Commodity Blog

Archive for October, 2009

Corn slumped to the lowest since August and soybeans slid on speculation that farmers in the U.S., the largest producer and exporter in the world, spurred sales to take advantage of the highest prices since before the harvest. The three-week rally in prices was caused by rains in the Midwest that has cut harvesting to half the five-year pace by October 18th and threatened to hurt crops. The corn yield may reach 25 percent this week and soybeans yield should reach about 50 percent. That should ease some of the concern that the crops can be damaged by the bad weather. December futures for corn delivery slumped $0.1475 (3.7 percent) to $3.83 per bushel by 12:07 on the Chicago Board of Trade. January futures for soybean delivery slid $0.1725 (1.7 percent) to $9.9025 per bushel on CBoT.

Gold declined the lowest in more than a week because the strengthening dollar cut the attractiveness of the precious metal as an inflation hedge. Gold typically moves inversely to the dollar. Thus a lot of people are looking at the performance of the dollar, tending to buy gold when the dollar declines. December futures for gold delivery declined $13.60 (1.3 percent) to $1,042.80 on NYMEX.

Latest commodity prices (ICE, NYMEX, CME) as of 17:31 GMT:

Oil (Brent) — $77.17
Gold — $1,038.58
Silver — $17.08
Palladium — $329.50
Platinum — $1,353.52
Copper — $6,540.00
Aluminum — $1,989.00
Nickel — $18,650.00
Zinc — $2,290.00
Cocoa — $3,355.00
Sugar — $23.16
Corn — $378.00
Soybean — $38.15

The technical analysis, that includes the indicators’ data and major pivot points for Brent Oil, Gold, Silver and Copper as traded on spot market as of October 25th 2009:

In the last 10 months on the weekly silver chart the bearish Wolf Wave pattern has formed. In case of the resistance level (yellow line at 15.76) breakout pattern will be confirmed and the withdrawal downward approximately along the line of the gray arrow may be possible. Click to enlarge the image to a full-size screenshot:

China will increase buying of gold, as the economy rebounds, to expand its gold holdings. China’s percentage of holdings in gold is underweight. China most likely will be accumulating gold in its reserves to increase the percentage. It would have a significant impact on the demand.

1,054 tons of China’s gold represents less than two percent of its reserves. China, the biggest gold producer in the world, has increased its reserves by 76 percent since 2003.

Record government debt and low interest rates cause investors to be concerned about the prospect of rising inflation and currency debasement, pushing gold to records. Immediate delivery for gold traded as much as $1,058.27 per ounce at 16:02 in Singapore.

Latest commodity prices (ICE, NYMEX, CME) as of 17:17 GMT:

Oil (Brent) — $79.33
Gold — $1,056.63
Silver — $17.70
Palladium — $335.50
Platinum — $1,364.94
Copper — $6,656.00
Aluminum — $1,976.00
Nickel — $19,200.00
Zinc — $2,268.50
Cocoa — $3,368.00
Sugar — $23.24
Corn — $403.00
Soybean — $38.76

Copper tumbled from a 13-month high in New York as the dollar rebounded, lowering the attractiveness of the metal as an inflation hedge. The dollar went up on speculation that China may cut investments to stimulate economy as the country’s gross domestic product grew fastest in a year in the third quarter and inflation sped up. Production of copper and aluminum in China increased 8 percent in September from the prior month, leading to concern about excess production. December delivery for copper slid $0.0345 (1.1 percent) to $3.0015 per pound by 9:48 on the New York Mercantile Exchange’s Comex unit.

Cotton prices slumped this week as the dollar gained, eroding the attractiveness of commodities from the U.S. The dollar rebounded against the euro after reaching a 14-month low yesterday. Declining exports also have negative impact on cotton prices. December futures for cotton delivery slumped $0.0042 (0.6 percent) to $0.6796 per pound as of 11:59 on ICE Futures U.S. in New York.

Latest commodity prices (ICE, NYMEX, CME) as of 18:14 GMT:

Oil (Brent) — $79.14
Gold — $1,059.80
Silver — $17.56
Palladium — $335.00
Platinum — $1,358.70
Copper — $6,580.00
Aluminum — $1,963.00
Nickel — $19,250.00
Zinc — $2,239.50
Cocoa — $3,388.00
Sugar — $23.09
Corn — $404.75
Soybean — $38.77

Gold advanced in New York as the weakening dollar increase the attractiveness of the precious metal as a hedge against inflation.

A change in gold prices depends on the dollar. The head dealer at Integrated Brokerage Services LLC in Chicago predicts that we “are going to see continued erosion in the dollar.” This situation is very bullish on gold.

The U.S. Dollar Index dropped 0.7 percent to a 14-month low. Gold futures reached a record of $1,072 per ounce on October 14th and have jumped 20 percent this year as the dollar index has fell 7.6 percent.

December delivery for Gold futures advanced $1.50 (0.1 percent) to $1,060.10 per ounce by 11:03 on the New York Mercantile Exchange’s Comex division.

Latest commodity prices (ICE, NYMEX, CME) as of 15:48 GMT:

Oil (Brent) — $78.76
Gold — $1,058.86
Silver — $17.68
Palladium — $337.50
Platinum — $1,353.12
Copper — $6,595.00
Aluminum — $1,970.00
Nickel — $19,725.00
Zinc — $2,240.00
Cocoa — $3,383.00
Sugar — $23.95
Corn — $396.75
Soybean — $38.26