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Commodities Briefing 13.Mar 2014

Posted on 13 March 2014 by VRS |  Email |Print

Oil cartel reveals plans to release emergency supplies as Washington announces ‘test’ sale of oil reserves. Fears grew of an increase in petrol prices after Opec raised its forecasts for world oil demand and the US revealed plans to release emergency supplies.
The Middle East-led oil cartel, which controls a third of world oil supply, said it now expected demand to increase during 2014 by 50,000 barrels a day to 1.14m as the world economy slowly picks up speed………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

World oil demand will increase more than expected in 2014, OPEC said on Wednesday, raising its prediction for a second straight month as economic growth picks up in Europe and the United States.
The view on oil demand growth from the Organization of the Petroleum Exporting Countries, source of a third of the world’s oil, contrasts with that of the U.S. government’s Energy Information Administration, which on Tuesday cut its forecast………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

The Organization of the Petroleum Exporting Countries boosted its closely watched forecast for oil demand growth for the second month in a row Wednesday, despite continuing to warn of possible emerging market headwinds. In its monthly oil market report, the cartel of some of the world’s biggest oil producers upgraded its forecast for demand growth this year by 50,000 barrels a day, after tweaking its expectations higher by the same amount last month.
The producer group now expects oil demand to increase by 1.14 million barrels a day this year, largely as a result of higher consumption in North America, as well as improved demand in Europe and Africa. Total oil demand for 2014 is pegged 91.1 million barrels a day………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

OPEC bolstered forecasts for the amount of crude it will need to provide this year as the economic recovery stokes global fuel consumption. Iraq, its second-largest member, pumped the most oil since 1980.
The Organization of Petroleum Exporting Countries, responsible for 40 percent of the world’s oil supply, said its 12 members will need to produce an average of 29.7 million barrels a day this year, 100,000 a day more than forecast last month. The amount required is about 400,000 barrels a day less than the group said it pumped in February, when output surpassed 30 million a day for the first time since August………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

The US has announced its first “test” sale of oil from its strategic petroleum reserve since Iraq invaded Kuwait in 1990, in a move that underlines its ability to respond to any energy market turmoil that might arise from the Ukrainian crisis.
The Department of Energy described the planned release of up to 5m barrels of oil, less than 1 per cent of the 696m barrels in the reserve, as intended “to appropriately assess the system’s capabilities in the event of a disruption”………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

Gold and silver prices have logged solid gains this year, helped by concerns over the crisis in Eastern Europe and slowing economic growth in China. Tensions continued to build in Ukraine this week as negotiations appear to be at a standstill and European Union governments are considering sanctions against Russia.
Also leading investors to opt for safe-haven assets rather than equities was weaker-than-expected Chinese export data for February. Over the weekend, China said exports plunged 18.1%, compared to expectations they would jump more than 7%, leading to a broad selloff in Asian markets earlier this week. ……………………………………….Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

When it comes to gold bullion prices, despite their mere 10% climb since the beginning of 2012, I wouldn’t be at all surprised to see gold bullion prices increase even further. With this, companies producing or looking for the precious metal are still presenting a great buying opportunity.
Let me explain… We see demand for gold bullion continues to increase, and at the same time, supply constraints are slowly starting to show. This is something I have been talking about for some time now and at the very core, it is the perfect recipe for higher gold bullion prices ahead………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

Copper reached a 44-month low in London amid concern demand is weakening in China, the biggest consumer of the metal. Futures traded in Shanghai touched the lowest price since 2009.
The metal slumped this week after figures showed exports from China unexpectedly fell the most since 2009 last month. The nation’s central bank will cut reserve ratios for lenders next quarter amid increased downside risks to the economy, Nomura said in a report. China’s industrial output slowed in February as retail sales sped up, economists said before data tomorrow………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

Copper has been getting a lot of attention as of late. A severe breakdown took place just over the last few days, and media outlet after media outlet is putting a spotlight on the metal. Because copper is so pervasive in industrial production and infrastructure building, the argument goes that its price movement can be indicative of future global growth expectations, particularly in China, which is, at the margin, the largest consumer of all.
In the case of China, copper (and other commodities) have often been used as collateral for lenders, which makes the potential for “margin calls” on the ground high when prices crater and the value of that collateral drops………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

While steep declines in copper, iron ore and coking coal prices have spooked investors, they are not severe enough to disrupt the mining sector at this stage. The vast majority of projects can generate decent margins at these price levels, according to experts. Though in the case of coal, there has been enough of a drop to make high-cost producers nervous.
Prices for all three commodities have been under pressure throughout 2014, but they plummeted over the last several days due to economic concerns out of China. Manufacturing activity has been weaker than expected, and a bond default by a solar company raised fears of tighter credit conditions. That hit the copper market in particular, as many Chinese companies use the red metal as collateral to raise money………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

The commodity ETF space had seen some all-stars to start the year thanks mainly to soft stock markets and the excessive under valuation in the natural resource world. Some metals like gold and silver surged on their safe haven investment status, while some soft commodity ETFs (like cocoa) have added double digits on a supply crunch.
However, significant weakness has been seen in the industrial metals space (such as with copper) in the year-to-date frame. All three exchange traded pure plays on copper haven’t seen gains so far this year. Notably, copper exchange traded products lost around 16% last year………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

Flows into ETFs and ETPs listed globally rebounded in February with net inflows of $29.0 billion, according to ETFGI, a London-based consultancy. When combined with the positive market performance over the month, the inflows helped push global industry assets under management to a new record high of $2.44 trillion.
“Positive comments from the Fed indicating that the US economy continues to brighten, the S&P 500 ending February with a record close of 1859 and signs of a wider global recovery in equities seems to have caused investors to come out of their winter hibernation after the winter storms and put net inflows of $29.0 billion into ETFs/ETPs in February,” said Deborah Fuhr, Managing Partner at ETFGI………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

The Zimbabwe government will soon set up a special market for agricultural products as it moves to address the marketing and pricing of crops, says Agriculture, Mechanization and Irrigation Development Minister Dr Joseph Made.
The government was seized with the marketing side of agriculture at a time the country was expecting a bumper harvest, he said here Tuesday, adding that the government was working to establish commodity markets for horticulture and cotton as well as strengthening irrigation………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

The Shanghai Futures Exchange is vying for more influence in the global market with plans to open up trading of its long-awaited crude oil futures and a number of other commodities futures to foreign investors.
“China is a big importer of crude, and we rely 60 per cent on crude imports. However, our influence in the global pricing of crude oil has been low, and it doesn’t match with our big consumption,” exchange chairman Yang Maijun said………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

The Singapore Exchange (SGX) and China’s Dalian Commodity Exchange have signed an agreement to collaborate on developing their commodities businesses, the Singapore bourse said on Monday.
The memorandum of understanding between the two exchanges will allow them to work together on developing commodity derivatives products and investor education, among other areas………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

The price moves are not for the most part very big, but it is beginning to look as if the markets are rolling over. The dollar, yen and Swiss francs are all relatively strong. Equity markets are under pressure. The MSCI Asia Pacific Index and the Emerging Equity Index are off 1.3%-1.5%. Europe bourses are also in the red, with the Dow Jones Stoxx 600 off almost 1%. Core bond yields are lower and the periphery higher.
There is much focus at the moment on the decline of copper, iron ore and crude oil prices. Copper prices continue to plunge. The 5% limit was hit in Shanghai. The four-session (though today) swoon, copper prices have fallen nearly 10%. The break of the $300 level is important as that represents the shelf that extends back to 2011………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

Global stability concerns coupled with heavy losses in commodity prices have seen investors shift away from riskier assets and push the Australian dollar lower in the process.
Over the past 24 hours, the local currency has slumped close to US1¢. Chinese credit and growth worries have pushed commodity prices lower, and teamed with geopolitical events like the situation in Ukraine to weigh on the Aussie………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

Political crises and central bank action have played havoc with emerging markets currencies since the start of the year. But for many investors in the foreign exchange market, the bigger problem has been the unnatural calm prevailing in major currency pairs.
Uncertainty over the pace of the US recovery, combined with the steady policy stance of the biggest central banks, has confounded fund managers and driven volatility in developed market currencies to lows barely seen since the “great moderation” that preceded the financial crisis………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

Edinburgh University’s Carbomap, an environmental survey company, has announced the completion of a three-dimensional carbon map of a forested region in Costa Rica and it reveals that the actual carbon content is 22% higher than published values using traditional satellite methods of measuring forest carbon.
Estimated using approved methodologies by the United Nations Framework Convention on Climate Change (UNFCCC), the global forest carbon stocks are understood to contain 638 billion tonnes of carbon, which may be valued at more than $3.8 trillion (using an average price of $6 per tonne of carbon)………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

Carbon Trade Exchange (CTX) continues to expand both its team and operations in Australia and International markets, on Wednesday, announcing the appointment of Dan Jackson as Chief Technology Officer and Nicole Favretto as Marketing Manager, both effective immediately.
Dan has over 10 years’ experience with systems architecture, analysis and design in the IT industry, including significant experience in the development of software solutions for large-scale defence projects in both the intelligence and communications sector………………………………………..Full Article: Source

Posted on 13 March 2014 by VRS |  Email |Print

Italian state-owned energy exchange Gestore Mercati Energetici (GME) will close its carbon emissions market on March 22, more than three years after it suspended trade due to what it called “presumed unlawful” activity.
The Rome-based bourse’s board of directors made the decision on March 5, GME said in a statement dated March 6 on its website. A GME official said the exchange was unable to comment further on the matter………………………………………..Full Article: Source

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