US jobs data accelerates commodity price falls
Sunday, 7 December 2008
LONDON, Dec 6 (AFP): Commodity prices tumbled this week with losses accelerated Friday by news of half-a-million job losses in the United States that fuelled expectations of steep falls in demand for raw materials.
"It's a very negative environment in terms of interest for commodities because of the belief that not only the US but many economies are in recession," said Bill Nelson, analyst at research group Doane Advisory Services.
OIL: Oil prices plunged below 40 dollars on Friday to their lowest levels in nearly four years as worse-than-expected jobs data in the United States raised the prospect of severe falls in energy demand.
In London, Brent North Sea crude slid to 39.50 dollars a barrel, the lowest level since January 2005. The New York light sweet crude contract for January was at 42.00 dollars, also a near four-year low.
Oil prices have plunged by more than two thirds since reaching record highs above 147 dollars in July, pulled down by a widening global economic slowdown that weighs on demand.
The tumble in prices is sharply reducing income for oil producing countries, including the world's biggest, Saudi Arabia and Russia.
The International Energy Agency on Friday lowered its projections for global oil demand in 2008-2013, foreseeing annual growth of 1.2 per cent rather than 1.6 per cent in the face of a worldwide economic slump.
In an announcement ahead of the US jobs data, the IEA said demand for oil products should climb from 86.2 million barrels a day in 2008 to 91.3 million in 2013, altering forecasts it had made in July. Oil prices began the week sharply lower after the Organization of Petroleum Exporting Countries (OPEC) decided at a weekend meeting against cutting production, preferring to wait until December before reducing crude exports.
By Friday on London's InterContinental Exchange (ICE), Brent North Sea crude for delivery in January slumped to 40.06 dollars from 51.68 dollars a week earlier.
On the New York Mercantile Exchange (NYMEX), light sweet crude for January dropped to 42.32 dollars from 52.00 dollars.
PRECIOUS METALS: Gold, silver, platinum and palladium slumped. "On one hand, gold has again proven itself as a safe haven with its price more resilient than those of other assets," said Morgan Stanley analyst Hussein Allidina.
"On the other hand, gold has not rallied through this financial and economic crisis to the extent that some, including ourselves, expected."
Silver fell in gold's wake, while platinum and palladium-used to make catalytic converters in vehicles-were weighed down by the collapse of the US auto sector.
On the London Bullion Market, gold dropped to 749 dollars an ounce at Friday's late fixing from 814.50 dollars a week earlier.
Silver dropped to 9.46 dollars an ounce from 10.12 dollars.
On the London Platinum and Palladium Market, platinum slid to 788 dollars an ounce at the late fixing on Friday from 876 dollars a week earlier.
Palladium fell to 164 dollars an ounce from 187 dollars.
BASE METALS: Base metals prices slumped, with copper and aluminium hitting multi-year lows. Copper on Friday dropped to 3,055 dollars a tonne-the lowest level since June 2005, as aluminium struck a five-year low of 1,491 dollars.
By Friday, copper for delivery in three months slid to 3,025 dollars a tonne on the London Metal Exchange from 3,610 dollars a week earlier.
Three-month aluminium fell to 1,513 dollars a tonne from 1,755 dollars. Three-month lead declined to 928 dollars a tonne from 1,080 dollars. Three-month zinc dropped to 1,080 dollars a tonne from 1,195 dollars. Three-month tin decreased to 11,475 dollars a tonne from 12,305 dollars. Three-month nickel retreated to 9,100 dollars a tonne from 9,850 dollars.
COCOA: Cocoa futures fell after a recent rally. By Friday on LIFFE, London's futures exchange, the price of cocoa for delivery in March dropped to 1,488 pounds a tonne from 1,515 pounds a week earlier.
On the New York Board of Trade (NYBOT), the March cocoa contract decreased to 2,146 dollars a tonne from 2,280 dollars.
COFFEE: Coffee prices headed south. By Friday on LIFFE, Robusta for delivery in January slumped to 1,558 dollars a tonne from 1,980 dollars a week earlier. On the NYBOT, Arabica for March fell to 102.45 US cents a pound from 115.80 cents.
SUGAR: Sugar prices weakened to under 300 pounds a tonne in London.
By Friday on LIFFE, the price of a tonne of white sugar for delivery in March slid to 294.50 pounds from 328.40 pounds the previous week.
On NYBOT, the price of unrefined sugar for March dropped to 10.55 US cents per pound from 11.88 cents.
GRAINS AND SOYA: Grains and soya prices fell sharply. By Friday on the Chicago Board of Trade, maize for delivery in March dropped to 3.19 dollars a bushel from 3.66 dollars the previous week. January-dated soyabean meal-used in animal feed-slipped to 7.86 dollars from 8.83 dollars. Wheat for March dived to 4.75 dollars a bushel from 5.61 dollars.
RUBBER: Rubber prices dived in tandem with crude oil, which is used to make synthetic rubber. Falling oil futures make the cost of synthetic rubber more competitive, pressuring natural rubber prices.
On Friday the Malaysian Rubber Board's benhcmark SMR20 slumped to 116.10 US cents per kilo from 140.35 US cents per kilo a week earlier.
"It's a very negative environment in terms of interest for commodities because of the belief that not only the US but many economies are in recession," said Bill Nelson, analyst at research group Doane Advisory Services.
OIL: Oil prices plunged below 40 dollars on Friday to their lowest levels in nearly four years as worse-than-expected jobs data in the United States raised the prospect of severe falls in energy demand.
In London, Brent North Sea crude slid to 39.50 dollars a barrel, the lowest level since January 2005. The New York light sweet crude contract for January was at 42.00 dollars, also a near four-year low.
Oil prices have plunged by more than two thirds since reaching record highs above 147 dollars in July, pulled down by a widening global economic slowdown that weighs on demand.
The tumble in prices is sharply reducing income for oil producing countries, including the world's biggest, Saudi Arabia and Russia.
The International Energy Agency on Friday lowered its projections for global oil demand in 2008-2013, foreseeing annual growth of 1.2 per cent rather than 1.6 per cent in the face of a worldwide economic slump.
In an announcement ahead of the US jobs data, the IEA said demand for oil products should climb from 86.2 million barrels a day in 2008 to 91.3 million in 2013, altering forecasts it had made in July. Oil prices began the week sharply lower after the Organization of Petroleum Exporting Countries (OPEC) decided at a weekend meeting against cutting production, preferring to wait until December before reducing crude exports.
By Friday on London's InterContinental Exchange (ICE), Brent North Sea crude for delivery in January slumped to 40.06 dollars from 51.68 dollars a week earlier.
On the New York Mercantile Exchange (NYMEX), light sweet crude for January dropped to 42.32 dollars from 52.00 dollars.
PRECIOUS METALS: Gold, silver, platinum and palladium slumped. "On one hand, gold has again proven itself as a safe haven with its price more resilient than those of other assets," said Morgan Stanley analyst Hussein Allidina.
"On the other hand, gold has not rallied through this financial and economic crisis to the extent that some, including ourselves, expected."
Silver fell in gold's wake, while platinum and palladium-used to make catalytic converters in vehicles-were weighed down by the collapse of the US auto sector.
On the London Bullion Market, gold dropped to 749 dollars an ounce at Friday's late fixing from 814.50 dollars a week earlier.
Silver dropped to 9.46 dollars an ounce from 10.12 dollars.
On the London Platinum and Palladium Market, platinum slid to 788 dollars an ounce at the late fixing on Friday from 876 dollars a week earlier.
Palladium fell to 164 dollars an ounce from 187 dollars.
BASE METALS: Base metals prices slumped, with copper and aluminium hitting multi-year lows. Copper on Friday dropped to 3,055 dollars a tonne-the lowest level since June 2005, as aluminium struck a five-year low of 1,491 dollars.
By Friday, copper for delivery in three months slid to 3,025 dollars a tonne on the London Metal Exchange from 3,610 dollars a week earlier.
Three-month aluminium fell to 1,513 dollars a tonne from 1,755 dollars. Three-month lead declined to 928 dollars a tonne from 1,080 dollars. Three-month zinc dropped to 1,080 dollars a tonne from 1,195 dollars. Three-month tin decreased to 11,475 dollars a tonne from 12,305 dollars. Three-month nickel retreated to 9,100 dollars a tonne from 9,850 dollars.
COCOA: Cocoa futures fell after a recent rally. By Friday on LIFFE, London's futures exchange, the price of cocoa for delivery in March dropped to 1,488 pounds a tonne from 1,515 pounds a week earlier.
On the New York Board of Trade (NYBOT), the March cocoa contract decreased to 2,146 dollars a tonne from 2,280 dollars.
COFFEE: Coffee prices headed south. By Friday on LIFFE, Robusta for delivery in January slumped to 1,558 dollars a tonne from 1,980 dollars a week earlier. On the NYBOT, Arabica for March fell to 102.45 US cents a pound from 115.80 cents.
SUGAR: Sugar prices weakened to under 300 pounds a tonne in London.
By Friday on LIFFE, the price of a tonne of white sugar for delivery in March slid to 294.50 pounds from 328.40 pounds the previous week.
On NYBOT, the price of unrefined sugar for March dropped to 10.55 US cents per pound from 11.88 cents.
GRAINS AND SOYA: Grains and soya prices fell sharply. By Friday on the Chicago Board of Trade, maize for delivery in March dropped to 3.19 dollars a bushel from 3.66 dollars the previous week. January-dated soyabean meal-used in animal feed-slipped to 7.86 dollars from 8.83 dollars. Wheat for March dived to 4.75 dollars a bushel from 5.61 dollars.
RUBBER: Rubber prices dived in tandem with crude oil, which is used to make synthetic rubber. Falling oil futures make the cost of synthetic rubber more competitive, pressuring natural rubber prices.
On Friday the Malaysian Rubber Board's benhcmark SMR20 slumped to 116.10 US cents per kilo from 140.35 US cents per kilo a week earlier.