OIL PRICES DIP AFTER US CRUDE HITS NEAR 2-YEAR HIGH
Oil prices eased on Thursday, with U.S. crude dipping away from two-year highs reached the day before, but the shutdown of the Keystone pipeline and a drawdown in fuel inventories continued to bolster markets despite worries over rising output.
U.S. West Texas Intermediate (WTI) crude futures were at $57.89 a barrel at 0437 GMT, down 13 cents, or 0.2 percent, from their last settlement, but still close to 2015-highs of $58.15 a barrel reached on Wednesday. Brent crude futures, the international benchmark for oil prices, were at $63.17 per barrel, 15 cents, or 0.2 percent, below their last close.
WTI has been buoyed by the shutdown of the 590,000 barrel-per-day (bpd) Keystone pipeline, one of the largest crude pipelines from Canada to the United States, as well as by another drawdown in commercial fuel inventories that came despite record US oil production. US crude inventories fell 1.9 million barrels in the week to Nov. 17, to 457.14 million barrels. Stocks have dropped by 15 percent from their records in March, to below 2016 levels.
PALM FALLS ON STRONGER RINGGIT, HIGHER PRODUCTION OUTLOOK
Malaysian palm oil futures fell in early trade on Thursday, and looked set for a fourth decline in five sessions, as the edible oil was weighed down by a stronger ringgit and prospects of rising production, traders said.
The ringgit rose to its strongest level in over a year on Thursday morning. It earlier gained as much as 0.4 percent at 4.0950 against the dollar, but was last slightly down 0.1 percent at 4.1120 around noon. Gains in the ringgit, palm’s currency of trade, usually make the vegetable oil more expensive for foreign buyers.
The benchmark palm oil contract for February delivery on the Bursa Malaysia Derivatives Exchange was down 0.7 percent at 2,626 ringgit ($638.62) a tonne at the midday break, its sharpest decline since Monday. Traded volumes stood at 17,730 lots of 25 tonnes each at noon. The market fell on the ringgit’s strength, said a futures trader from Kuala Lumpur, adding that production is also key to market movements now.
CBOT SOYBEANS END HIGHER, LA NINA WORRIES
Chicago Board of Trade soybean futures rose on Wednesday on technical buying ahead of the US Thanksgiving holiday and worries that the La Nina weather phenomenon could cause dry conditions in South America’s crop belt, traders said.
CBOT January soybeans settled up 8-1/4 cents at $9.97-1/4 a bushel after reaching $9.99-1/2, the contract’s highest since Nov. 9. CBOT December soymeal ended up $6.10 at $324.40 per short ton, after hitting a one-month high at $325.30. CBOT December soyoil fell 0.12 cent to 34.05 cents per pound as traders exited long soyoil/short meal spreads. US markets will be closed on Thursday for Thanksgiving, with CBOT trade resuming Friday at 8:30 a.m. CST (1430 GMT). Australia’s Bureau of Meteorology issued an alert for a La Nina weather event starting next month, saying the chance it would take place was triple the normal likelihood. Ahead of the US Department of Agriculture’s weekly export sales report, which is delayed until Friday, analysts expected the government to report soybean export sales at 1.0 million to 1.5 million tonnes (old and new crop years combined).
INDIA’S NORTH AMERICAN COAL IMPORTS MAY SURGE
India’s coal imports from North America are likely to surge as buyers are looking to boost purchases amid a domestic shortage of the fuel and a regional ban on petroleum coke, traders and cement company officials said. Shipping data showed that India’s coal imports from North America tripled to 2.1 million tones in October from a year ago. Other trading sources put this figure lower, at 1.47 million tones, and they said coal imports for Nov. 1-20 have reached 1.14 million tones.
Indian imports of North American coal, including supplies from Canada, stand at about 1.5 million tones from Nov. 1 to 20, statistics showed, already more than 70 percent of last month’s purchases. A ban on the use of petroleum coke, a dirtier but better-burning alternative to coal, is spurring expectations India will buy even more coal from the United States in coming months.
SOCGEN FORECASTS GLOBAL SUGAR SURPLUS AT 5.5M TONS
The global sugar market will see a surplus of 5.5 million tons in 2018/19 due to higher production in India, Thailand, China and the European Union, Societe Generale said on Wednesday. Global sugar demand was forecast to rise 1.5 percent next year, in line with the five-year average, Societe Generale said in its Commodities Outlook report. Going forward, Brazil’s sugar-ethanol parity floor will remain a key driver of sugar prices, especially in the context of under-hedged Brazilian sugar production in (marketing year) 18/19, and retracing energy prices will weigh on sugar prices.
BANGLADESH TEA PRICES RISE ON WINTER DEMAND
Tea prices in Bangladesh rose 2.5 percent at the weekly auction due to strong winter demand, despite there being a higher volume on offer. Bangladeshi tea fetched an average price of 240.35 taka ($2.80) per kg at the auction on Tuesday, compared with 234.43 taka at the previous sale, National Brokers said.
There was strong demand as buyers wanted to stock up for the winter season although supplies were larger than last week, a senior official with the National Brokers said. Demand for tea in Bangladesh usually rises in winter. Around 13.8 percent of the 2.36 million kg offered at the sole auction centre in Chittagong remained unsold. In the previous auction, 8.7 percent of the 2.36 million kg on offer was unsold. Bangladesh’s tea production rose nearly 27 percent last year to a record 85 million kg, a harvest that was seen as big enough to make imports unnecessary. The South Asian country was the world’s fifth-largest tea exporter in the 1990s but is now a net importer due to a surge in domestic consumption.