Commodity Blog

Posts Tagged ‘CME’

Hog futures rose today, but the increasing food prices prevented the US farmers from expanding their herds, potentially resulting in lack of supplies of pork. The farmers kept for breeding about 5.745 million sows, that’s 0.3 percent less compared to 5.76 million a year ago. June futures for hogs delivery gained $0.01525 (1.5 percent) to $1.027 per pound by 9:50 on CME.

Gold retreated from the record high on the speculation that the precious metal rallied too high, too fast. Silver also declined. A stronger dollar also contributed to the drop of the metals. April futures for gold delivery subtracted $8.70 (0.6 percent) to $1,426.20 as of 13:44 on COMEX, following the jump to the all-time high of $1,448.60 per ounce. May futures for silver delivery declined $0.326 (0.9 percent) to $37.049 per ounce after the price touched $38.18 yesterday, the highest level in 31 years.

Rubber dropped as China’s tightening measures caused the speculation that demand will wane. China’s central bank has raised the interest rates three times since October in an attempt to slow the rapidly accelerating inflation. September contract for delivery of natural rubber went down 0.9 percent to 35,560 yuan ($5,422) per ton in Shanghai.

Cattle jumped to the record as demand for US beef increased. The US Department of Agriculture reported that the US beef exports advanced as much as 19 percent last year to about 1.04 million metric tons. Increasing demand put strain on supplies of meat, making the US cattle herd the smallest since 1958. June futures for cattle delivery rose $0.0155 (1.3 percent) to $1.1745 per pound as of 13:08 on CME. Previously the price reached the record level of $1.18.

Wheat and corn posted the first gain this week on the concern that the global inventories may decline. The USDA is expected to reduce its estimate of the world supplies tomorrow. The experts say that Saudi Arabia will increase its imports of food to prevent increase of food prices, as the surge of the prices was one of the reasons for the uprising in Tunisia, Egypt and Libya. May delivery for wheat gained $0.07 cents (0.9 percent) to $7.8675 per bushel by 13:14 on CBoT. May delivery for corn added $0.045 (0.6 percent) to $7.10 per bushel.

Oil extended its rally for the fourth day as US stockpiles of crude decreased more than expected. Energy Department reported that crude oil inventories declined 2.15 million barrels to 333.1 million last week, compared to the expected decrease by 1.4 million barrels. The February contract for crude gained $0.3 (0.3 percent) to $92.16 per barrel on NYMEX.

Gold rallied on the signs of increasing imports in India. Ajay Mitra, the managing director for India and the Middle East at the World Gold Council, informed that India’s imports possibly have increased to 800 metric tons from 557 tons in 2009, exceeding its previous record. Spot price for gold was $1,381.90 per ounce in Mumbai yesterday.

Cattle futures reached the record and hogs rose to the highest level in eight months on the speculation that increasing feed costs will force farmers to cut supplies. Corn, the main ingredient in livestock feed, jumped to the highest price in 29 months as the government forecast for US stockpiles worsened. February futures for delivery cattle advanced $0.0175 (1.6 percent) to $1.102 per pound by 13:11 on CME. April futures for hog delivery rose $0.01875 (2.2 percent) to $0.87025 per pound.

Cattle futures rallied to the highest level in 26 months on expectations that demand from meatpackers will increase ahead of holidays, such as Christmas and New Year. Wholesale choice beef rose to $1.5901 per pound at midday after it fell yesterday for the first time in five sessions. February futures for cattle delivery rose $0.00525 (0.5 percent) to $1.05025 per pound at 13:00 on the CME.

Corn, cotton and soybeans dropped today on speculation that China may take steps to cool its economy. China, the largest world user of soybeans and the second-biggest consumer of corn, ordered its banks to increase reserves to cut inflation and prevent asset-bubble. March futures for corn delivery dropped $0.21 (3.8 percent) to $5.3475 per bushel on CBoT as of 13:15. March futures for cotton delivery slipped $0.06 (4.6 percent) to $1.2315 per pound by 14:49 on ICE. January futures for soybean delivery went down $0.405 (3.3 percent) to $12.015 per bushel in Chicago.

Hogs climbed today as demand for pork in the US is recovering. Analysts say that pork was oversold and now is returning to more “fair” price. December futures for hog settlement added $0.01 (1.5 percent) to $0.662 per pound at 13:05 on CME.

Corn and soybeans gained today for a second consecutive day on forecast that favorable weather will increase supplies. Rains in Brazil and Argentina should boost output. December futures for corn delivery slipped $0.015 (0.3 percent) to $5.7575 per bushel as of 13:15 on CBoT. January futures for soybean delivery slid $0.01 (0.1 percent) to $12.34 per bushel.

Cotton climbed to the record today as demand in China grows. Prices also surged on speculation that adverse weather will curb supplies. December delivery for cotton rose $0.05 (3.9 percent) to $1.3426 per pound by 15:20 on ICE, reaching the highest level in 140 years of trade.

Prices for lumber jumped today as concerns for US economic growth eased. Wholesale inventories in the US grew 1.3 percent, more than predicted. Growing stockpiles suggests that economic recovery retained its momentum. November futures for lumber delivery added $0.5 (0.2 percent) to $227.10 per 1,000 board feet by 13:05 on CME.

Copper fell today on speculation that demand is slowing. Prices also slipped on outlook for slower economic growth in China, the biggest metal consumer. December futures for copper delivery fell $0.037 (1.1 percent) to $3.4065 per pound as of 13:29 on COMEX. Copper for delivery in three months went down $69 (0.9 percent) to $7,486 per metric ton on LME.

Cattle futures surged as unusually hot weather in US may cause decrease of animals’ weight, reducing beef supplies from the US. Hogs prices also rose. Animals tend to gain less weight when weather is hot as they eat less food. And weather is hot as average temperature in major cattle-producing states was 43 degrees Celsius (110 Fahrenheit).

Average weight of steer carcasses at slaughter was 391.5 kg (863 pounds), 2.9 percent less compared to the same period in the previous year. CME-monitored inventories of pork bellies dropped 73 percent in the year through July after hog producers in the US cut herds to curb their losses in 2008 and 2009. Low supplies should support prices. On the other hand, high prices may damp demand from retailer.

October futures for cattle delivery rose $0.01575 (1.7 percent) to $0.958 per pound as of 11:44 on CME. October futures for hog settlement went up $0.0015 (0.2 percent) to $0.79075 per pound.

Hogs futures slipped today on forecast that high US pork prices may diminish retail demand. Meatpackers shipped 9.215 million pounds of pork last week, the worst week since late June. October futures for hog settlement slid $0.003 (0.4 percent) to $0.793 per pound at 9:42 on CME.

Raw sugar experienced a strongest decrease in almost two moths on speculation that supplies from Brazil and India, the world’s largest producers, would increase, erasing the global deficit. Production in Brazil’s Center South increased by 26 percent in the first half of July, while cane planting in India was boosted by rains, which were 2.5 percent above the 50-year average in July. October delivery for raw sugar slumped $0.0079 (4.1 percent) to $0.1861 per pound by 9:45 on ICE.

Coffee futures dropped the most in two weeks on speculation that the commodity rallied too much, considering the anticipated high supplies from Brazil, the biggest producer. Global coffee production may grow 12 percent to 135 million bags in the year starting October 1st. September delivery for Arabica coffee slid $0.0475 (2.8 percent) to $1.6775 per pound as of 10:04 on ICE.

October cattle futures rose to the highest level in more than 8 weeks today as the speculations that the extremely hot weather will impact the amount of beef produced by the farmers.

First of all, the unusually hot summer has already killed some animals in U.S, as reported by the Kansas Livestock Association (KLA). Second, the current heat levels threaten the weight gains of the living cattle, decreasing the amount of useful meat extracted by the farms. Meanwhile National Weather Service predicts further increase of the temperature in the states that are the major producers of the commodity.

According to the reports by KLA the cattle deaths due to heat started to occur since about July 16, while the number of such deaths isn’t report. Rich Nelson of Allendale Inc. commented on the current situation:

There were those limited deaths in Kansas, but the bigger deal is the impact on potential weight gains for cattle in the feedlots.

Cattle futures contracts with delivery in October rose from $0.94500 to $0.94875 (or about 0.4 percent) as of 16:09 GMT today on the CME after reaching as high as $0.95025 during early trading session.

Cocoa futures gained today after the report about increased demand in North America. The cocoa grind increased by 12 percent in the second quarter to 117,657 metric tons compared to the previous year. Analysts say that grinding numbers show strong demand and support prices. September delivery for cocoa rose $21 (0.7 percent) to $3,165 per ton on ICE.

Hogs futures went up today as hot weather in the U.S. causes decrease of animals’ weight, causing concern about declining pork supply. The animals tend to eat less with such jot weather, decreasing their weight. Hogs purchased yesterday by pork processors weighed 2 kilograms (4.44 pounds) compared to the same day in the previous month. October futures for hog settlement gained $0.00375 (0.5 percent) to $0.757 per pound on the CME.