Iron Ore Ends Wild Week Lower
A mostly down week for commodities, with losses for iron ore, copper, gold and oil.
A stronger US dollar helped push prices lower, as did changing sentiment about some products such as copper.
The stronger greenback saw the Aussie dollar fall almost a cent over the week to end just over 75 US cents early Saturday.
But iron ore finished a skittish week with sharp 5.5% surge on Friday, or $US3.65 to nearly $US70 a tonne, according to the Metal Bulletin.
The closing price of $US69.35 though was 1% short of the previous week’s ending of $US70.11 a tonne.
Friday’s rise followed a rebound on China’s futures market and came after a 19% rebound in iron ore imports in November to a near record 94.5 million tonnes from October’s 79.5 million tonnes.
The Metal Bulletin’s China Premium Hard Coking Coal Index closed at $US209.43 per tonne, down from the $US214.35 a tonne end of the week before.
The Metal Bulletin said November’s price surge will see Japanese steel mills paying 10% more for their imports in comparison with the preceding quarter.
November’s iron ore price surge (up 19%) will also see rise in the index - based contract prices for the current quarter.
Meanwhile Comex gold prices fell on Friday, settling at their lowest level in nearly five months as the US dollar and Wall Street prices firmed in the wake of stronger-than-expected 228,000 new US jobs for November.
February gold futures fell $US4.70, or 0.4%, to settle at $US1,248.40 an ounce. That was the lowest since July 20, according to FactSet data. Gold lost around 2.6% for the week, the third straight weekly loss.
In other metals trading, Comex March silver futures rose 0.1% to $US15.823 an ounce, but 3.5% lower on the week.
Comex March copper rose 0.5%, to $US2.979 a pound, but 3.7% lower on the week thanks to Tuesday’s 4.7% slump.
LME 3 months copper ended down 3.96% a $US6,536 a tonne on Friday night.
Comex January platinum fell 6.1% over the week, while March palladium suffered a weekly loss of 2%.
Oil ended higher on Friday, with tensions in the Middle East, the threat of an oil-worker strike in Nigeria and data showing strong Chinese crude imports helping prices trim their losses for the week.
In New York January West Texas Intermediate crude futures rose 67 cents, or 1.2%, to settle at $US57.36 a barrel—for a weekly loss around 1.7%.
In Europe February Brent crude futures, rose $US1.20, or 1.9%, at $US63.40 a barrel cutting its fall for the week to roughly 0.6%.
Baker Hughes on Friday reported that the number of active US oil rigs rose 2 to 751 last week.
The number of US oil rigs has now climbed for three weeks in a row. The total active US rig count, which includes oil and natural-gas rigs, added 2 to 931.
US daily production topped 9.7 million barrels a day last week, more than one million barrels a day above a year ago.
China’s trade report on Friday showed crude imports rose in November to over 9 million barrels a day, up from 7.3 million barrels a day the month before, the second-highest monthly figure on record, while crude imports rose by 12% year-over-year during the first 11 months of 2017.
January natural gas settled at $US2.772 per million British thermal units (MBTUs), up 0.3% for the session, but lost around 9.4% on the week. Prices dropped more than 5% Thursday.
The weakness is in contrast to the three year high for Asian LNG prices reached last week of more than $US10 a MBTUs. That is solely due to soaring purchases by China.
Glenn Dyer has been a finance journalist and TV producer for more than 40 years. He has worked at Maxwell Newton Publications, Queensland Newspapers, AAP, The Australian Financial Review, The Nine Network and Crikey.
At the AFR he was a finance writer, Finance Editor, News Editor and Chief of Staff. At the Nine Network he was supervising producer of Business Sunday for more than 16 years. He has also written for other online and analogue print publications here and overseas.