Commodity markets mostly fall

FE Team | Published: August 03, 2014 00:00:00 | Updated: November 30, 2026 06:01:00

LONDON, Aug 2 (AFP) : Commodities mostly sank this week, with many hit by sliding equities, demand concerns, ample supplies, geopolitical worries in the Middle East and Ukraine and Argentina's default, dealers said.
Star performers coffee and cocoa, however, forged significant peaks on frenzied speculative buying interest, they added.
Heading into the weekend, traders digested Friday's tepid non-farm payrolls data in the United States, the world's largest economy and a major consumer of most raw materials.
OIL: Crude oil prices in New York tumbled to their lowest level since early February, with the market awash with supplies, dealers said.
New York's light sweet crude sank Friday to $97.09 per barrel, last seen on February 7, and London's Brent oil touched the lowest level since mid-July.
She added: "The prospect of healthy supply levels from Africa and Europe offsets political tension in Russia (and) Ukraine."
Commerzbank analysts agreed that investors were focussed on adequate supply levels.
On the New York Mercantile Exchange, West Texas Intermediate or light sweet crude for August dropped to $97.30 a barrel from $101.66.
PRECIOUS METALS: Gold and other precious metals retreated as many traders opted to cash in recent gains, pushing prices to multi-week troughs.
Gold was also hit by news of easing inflationary pressures in the eurozone, because the metal is traditionally regarded as a safe store of value in times of rising inflation.
July inflation dropped to 0.4 per cent from June's 0.5 per cent, hitting its lowest level since late 2009 and sparking renewed deflation worries.
The yellow metal was also pulled lower as the dollar strengthened on hopes of US monetary policy tightening from the US Federal Reserve.
Silver decreased to $20.34 an ounce from $20.46.
On the London Platinum and Palladium Market, platinum declined to $1,462 an ounce from $1,473.
Palladium dipped to $871 an ounce from $876.
BASE METALS: Base or industrial metal prices largely fell, in line with global equities, as dealers fretted over Argentina's debt default and fast-moving geopolitical crises in Gaza and Ukraine.
The move lower came despite an upbeat start to the week, in which aluminium, lead and zinc scored multi-month highs on speculative buying.
COCOA: Prices were catapulted to a 3.5-year pinnacle at £2,028 per tonne in London, on the back of solid demand and intense speculative buying.
"Strong demand continues to keep the market well-supported," said Citi analyst Sterling Smith.
The key chocolate ingredient has jumped by almost a fifth in value since the start of the year.
COFFEE: Prices leapt on Friday to a three-month peak at 207.40 US cents per pound, driven by expectations of a poor crop in top producer Brazil.
The market also zoomed to $2,139 per tonne in London, the highest level since mid-May.
SUGAR: The market struck multi-month lows, at $436.40 per tonne in London and 16.40 US cents per pound in New York, as prices were weighed on by abundant supplies.
"Brazil continues to harvest the crop rapidly and make sugar available to the market as the dry weather has made for very rapid harvest progress," said Scoville.
RUBBER: Prices in Kuala Lumpur drifted higher as a weaker Malaysian ringgit against the US dollar attracted foreign buyers in a holiday-shortened trading week. The Malaysian Rubber Board's benchmark SMR20 ended at 170.10 US cents a kilo, up from 169.05 cents a week earlier.