With oil prices back over $US59 a barrel, our market will get a touch of hope today but there was nothing much in the way of assistance from other commodities.
In fact metals were mixed to a touch easier at the end of a solid week.
Gold prices were mixed, down $US3 to $US 666.30 in London after peaking well above a bullish $671 mid week. But with oil firmer in the US New York gold rose to around $US672 an ounce.
The precious metal is up five per cent this year.
Base metals had a strong week as recent economic data indicated stronger than expected industrial activity around the world. Three-month nickel touched $US 40,000 a tonne on the London Metal Exchange but eased to $US 38,800 in late London trade, down on the day.
Still the metal’s price was around 10 per cent up on the week and more than 23 per cent higher for the year to date as the market remains tight with low global stocks.
Lead prices on the LME also hit a record high last week, touching $US1,795 a tonne, up 11 per cent on the week. That was due to Xstrata halting production at its Northfleet lead refinery in the UK following reduced supplies from Mount Isa’s smelter.
But analysts point out that lead’s supply position is tightening with stocks at the LME falling 20 per cent so far in 2007, quite a sharp fall.
Supply concerns boosted tin prices to a long term high of $US13,300 a tonne and were up eight per cent on the week.
But the most influential base metal is copper and it fell on Friday after figures were released showing that production from all sources (mines, scrap etc) exceeded consumption in the 11 months to last November.
Production from mines and scrap yards exceeded demand by 108,000 tonnes in the 11 months to November, compared with a shortfall a year earlier and analysts blamed the US housing slowdown (an average US house uses an estimated 180 kilograms of the metal).
May copper futures in New York fell to $US 2.659 a pound on Comex but were still up 5.6 per cent over the week. That was the best performance since last July.
Copper stocks in warehouse monitored by exchanges in London, New York and Shanghai have gained 13 percent this year, reaching the highest level in 32 months, while prices have fallen 7.4 per cent. That would have been a much bigger fall if it hadn’t been for last week’s solid rise.
In London LME prices were down $US44 to $5,783 a tonne.
Among the agricultural commodities, wheat prices in Chicago topped the $US5 a bushel mark for the first time in several months, finishing at $US5.07 a bushell, US soybean futures reached the highest level since May 2004 and corn was also higher.
Traders said it was an expectation of low stocks, the continuing strong demand from the biofuels sector, the rise in the oil price and emerging worries about a dry winter and poor spring in US grain growing areas.
