Friday, December 14, 2012

20121214 0941 Global Commodities Related News.

DTN Closing Grain Comments 12/13 14:51 Grains Close Mostly Lower (CME)
Grains struggled throughout the session for the most part, with corn and wheat struggling to find buying interest. Soybeans rallied and fell a couple of times over the course of the day, closing on the defensive.

Corn Market Recap for 12/13/2012 (CME)
March Corn finished down 5 1/4 at 720 1/4, 7 3/4 off the high and 5 1/4 up from the low. May Corn closed down 4 1/2 at 724. This was 5 1/2 up from the low and 6 3/4 off the high.
March corn traded lower into the closing bell. Grain markets saw pressure from a stronger dollar and a steady dose of weak demand data this week. The ethanol stocks report was not considered supportive to the market yesterday and despite today's export sales falling in line with market estimates, they are still well below the pace needed to reach the USDA forecast. Net weekly export sales came in at 258,900 tonnes for the current marketing year and 13,700 for the next marketing year for a total of 272,600. This was up from 51,600 tonnes last week. As of December 6th, cumulative sales stand at 43% of the current USDA forecast vs. a 5 year average of 52%. Sales of 435,000 tonnes are needed each week to reach the USDA forecast which is up about 5,000 tonnes from last week at 430,700 tonnes. Cash basis was steady midday on light farmer selling but the sluggish ethanol and export demand helped to offset.
January Rice finished up 0.155 at 15.5, equal to the high and 0.19 up from the low.

Wheat Market Recap Report (CME)
March Wheat finished down 3 1/2 at 808 1/2, 9 1/4 off the high and 7 up from the low. May Wheat closed down 3 1/4 at 821 1/4. This was 7 up from the low and 9 off the high.
March Chicago and KC wheat traded lower on the day. The US Dollar was stronger and outside markets had a negative tilt which pressured most commodity markets. Net weekly export sales came in at 518,600 tonnes for the current marketing year and 54,900 for the next marketing year for a total of 573,500. Sales fell in line with market estimates and were up from 353,000 last week. As of December 6th, cumulative sales stand at 59.5% of the USDA forecast for the current marketing year vs. a 5 year average of 71%. Sales of 457,000 tonnes are needed each week to reach the USDA forecast. Traders also note that inquiries are being made to work wheat into feed rations in 2013. Wheat vs. corn spreads have collapsed this week following Tuesday's bearish wheat report released from the USDA. Furthermore, the sharp decline in Chicago wheat futures could pull in export demand soon which would likely help stabilize price levels. The EU cleared 583,000 tonnes of soft wheat export licenses this week taking the crop year total to 8.6 million tonnes vs. 6.9 for the same period last year.
March Oats closed up 1 3/4 at 387. This was 6 3/4 up from the low and 1 1/2 off the high.

Recap Energy Market Report (CME)
January crude oil prices broke their latest three day wining streak with another late day sell off. The market was under pressure early in the session on concerns regarding US budget negotiations and modest gains in the US dollar. January crude oil prices managed to turn into positive territory into the mid session but struggled to overcome the $87.00 level. It is possible that some of the morning lift in prices came in the wake of US jobless claims data that showed a much larger than expected decline. However, mid day comments from both parties seemed to reflect further distance between them, and that weighed heavy on crude oil prices for the balance of the session.

Natural Gas Drops Near 11-Week Low After Unexpected Supply Gain (Bloomberg)
Natural gas futures fell to the lowest price in almost 11 weeks after a government report showed that U.S. stockpiles increased unexpectedly as mild weather cut demand for heating fuels. Gas slid 1 percent after the Energy Department said inventories rose 2 billion cubic feet in the week ended Dec. 7 to 3.806 trillion cubic feet. Analyst estimates compiled by Bloomberg showed an expected drop of 3 billion. It was the latest seasonal supply gain since the week ended Dec. 30, 2005, according to department data compiled by Bloomberg. “The storage injection was reflective of the very, very warm temperatures,” said Kyle Cooper, director of research with IAF Advisors in Houston. “If Mother Nature continues to deal bearish blows, the market is going to head lower.”
Natural gas for January delivery decreased 3.5 cents to $3.347 per million British thermal units on the New York Mercantile Exchange, the lowest settlement price since Sept. 28. The futures have risen 12 percent this year, heading for the first annual gain since 2007. January $3.70 calls were the most active gas options in electronic trading. They were 0.5 cent lower at 1.2 cents on volume of 2,629 contracts as of 3:15 p.m. Calls accounted for 49 percent of options volume. The stockpile increase compares with the five-year average decline for the week of 113 billion cubic feet, department data show. Supplies were 8 percent above the five-year average, wider than 4.6 percent the previous week. Inventories were 1.3 percent higher than year-earlier levels after being 0.9 percent lower in last week’s report.

Oil Heads for Weekly Gain on U.S., China Manufacturing Outlook (Bloomberg)
Oil rose in New York, extending a weekly gain, before reports that are forecast to show a recovery in manufacturing in the U.S. and China, the world’s biggest crude consumers. Futures advanced as much as 0.6 percent and headed for the fifth weekly increase in six. U.S. industrial production expanded by 0.3 percent in November, according to the median estimate in a Bloomberg survey before Federal Reserve data today. A preliminary index of China’s manufacturing for this month by HSBC Holdings Plc and Markit Economics may rise to 50.8, a separate Bloomberg survey showed. A number above 50 indicates an expansion. Crude for January delivery climbed as much as 50 cents to $86.39 a barrel in electronic trading on the New York Mercantile Exchange and was at $86.30 at 8:11 a.m. Singapore time. The contract fell 88 cents to $85.89 yesterday, the lowest close since Dec. 11. Prices are up 0.4 percent this week and down 13 percent this year.
Brent for January settlement slid 1.5 percent to $107.91 a barrel on the London-based ICE Futures Europe exchange yesterday and settled at a premium of $22.02 to New York-traded West Texas Intermediate. The European benchmark contract is up 0.5 percent in 2012.

Gold Drops to Lowest Level in a Week on U.S. Budget Negotiations (Bloomberg)
Gold declined to a one-week low as a rally to the highest level this month prompted some investors to sell the metal amid concern about the U.S. budget deadlock. Silver, platinum and palladium retreated. Spot gold slumped as much as 1 percent to $1,694.35 an ounce, the lowest price since Dec. 7, and traded at $1,700.90 at 10:49 a.m. in Singapore. The metal climbed to $1,723.40 yesterday, the most expensive since Nov. 30, after the Federal Reserve said it will expand asset purchases. The rally was “modest” as additional Fed balance sheet expansion was already “priced in,” according to Goldman Sachs Group Inc. Gold dropped with other commodities including oil and copper as the dollar rebounded from a three-day decline against a basket of six major currencies. U.S. lawmakers said it’s becoming less likely an agreement on the budget can be enacted before the Christmas holiday, as House Speaker John Boehner said yesterday both parties have “got some serious differences.”
“Investors are now focused on the fiscal cliff negotiations, which are looking protracted and threatening to weigh on all markets,” said Xiang Nan, an analyst at CITICS Futures Co., a unit of China’s biggest listed brokerage. “ We view a drop below $1,700 as a good buying opportunity. The Fed sent a strong signal about supporting the economy and keeping the easy monetary policy stance unchanged, which should support higher gold prices in the longer term.” Prices may be underpinned at $1,662 to $1,672.50, according to technical analysis from Commerzbank AG, an area of support made up of the November low, 200-day moving average and 50 percent retracement of the May-to-October rise, technical analyst Karen Jones wrote in a report.

Silver Market Recap Report (CME)
March silver was unable to shake off heavy pressure during today's trading and finished the session more than $1.50 below yesterday's highs. US equity markets were unable to hold their early gains after today's series of US economic reports, which many traders felt was a source of additional headwinds for silver prices this morning. Lukewarm strength in the Dollar may have provided some measure of support to the silver market but was unable to overcome the negative turnaround in global risk sentiment during the later stages of today's trading session.

Gold Market Recap Report (CME)
The gold market could not sustain a modest recovery from early lows and ended up posting heavy losses by the close of Thursday's session. A decline to multi-year lows for both the Initial and Continued Jobless Claims numbers provided a limited boost to macro-economic sentiment, which helped gold prices find their early lows after finding severe and sustained overnight pressure. Many traders felt that global risk appetites took a negative shift during Asian trading hours, as the market started to have second thoughts over the impact of the FOMC meeting results from yesterday afternoon. A lack of progress with the US fiscal cliff situation continues to be widely seen as a key negative factor for gold prices late in this week's trading.

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