June 03, 2007	Sunday	Jamadi-ul-Awwal 17, 1428

LONDON, June 2: Metal prices jumped higher this week as the US dollar struggled to find higher ground, while lead hit a record high on worries over critically low stockpiles and Chinese demand.Oil prices fell as US refineries began restarting production following disruptions, but losses were capped by falling US crude reserves and geopolitical jitters in Nigeria.

GOLD: The price of gold advanced.

The precious metals complex put in a positive performance, said Barclays Capital analyst Suki Cooper, adding that “gold prices rose as prices tracked dollar weakness. A weaker US currency tends to increase demand for dollar-denominated commodities, such as gold, as they become more expensive for buyers holding other currencies.

However, the dollar firmed towards the end of the week after non-farm payroll data came in slightly stronger than expected.

On the London Bullion Market, gold climbed to $666.50 an ounce at Friday's late fixing, from $655.30 a week earlier.

SILVER: Silver prices jolted higher this week, holding above $13 an ounce following strong gains by sister metal gold.

On the London Bullion Market, silver jumped at $13.53 an ounce at Friday's late fixing, from $12.92 a week earlier.

PALLADIUM AND PLATINUM: Both platinum and palladium gained ground.

Barclays Capital analysts said that the platinum prices could climb higher this year due to more supply disruptions.

On the London Platinum and Palladium Market, platinum rose to $1,290 an ounce at the late fixing Friday, from $1,276 a week earlier.

Palladium climbed to $371 an ounce, from $367.

BASE METALS: The price of lead hit an all-time record of $2,380 a ton Friday on the London Metal Exchange, while other base metals also bounded higher.

Lead, which is used extensively for batteries and in the automotive industry, found solid price support from low global stockpiles.

We anticipate further upside risk to lead, in light of the market's tightness amid supply disruptions, strong demand from the battery sector, and recent changes to China's lead export taxes, said Barclays Capital analyst Suki Cooper.

China has said it would place a tax of between five and ten per cent on lead exported by the Asian nation.

Copper also advanced on dwindling inventories of the metal.

On Friday, three-month copper prices surged to $7,420 a ton on the London Metal Exchange, from $7,120 a week earlier.

Three-month aluminium prices rose to $2,812 a ton from $2,783.

Three-month nickel prices gained to $47,595 a ton from $47,005.

Three-month lead prices leapt to $2,355 a ton from $2,175.

Three-month zinc prices climbed to $3,710.50 a ton from $3,600.

Three-month tin prices rose to $14,050 a ton from $13,950.

OIL: Crude oil prices slid on an easing supply picture.

Several major oil companies, such as ConocoPhillips, Citgo and Valero, announced that problems at their refineries in the United States had been resolved.

And British energy giant BP's vast Prudhoe Bay oil field in Alaska was back to operating at full capacity after a recent water pipe leak.

But analysts said the US refinery problems would continue to weigh on gasoline or petrol supplies.

Despite some refiners resuming production, the huge deficit in gasoline stocks is unlikely to be resolved anytime soon, said Mike Fitzpatrick of Man Financial.

London Brent crude had neared $72 per barrel last week as traders fretted over below-normal levels of gasoline reserves heading into the peak-demand driving season in the United States.

The US driving season, which began last weekend, sees many Americans hit the highways for their holidays -- sparking a rush for gasoline.

However, the US Department of Energy has revealed that gasoline stocks rose by 1.3 million to 198 million barrels in the week ending May 25 -- which was in line with forecasts for an increase of 1.5 million.

Sucden analyst Michael Davies added: The market continues to draw support from geopolitical concern and especially from civil unrest in Nigeria.”Nigeria is the world's sixth biggest crude producer and the biggest on the African continent, but unrest has cut the country's production by about 25 per cent.

Brent North Sea crude for July delivery fell to $67.91 per barrel on Friday, compared with $70.69 per barrel at the close on Friday of the previous week.

New York's main oil futures contract, light sweet crude for delivery in July, sank to $64.33 per barrel, from $65.20 a barrel the previous week.

COCOA: Cocoa prices drifted lower.

Cocoa futures closed down amid speculative selling, Sucden analyst Michael Davies said.

By Friday on the LIFFE, the price of cocoa for July delivery slipped to 1,021 pounds a ton, from £1,057 a week earlier.

On the New York Board of Trade (NYBOT), the July contract decreased to $1,868 a ton, from $1,918.

COFFEE: Coffee prices hit a new multi-year high in London as investors eyed a low harvest in leading producer Vietnam.

The price of Robusta coffee surged on Friday to $1,776 per ton -- which was last seen in January 1999.

Bullish market fundamentals still remain intact, with many investors concerned about tight supplies in Vietnam, Davies said.

By Friday on the LIFFE, Robusta quality for July delivery edged up to $1,766 a ton, from $1,729 a week earlier.

On the NYBOT, Arabica for July delivery gained to 114.80 US cents a pound, from 112.85 cents.

GRAINS AND SOYA: Grains and soya prices rose as traders said that hot weather in key producers had cut crop output.

Drought in Ukraine, Russia and dry weather talk in China is helping to support the wheat prices,” said Allendale analyst Joe Victor.

He added: Next week, the US Midwest could be hit by some hot dry weather.”By Friday on the Chicago Board of Trade, the price of maize for July delivery jumped to $3.91 a bushel, from $3.76 a week earlier.

Wheat for July delivery climbed to $5.27 a bushel, from $5.01.

July-dated soyabean meal -- used in animal feed -- increased to $8.14, from $8.13.

On the LIFFE, London's futures exchange, the price per ton of wheat for November delivery increased to 103.80 pounds, from 102.75 pounds the previous week.

SUGAR: Sugar prices fell. Investors are still reluctant to take long term positions in sugar as fundamentals remain bearish on the prospect of a large global surplus for this season, Davies noted.

By Friday on the LIFFE, the price per ton of white sugar for August delivery eased to $334, from $340 a week earlier.

On the NYBOT, the price of unrefined sugar for July delivery slid to 9.25 US cents a pound, from 9.29 cents.

RUBBER: Rubber prices fell in line with losses at the Tokyo Commodity Exchange (TOCOM), but a tight supply situation was expected to ease with drier weather in coming months.

The wintering season is almost over. We expect production to pick up in June, July and August, said an official with a rubber production firm, who asked to remain anonymous.

On Friday, the Malaysian Rubber Board's benchmark SMR20 fell to 223.7 US cents per kilogramme, from 231.65 cents the previous week.

WOOL: Wool prices in major producer Australia hit season highs, with the four main indicators all rising above 10.0 Australian dollars a kilo for the first time since April 2003.

Buyers for China continue to dominate the market, said the Australian Wool Industry Secretariat.

The Australian wool market finished 0.8 per cent higher on average this week, with the Eastern Index ending at 10.16 Australian dollars a kilo, compared with 10.08 Australian dollars the previous week.---AFP