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Commodities Briefing 20.Apr 2016

Posted on 20 April 2016 by VRS |  Email |Print

Supply concerns are resurfacing for commodities from crude oil to soybeans, sparking the biggest rally for raw materials since August. The Bloomberg Commodity Index, a measure of returns for 22 components, jumped percent 2.4 to 82.6543 on Tuesday, the biggest gain since Aug. 27. Oil in New York climbed as much as 4.4 percent, corn reached a six-month high and silver entered a bull market.
After five straight years of losses, commodity markets are rebounding as supply overhangs start to subside. Unfavorable weather is threatening soybean output in South America, while the start of a La Nina pattern this year could bring dry weather to U.S. grain-producing regions………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

Why is it that so many seasoned investors mess up when they decide to enter the commodities market? Otherwise smart people seem to lose all reason and are frequently left with a handful of nothing.
I sat done recently with veteran commodity markets investor Jeff Christian to discuss this matter. His experience goes back decades to the 1970s commodities boom and then he survived the two-decade bear market which lasted from 1980 through the turn of the millennium………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

Strike in Kuwait and news of outages in Nigeria and Venezuela bolster crude market. A workers’ strike in Kuwait that has temporarily halved its crude output and a string of global supply disruptions propelled oil prices higher on Tuesday.
Brent, which had sunk to almost $40 a barrel on Monday after talks between some of the biggest producers in Doha collapsed, rose as much as $1.34 to $44.25 on Tuesday. West Texas Intermediate, the US benchmark, rose $1.49 to $41.26 a barrel………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

Oil prices plunged after the world’s top producers failed to reach an agreement on capping output aimed at easing a global supply glut, sparking fears it could set off another round of price falls.
Brent crude, the global benchmark, has lost 34pc over the past 12 months. We look at the countries that are sitting on the largest supplies of oil and are most susceptible to the tumbling price of crude………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

​It’s difficult to see what purpose the once-mighty OPEC serves following Sunday’s spectacular flop of much-anticipated talks to freeze oil production and drive up prices. This was the first substantial effort in a decade and a half to co-ordinate both OPEC and non-OPEC countries in a freeze that would boost prices, yet it ended in only more confusion across energy markets.
Prices have been battered since late 2014 after OPEC rejected calls to rein in an oversupply of 1.3 million barrels a day — but they began rising sharply in recent weeks on rumours that top producers Saudi Arabia and non-OPEC Russia would push for the freeze………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

The Organization of Petroleum Exporting Countries will resume talks at a meeting in June to reach an agreement on freezing oil output, Iraq’s governor to OPEC said just days after politics thwarted a deal to cap production and curb the global glut.
No deal will be possible without a change in “political positions,” Falah Al-Amri said on his Facebook page. Negotiations among 16 oil producers in Doha on Sunday ended without any accord after Saudi Arabia demanded all producers take part in a freeze………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

Top gold consumer China launched a yuan-denominated gold benchmark on Tuesday, in an ambitious move to exert more control over pricing of the metal and influence in the global bullion market.
The benchmark is a culmination of efforts by China over the last few years to reform its domestic gold market, attempting to gain a bigger say in the bullion industry, long dominated by London where the global spot benchmark price is set. As the world’s top producer, importer and consumer of gold, China has baulked at depending on a dollar price in international transactions, and believes its market weight should entitle it to set the price of gold………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

Yuan-denominated benchmark for the metal is a sign of China’s growing clout in the world. The yuan-denominated gold benchmark debuted in Shanghai yesterday as China took a step forward in vying to be a global price-setter for the precious metal.
The gold fix is also the latest sign that Beijing will continue to expand the role of its currency to match the country’s increasing economic might. The gold benchmark launched by the Shanghai Stock Exchange is based on a 1 kilogram-contract and was set at 256.92 yuan yesterday morning………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

The last 24 days mark the longest period in which bitcoin prices have been less volatile than gold prices. Digital gold is starting to look slightly more stable than its physical counterpart.
Since its inception several years ago, bitcoin has seen wild prices swings as advocates have tried to establish the nascent technology as a widely-used digital currency. But for the past three weeks, the price volatility of bitcoin has remained below or equal to that of safe-haven gold, according to data analysis from FactSet and CoinDesk………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

So much for the idea that silver is the “poor man’s gold.” Lately, silver has been on a hot streak — up 22% so far this year — making it one of the best investments of 2016. The rally has outshone gold’s 18% gain so far this year.
On Tuesday, silver shot up 4.5% to its highest level in 11 months. The price of silver has always been just a fraction of gold’s, but precious metal experts have pointed out for weeks — if not months — that silver has been trading a real bargain………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

As gold prices have surged this year, silver has lagged far behind. Now, the metal known as “poor man’s gold” is starting to play catch up. On Tuesday, silver hit its highest level in more than 10 months, and its more than 4% gain helped silver narrow its price gap with gold.
The gold-to-silver ratio fell to its lowest level in four months on Tuesday at 74. In March, the ratio hit its highest level since 2008 at 83, according to FactSet data. That recent divergence in price has sparked some buying in silver, as traders bet that the ratio between gold and silver will revert back to its average level………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

Gold, one of this year’s best performing assets, has room to extend its advance, according to top-ranked forecasters, even as the rebound shows signs of losing steam. Capital Economics Ltd. and Cantor Fitzgerald LP are bullish as real interest rates will probably stay low even if the Federal Reserve raises borrowing costs in response to higher inflation.
Bullion may surge to $1,350 an ounce by the year-end, says Simona Gambarini, an economist at Capital Economics in London. The metal will continue to climb, though at a slower pace, says Rob Chang at Cantor Fitzgerald in Toronto. Gold traded at $1,235 on Monday………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

The Platts ex-works Shanxi alumina spot assessment stood at Yuan 1,980/mt ($306/mt) full cash terms on Tuesday, up Yuan 20 from Monday, up Yuan 30 on the week and Yuan 50 on the month. Alumina prices have been tracking domestic metal prices higher this week, and are expected to continue testing higher in the near term should aluminum prices remain supported, market participants said.
The front-month aluminum contract on the Shanghai Futures Exchange hit an eight-month high on Tuesday to close at Yuan 12,020/mt. The last time the SHFE price was above this level was on August 14, 2015, when the front-month price settled at Yuan 12,030/mt………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

With negative interest rates dominating international headlines and the benchmark 10-year U.S. treasury yields slipping to below 2%, there is huge demand for income ETFs. Yield-hungry investors have rushed to high-dividend securities and ETFs in search of steady current income.
Global growth continues to flounder and the Fed is in no mood to hike rates frequently this year suggesting continued outperformance by dividend ETFs. That being said, we would like to note that current income turns futile if you end up paying high expenses for a high-dividend or high-income ETF……………………………………….Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

It’s a big day for exchange traded funds in Canada. Not only has Sphere Investments — a new ETF provider — launched a suite of funds, but Sprott Asset Management announced a new ETF that hopes to monetize Internet hype.
The Sprott BUZZ Social Media Insights Exchange Traded Fund will use Twitter, Facebook and other social media platforms to identify — and invest in — companies with strong Internet sentiment, said John Ciampaglia, Head of ETFs at Sprott, in a release………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

How do Swiss-based commodities giants Glencore or Vale operate in the field and what are the consequences of their work for those living there? A new documentary by respected Swiss director Daniel Schweizer takes a rare look behind the scenes of this industry.
“Today some of the biggest extraction and trading firms are based between Geneva, Zug and Lausanne. Switzerland has a great responsibility accepting them here and monitoring them so little,” declared Schweizer at the world premiere of his new documentary Trading Paradise, shown at the Visions du Réel film festival in Nyon last weekend………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

When it comes to predicting commodity market moves for 2016, farmers and ranchers should look at past economic and weather trends across the globe. Jim Bower of Bower Trading says producers need to look on a more international scale than a local level for prices and risk management this year.
Bower: “The change in commodities is that it has gone very much international in scope. There is an international awareness. You really can’t get your pricing or your trading right unless you have the international backdrop. Now you can overlay it with technical factors which you can do yourself or with an advisor to fine tune your program. Don’t look at just the local or regional — look at the international that is where you get your success.”……………………………………….Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

Commodity currencies rose on Tuesday with the Australian dollar hitting a 10-month high, while the yen edged lower after oil prices appeared to stabilise from a sharp slide, underpinning risk sentiment. The Australian dollar touched a high of $0.7784 at one point, its best level since last June. It last stood at $0.7773, up 0.3 per cent from late US levels on Monday.
The Aussie and other commodity currencies benefited from oil’s bounce off lows touched on Monday, when they came under pressure after major oil producing countries failed to agree on an output freeze on Sunday………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

Banknotes are changing - with the look and feel of the cash in our pockets going through significant changes in the coming years. The Bank of England’s first plastic banknote will enter circulation in September, when the new £5 note featuring Sir Winston Churchill is issued.
A plastic £10 note will be issued in 2017 and the £20 plastic note will be in circulation by 2020, the Bank says. They will eventually replace cotton paper notes, which have been used for more than 100 years………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

The New Zealand government may have participated in major climate fraud through the use of dodgy “hot air” carbon credits issued by the Ukraine and Russia, according to a new report from the Morgan Foundation. The Emissions Reduction Units from the two countries did not represent true emissions reductions, Morgan Foundation economist Geoff Simmons said.
His report, Climate Cheats, also said that proportional to national emissions, NZ had been the largest purchaser of the credits worldwide through its Emissions Trading Scheme to the tune of $200 million………………………………………..Full Article: Source

Posted on 20 April 2016 by VRS |  Email |Print

Greenhouse gas emissions from Irish companies in the EU Emission Trading Scheme rose by almost 6% last year, to the highest level in four years. According to the Environmental Protection Agency emissions from the cement and aviation industries grew by 11%.
Emissions from the power generation sector were also markedly up, around 5.3%, driven by an increase in use of the coal-fired plant at Moneypoint for electricity generation. The food and drink sector saw a 4.6% rise in its emissions………………………………………..Full Article: Source

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