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Oil turns lower as weaker demand outlook weighs

Oil prices gave back early gains and turned lower on Friday after the International Energy Agency (IEA) deemed supply adequate and the outlook for demand weakening, sinking even as equities rebounded from a slump Thursday.

The West’s energy watchdog said in its monthly report that the market looked “adequately supplied for now” and trimmed its forecasts for world oil demand growth this year and next.

Brent crude fell 56 cents a barrel to $79.70, after dropping 3.4 percent on Thursday. US crude futures fell 2 cents to $70.95.

Both benchmarks were headed for their first weekly drop in five weeks, pressured by a big rise in US inventories and fading concerns about shrinking global supplies due to looming U.S. sanctions on Iran’s oil exports.

The IEA report is the latest official forecaster to predict weaker demand ahead and conclude that supply is adequate. The Organization of the Petroleum Exporting Countries (OPEC) made a similar move on Thursday.

Gold prices decline

Gold prices eased on Friday, the session after their biggest daily gain in more than two years, coming under pressure as the US dollar climbed and global stocks rebounded from a six-day rout.

Spot gold was down 0.5 percent at $1,217.81 an ounce in the New York trade on Friday. On Thursday, bullion jumped about 2.5 percent on safe-haven buying during an equities selloff.

Thursday’s peak of $1,226.27 was the highest since July 31. Spot gold was on track for its biggest weekly gain in seven weeks, up about 1.3 percent for the week. US gold futures settled down $5.6, or 0.46 percent, at $1,222.

During Thursday’s surge, bullion broke above the narrow trading range of the past 1-1/2 months.

In other precious metals, palladium fell over 1 percent to $1,065.72. The metal rose to its highest since Jan. 26. at $1,096.80 in the previous session.

Silver was up 0.1 percent at $14.57 and platinum fell 0.7 percent to $833.49, hovering below the previous session’s more than two-month high of $843.90.

Gold, however, has fallen over 13 percent since hitting a peak in April, with investors increasingly opting for the safety of the greenback as the US-China trade war unfolded against a backdrop of rising US interest rates. Rising bond yields have also dampened the appeal of gold, which pays no interest.

French wheat exports to gain from Russia supply drop

A brisk start to France’s wheat export season and less competition from Russian supplies led farming agency FranceAgriMer to raise its forecast for French soft wheat exports outside the European Union in 2018/19. FranceAgriMer pegged French soft wheat exports to non-EU destinations at 8.75 million tonnes, up from its initial outlook of 8.5 million in September and well above 8.1 million in 2017/18.

Exports outside the EU in the first three months of the season that began on July 1 were 24 percent above the year-earlier volume, the agency said. Traders are more cautious about French exports this season after a lull in the past month. French exporters group Synacomex said on Tuesday it expected soft wheat exports outside the EU to reach 8.3 million tonnes. FranceAgriMer lowered projected soft wheat exports within the EU, to 7.9 million tonnes from 8.1 million last month, reinforcing an anticipated reversal of the trend in the past two seasons when intra-EU trade outpaced exports beyond the bloc. Expected soft wheat stocks in France at the end of the 2018/19 season on June 30 were trimmed to 2.4 million tonnes from 2.5 million last month.

 

Soybeans slump on big harvest, China trade war worries

US soybean futures fell for a second day on Wednesday, shedding more than 1 percent on expectations of a bumper US crop and concerns about a protracted U.S.-China trade war that has already depressed demand for US shipments. Corn and wheat also eased as traders squared positions ahead of a monthly US Department of Agriculture (USDA) report due on Thursday that is expected to show bigger supplies of both crops.

Forecasters expect drier weather in the western Midwest next week, which should help boost harvesting. In a weekly report late on Tuesday, the USDA said soybeans were 32 percent harvested as of Sunday, below trade expectations and behind the five-year average of 36 percent.

The USDA pegged the corn harvest at 34 percent complete and said winter wheat seeding was 57 percent finished, both ahead of average. Chicago Board of Trade November soybean futures were 10-3/4 cents lower at $8.52-1/4 a bushel. Selling accelerated as the contract fell below its 10- and 50-day moving averages. CBOT December corn was 1-3/4 cents lower at $3.62-3/4 a bushel, ending lower for a third straight day. December wheat fell 4-1/2 cents to $5.10-1/2 a bushel.

Zinc falls after nearing 3-month high on tighter supplies

Zinc fell on Wednesday on trade and inflation worries, although it had earlier risen back towards a 3-month high reached last week on shrinking inventories and smelter cuts in China. Zinc inventories in LME-registered warehouses fell to 194,575 tonnes from more than 250,000 tonnes in August and are nearing 10-year lows.

Stockpiles in Shanghai Futures Exchange storehouses at 29,204 tonnes are the smallest since 2007. Also weighing on zinc were lingering worries that trade tensions will sap growth. The worries, coupled with rising U.S. bond yields, pushed world shares down to a three month low. Demand for refined zinc will exceed supply by 322,000 tonnes this year, but the gap will narrow to 72,000 tonnes in 2019, industry data showed on Monday.

Raw sugar slips from 7-month high; coffee, cocoa also fall

Raw sugar futures fell on Wednesday, slipping from a seven-month peak as fund selling and a weaker Brazilian currency offset fresh signs of lower output from the top grower, while arabica coffee turned lower after setting a 3-1/2 month high. March raw sugar was down 0.20 cent or 1.5 percent at 12.78 cents per lb by 1420 GMT, after earlier touching 13.14 cents, the highest for the front month since early March. A sharp decline in Brazil’s real currency boosted selling. A weaker real encourages producer selling by increasing returns in local currency terms on dollar-traded commodities. This offset earlier gains on the back of data showing Brazil’s centre-south region produced 1.286 million tonnes of sugar in the second half of September, compared to 2.147 million tonnes in the previous two-week period.

Malaysia’s end-Sept palm oil stocks up

Malaysia’s palm oil stockpiles at the end of September slightly rose 1.45 percent from the previous month to 2.54 million tonnes, industry regulator the Malaysian Palm Oil Board (MPOB) said on Wednesday.

Production in September rose 14.38 percent from the previous month to 1.85 million tonnes, while exports rose 47.18 percent from August to 1.62 million tonnes, according to the MPOB data.

Brazil coffee exports up in Sept

Brazilian coffee exporters shipped 2.73 million 60-kg bags of coffee abroad in September, 27 percent more than a year earlier as the country sells a record crop, but the lack of container space in ships prevented larger volumes.

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