World oil and metals prices rally
LONDON, March 25: World crude oil prices rose this week following more volatile trading, while copper and zinc hit historic highs owing to low inventories of base metals. The Commodities Research Bureau’s index of 17 commodities climbed to 328.35 points on Friday, from 327.70 points the previous week.
GOLD: Gold prices advanced but failed to perform as well as other metals.
Gold remains the laggard in the precious metals sector as prices continue to struggle around the 550-dollar mark despite strength in the rest of the commodity complex, Barclays Capital analyst Yingxi Yu said.
The big move up in oil prices failed to rekindle much fund interest in gold, while a sharp rise in the dollar put additional weight on an already lacklustre market.”
On the London Bullion Market, gold prices gained to 556.75 dollars per ounce at Friday’s late fixing from 552.75 dollars the previous week.
SILVER: Silver prices hit a fresh 22-and-a-half-year high.
On Friday, silver prices reached 10.745 dollars per ounce — the highest level since September 1983. Prices have risen 19.0 per cent since the start of the year.
Silver was boosted by news Tuesday that the Securities and Exchange Commission, a US government financial watchdog, gave its backing for a silver fund to begin trading on the American Stock Exchange (AMEX).
“Although there are still a few regulatory hurdles to clear, traders bought and borrowed silver on this news,” UBS analyst John Reade said.
On the London Bullion Market, silver prices rose to 10.68 dollars per ounce at Friday’s fixing, from 10.36 dollars the previous week.
PALLADIUM AND PLATINUM: Platinum and palladium prices gained in the wake of silver.
Palladium rose to 326.5 dollars per ounce on Friday, the highest level since April 2004.
“The firm mood in silver seems to be adding support to the more industrial Platinum group metals,” said James Moore, analyst for specialist website TheBullionDesk.com. As well as being used to make jewellery, silver is needed by industry, particularly in the making of cameras.
On the London Platinum and Palladium Market, an ounce of platinum advanced to 1,042 dollars per ounce at the late fixing on Friday, compared with 1,033 dollars the previous week.
Palladium gained to 324 dollars per ounce on Friday, from 316 dollars.
BASE METALS: Base metals prices advanced, led by copper and zinc which hit historic high points owing to low inventories of the commodities.
Copper prices hit a record high 5,255 dollars per ton on Friday, while on Thursday zinc touched 2,585 dollars per ton, also a historic peak.
“Stocks fell across the board” as the sector heads into the peak demand season, said UBS analyst Robin Bhar. “Industry reports suggest that demand remains strong and order books are robust.”
On Friday, three-month copper prices on the London Metal Exchange jumped to 5,207 dollars per ton from 5,035.50 dollars the previous week.
Three-month aluminium prices dollars climbed to 2,512 dollars per ton from 2,452 dollars.
Three-month nickel prices lifted to 15,080 dollars per ton from 14,910 dollars.
Three-month lead prices gained to 1,235 dollars per ton from 1,184.50 dollars.
Three-month zinc prices advanced to 2,543 dollars per ton from 2,452 dollars.
Three-month tin prices rose to 8,125 dollars per ton from 7,975 dollars.
OIL: World crude oil prices rose following the second volatile week in a row.
After tumbling more than 2.0 dollars in New York on Monday owing to the presence of plentiful stocks of US crude, oil prices raced higher on Thursday as the market focused on weaker gasoline (petrol) supplies.
New York crude jumped 2.14 dollars to close at 63.91 dollars on Thursday — the highest finish since February 6.
“The drop in gasoline (petrol) stocks is of particular concern ahead of the driving season, with stocks not as high as the market wants,” analysts at the Sucden brokerage firm said.
“News that gasoline demand is up 2.0 per cent on the year has increased speculation that refiners may not be able to meet booming demand” ahead, they added.
Levels of gasoline stocks are taking on a sharper focus ahead of the US peak-demand season beginning in May, when American drivers take to the open roads on vacation.
The US Department of Energy (DoE) said Wednesday that gasoline stocks fell by 2.3 million barrels last week to 221.6 million barrels. Analysts had expected them to fall by only one million barrels. Despite the drop they are marginally higher than at this time last year.
The DoE also said Wednesday that crude oil inventories slipped by 1.3 million barrels last week to total 338.6 million. However they are still nearly nine per cent above their levels a year ago.
Supply disruptions in Nigeria, Africa’s biggest producer of crude, helped also to support prices this week. Traders meanwhile tracked events over Iran amid concerns that the world’s fourth biggest producer of crude may disrupt its oil exports if punished over its controversial nuclear programme.
Trading in London had been temporarily suspended on Thursday owing to technical factors.
In London, a barrel of Brent North Sea crude for delivery in May rose to 63.56 dollars per barrel on Friday, from 63.26 dollars the previous week.
In New York, a barrel of crude for delivery in May climbed to 64.40 dollars per barrel Friday from 64.20 dollars.
RUBBER: Rubber prices firmed amid the ongoing wintering season across Asia.
Wintering refers to the low-harvest season which normally lasts between February and April across major rubber producers Indonesia, Malaysia and Thailand. However this year it has begun late and is set to end early.
“Prices seem to be holding at the moment,” said Corrie MacColl analyst Rashid Ahmed.
“Wintering is now in place in Malaysia, (but) not in Indonesia.”
On TOCOM, Tokyo’s commodity exchange, natural rubber for June delivery climbed to 245.70 yen per kilogramme on Friday, from 243.10 yen the previous week.
Singapore’s RSS 3 June contract increased to 206.75 US cents per kilogramme on Friday, from 205.50 cents.
COCOA: Cocoa prices fell on profit-taking after spiking to a one-month high the previous week.
Prices were “depressed by trade and speculative selling”, Sucden analysts said.
On the LIFFE, London’s futures exchange, the price of cocoa for May delivery dropped to 909 pounds on Friday, from 912 pounds a week earlier.
COFFEE: Coffee prices hit a three-month low point owing to forecasts of an abundant harvest.
In New York, prices slid to 103.50 dollars per pound, the lowest level since December 22.
SUGAR: Sugar prices gained in line with higher oil futures. Sugar cane is used to produce ethanol, a cheaper alternative to gasoline or petrol.
“Sugar remains well supported on expectations that Brazil will divert a larger proportion of sugar into the production of ethanol at a time of higher crude prices,” Sucden analysts said.
By Friday on LIFFE, the price of a ton of white sugar for May delivery climbed to 448 dollars, down from 439.50 dollars the previous week.
On NYBot, the price of unrefined sugar for May delivery advanced to 16.92 US cents per pound on Friday, from 16.46 cents.
GRAINS AND SOYA: Grain and soya prices mostly fell owing to rainy weather in leading producer the United States, which is deemed favourable for crop growth.
“There is good moisture for the spring wheat region which is going to be planted fairly soon,” Allendale analyst Joe Victor said.
On the LIFFE, the price of aonne of wheat for May delivery edged up to 72.40 pounds late Friday, from 72 pounds a week earlier.
On the Chicago Board of Trade, the price of wheat for May delivery fell to 3.44 US dollars per bushel on Friday, from 3.56 dollars.
Maize for May delivery dropped to 2.21 dollars per bushel Friday from 2.24 dollars.
May-dated soyabean meal — used in animal feed — stood at 5.78 dollars per ton, unchanged from a week earlier.
WOOL: Wool prices dropped in major exporter Australia, owing largely to the release onto the market of poor quality wool, the Australian Wool Industries Secretariat said.
The Australian Eastern index fell to 7.44 Australian dollars per kilo on Thursday, from 7.51 Australian dollars the previous week.—AFP