisis.
A great leader sets the tune, dances to it and teaches others too to dance with him! And the leader comes from the crowd! And the crowd is formed by you, me, him and she!……………………………………….Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

Turkey started an investigation of foreign-currency transactions, building on a probe of stock trading, as the central bank broadened a fight to shore up the lira, moves analysts say threaten to undermine confidence in the country.
The Banking Regulation and Supervision Agency has asked Turkey’s major banks for detailed information on clients who sold the lira on Monday and Tuesday, as well as the sums of money and profit margins involved in the currency trades, three bankers said Wednesday. The BRSA said in an emailed statement that the probe is “routine.” The central bank declined to comment………………………………………..Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

The values of fiat currencies are hard to measure because they are assessed mainly upon confidence in the government and expectations from the central bank. Though there is some room to analyze currencies based on fundamental data, such as inflation rates, retail sales, and trade balances, often speculation and fear are the most significant factors.
Kathy Lien of Currency Trader magazine wrote, “more than 80 percent of currency trading volume is speculative in nature and, as a result, the market frequently overshoots and then corrects.”……………………………………….Full Article: Source

Posted on 11 July 2013 by VRS |  Email |Print

It is wrong to suggest there is any genuine mainstream business support for an emissions trading scheme. Cost-sensitive and energy-reliant businesses across Australia oppose both an ETS and the carbon tax.
The reason is simple: trade-exposed and vulnerable sectors such as manufacturing are already under enough pressure from international economic uncertainty and exchange rate volatility. They have limited capacity to absorb unilateral cost penalties of any form, let alone those deliberately imposed by government and where their competitors don’t face such charges………………………………………..Full Article: Source

See more articles in the archive

July 2014
S M T W T F S
« Jun    
 12345
6789101112
13141516171819
20212223242526
2728293031