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Commodities Briefing 11.Nov 2013

Posted on 11 November 2013 by VRS |  Email |Print

At the food processing plant he runs in Lagos, Mukul Mathur describes the thousands of miles that his tomatoes travel. At first, their odyssey between Nigeria and California appears unremarkable in an age of globalisation.
Mr Mathur would seem to be just another trader buying raw materials in Africa and selling them to distant, wealthier markets. But he actually runs a supply chain at odds with old, colonial-era trade routes. “We farm tomatoes in California, process them into triple concentrate and ship them to Nigeria,” Mr Mathur, an Indian-born trader, says at the $12m plant that Olam, a leading commodities house, opened in Lagos this year………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

The U.S. dollar has enjoyed a massive rally over the past two weeks, which has weakened commodities such as gold and crude oil. But according to several traders, the worst could be yet to come.
A strong dollar tends to hurt commodity prices, because as the dollar gains in value, then it takes fewer of those dollars to buy an ounce of gold or a barrel of oil. Consequently, a rising Dollar Index (which compares the U.S. dollar to a basket of four other currencies) usually causes gold and oil prices to drop………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

The oil market is stable and prices are steady, two oil ministers said on Sunday, weeks ahead of an Organisation of the Petroleum Exporting Countries (OPEC) meeting to decide whether the group needs to adjust its output target.
“I think no, now the market is stable,” Angola’s oil minister Jose Botelho de Vasconcelos told Reuters in Abu Dhabi, when asked if OPEC needs to change its oil policy when the group meets next on December 4 in Vienna. “The market is stable and the price is stable too,” Iraq’s oil minister Abdul Kareem Luaibi told Reuters………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

OPEC, which produces about 40 percent of the world’s oil, will probably keep its crude oil output target unchanged at its next meeting, according to oil ministers from member states Iraq and Angola.
Iraqi Oil Minister Abdul Kareem al-Luaibi and Angola’s Jose Maria De Vasconcelos said they don’t see the need for the Organization of Petroleum Exporting Countries to alter its collective production target of 30 million barrels a day because current oil-price levels are satisfactory………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

Kuwait is currently producing 2.9 million barrels per day of oil and had the capacity to produce 3.2 million bpd. Kuwait’s oil minister said on Saturday he expected OPEC to keep its crude oil output target unchanged at its next meeting.
Kuwait is a member of the Organization of Petroleum Exporting Countries (OPEC), the producer group that pumps more than a third of the world’s oil. It will meet next on December 4 in Vienna to decide whether to adjust its output target………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

Business-led innovation and market-based solutions can drive a shift to more efficient renewable energy systems. Forty years ago, the US and much of the Europe learned difficult lessons about their dangerous addiction to fossil fuels.
Following Israel’s victory in the Yom Kippur War, the Arab members of the Organization of the Petroleum Exporting Countries (OPEC) announced an oil embargo on Israel’s supporters. Developed countries, faced with the sudden cutoff of a key energy source and a major spike in world oil prices, felt powerless………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

A stronger-than-expected U.S. jobs report has created strong downward pressure on gold prices, and looking at the technical picture, analysts said that prices could head lower in the near-term.
Following the U.S. jobs numbers, strong selling hit the December Comex gold futures contract. At the time of the release, at 8:30 a.m. EST, gold was trading at $1,304.50 an ounce. Five minutes later the yellow metal hit $1,292.30. The selling pressure continued and by 10:35 a.m. gold fell to a session low of $1,280.50………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

Hedge funds cut bullish gold bets, adding the most short contracts in four weeks, as U.S. economic growth fuels speculation the Federal Reserve will trim stimulus. Holdings across commodities dropped the most since April.
The net position in gold slid 13 percent to 87,689 futures and options in the week ended Nov. 5, U.S. Commodity Futures Trading Commission data show. Short bets jumped 37 percent, the most since Oct. 15, and long wagers fell 4.9 percent………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

It has been a tough couple of years for gold. The metal’s price has dropped 30% from the record high it reached in the summer of 2011, providing ammunition for critics who say gold is too risky an investment because its price is too volatile and unpredictable.
Yet, gold enthusiasts are undaunted. They argue gold is an effective hedge against inflation and, despite its own volatility, it can help smooth out the overall volatility of a diversified investment portfolio. Some also see reasons for the price to rise significantly in the next few years………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

Gold prices are the honey badger of precious metals right now. As 2011’s very popular YouTube video showed us, the honey badger makes moves that don’t make sense - it “don’t care.” And neither does gold.
Like the honey badger, gold prices just don’t seem to care that the world has teetered on the brink of destruction all year. They just keep heading lower. Gold prices have been trending down for most of this year. On Jan. 2, the London spot price was $1,693.75 per ounce. As of this writing, the last bid was $1,286.88, a loss of 24%………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

People love to debate, but sadly sometimes it crosses a line and turns argumentative. That’s what is happening right now with the debate over gold. There have been several high-profile articles, most recently in the Wall Street Journal, saying you should eliminate gold as a worthwhile part of your portfolio. Primarily because of this year’s lower price.
Against that idea, many bloggers and private investors, wondering why gold prices have fallen, say that it shouldn’t have dropped. There must be some conspiracy driving down prices when money-printing and our still-weak economy should be driving gold higher………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

Britain’s parliamentary financial watchdog has urged regulators to probe potential abuses in metals markets as deeply as they are investigating the ongoing scandals over foreign exchange and Libor benchmark interest rates.
Andrew Tyrie, chairman of the Treasury select committee, told the Financial Times that MPs were conscious of growing concerns that the manipulation of rates – already exposed in the Libor affair, and now under investigation in a mounting regulatory probe into potential forex abuses – may go well beyond those areas and into metals markets………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

Until roughly 12,000 years ago – at least 90 percent of our history - we humans eked out a living by hunting and gathering. Our hunter-gatherer ancestors were replaced by farmers and herders who crowded into villages following the invention of agriculture.
Over the last 200 years a major resettlement pattern has emerged: In 1800 only about 2 percent of the world’s population lived in urban areas……………………………………….Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

And by that we mean the following slideshow will contain 10 exchange traded funds that have seen their assets under management tallies double (or more) this year.
The law of large numbers might imply that as an ETF grows larger, particularly well into the $500 million in AUM or more area, a double in less than a year becomes a difficult feat to accomplish. Flows data indicate this been a stellar year for ETF growth, indicating more than a few ETFs have had ample opportunity to increase their heft………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

The dollar’s rate of exchange against the Iranian currency rial fell below 30,000 rials on Saturday November 9.The Mehr News Agency reports that foreign currency traders sold the dollar at 29,950 rials today on the open market, and similar declines in other currencies’ exchange rates were also reported.
The report indicates that the rise in the value of the national currency appears to be a result of optimism about the direction of nuclear talks in Geneva.Iran’s national currency has fallen in value significantly in recent years as a result of international sanctions and pessimism about the country’s economic situation………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

South Korea plans to scale down the amount of its foreign currency stabilization fund for next year as part of efforts to reduce mounting losses from its operation, the finance ministry said Monday.
According to the ministry, the government set the amount of the money being operated under the fund at 72.07 trillion won (US$67.5 billion) for next year, which is down 10.5 percent, or 8.42 trillion won, from this year………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

Mexico’s stock exchange said on Friday it will launch an electronic platform to trade carbon credits, opening a new environmental market in the Americas and looking to profit from new low-carbon legislation in Mexico.
Bolsa Mexicana de Valores (BMV) and its partners in the project said they will hold a presentation on Nov. 26 at the exchange’s auditorium, in Mexico City, to detail the mechanism called MEXICO2………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

Ousted prime minister Julia Gillard has urged her former Labor colleagues to stand by carbon pricing ahead of the coalition’s plans to have it scrapped during federal parliament this week.
Climate change will be the key battleground when the 44th parliament sits for the first time, with the Abbott government expected to introduce its carbon tax repeal bills first thing on Wednesday morning. The Greens oppose the bills while Labor says it’s open to scrapping the tax if the government replaces it with an emissions trading scheme - something the coalition is not going to do………………………………………..Full Article: Source

Posted on 11 November 2013 by VRS |  Email |Print

Saad Khalil, director of King Abdullah’s Initiative for Saudi Agricultural Investment Abroad, recently revealed that 35 countries have been targeted for agro-investment so far. Khalil said investments are available in these countries to produce basic and strategic commodities for food security for both the Kingdom and target countries.
“We still don’t have accurate information as to whether there has been growth or decline in the volumes of agro-investment abroad,” he added………………………………………..Full Article: Source

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