WORLD COMMODITIES TRADING
World oil prices surge on US data
Oil prices inched up on Friday, ending the week higher after stronger-than-expected US economic data brightened the crude demand outlook and concerns over the safety of oil transport around the Strait of Hormuz threatened supply.
Brent crude futures LCOc1 settled at $63.46 a barrel, up 7 cents. They clocked a weekly rise of about 1.7%. US West Texas Intermediate crude CLc1 settled at $56.20 a barrel, rising 18 cents. It gained about 1.2% on the week.
US economic growth slowed less than expected in the second quarter with a boom in consumer spending, strengthening the outlook for oil consumption.
Next week, top US and Chinese negotiators meet for the first time since trade discussions between the world’s two largest economies broke down in May after nearing agreement. Any positive outcome from the talks is expected to boost oil prices.
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Gold prices move higher
Gold firmed on Friday, having shed 1% in the previous session on robust US jobs data, with investors awaiting further economic readings from Washington that could drive sentiment going into next week’s Federal Reserve meeting.
Spot gold was up 0.5% to $1,420.78 an ounce at 1205 GMT. US gold futures gained 0.4% to $1,420.50.
Prices were still on track for a first weekly drop in three, pressured in part by a stronger dollar and spillover from Thursday’s slide after comments from European Central Bank Governor Mario Draghi lowered expectations for an immediate cut to interest rates.
In other precious metals, platinum rose 0.2% to $867.09 an ounce while palladium edged up 0.3% to $1,535.42. Silver, meanwhile, firmed by 0.5% to $16.48. Silver was on track for a third week of gains, having risen 1.7% so far.
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Copper prices boosted by hopes for end to US-China trade war
Copper prices rose on Wednesday as news that US officials would go to China next week to resume trade talks helped to boost sentiment in industrial metals markets under pressure from concerns over growth and demand.
Benchmark copper on the London Metal Exchange traded up 0.5 percent at $6,000 a tonne in official rings. Prices of the metal used widely in the power and construction industries touched a six-month low at $5,740 in June. US Trade Representative Robert Lighthizer and senior US officials will travel to Shanghai next week to kick-start stalled negotiations aimed at ending a protracted trade war marked by tit-for-tat tariffs.
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Malaysian palm oil hits over 1-month high
Malaysian palm oil futures climbed over 1 percent at midday break on Wednesday to their highest in more than a month, tracking gains in US soyoil on the Chicago Board of Trade (CBOT).
The benchmark palm oil contract for October delivery on the Bursa Malaysia Derivatives Exchange was up 1.1 percent at 2,026 ringgit ($491.87) per tonne at noon, heading for a third straight session of gains. Earlier in the session, it rose as much as 1.2 percent to 2,028 ringgit, its strongest levels since June 21. Palm oil may raise more to 2,023 ringgit per tonne, as it has cleared a resistance at 2,001 ringgit, said Wang Tao.
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ICE canola futures rise as heat stresses European rapeseed crop
ICE canola futures ended higher on Wednesday on concerns that a severe heat wave would reduce European rapeseed production this season, potentially stoking demand for Canadian exports, traders said.
Temperatures across northern Europe hit record highs on Wednesday in the second heat wave this month. The crop-stressing conditions are expected to last until Friday. Most-active November canola ended $2.70 higher at $450.20 per tonne. The contract touched a three-week high during the session. Hedge selling clipped gains late in the session as farmers seized the chance to liquidate some of their stored canola at higher prices and ahead of the upcoming harvest. Canola also drew some spillover support from soybean futures, which climbed on adverse US crop development weather and hopes for revived trade talks between the United States and China.
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Raw sugar prices inch up as Brazilian output falls
Raw sugar futures on ICE rose on Wednesday, lifted by data indicating that Brazilian sugar production dropped in the first half of this month, while coffee and cocoa prices slipped.
October raw sugar settled up 0.08 cent, or 0.7 percent, at 12.06 cents per lb, supported by constructive Brazilian data, dealers said. Sugar output from Brazil’s center-south region slumped 19 percent in the first half of July, cane industry group Unica said. In addition, about 400,000 hectares of cane fields were affected by frosts earlier this month which may impact yields, Unica said. In the previous session, the monthly contract hit a contract low of 11.39 cents before rebounding, in part in anticipation of the Brazilian data.
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CBOT wheat futures rally
Chicago Board of Trade (CBOT) wheat futures rallied on Wednesday, with traders saying they had begun unwinding the corn-wheat spread after the US spring wheat tour found inconsistent yields in parts of North Dakota. CBOT September soft red winter wheat ended the day up 10-1/2 cents at $4.97-3/4 per bushel. K.C. September hard red winter wheat ended up 8 cents at $4.39-1/2 a bushel, and MGEX September spring wheat up 1-3/4 cents to $5.22-1/4 a bushel. Harvest potential for the spring wheat crop in north central North Dakota is variable, with fields that were planted in a timely fashion on track for bumper yields, scouts on an annual tour found on Wednesday.
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China iron ore slumps
Chinese iron ore futures fell nearly 5 percent on Wednesday after miner Vale SA won approval to resume some processing operations, while Shanghai rebar steel extended losses into a sixth session.
The Brazilian miner said the move at the Vargem Grande complex should add 5 million tonnes to annual production, and reaffirmed its 2019 guidance for iron ore and pellets sales, easing concerns over supplies of the steel making ingredient. Brazil’s mining regulatory agency had ordered Vale to halt operations at Vargem Grande in February to guarantee the stability of its dams, following a deadly dam burst in January.
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Shanghai steel rebar hits 1-month low
Shanghai steel futures fell to their lowest in one month on Wednesday, extending losses into a sixth straight session, despite strong steel demand in the physical market.
The construction steel rebar contract on the Shanghai Futures Exchange slid as much as 1.7 percent to 3,882 yuan a tonne, its lowest since June 24. The rest of China’s ferrous markets have retreated after last week’s gains, led by Dalian iron ore, but Toh said a rebound could be expected. Hot-rolled steel used in cars and home appliances dropped as much as 1.8 percent to 3,815 yuan a tonne, its lowest since July 15.