Copper, crude oil lose about 8%

Print this page Posted on : 01-31-2010 by recycleinme.com

The Reuters-Jefferies CRB index, a commodities bellwether that tracks prices across 19 futures markets, ended the month down about 6 per cent — its worst loss since November 2008, when it dropped almost 10 per cent.

New York, Jan. 30

Commodity markets ended January with their worst losses in more than a year as a surge in the dollar and weak demand outlook caused prices to stumble after a strong run through 2009.

The Reuters-Jefferies CRB index, a commodities bellwether that tracks prices across 19 futures markets, ended the month down about 6 per cent — its worst loss since November 2008, when it dropped almost 10 per cent.

Copper and crude oil took some of the biggest hits from the resurgent dollar and surging stockpiles of supply.

Reuters data showed copper prices fell nearly 9 per cent in January, compared with the 14 per cent loss in December 2008 when financial markets slumped almost all at once in the run-up to the global recession.

Crude oil also fell about 8 per cent after the 18 per cent loss in December 2008.

Much of the selling pressure in commodities this month emanated from the stronger dollar — which surged on Friday to a 6-1/2 month peak against the euro — after a slew of stronger-than-expected data on the US economy.

Copper

US copper's most-actively traded copper futures contract, March settled Friday down 1.5 per cent at $3.0525. During the session, it fell to $3.0490 a lb, a low since Nov. 27.

Benchmark copper for three-month delivery in London ended down $140 at $6,750 a tonne. The intraday low was $6,720, a level not seen since late November last year.

Oil prices slipped below $73 per barrel, and suffered a third consecutive week of losses, as continued lagging energy demand outweighed stronger-than-expected US economic data.

US crude's benchmark front-month contract fell 75 cents to $72.89 a barrel, down from a 15-month high of just under $84 achieved on Jan. 11. For the month, crude futures slumped 8.15 per cent, the biggest monthly percentage drop in 13 months.

The weak demand outlook aside, oil was also weighed down by the 37 per cent drop in quarterly profit posted by prominent energy firm Chevron Corp, which missed Wall Street's forecasts.

On the agricultural front, soyabeans at the Chicago Board of Trade neared four-month lows and fell 12 per cent in January, the sharpest drop since September 2009 when soyabeans lost 15 per cent. Chicago wheat fell 12 per cent in January, the sharpest fall since tumbling 19 per cent in June 2009. Corn fell nearly 14 per cent, its biggest drop since losing 20 per cent in June.

"Several leading technical analysts are saying we are close to a major low across the US grains complex although there may be some more downside,” said Mr Garry Booth, advisor at MF Global Australia.

Sugar bucked the broad trend in commodities, gaining almost 10 per cent on the month, as players bet on more immediate demand than supply for the sweetener.

New York-traded raw sugar hit a 29-year peak of 30.33 cents a lb while London's white sugar rose to nearly $742 a tonne, in sight of recent record highs at $767.

Gold prices fell on Friday, posting a third straight week of declines as strong economic data boosted the dollar and commodity investors remained cautious of a US proposal to limit bank risks.

Spot gold was at $1,079.05 an ounce at 2:44 p.m. EST (1944 GMT), against $1,086.75 late in New York on Thursday.

US April futures settled down $1 at $1,083.80 an ounce on the COMEX division of NYMEX.

Silver was at $16.14 an ounce versus $16.20. Platinum was at $1,497 an ounce versus $1,508, and palladium at $411 versus $418.50.

ETFS Platinum's holdings unchanged at 214,900 ounces as of Jan. 28, while ETFS Palladium's holdings at 399,925 ounces.

Source : Business Line