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According to the International Aluminium Institute (IAI), global primary aluminium output rose by 11.3% y/y last month, broadly unchanged from the 11.4% growth rate in January. … Global Aluminium Production …
20th March 2017
It has been an eventful week in commodity markets but, for the most part, prices have risen. The US 25bp rate hike on Wednesday was widely anticipated so markets chose to focus on the fact that the Fed left its economic and interest rate expectations …
17th March 2017
The prices of most commodities rose in the wake of the 25bp hike in US interest rates and the 10bp rise in China’s interest rates this week. While tighter monetary policy represents a headwind for commodities, supply and demand factors can be more …
Steadily rising crude stocks and falling prices have made it more likely that OPEC will prolong its production cuts beyond June. However, there are significant hurdles which will need to be overcome before members, particularly Saudi Arabia, will agree. … …
16th March 2017
Yesterday’s US rate hike was widely anticipated, but we expect the Fed to accelerate the pace of tightening in 2017. That said, US interest rates will remain historically low and, in any case, other factors will probably continue to be more important …
Crude oil stocks declined slightly last week, after rising for nine consecutive weeks, as net imports fell sharply. Product stocks also continued to slump. … US Weekly Petroleum Status …
15th March 2017
The latest data show that central banks’ holdings of gold increased in January. However, we think that a strong US dollar will be a major headwind for gold demand from the official sector this year. … Central banks’ gold demand starts the year on a …
China’s activity and investment data for the first two months of the year point to robust metals demand. However, we are wary that this may represent the high point of 2017, given signs of a steadily tightening policy environment. … China Industrial …
14th March 2017
OPEC continued to reduce its production in February. However, the group also revised upwards its expectations for non-OPEC output. … OPEC production falls as compliance …
South Africa’s overall mine production recovered slightly in January, as higher prices acted as an incentive for producers to increase output. The strength in the output data was broad-based, with gold the only significant exception … South Africa’s Mine …
It has been a disappointing week for commodity prices, against a backdrop of a stronger dollar and the likelihood of an imminent rate hike in the US. The strong US employment report on Friday removed the last obstacle to Fed tightening. Investor selling …
10th March 2017
The big story this month is an unexpected surge in LME copper stocks, which appears to be related to investors closing long positions in the futures market. At the same time, China’s exchange stocks have continued to rise, pointing to lacklustre demand. … …
After rising for most of February, gold prices have slumped in recent days, falling below the $1,200 per ounce mark, on expectations that the Fed will press ahead with a rate hike next week. We expect prices to fall further over the coming months as the …
A return to more normal levels of volatility in oil prices seems likely over the next few months as investors question the effectiveness of OPEC’s production cuts. However, we still expect prices to recover in the second half of the year as demand …
Oil prices were remarkably quiet in February. Indeed, the price of Brent moved by less than $2 per barrel during the month, but prices have fallen so far in March. February proved to be a more volatile month for the prices of most other energy …
9th March 2017
While we have been positive on the prospects for cobalt prices for some time now, we think that the most recent rally is overdone. Admittedly, the market is tightening. But, in our view, the move-up in prices to the highest level since November 2008 has …
8th March 2017
In late February, the US Department of Agriculture (USDA) published its first assessment of the prospects for US crops in 2017/18. In this Commodities Watch, we will discuss the USDA’s forecasts and what we think they imply for prices. Although, so far, …
Crude oil stocks rose sharply last week as imports and output increased and inputs to refineries fell. But product stocks declined by even more, as demand edged higher. … US Weekly Petroleum Status …
China’s commodity import volumes remained strong in February, despite generally higher prices. However, we are reluctant to read too much into the data given the usual seasonal distortions. … China’s commodity imports holding up …
The big news this week was the ratcheting up of expectations of an imminent rate hike by the Fed, which weighed on most commodity prices. That said, the prices of US grains and soybeans rose, on optimism that President Trump will support the biofuels …
3rd March 2017
The prices of some industrial metals eased back in February, but the bigger picture is that they broadly held on to the gains made in January. A combination of optimism about demand, notably in the US and China, and concerns over supply supported prices. …
US crude oil inventories increased again last week, for the eighth consecutive week. On the other hand, gasoline and distillate stocks fell. … US Weekly Petroleum Status …
1st March 2017
Both the official and unofficial February manufacturing PMIs for China surprised on the upside. However, much of the growth was driven by higher export orders, which we think are unlikely to be sustained. Moreover, signs of a slowdown in construction is …
Most commodity prices traded in a narrow range last month, in the absence of clarity on developments in China (owing to the Lunar New Year Holiday) and on US policy direction. That said, the price of gold was a beneficiary of the heightened uncertainty. … …
The latest import data out of China and India show weak demand for gold in the two largest consumers. While China’s data could be distorted by the timing of the New Year, in India the liquidity crunch continues to weigh on gold imports. … China and …
27th February 2017
The price of spot LNG in Asia has been in freefall in recent weeks as temporary supply outages have been resolved and demand has cooled. We expect prices to fall further given ongoing expansions to output. … Surging supply to keep a lid on LNG …
Commodity prices were broadly unchanged this week, aside from a few notable exceptions. Cobalt was the star performer as concerns about supply and expectations of strong demand led to a surge in prices, albeit in a relatively thin market. Elsewhere, the …
24th February 2017
Optimism about demand, fuelled by a pick-up in China’s activity data and the prospect of fiscal stimulus in the US, continues to buoy investor sentiment in the industrial metals markets. However, there are now signs that China’s economy is starting to …
China’s metals imports were broadly weak in January. This is in line with the most recent activity data which show that the Chinese economy, while still holding up well, may have lost some momentum in January. That said, shifts in the timing of the …
US crude oil inventories increased last week, marking seven weeks of consecutive gains, though at a slower rate. On the other hand, gasoline stocks fell. … US Weekly Petroleum Status …
23rd February 2017
Donald Trump’s proposed restrictions and tariffs on trade could cause turmoil in both the domestic and international energy markets if enacted. This Energy Watch takes a first look at what some of the possible implications of a general import tariff or …
22nd February 2017
World Steel Association (WSA) data, released this afternoon, show a 7% y/y rise in global steel output in January. Production in all major producing regions rose, which is in stark contrast to the start of 2016, when output fell sharply. … Global Steel …
21st February 2017
According to the International Aluminium Institute (IAI), global primary aluminium output rose by 11.4% y/y last month, up from 7.8% y/y in December, led by a 19% y/y surge in China’s production. … Global Aluminium Production …
20th February 2017
While a slight weakening of the US dollar provided some support to prices this week, individual demand and supply fundamentals were the main drivers. Oil prices fell as a further rise in US stocks overshadowed the more positive news of OPEC’s good …
17th February 2017
China’s exchange stocks have soared since the start of the year on a combination of optimism about demand and concerns about supply. … Stocks continue to build in …
16th February 2017
US crude oil inventories continued to rise last week, albeit at a slower rate than in the previous one. Gasoline stocks also increased, after a small reduction a week earlier. … US Weekly Petroleum Status …
15th February 2017
Oversupply has been plaguing the silver market for the past ten years. However, the latest data show that production cuts across the industrial and precious metal industries are starting to take their toll on silver mine supply. We expect silver output to …
High prices are spurring iron ore production at a time when we think demand will start to slow. As such, the recent rally in prices appears unsustainable. … Why are we so negative on the outlook for iron ore …
The prices of most commodities have risen since the start of the year, boosted by optimism about demand and, in some cases, disrupted supply. A period of weakness in the US dollar has helped, but the dollar has strengthened recently. Indeed, we are wary …
14th February 2017
Oil price increases following production cuts by OPEC and non-OPEC countries stand to be partially tempered by higher US shale oil output. Improved efficiency in the industry means that oil producers are well-placed to increase output in response to …
OPEC’s oil production dropped sharply in January as the group’s new output quota came into force. However, Iran, Libya and Nigeria continued to increase output. … OPEC reins in …
13th February 2017
Nickel ore supply is likely to fall this year which underpins our forecast of a rise in refined nickel prices. But the scale of any rally will be constrained by high prevailing stocks. … Uncertain ore supply to support nickel …
Most commodity prices rose this week despite a sharp appreciation of the US dollar. The latest data on Chinese trade, released today, show that commodity import volumes jumped in January but this could be largely due to seasonal effects since the Chinese …
10th February 2017
Commodity prices continued their strong run in the early weeks of 2017, but we are concerned that investor optimism may fade in the months ahead. Prices have been buoyed by the pick-up in China’s economic activity and the likelihood of fiscal stimulus and …
China’s commodity import volumes jumped in January, despite a further fall in the renminbi vis-à-vis the US dollar. However, the most recent activity data show that the Chinese economy, while still holding up well, may have lost some momentum at the start …
Strong growth in demand for oil and a reduction in stocks should push prices higher over the rest of this year. However, rising US interest rates and a stronger dollar are likely to act as headwinds, preventing oil prices from rising too far. … Will a …
9th February 2017
South Africa’s overall mine production fell in 2016, with all the main metals seeing a drop in output. The PGM market appears finally to be tightening but we think that it will take some time to rise further, owing to high stocks. … South Africa’s Mine …
US crude oil inventories rose by a near record level last week. But stocks of gasoline were drawn down a little. … US Weekly Petroleum Status …
8th February 2017
Global gold demand rose 2% y/y in 2016 to reach a three-year high of 4,309 tonnes. This increase was predominantly the result of strong safe-haven demand in the first half of the year. In 2017, we expect gold prices to be mainly driven by changes in US …
Donald Trump’s foreign policy, especially regarding the Middle East, is likely to have a bigger impact on oil prices in the near term than changes to domestic energy policies. … US foreign policy is a major upside risk for oil …
6th February 2017
