Five Factors in a Constructive Strategy for Investing in Commodities

Investing in commodities is something that needs to be done within a constructive strategy to understands risks and opportunity. There are many factors to consider individually depending on one’s access, location and financial position. Five factors to consider are monitoring the market, monitoring supply and demand dynamics, diversification, long-term focus and dollar cost averaging. Constructive Strategy Investing in Commodities Could Include: 1. Monitoring the market: Stay up to date on the latest market developments and adjust your investment strategy as … Continue reading “Five Factors in a Constructive Strategy for Investing in Commodities”

Standard & Poor’s Affirm Australia’s AAA Rating with a Stable Outlook.

The ratings agency S&P Global Ratings reaffirmed its AAA long-term sovereign credit rating and A-1+ short-term rating for Australia. S&P issued a note saying Australia should avoid a recession amid record low unemployment and elevated commodity prices, even as the economy slows this year amid higher interest rates. The RBA is expected to announce another 25 basis point increase in the official cash rate after its board meeting next Tuesday. S&P said Australia’s ratings were supported by “strong institutions, which … Continue reading “Standard & Poor’s Affirm Australia’s AAA Rating with a Stable Outlook.”

Alcoa Reports Another Quarterly Loss with Falling Aluminum Prices and Pressured Margins

The largest US Aluminum producer Alcoa reported a second consecutive quarterly loss as expected for the fourth quarter on Wednesday but missed on revenue. The company has been squeezed by higher energy and raw material costs and restructuring charges putting pressure on margins. $AA projects 2023 total alumina shipments of 12.7-12.9 million metric tons and aluminum shipments between 2.5-2.6 million metric tons. $AA traded down 5.5% after the release. Aluminum is down roughly 40% from a record high of approximately $4,000 … Continue reading “Alcoa Reports Another Quarterly Loss with Falling Aluminum Prices and Pressured Margins”

Wheat Ends Volatile Year Up 1%, down 62% From Invasion Highs

Chicago wheat futures ended a volatile 2022 up 1.44% above the $7.7 per bushel level with all 3 wheat classes closing out 2022 with solid gains, highlighted by uncertain supply from major producers offsetting lower demand in the global economy. Wheat was still flat on the year despite pulling back 61.8% from the panic highs after the invasion. Russia’s invasion of Ukraine in the end of February triggered a supply halt from the key exporter, while lifting natural gas prices … Continue reading “Wheat Ends Volatile Year Up 1%, down 62% From Invasion Highs”

Silver Survives Volatile Year to Close Year 2% Higher

Silver futures prices hovered above $24 per ounce after breaking out of its downtrend in the last month to end a volatile 2022 up 2.3% $24.04 an ounce. Gold also rebounded from its lows; the catalyst was the retreat of the rampant US dollar. Prices were supported by increased demand for precious metals amid recession concerns and looming supply shortages. Geopolitical risks triggered by the Russian invasion of Ukraine ramped up demand for bullion prices but pulled back until the … Continue reading “Silver Survives Volatile Year to Close Year 2% Higher”

Wheat Futures Hampered by Strong US Dollar Pricing Out Exports

A rough week for wheat futures, closing the week down 2.41%. The high US dollar is weighing on “reduced supplies, slow pace of export sales, and continued uncompetitive U.S. export prices”. On Friday all wheat basis front month contracts closed lower. SRW December down 21 1/2 cents for the week loss. KC Dec futures closed down 23 1/4 cent for the week. Spring Dec wheat futures closed down by 16 1/2 cents on the week. Weakness continued from the USDA … Continue reading “Wheat Futures Hampered by Strong US Dollar Pricing Out Exports”

Corn Futures Steady as Harvest Season Winds Down

Corn prices corn prices down just 0.66% as harvest winds down and farmer selling slows.  The European Commission reduced their corn crop outlook by another 600k MT to 54.9 MMT to 25% lower yr/yr with imports 1 MMT higher to 22 MMT. The summer’s historic heat wave has crushed the crop from France to Ukraine. Mexico’s agriculture ministry has indicated that the country’s 2014 ban on genetically modified corn would not be amended. Mexico’s U.S. imports could be cut in … Continue reading “Corn Futures Steady as Harvest Season Winds Down”

Soy Complex Futures Close Week Mixed, Soybean Lower with Soymeal and Soyoil Higher

Soybean futures closed down 0.32% on the week, consolidating after being strongest grain in the past week. Soy complex closed higher on the week with support from soymeal (+1.6%) and soyoil (+0.48%). Uncertainty about soybean purchases by China, the world’s largest buyer of soybeans continues to keep prices in check. China will auction off another 18.4 million bushels of its state reserves of imported soybeans on November 11. South Korea purchased 120,000 metric tons of soymeal, likely sourced from China … Continue reading “Soy Complex Futures Close Week Mixed, Soybean Lower with Soymeal and Soyoil Higher”

Steel Rebar Futures Lowest in Two Years Impacted by China’s Dynamic Zero-COVID Policy

Steel rebar futures fell to the lowest in two-years Monday at CNY 3,650 per tonne. Deepening recession fears and heavy losses in Chinese bonds and stocks following the reelection of President Xi. Steel rebar and Iron ore futures have been a clear leader from the early days of the raw materials rally. They are also the most volatile. Volatility is fed multiple things, the property sector, energy prices, interest rates, COVID policy and the ongoing trade war between the world’s biggest … Continue reading “Steel Rebar Futures Lowest in Two Years Impacted by China’s Dynamic Zero-COVID Policy”

Wheat Futures Down with Lowest US Exports Since 1971-1972

Wheat futures closed the week down 1.39% despite bouncing Friday with a broad set of other commodities higher as the U.S. Dollar retreated from recent highs on Fed speak. Weakness for the week came from the USDA cutting its 2022-23 outlook for U.S. wheat exports by 50M bushels to 775M bushels, the lowest amount of domestic wheat exports since the 1971-1972 marketing year. The high US dollar is biting “reduced supplies, slow pace of export sales, and continued uncompetitive U.S. … Continue reading “Wheat Futures Down with Lowest US Exports Since 1971-1972”