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Commodities Briefing 07.Aug 2008

Mining M&A more than doubles this year
Soft commodities in strong demand as food prices soar
EU plans to link carbon trading system with UN
Commodities: time to buy in or bail out?
Thailand: Gold traders move to stall futures listing
Rubber futures drop to two-month low on concern demand may wane
Oil steady near $119; US demand still a concern
A review of carbon trading
World wheat outlook is looking favorable
Commodities rush could be over
Opec supply move helps drive fall in crude
Special got gold report - August silver swoon again
Russia's oil exports to go down by 2020
NASDAQ OMX announces second quarter results
From bull to bust: Tracking the plunge in commodity prices, and what it may mean for U.S. inflation
Profiting from carbon trading 'must be stopped'
Trayport signs five-year agreement with SIBEX for new trading technology
Top US regulator asked for evidence of oil market manipulation
New carbon trade association formed
Gold ETF hangs on by a thread
ICE Canola hits four-month low
Exotic currencies gain more than 11 pct of retail lending market
NSEL gears up for launching e-trading platform in 5 states
CBOE says gold-ETF options trading hits high
Carbon prices fall along with oil and other commodities
Bears are eating the commodities market?
Commodity currencies continue to slide
Platinum rises above $1,600 on strike, gold advances
RBI, Sebi release currency futures trading norms
Commodities are down...Hooray?
Commodities open interest falls as investors exit
Commodity exchanges jostle for share of rising Indian market
Canadian dollar rattled again by oil-price fall
AYF to sell commodity foreign fund

Posted on 07 August 2008 by VRS |  Email |Print

From Mining M&A has more than doubled so far this year, boosted earlier Wednesday by Anglo-Swiss miner Xstrata PLC’s GBP5 billion unsolicited bid for Lonmin PLC. Mining M&A deals are worth $142.5 billion so far this year, up from $56.8 billion in August 2007, according to Dealogic PLC, which tracks the M&A market.

Growth is driven by consolidation in the industry as players seek to gain scale by buying competitors rather than developing projects on their own. Lonmin said that Xstrata’s offer was opportunistic as well.

Merrill Lynch & Co has been the most active bank, advising on mining M&A deals worth $25 billion collectively. Citigroup Inc and CIBC World Markets were the next most active advisers, working on deals worth $15.9 billion and $ 15.47 billion, respectively…… Full Article: Source

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From Traders in soft commodities are keeping a close eye on events in parts of the developing world where food supply shortages and skyrocketing prices have sparked riots. The World Bank says 33 nations may face “social unrest” as a result. Already in Haiti four people died in two days of rioting. In some countries, hording is punishable by jail terms or even death.

Prices for crops such as wheat and rice - a basic staple for half the world - have doubled over the past year. According to the United Nations’ Food and Agriculture Organization global food prices rose 57 per cent in March from the previous year. The supply crunch is prompting exporting nations like China, Vietnam, India and Egypt to hold back supply - forcing consuming nations like the Philippines to ration whatever is available on the open market…… Full Article: Source

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From The European Union plans to link its carbon emission-permit tracking system to one operated by the United Nations by December, potentially cutting the cost for factories and power stations complying with climate protection laws.

Testing of the link was “successful”, the European Commission, regulator of the EU programme, said yesterday. The linking of the systems comes almost four years after the start of the EU carbon dioxide trading system, the world’s largest greenhouse gas market.

The commission has been making sure its systems interact properly with the UN’s International Transaction Log. The UN system is the second-biggest greenhouse gas trading programme. EU factories and power plants can use credits from either programme for compliance with emissions targets…… Full Article: Source

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From Tens of thousands of investors have piled into commodities in recent years, spurred on by stupendous returns. Take the top-selling JPMorgan Natural Resources fund, for instance. For those who caught the commodity bug long before it became widespread and invested in the fund in 2003 they would have seen an outlay of £5,000 rocket to £19,450.

But lately the commodity bull-run has shown signs of running out of steam. The CRB commodity index fell 10pc last month, the steepest one-month drop since 1980.

Most raw materials have been slipping for months. Oil has dropped to a three-month low after peaking at $147 early last month. It begs the question: Is now a time to take profits? Many investors already are…… Full Article: Source

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From The Gold Traders Association has asked securities regulators to delay the introduction of gold futures on the Thailand Futures Exchange. Jitti Tangsitpakdi, the association president, met with the Securities and Exchange Commission last week to ask for the futures delay.

”While gold shops may not be affected much in the first year, we could see over half of the 7,000 shops in Thailand closed in three years as investors move from physical gold investment to futures trading,” Jitti said.He compared the launch of gold futures on the TFEX to the entry and expansion of foreign retail hypermarts and the negative impact on the traditional retail sector.

”There are more disadvantages than advantages. We have asked to establish a committee to study the impact [of gold futures],” Mr Jitti said…… Full Article: Source

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From Natural rubber futures in Tokyo fell to the lowest in more than two months on concern demand for the commodity used in tires may drop after the Japanese government said the world’s second-largest economy was deteriorating. Prices dropped as much as 1.3 percent to 312.7 yen, matching the low touched on May 20. There’s a high possibility the economy has entered a recession, Shigeru Sugihara, head of business statistics at Japan’s Cabinet Office, said yesterday.

Rubber for January delivery lost 0.4 percent to 315.5 yen a kilogram ($2,884 a metric ton) on the Tokyo Commodity Exchange at the 11 a.m. local time break. The most-active contract has fallen 12 percent from a 28-year high of 356.9 yen June 30, when record oil prices raised production costs for the rival synthetic rubber…… Full Article: Source

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From Oil prices were steady Thursday in Asia near US$119 a barrel as concerns over slackening U.S. fuel demand offset the shutdown of a major Turkish pipeline after a fire. “The oil market right now is overwhelmingly preoccupied with poor U.S. oil demand,” said Victor Shum, an energy analyst with consultancy Purvin & Gertz in Singapore. “The market is choosing to ignore somewhat some of the supply-side issues, such as the pipeline fire.”

Light, sweet crude for September delivery rose 18 cents to US$118.76 a barrel in electronic trading on the New York Mercantile Exchange by midday in Singapore. The contract dropped 59 cents overnight to settle at US$118.58 a barrel. The U.S. Energy Department’s Energy Information Administration said Wednesday that crude supplies rose 1.7 million barrels in the week ended Aug. 1, slightly more than the 1.2 million-barrel increase expected by analysts…… Full Article: Source

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From There are 2.6 million cars in Beijing. This has caused pollution in the Chinese capital to rise three times above the acceptable level. This condition is an environmental concern that threatens the Beijing Olympics. Some suggest that 90 percent of the cars need to be removed from the streets during the games for the emissions to clear up. The world is waiting to see what plans the Chinese government has to reduce emissions in the city.

The Beijing experience tells us that it is easy to pollute the air, but difficult to clean up. Its population density in Beijing is similar to that in the Philippine National Capital Region, or 16,000/sq km. This puts us in the same league with Shanghai, Taipei, Seoul and Jakarta…… Full Article: Source

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From With world wheat stocks at all-time lows, a good harvest this year is vitally important. According to numbers released Tuesday, the Asian part of the equation is holding up their end.

Russia has harvested 41.8 million tons of wheat from 25% of acres that were planted. That is 8.5 million tons more than the same time last year and yields are just under a ton more per hectare than last season’s harvest. The agriculture ministry expects a final harvest around 85 million tons, an increase of three million from 2007.

The Ukraine is also seeing an improved harvest over last year. They have harvested 74% of wheat acres which have produced 31.86 million tons. Although the harvest pace is behind last year, yields are more than 1.35 tons per hectare greater than last year’s harvest. The agriculture ministry is predicting a grain harvest more than 10 million tons greater than last year…… Full Article: Source

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From The commodity price boom is fizzling fast, a development that could ease inflation fears and lead to some relief for consumers at the pump, in grocery aisles and at the jewelers. After skyrocketing earlier this year, prices for a wide variety of commodities, including oil, corn, wheat and gold, have fallen drastically in recent weeks, thanks to declining demand, a strengthening dollar and emerging signs of weakness in the global economy.

“The rush is definitely over,” says Nathan Golz, futures researcher at broker A.G. Edwards.The Reuters-CRB Continuous Commodity Index, gauging the prices of a range of commodities, is down 16% from its July 2 peak. Still, it’s up 25% from a year ago…… Full Article: Source

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From When the oil price slipped below $120 a barrel earlier this week, the move was blamed on investors’ fears that slowing global growth was crimping demand.But that was only half the story. Just as important, is a large increase in supply from Opec, the oil exporters’ cartel, which is helping to ease the tight market.

Oil prices sank on Tuesday to an intraday low of $118 a barrel – a fresh three-month trough – almost 20 per cent below the all-time high hit last month of $147.27 a barrel.

The fall in oil prices has helped to trigger a broad commodities sell-off, with the Reuters-Jefferies CRB index, a global commodities benchmark, down 15.6 per cent from its July record. The index is, however, 27.9 per cent up on the past 12 months…… Full Article: Source

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From In the first two weeks of last August (2007) silver sold off strongly. So far this August the metal seems to be following the same script. Just as last year at this time, there are signs that silver is closer to a bottom than a top, but the signs are not exactly the same. At least not yet.

Just as last year silver has broken through technical support levels, tripping sell stops, crashing through long trailing stops and forcing technically minded traders to sell or take defensive action. Just as last year a goodly number of market commentators have heralded “the end of the commodities boom.” Right on cue, mining shares have answered in waterfall plunges measured in high percentages, and that was from already depressed levels for many of the smaller, less liquid companies that mine for silver…… Full Article: Source

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From All development concepts for Russia provide for lower oil production for the period until 2020, the Russian Economy Ministry indicated in a long-term social and economic development outline. Domestic oil consumption is expected to exceed production, while oil exports are also anticipated to decline. About 85 percent of exported oil will be supplied to the CIS countries. Europe is projected to become less dependent on Russia’s oil supplies. By 2030, oil exports are estimated to reach 245m tonnes…… Full Article: Source

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From The NASDAQ OMX Group reported second quarter 2008 net income of $101.6 million, or $0.48 per diluted share, an increase of $45.5 million from $56.1 million, or $0.39 per diluted share, in the second quarter of 2007.

For comparison purposes net income and dilutive earnings per share for the second quarter of 2008 are presented on a non-GAAP basis and exclude merger expenses and gains from foreign currency contracts. Net income and dilutive earnings per share for earlier periods are presented on a pro-forma, non-GAAP basis that reflect the financial results of both NASDAQ and OMX as if they were a combined company for the periods presented and exclude merger expenses, gains (losses) from foreign currency contracts, and capital gains from shares in equity investments. For the second quarter of 2008 net income on a non-GAAP basis was $101.8 million, or $0.48 per diluted share, an increase when compared to pro forma non-GAAP net income of $77.2 million, or $0.38 per diluted share, for the second quarter of 2007. Second quarter 2008 non-GAAP net income also increased when compared to pro forma non-GAAP net income of $96.7 million, or $0.45 per diluted share, for the first quarter of 2008. The remaining results are presented on a pro forma basis unless otherwise noted…… Full Article: Source

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From “The committee expects inflation to moderate later this year and next year,” Federal Reserve policymakers said in their post-meeting statement. We’ve heard that before, but this time the Fed’s optimism may be borne out: Commodity prices, which helped stoke the inflation fires over the last year, are continuing to deflate.

The steep slide in oil prices during the last month has gotten the headlines, for obvious reasons. Oil futures, which slipped 59 cents to $118.58 a barrel today, are down 18.4% since peaking on July 3 at $145.29.

Commodsaug6 But take a look at the accompanying chart. Natural gas has plunged nearly twice as much as oil since July 3, down 35.4%. Corn is down 32% in the same period. Soybeans have tumbled almost 25%…… Full Article: Source

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From The New South Wales Greens say electricity generators must be stopped from using a planned emissions trading scheme to increase their profits.The Total Environment Centre says it has obtained documents showing the generators plan to pass on the full carbon cost to consumers, despite the industry being issued free permits and compensation.

Greens MP John Kaye says it is double dipping and undermines the purpose of an emissions trading scheme.”It should not be that carbon trading makes the generators wealthier,” he said…… Full Article: Source

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From Trayport, a provider of e-trading solutions, has signed an initial five-year agreement with Sibiu Monetary Financial and Commodities Exchange for Trayport’s GlobalVision Exchange Trading System

Trayport said that GlobalVision, which will go into production with Sibiu Monetary Financial and Commodities Exchange (SIBEX) in the first quarter of 2009, is to replace the current trading system which was developed in-house. In addition, SIBEX will implement interfaces between GlobalVision and its clearing and risk management systems.

Darius Cipariu, deputy managing director of SIBEX, said: “Key factors for us are the flexibility and proven performance that GlobalVision delivers. Through this, we will be able to facilitate business growth and expansion into new asset classes while supporting our existing clients and markets. The constraints that we were facing with our existing platform will now be lifted.”….. Full Article: Source

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From America’s top futures market regulator will be invited to give evidence in London as part of a full parliamentary investigation into possible manipulation of the oil market. MPs on the House of Commons’ powerful Treasury Select Committee are set to unveil details of the investigation next month, after they were left dissatisfied with findings from an initial inquiry into oil market regulation held last month.

A spokeswoman said it was “highly likely” that the committee, chaired by Labour MP John McFall, would push for a full parliamentary inquiry when Parliament returns from its summer recess.Nick Ainger, MP, who is also a committee member, said that among those who would be invited to give evidence are Walter Lukken, chairman of the Commodity Futures Trading Commission (CFTC), which has launched a series of initiatives designed to stamp out alleged market abuse in the US in recent months…… Full Article: Source

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From Two international trade associations have joined forces to form a new group called the Carbon Markets and Investors Association (CMIA) with the aim of keeping the role of the market at the centre of next year’s global climate change talks in Copenhagen.The merger between Carbon Markets Association and International Carbon Investors and Services brings together sixty investment banks and service providers that handled around three quarters of the estimated $64 billion carbon market in 2007.

Companies in the new association aim to provide their market insights in the run up to the UN-brokered international talks in Copenhagen in 2009 which are seen as a deadline to agree a new deal post 2012 to follow the Kyoto Protocol. A series of international climate change talks will take place before the December 2009 gathering, including a session of working groups on long-term cooperative action and further emissions reduction commitments in Accra, Ghana, scheduled for August this year, and a full meeting of the Conference of Parties to the UN Framework Convention on Climate Change in Poznan, Poland in December 2008…… Full Article: Source

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From Could recent trends, higher commodity prices, and a lower dollar be ready to reverse? The Streettracks Gold Trust has fallen below its 200-day moving average as the dollar strengthens.

This could be an important development, barring its reversal in the short term, as it may be signaling that the trends of the last several years, higher commodity prices, and a lower dollar are about to reverse. There is an interesting school of thought that is emerging as this dynamic evolves. And that is that the U.S. is farther along the weak economy curve than the rest of the world.

Based on this assumption, money managers are starting to price in a stabilization of the U.S. economy, while preparing for a weakening of the global economy…… Full Article: Source

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From Grain and oilseed futures at ICE Futures Canada closed Wednesday’s session lower with canola hitting its lowest level since April as the weakness in the Chicago Board Of Trade soy complex sent canola down, brokers said.Canola saw moderate trade with only light intermonth spreading evident.

The total canola volume was estimated at 9,464 contracts, up from Tuesday’s 9,046 contracts, including an estimated 1,234 contracts involved in the spread trade.Canola was higher in the overnight session following the firm tone in international vegetable oil markets and ideas that canola was oversold. Canola, however, turned lower early in the North American trading session as the CBOT soy complex plunged to as much as limit losses, traders said. Canola ended moderately lower.

Canola was also undermined by the favorable crop outlook, benign weather forecasts, bearish technical signals and declines in crude oil, traders said. However, canola losses were much smaller than the U.S. soy complex as the Canadian dollar dropped to its lowest level in a year against the U.S. greenback. The lack of farmer selling was also supportive. The canola decline triggered speculative sell orders in the November contract…… Full Article: Source

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From In May 2008, loans in exotic currencies such as the Swiss franc and the Japanese yen were accounting for over 11 pct of retail lending, compared to 4.6 pct in May 2007, reveals data of the National Bank of Romania (BNR) cited in the July 29 issue of daily Ziarul Financiar.

Exotic currencies gained 2% of the entire credit market, advancing to 4 pct of the aggregate credit in May 2008.

Credits in Swiss franc and Japanese yen address mainly the banks’ retail clients who are increasingly interested in such financing, due to the nominal interest rates that are far lower than those charged for local lei or even euro.

According to the cited paper, some bankers declare themselves against lending in exotic currencies, considering it highly risky for the borrower; others however comfortably practice it in order to keep their market share up…… Full Article: Source

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From National Spot Exchange, the sister concern of leading commodity exchange MCX, is gearing up to launch an e-trading platform for agri-products in five states including Gujarat, Maharashtra and Karnataka by the end of August.

NSEL is also looking to expand its presence in Uttar Pradesh, the largest Indian state and a major producer of wheat and rice, and has approached the state government for licence to set up the spot exchange.

“We have already started mock trading last week. The spot exchanges are expected to be launched by the end of the month,” NSEL chief operating officer Anjani Sinha said…… Full Article: Source

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From The Chicago Board Options Exchange said daily trading volume in options on SPDR Gold Trust on Tuesday hit 188,841 contracts, the most since the contract was listed on June 2. The ETF is designed to reflect the performance of gold. The previous volume high for the ETF’s options was 139,786 contracts traded on July 15, according to CBOE. The gold ETF slipped more than 2% on Tuesday…… Full Article: Source

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From Carbon prices (as measured by Certified Emissions Reductions or CERs) have declined by 24% since peaking in early July. The fall in carbon prices mirrors that of energy commodities such as oil and other commodities such as precious/industrial metals and agricultural products.On the European Climate Exchange, the leading exchange for the secondary market trade of issued CERs, December 2008 CERs closed at 17.25 euros ($27 USD) on August 1, which is off by 24% or 5.50 euros from a peak of 22.94 euros in early July.

The European Union Emission Trading Scheme (EU ETS) is the largest market for the trading of emission allowances, spanning 28 countries throughout Europe; and other developed countries such as the US, Japan, and Australia are developing similar ETS markets. Carbon commodity trading is dominated by EU Allowances (EUAs) with a 78% share, followed by CERs which are created through the United Nations climate change convention’s Clean Development Mechanism [CDM]…… Full Article: Source

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From Precious metals turned higher following three losing sessions as bargain hunters emerged from the shadows and picked some up at prices nearly $100 lower than what was on offer two weeks ago.

The markets (stocks aside) greeted the unsurprising Fed decision with little more than minor moves after it became evident that the central bank is now dividing its attention between growth (not happening just yet) and inflation (happening allright, and on the public enemy list at pole position).

Then again, it could also be argued that the Fed’s steady stance and the Dow’s rally were likely (and in good part) the results of an oil price that has finally cracked, and of the most sizeable slump in commodities since 1980. Looks like the commodity markets may be doing the Fed’s job on its behalf at least as regards bringing down inflation. It’s the growth part that has commodity sellers crowding the market exit doors…… Full Article: Source

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From Under $119, oil is trading decisively below the 100-day moving average for the first time in 15 months. The 100-day MA has provided key technical support to oil during this bull run, and now that it has been breached, $110 is the next level of support. If $110 falls, support would next be found at $98 and then $87. Although $147 oil is imbedded in our recent memories, and a lot of people believe oil prices can only go higher, let s not forget that crude was trading at $50 a year and a half ago and it was actually below $10 in 1999. Certainly $10 oil didn t make a lot of sense, but neither does $147 oil. The marginal cost of producing a barrel of oil is $60 to $70 depending on the grade and source. Typically, speculators aside, the market price will trend towards the marginal cost of production.

And let’s not underestimate the role of speculators in running up oil prices. In a CFTC report yesterday, it was revealed that speculators controlled 48% of the NYMEX crude futures contracts as of July 15th. Certainly if the speculators can chase oil prices a lot higher than warranted by economic fundamentals, they can just as easily cause oil prices to collapse. In another story yesterday it was interesting to read that a major energy trader SemGroup LP has filed for bankruptcy after suffering losses of $3.2 billion on oil futures and derivatives trading. Who says there s no justice in the markets?….. Full Article: Source

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From Platinum briefly spurted above $1,600 an ounce on Thursday, extending a 2 percent rally in New York, as supply fears resurfaced after a national strike in main producer South Africa forced mines and factories to shut.

Supply fears that sent platinum to a record high of $2,290 in March reappeared after striking workers in South Africa forced mines and factories to shut on Wednesday in a one-day protest against rising power, food and fuel prices. Spot platinum hit an intraday high of $1,603 ounce before slipping to $1,587/1,607 an ounce, down from $1,594.50/1,614.50 late in New York on Wednesday.

“I guess it’s a bit of everything. A bit on the strike, a bit on bargain hunting and maybe a bit on a technical rebound,” said Adrian Koh, an analyst at Philip Futures in Singapore…… Full Article: Source

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From The contracts will be quoted and settled in the local currency with a maturity of not more than 12 months. The path has been cleared for currency futures trading with both the Reserve Bank of India, or RBI, and the Securities and Exchange Board of India, or Sebi, the capital market regulator, releasing guidelines for such trading on Wednesday.

Only US dollar-rupee contracts with a size of $1,000 (Rs42,000) each will be allowed for trading. The contracts will be quoted and settled in the local currency with a maturity of not more than 12 months.

The membership of the currency futures market of an exchange will be separate from the membership of the equity derivatives segment or the cash segment, RBI said. Such an exchange will be subject to the guidelines of the capital market regulator…… Full Article: Source

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From Lower prices are welcome, but a global slowdown is a big part of the change, and that’s no reason to cheer. These days, even the good news is bad news. The good news, which helped the stock market to its biggest gain in four months on Aug. 5, is that commodity prices, led by oil, have been plunging. The bad news is why commodities have fallen: One big factor is a slowdown in global economic growth, with prospects for worse ahead.

On the bright side, lower commodity prices, all else being equal, help hold down inflation and ease strains on consumers and commodity-buying businesses. Prices of oil, copper, aluminum, corn, and soybeans began dropping sharply earlier this summer, joining zinc, tin, nickel, and platinum, which began falling earlier. Crude oil fell 18% from its July 3 peak of $145 a barrel through Aug. 6, when it closed at $118.60 on the New York Mercantile Exchange. Nickel is down 47% from its 2008 high; orange juice, down 33%; platinum, down 30%; soybeans, down 26%. Overall, the S&P GSCI—a global commodity index created by Standard & Poor’s (MHP) and Goldman Sachs Group (GS)—is off 19% since early July…… Full Article: Source

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From Open interest, a measure of market liquidity, has fallen in most key U.S. commodities as a plunge in prices over the last month encouraged some investors to get out of the market.

Data from crude oil, metals and grains exchanges on Wednesday showed between 2 and 17 percent fewer futures contracts that have not yet been exercised, expired, or fulfilled by delivery at the end of a trading day compared with a month ago.

A softer outlook for raw materials — plus a stronger dollar from a halt in U.S. rate cuts — has also led to more investors going short, or bearish, on commodities than those going long, or bullish, analysts said.

“It is a combination of shorts and liquidations,” said Jim Ritterbusch, president of Ritterbusch & Associates, an oil trading advisory in Galena, Illinois…… Full Article: Source

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From A growing trade in metals and energy has propped up Indian commodity exchanges despite a ban on farm futures, and volumes are set to grow even more as investors scramble for safer assets amid weakening financial markets.

Buoyed by a rapid-fire approach to new contracts, the Multi Commodity Exchange, or MCX, has taken the lead in commodity trading in India. It was valued at $1.1 billion when Citigroup and Merrill Lynch each bought 5 percent stakes in the exchange last year.

The second-largest commodities market, the National Commodity & Derivatives Exchange, or NCDEX, has watched its fortunes wither this year. The volume of its trading, which focuses on agricultural products, dropped by a third after the government banned contracts for eight commodities, including heavily traded wheat, soy oil and chickpea contracts. Goldman Sachs and IntercontinentalExchange hold minority stakes in the company…… Full Article: Source

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From The Canadian dollar fell more than half a cent to a fresh 11-month low versus the U.S. dollar on Wednesday as the downdraft in commodity prices continued to rattle the currency.

Canadian bond prices, with no key economic data to spark a move, finished mostly flat across the curve as dealers bided their time until key Canadian jobs figures are released on Friday. The Canadian dollar closed at C$1.0477 to the U.S. dollar, or 95.45 U.S. cents, down from C$1.0419 to the U.S. dollar, or 95.98 U.S. cents, at Tuesday’s close.

As has been the case in recent sessions, Canada’s role as a key exporter of oil weighed on its currency since the price of oil fell to a three-month low less than a month after it vaulted to a record above $147 a barrel.”It hasn’t been the same degree that other commodity-based currencies have fallen, but normally if commodity prices fall we tend to get dragged along,” said Sal Guatieri, senior economist at BMO Capital Markets…… Full Article: Source

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From Ayudhya Fund Management (AYF) is gearing up to launch a new commodities foreign investment fund expected to offer returns outpacing inflation. AYF chief executive Chatrapee Tantixalerm said the new fund would invest in four commodities categories: soft commodities, such as rubber, rice and tapioca; hard metals such as steel; energy commodities such as oil and coal; and precious metals such as gold and silver.

”Commodities is one of the most interesting asset classes for the moment, due to price trends and expectations that demand will continue to increase over the next several years,” he said.The new FIF will follow a flexible investment policy that will shift holdings across the four commodities classes based on market trends…… Full Article: Source

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