Commodity Blog

Posts Tagged ‘rubber’

Soybeans and rubber declined today as macroeconomic data from the United States showed decreasing number of new home sales and increasing number of unemployment claims. Claims for unemployment benefits rose from 356,000 to 377,000 last week. New homes sales were at a seasonally adjusted rate of 307,000 in December, compared to the median forecast of 321,000 and the November value of 314,000.

Yesterday, soybeans advanced as the pledge of the US Federal Reserve to keep interest rate record low till 2014 was supporting commodities. The Standard & Poor’s GSCI Spot Index of 24 commodities added 1.5 percent yesterday.

Futures for delivery of rubber in July went down to 316.4 yen per kilogram ($4,087 per metric ton) before trading at 317.3 yen on the Tokyo Commodity Exchange. Soybeans fell from $12.2175 to $12.1825 per bushel as of 6:31 GMT on CBoT after reaching the highest price since January 3 of $12.3500 yesterday.

Corn posted the biggest advance in more than a week on the anticipation of returning demand for the US supplies. According to the report of the US Department of Agriculture, the US exports of corn totaled 1.763 million metric tons in the week ended October 13, the highest level since March. Total sales for delivery before August 31 were 5 percent above the sales in the same period of the previous year, being at the highest level in four years. Settlement for corn jumped from $6.38 to $6.50 per bushel by 23:38 GMT today on CBoT.

The forecasts of good weather drove soybeans down. Dry weather in Brazil and rains in Argentina should boost harvest. The problems of Europe and the resulting worries also weighted down the oilseed. Soybean prices retreated from $12.2525 to $12.2350 per bushel today on CBoT.

The European crisis also caused the drop of rubber to the lowest level in 14 months. The leaders of European nations will discuss the situation in Europe at the summit this weekend. Some economists argue that the bailout fund will be boosted. Yet others speculate that the politicians won’t be able to reach an agreement and such speculation weight the commodity down. January future fo delivery of rubber slumped as much as 4.4 percent to 25,445 yuan ($3,985) per ton in Shanghai.

Corn and wheat retreated today on the forecast rains will help boost growth of the crops. Previously traders were concerned that drought would damage plants. Now forecasts promised rains in the US Midwest over next several days. December futures for delivery of corn fell $0.08 (1.1 percent) to $7.175 per bushel at 11:40 on CBoT. Contract for delivery of wheat in December slipped $0.1525 (2 percent) to $7.4275 per bushel.

Rubber erased some of its losses as the threat of adverse weather reducing supplies from Thailand overshadowed concerns about possible slowdown of the global economic growth. 60 percent of Thailand’s south received heavy rainfalls. Rubber is still down over the trading session as the yen strengthened, reducing attractiveness of commodities prices in the Japanese currency, and oil fell 1 percent to $86.70 per barrel. January delivery for rubber subtracted 1 percent to 33,745 yuan ($5,283) per metric ton on Shanghai Futures Exchange.

Crude oil declined after Saudi Arabia said that it can make up for the supplies lost because of the tensions in Libya. In the meantime, ships continue to pick up cargo in Libya without major disruption. April delivery for crude oil fell $0.02 to $96.95 per barrel, in electronic trading on NYMEX.

Copper gained on the signs of the economic recovery. The Chicago PMI grew again for the seventeenth consecutive month in February, rising to the highest level since July 1988. May futures for copper delivery went up $0.0415 (0.9 percent) to $4.4965 per pound as of 13:27 on COMEX.

Rubber may decline only to rebound and start a new rally. Goldman Sachs Group Inc. predicted that output in Thailand, Indonesia and Malaysia, the biggest producer, won’t be able to satisfy demand for the second year in 2011. Analysts forecast that the prices may climb as much as 32 percent to $7,407 per metric ton by the end of this year.

Crude oil slipped today as US gasoline inventories surged and the dollar strengthened. Gasoline stockpiles in the US, the biggest consumer of oil, advanced 5.6 million barrels last week. February delivery for crude oil dropped $0.48 cents (0.5 percent) to $88.90 per barrel on NYMEX.

Rubber also declined on a stronger dollar. Another reason for the decline was the profit-taking after prices surged to the record. June delivery for rubber slid 1.7 percent to 419.1 yen per kilogram ($5,102 per metric ton) on the Tokyo Commodity Exchange.

The commodity sell-off affected gold too, causing the spot price to decline 0.2 percent to $1,378.18 an ounce.

Rubber jumped in Tokyo to the highest level in three week on concerns that bad weather will disrupt supplies. Cyclones and monsoon caused deaths in Malaysia, Thailand and Vietnam, also threatening to halt shipments of rubber from these countries. Floods caused some major rubber markets in Thailand to close. Futures for rubber delivery rose 1.9 percent to 33,250 yuan ($4,991) per ton in Shanghai.

Oil gained higher than $85 level today after the US Federal Reserve announced its $600 billion Treasuries-purchase program. Total US motor gasoline inventories decreased by 2.7 million barrels last week. Analysts say that next resistance level is $87 but it may be easily passed, considering weakness of the US currency after the announcement of quantitative easing by the Fed. December delivery for crude oil went up $0.43 (0.5 percent) to $85.12 per barrel on NYMEX.

Crude oil rose today after the dollar weakened, increasing attractiveness of commodities as an alternative investment. Dollar Index, tracking the US currency versus major trading partners, fell to the lowest level since January on speculation that the Federal Reserve would resume its bond purchases to support the US economy. Analysts say that $80 is fair price for crude and oil will be following moves of the dollar. November delivery for crude oil gained $0.42 (0.5 percent) to $82.09 per barrel on NYMEX.

Rubber jumped today to the highest level in six months as excessive rainfall in major producing countries caused speculation that supplies may decline. Chinese production decreased because of rains, while demand in China is increasing. Rubber futures advanced 1.9 percent to 334.4 yen per kilogram ($4,084 per metric ton) in Tokyo, the highest level since April 19.

In this video interview Jonathan Barratt talks about the future of the soft commodities. He’s making an emphasis on the sugar as an extremely volatile commodity, which continues jumping up and down both in long- and short-term perspectives. Jonathan also talks about the macroeconomic uncertainties that spur the speculative rallies in some of the low-volume commodities with some potential problems with supply, namely rubber.

Sugar prices dropped as Brazil’s output rose this year and India may increase production in the year starting October 1st. Prices’ downfall may cause decline in global supplies, as low prices make expanding production unprofitable. This may cause global deficit as demand continue to increase, leading to rebound of prices for the sweetener. July delivery for raw sugar dropped 2.9 percent to $0.1492 per pound in New York yesterday.

Orange-juice futures jumped today to the highest level in two weeks amid concerns that citrus groves in Florida, the second biggest citrus producer, will be harmed by hurricanes. Forecasts tell that this is an active year with 14 to 23 named storms in the season beginning June 1st and 8 to 14 among them will develop into hurricanes. July delivery for orange juice climbed $0.023 (1.6 percent) to $1.435 per pound by 10:03 a.m. on ICE Futures U.S.

Rubber rose today on signs of increasing demand in China, the largest buyer, which should outweighing concerns for decreasing demand from Europe. Chinese demand can boost rubber prices by at least 25 percent to the 30-year high. November delivery for rubber rose 1.8 percent to 286.20 yen as of 14:17 in Tokyo.

Corn and soybeans gained today as farmers slowed sales after a price drop earlier this year. Drop in sales have led to decline of supplies for export and for producing fuel, animal feed and food. May futures for corn delivery added $0.0575 (1.5 percent) to $3.79 per bushel by 10:44 on the Chicago Board of Trade. March futures for soybean delivery rose $0.18 (1.9 percent) to $9.63 per bushel.