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Gold, silver prices pop on big US dollar drop

Gold and silver prices are solidly higher in early US trading on Wednesday. Gold prices have scored a 4.5-month high. A sharply lower US dollar index that slumped to a 3.5-year low is providing the precious metals bulls with some rocket fuel.

February Comex gold was last up $15.50 an ounce at $1,352.20. March Comex silver was last up $0.382 at $17.29 an ounce. Some upbeat economic data coming out of the European Union Wednesday helped to lift the Euro currency to a more-than-two-year high. Meantime, Nymex crude oil prices are slightly higher, near $65.00 a barrel and not far below last week’s more-than-three-year high. The rally in the oil market is also an underlying bullish element for the precious metals markets.

Drawdown in world wheat stocks to fall on Russia, US, China

The world may be up to its eyeballs in wheat, but there are signs that the corner might have been turned and a contraction in wheat supply could begin by mid-2018. And if China is excluded from the picture, the contraction has already begun. According to the US Department of Agriculture, global wheat inventory in 2017-18 will swell to an all-time high of 268 million tons. In regards to 2018-19, which will begin mid-year, the International Grains Council (IGC) said last week that world wheat stocks could shrink for the first time in six years based on a 2-percent decline in production. The IGC’s statement ignores the fact that in reality, world wheat supply may hit a four-year low by mid-2018 when considering only those supplies available on the world market. Analysts often exclude China’s share of world wheat carryout because the top wheat-producing country keeps its supply locked away in massive hoards and does not export.

China’s 2017 coal imports from Russia surge

China’s coal imports from Russia and Mongolia soared in 2017, customs data showed on Thursday, as the two countries filled a supply gap caused by a series of trade sanctions on North Korea. Arrivals from Russia surged 36.3 percent from 2016 to 25.3 million tons, data from the General Administration of Customs showed, with December figures at 2.14 million tons, up 16.2 percent from a year ago and 11.5 percent from November. Shipments from Mongolia rose to 33.58 million tons in 2017, up 27.6 percent from 2016, while December’s imports came in at 2.83 million tons, down 18.6 percent from a year ago but up 2.5 percent from November. Coal imports in 2017 from Australia rose 13.4 percent from 2016 to 79.91 million tons.

Soybeans rise, set for longest winning streak in 6 years

Chicago soybeans rose for a ninth consecutive session on Thursday, the longest unbroken gaining run in nearly six years, as dry weather in Argentina hit crop yields and a weaker US dollar made greenback-priced commodities cheaper. Wheat climbed to a two-week high, while corn was little changed after rising 1.5 percent in the last session.

The most-active soybean contract on the Chicago Board of Trade rose 0.3 percent to $9.95 a bushel by 0334 GMT, the highest since Dec. 8. Soybeans last rose for at least nine straight sessions in March 2012. Wheat added 0.4 percent to $4.34-3/4 a bushel, having closed up 2.7 percent on Wednesday, while corn was unchanged at $3.56-1/2 a bushel.

 

Palm oil hits 1-week top in 3rd straight day of gains on output cut

Malaysian palm oil futures rose over 1 percent in their second half of trading on Wednesday, charting a third consecutive session of gains, as bullish sentiment on declining production lifted the market.

The benchmark palm oil contract for April delivery on the Bursa Malaysia Derivatives Exchange rose 1.1 percent to 2,521 ringgit ($644.59) a tonne at the end of the trading day. It rose earlier to an intraday high of 2,526 ringgit, its strongest since Jan. 16. Trading volumes stood at 39,883 lots of 25 tons each on Wednesday evening. The market is up on a technical retracement and the double-digit fall in production,” said a Kuala Lumpur-based trader, referring to production figures from the Malaysia Palm Oil Association on Tuesday, which he said showed a 17 percent drop during Jan. 1-20 compared with the same period last month.

Bangladesh tea prices fall amid supply glut

Tea prices fell at Bangladesh’s weekly auction amid higher supply than at the previous sale, although strong demand for quality leaf capped a steeper price decline.

Bangladeshi tea fetched an average price of 229.62 taka ($2.80) per kg at the auction, compared with a revised price of 234.98 taka in the previous sale. There was muted demand overall but good demand for quality leaf, which helped limit a steep drop in prices when supplies were higher than last week, a senior official at National Brokers said.

Copper rebounds despite surge in LME inventories

A sharply weaker dollar helped copper prices to rebound on Wednesday from a one-month low despite a second day of rapidly rising inventories that suggested there is plentiful supply of the metal used in power and construction.

Benchmark copper on the London Metal Exchange traded up 0.9 percent at $6,987 a ton in official rings after plunging by 2.1 percent on Tuesday to $6,885, its lowest since Dec. 19. On-warrant copper stocks available to the market in LME-registered warehouses jumped by 24,325 tons after a rise of 44,825 tons on Tuesday, taking the increase in on-warrant inventories since Jan. 17 to 51 percent. Traders said after Tuesday’s big rise that further increases had been expected.

OPEC, non-OPEC producers expect oil market balance in Q3 or Q4

The OPEC and non-OPEC countries involved in a global deal to reduce oil output expect the market to return to balance in the third or fourth quarter of the year, RIA Novosti news agency quoted Russian Energy Minister Alexander Novak as saying on Wednesday.

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