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The latest data from the EIA suggest that the surge in gasoline stocks may have run its course as demand picks up, but stocks of crude oil are likely to continue to rise. … US Weekly Petroleum Status …
11th March 2015
Although the price of corn has been boosted by a downward revision to estimated global year-end stock levels, this isn’t enough to alter the underlying market situation. We continue to expect the price to end the year lower. … Corn stocks revised down, …
Factors unrelated to physical demand continue to drive stock movements. However, a lull in activity around Chinese new year was also an issue in February. We expect the rise in copper stocks to be reversed later in the year as supply disappoints. … Copper …
Investor enthusiasm for agricultural commodities waned further over the lastmonth. Indeed, for eight of the commodities we cover and have Commitment ofTraders data, five saw a fall in net-long non-commercial positions. Moreover,the total number of …
We expect US oil production to peak in the middle of this year as the backlog of drilled but uncompleted wells is used up. This should help support oil prices, especially in the US, in the second half of this year. … How do lower rig counts affect oil …
10th March 2015
The prospect of further gains for the US currency remains a major headwind for commodity prices. However, the dollar has already appreciated a long way and, if it continues to climb, much would still depend on the reasons why. If dollar appreciation …
We expect additional Chinese stockpiling to increase demand for agricultural commodities over the next few years. This should add a bit of support to prices, but the fundamentals of individual commodities will still be far more important for prices than …
9th March 2015
China’s commodity import volumes fell in February but this was hardly surprising given the long mid-month holiday. We expect demand to start recovering in March, boosted by low prevailing prices. … China’s commodity import data still distorted by …
Most commodity prices fell this week even before the strong US payrolls data raised expectations of early Fed tightening and further dollar strength. While recognising that both developments have negative implications for commodity prices, the robust US …
6th March 2015
US steel prices have plummeted since late 2014 but perhaps what is more surprising is the fact that they had not fallen earlier. Market conditions suggest prices will continue to struggle this year, but we expect a modest rebound in 2016 as the market …
We expect global demand for coal to be subdued and prices to fall further over the next few years as China continues to turn its back on coal. However, the downside should be limited by growing demand from other emerging markets and by falling coal …
5th March 2015
After recording a small surplus in 2014, we expect the tin market to plunge back into deficit this year and prices to rise. As such, any attempt by Indonesia’s producers to curb exports may be unnecessary. … Tin prices to rise even without an Indonesian …
A lack of Chinese buyers because of the new year holiday was a key factor weighing on metals prices in February. Only copper prices rose, perhaps in part reflecting encouraging economic data out of the euro-zone and China. … Copper provides a glimmer of …
4th March 2015
US oil stocks increase by the largest amount in over a decade, but fears about storage capacity constraints seem overdone. … US Weekly Petroleum Status …
A deal between Iran and the West which allows for the removal of sanctions on Iranian oil exports is looking more likely. However, as always, the devil is in the detail. The most likely scenario in our view is a gradual return of Iranian exports over the …
Concerns about demand coupled with the return of South African production are weighing on platinum prices. However, we think that demand will pick up, particularly in China, and that platinum prices will rise this year. … Will platinum prices …
3rd March 2015
The price of Brent staged a remarkable rebound early in the month, while the copper price also made up some lost ground, with the result that the GSCI commodities index managed to outperform US equities in February. … Commodities on the way …
2nd March 2015
Metals prices have shown some of the largest gains in the past week, benefitting from some better news on the global economy including stronger manufacturing PMI surveys in China and the euro-zone. Gold prices have been stable despite fading fears of an …
27th February 2015
The announcement that the Thai government is planning to clear its rice stockpiles in just two years should put significant downward pressure on rice prices over this time period. … Faster sales of Thailand’s rice stocks should pull down …
Lower bauxite availability, owing to the Indonesian export ban, and dwindling Chinese stocks will impede alumina production this year, leading to higher prices. … Bauxite shortfall to support alumina …
The Indian government’s budget, to be unveiled this weekend, is widely expected to include a cut in the import duty on gold. This should provide a further boost to the local market following clarification of the rules on the amounts of gold that can be …
We do not expect the latest dispute between Russia and Ukraine over natural gas to disrupt the supply to Western Europe. But even if did, the EU should still be able to cope reasonably well as warmer weather reduces seasonal demand for gas and alternative …
Copper has fallen dramatically out of favour since the start of 2015. Prices have dropped nearly 10% since the beginning of the year. Projections of strong growth in mine supply and concerns about demand, particularly from China, have led to investor …
26th February 2015
We doubt that there will be an extraordinary meeting of OPEC anytime soon and, even if there is, policy is unlikely to change. The cartel’s current strategy of tolerating price falls to protect market share over the longer term appears to be working. …
The latest data show that US oil stocks are climbing at an increasing rate as maintenance work at refineries means that even more oil is funnelled into storage. … US Weekly Petroleum Status …
25th February 2015
A fast-changing regulatory background is becoming increasingly important to global energy markets. In this Energy Watch, we examine how the recent fall in oil prices has affected the outlook for US energy exports, both of oil and gas, and how these …
Today’s February PMI data provide further evidence that China’s economy is stabilising. Fading fears of a “hard landing” should therefore support the prices of industrial commodities, especially metals. The latest PMIs from the euro-zone, US and Japan …
Even though industrial metals prices were dragged lower by the fall in the price of oil last year, they have yet to benefit from Brent’s recent recovery. Indeed, the futures curves for most industrial metals have fallen further over the past month. … …
24th February 2015
The preliminary 2014 data from the International Lead and Zinc Study Group (ILZSG) show another year of deficit in the global zinc market, while the lead market was effectively in balance. With production of both metals expected to struggle this year, …
Weather-related factors were responsible for the biggest moves in individual commodity prices in the past week: a cold snap in the US drove up the cost of natural gas, while further rains across key growing areas of Brazil undermined the price of arabica …
20th February 2015
Aluminium price premiums should fall in 2015 based on supply and demand fundamentals. Admittedly, they have not been easy to justify on these grounds for some time. But we think changing dynamics in the market this year should finally pave the way for …
Today’s US weekly export sales data show a further slump in demand for US wheat. And while exports of soybeans also fell sharply, this is likely, at least in part, to be due to seasonal factors related to the Chinese New Year holiday. … USDA Weekly Export …
World Steel Association (WSA) data for January 2015 showed a fall in global steel output, led by Asian producers. It could be that the oversupply in the Chinese market is at last leading to producer cutbacks. … Global Steel Production (Jan. …
The much-hyped “super-cycle” of rising commodity prices, driven by rapid growth in China since the early 2000s, probably ended some years ago. Future cycles are likely to be smaller in magnitude, and shorter in length. Nonetheless, commodities are still …
Agricultural commodities have faced a number of opposing pressures over the last month, including the further strengthening of the US dollar and the partial recovery in the price of crude oil. But supply-related issues were the main driver of price …
There is no sign of a drop off in US oil production in the latest data, nor any pick-up in demand, as US oil stocks surge again. … US Weekly Petroleum Status …
19th February 2015
The demand for gold often follows a seasonal pattern due to the timing of festivals associated with gift-giving, such as the Chinese New Year. But the calendar appears to have little impact on the price of gold on global markets. Indeed, there are …
A combination of lower production and higher demand means that US natural gas prices should rise over the next few years, regardless of the weather. … US natural gas to burn brighter this …
18th February 2015
Today’s 2% fall means that gold has now given up most of its price gains from earlier this year. This is perhaps surprising given the ongoing uncertainty over Greece and the conflict in Ukraine, but for now the markets appear to be paying more attention …
17th February 2015
Falling ore stocks at China’s ports and lower ore exports from the Philippines are likely to curb Chinese refined nickel output this year. Given steady demand growth, prices should rebound. … Dwindling surpluses to boost nickel …
The rally in coal prices this year is unlikely to be the start of a sustained turnaround in fortunes for the beleaguered market. Stronger demand from India may continue to support prices over the next few months but declining Chinese imports and a …
The further decline in the Baltic Dry Index (BDI), to its lowest level since the series was first compiled in 1985, provides some more colour on current trends in the supply and demand for ships and in trade flows. Nonetheless, the BDI adds little to what …
16th February 2015
US wheat exports have struggled this year as the rising US dollar reduces competitiveness. We think the same could happen to soybean exports as the South American harvest gets under way. … Strong dollar likely to dent US soybean …
The rebound in global oil prices has lifted Brent crude back to $61 per barrel, slightly above our existing forecast for the end of the year but consistent with our central scenario of a recovery to $70 over the medium term. With declining rig counts in …
13th February 2015
It would be wrong to write off gold this year purely on the basis that the Fed is likely to start to raise interest rates, probably in June. We expect the withdrawal of monetary stimulus in the US to be gradual, leaving plenty of scope for other, more …
The rebound in the price of Brent over the last two weeks supports our view that oil prices will gradually climb back to around $70 per barrel over the medium term helped on their way by further evidence of reductions in investment. However, we do not …
Expectations of strong growth in US and Chinese auto output and sales in 2015 underpin our forecast of a recovery in palladium prices. At the same time, supply remains constrained. … Strong demand to lift palladium …
Concerns about global growth prospects, and particularly the slowdown in China, have reportedly been a key factor in the recent falls in metals prices. However, we would argue that these fears are overdone and that physical metals demand will hold up …
12th February 2015
The main story since the beginning of the year has been the recovery in the price of oil, which is now 20% above its recent lows, reflecting the first signs of supply cuts in response to the previous drop. This year has also seen a rebound in coal prices, …
Lower input costs, weakening demand and overproduction led to sharp falls in Chinese steel prices over the last year. In our view, these factors will continue to weigh on the Chinese steel market in 2015, suggesting that prices could fall further. … …
