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Commodities Briefing 20.Feb 2014

Posted on 20 February 2014 by VRS |  Email |Print

Commodities revenue at the 10 largest investment banks dropped 18 percent last year, according to analytics company Coalition Ltd. Revenue dropped to $4.5 billion from $5.5 billion in 2012, Coalition said in an e-mailed report. In November, the company anticipated a 14 percent drop in revenue.
“Revenues continued to decline, affected by a depressed client environment and low volatility,” Coalition said. “In 4Q13, performance in U.S. power and gas was particularly weak.”……………………………………….Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

Strong demand for New Zealand’s main commodity exports - particularly from China - has prompted the Ministry for Primary Industry to revise up its revenue forecast for the sector by $4.9 billion to $36.5 billion for 2013/14.
The ministry, in an update of last year’s Situation Outlook for Primary Industries, said the net effect of higher demand for dairy was a $2.7 billion increase in forecast dairy revenues over last year’s forecast for the 2013/14 year to June………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

While most traders white-knuckled the sharp equity drop last month, a much bigger (and more important) trend emerged… In case the market has distracted you, here’s what you’ve missed: Gold is up nearly 10% on the year…Silver is up 13%…
After a sharp drop in January, crude oil has risen more than 4.5% since Jan. 1…Thanks in part to a harsh winter, natural gas has spiked a whopping 31%… Due to drought concerns, soybeans are up more than 5.5%, while coffee has blasted higher by 38%………………………………………….Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

After falling during the past three years, the Dow Jones-UBS Commodities Index has rebounded 5.6 percent so far this year. And analysts say now is a good time to look at select commodities.
“The approach we’re taking is to selectively invest on a limited basis in parts of the market where supply and demand dynamics are looking more favorable,” Stephen Jury, global head of currencies and commodities at J.P. Morgan Private Bank, told The Wall Street Journal………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

Congratulations! We live in the only country on Earth whose oil and gas production is increasing along with its reserves. America is enjoying an energy renaissance while the rest of world is suffering a decline in reserves and production and a corresponding increase in prices.
This is big news. Cheap, abundant, domestic energy affects everything from employment to cost of living, and from the environment to national security. It makes the U.S. more appealing to manufacturers. And our dependency on OPEC oil continues to decrease………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

Oil prices have rallied back to the $100.00-per-barrel level on some near-term supply and inventory concerns. While the upside move is rewarding the buyers of oil stocks, I don’t think oil prices are set for an extended rally.
The chart of the West Texas Intermediate (WTI) crude oil shows oil prices bouncing higher after the formation of a bullish double bottom, based on my technical analysis. And while oil prices can head higher on the chart, I just don’t see any moves being sustainable………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

The head of the world’s largest oil trading firm has called for an overhaul of the Brent Crude benchmark oil price. Ian Taylor, the chief executive of Vitol, says Brent is no longer efficient as a price and should include other global oil grades.
A leading oil analyst at Citigroup, Seth Kleinman, has also called Brent a “broken” benchmark. Platts, the price reporting agency, says change may be necessary, but not yet………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

I work at a place that is set up to represent and improve the livelihood of the underrepresented, marginalized, and middle class of our society. To see public and private actions and policies that are deepening their unenviable plight and not comment on them will amount to a serious betrayal of not only my conscience but the tenets of this noble country and its founding principles advocate.
Based on the inscription on the Statute of Liberty, we have and hear, “Give me your tired, your poor, your huddled masses yearning to breathe free.” What is the call for, to increase their poverty and pain or lift them up out of poverty and deprivation?……………………………………….Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

Gold has had the best start to a year since 1983, rallying about 10 per cent year to date. Maybe it is simply a medium term short covering rally. It could be the physical demand for the yellow metal arising from the Lunar New Year celebrations in China or the weaker dollar index, which has been trending lower due to poor economic data releases in the United States.
To try and predict the longer term price trend in gold, we must analyse the supply demand dynamics in detail. The World Gold Council released a report yesterday, titled “Gold Demand Trends” that gives us an insight into the global demand trends for the yellow metal………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

In spite of the tightening clutches of the government imposed gold import restrictions, gold demand in India increased 13% in 2013. The reports released by the World Gold Council (WGC) indicate an impressive surge of gold demand in India amidst the stringent rules and regulations put forth by the Reserve Bank of India.
Even though India gave away its first position of being World’s largest consumer of gold to China, the demand for the yellow metal among Indian’s was unaltered as usual. The WGC data shows that gold import reached 975 tons in 2013, in spite of the 10% import hike and 80:20 norms………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

While 880.8 tonnes of gold flowed out of exchange traded funds in 2013, according to the World Gold Council’s Gold Demand Trends report for the fourth quarter and full year 2013, three quarters of these outflows were absorbed by consumer demand.
This, the WGC says, marks the largest year-on-year increase in consumer demand for the yellow metal since its records began and justifies it calling 2013, the year of the consumer. But, it says, it also reflects a distinct polarisation in sentiment between those institutional funds selling out of ETFs and consumers buying jewellery, bars and coins………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

The rally in the gold price in recent weeks ran out of steam on Wednesday after the release of Federal Reserve minutes that showed a number of officials want tighter US monetary policy sooner and after hawkish comments by a key Fed member.
In late trade on the Comex division of the New York Mercantile Exchange, gold futures for April delivery deepened its losses after the release of the minutes to trade at $1,312.50 an ounce, down $11.90 from Tuesday’s close………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

How can I track diamond prices real-time? Since there not a centralized spot or futures market for diamonds, “real-time pricing” does not exist the way that it does for stocks or fungible commodities.
Given the unique characteristics of each diamond, there is technically a separate market for each category of diamond, of which there can be upwards of 12,000 categories. There is also a separate market for rough and polished diamonds. That said, there are still ways to actively track diamond prices………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

Not so long ago, zinc and lead were the “ugly sisters” of the London Metal Exchange (LME) base metals suite, both burdened by consecutive years of surplus and high inventories.
The peak of the commodities super-cycle has come and gone, and you’d be hard pressed to discern its passage through the prism of these two industrial metals. With no spectacular bull runs such as seen in copper and iron ore, they went through a long, long period of largely sideways grind………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

2013 marked the worst year for gold since 1981. It was the first negative year in 12 years, down -27%. This was mainly attributed to a lack of inflationary pressures and a booming developed equity market. Huge outflows were seen in gold funds and gold ETFs. The largest gold ETF, SPDR Gold Shares (GLD), lost over one third of its assets under management.
Gold mining ETFs fared even worse, as Market Vectors Gold Miners ETF (GDX) fell over -54% in 2013, marking the third consecutive year of losses. Junior miners (GDXJ) were down over -60% in 2013. With gold prices way down, is it finally time to buy back into precious metals?……………………………………….Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

Though broad commodities started 2014 on a strong note, they appear to be losing steam of late. Commodities like natural gas, gold, silver, cocoa and coffee have been on a tear posting incredible gains from a year-to-date look, while others like wheat, tin, aluminum and copper have seen extreme weakness.
This is largely thanks to supply/demand imbalances and global developments. Macro fundamentals in developing nations have been out of investors’ favor of late thanks to emerging market weakness and signs of a slowdown in the world’s second largest economy that have raised concerns over global economic growth………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

As the Commodity Futures Trading Commission’s (CFTC) Division of Swap Dealer and Intermediary Oversight recently reminded market participants in a Staff Advisory, entities that meet the definition of a commodity trading advisor (CTA) are subject to various regulatory requirements and may be required to register as a CTA with the National Futures Association (NFA).
The Staff Advisory is an indication that the CFTC is turning to compliance with its regulatory and registration requirements now that the rulemaking process of the Dodd-Frank Act is finishing………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

The devaluation of Kazakhstan’s rouble-shadowing tenge has left investors wondering which other closely managed emerging market currencies might be next, with those of commodity exporters like Nigeria and Angola in the spotlight.
The free-floating currencies of the ‘Fragile Five’ countries that rely on foreign investment to finance deficits - Brazil, India, Indonesia, Turkey and South Africa - felt the brunt of an emerging market sell-off that began last May………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

Around this time of the year (seasonally commodity harvest is round the corner), there are three sets of people watching the events in Argentina unfold with a lot of interest. I am referring to commodity and currency traders, scholars in Boston and Washington, and the people of Argentina themselves. My views are based on my understanding of the first set of people, as I have little current insight into the cerebral activity of the other two.
Argentina produces a large amount of agricultural commodities every year and consumes only a fraction of what it produces…………………………………………Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

More companies are trading goods and services with China and pricing it in yuan instead of dollars, the Bank of China said on Wednesday. Bank President Chen Siqing said in a note that the fourth quarter of 2013 saw a 30% increase in yuan trade settlements from the second third quarter.
Although the currency remains a tightly controlled currency – pegged to the dollar – the Chinese government and many fund managers are betting on the yuan eventually becoming the new yen in Asia. According to the Bank, dollar activity in the fourth increased by just 2% while euro, pound and yen trade all declined………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

After imposing the highest carbon tax in the world, Australia was primed to become the first developed nation to test the idea that a link with the European Emissions Trading System would lead to a functioning global cap-and-trade CO2 market and more efficient carbon abatement.
Then last fall the Labor Party lost the parliamentary election, and the new government is embarking on a climate policy experiment of its own. While eliminating the carbon tax, dismantling many of the green programs of the previous government and officially banning Australian carbon polluters from buying carbon credits outside the country, the new coalition nevertheless reaffirmed the country’s pledge to cut emissions by 5 percent below 2000 levels by 2020………………………………………..Full Article: Source

Posted on 20 February 2014 by VRS |  Email |Print

It is a basic principle of psychological warfare that the side that controls the language of the argument controls the argument. Barack Obama’s own website is using this PsyWar technique by calling opponents of his cap and trade agenda “climate change deniers.”
He has also used the financial resources of the federal government, such as whitehouse.gov, to marginalize everybody who doesn’t agree with him as a climate change denier………………………………………..Full Article: Source

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