BULLION METALS OUTLOOK GOLD - Gold prices traded lower for this week tradind Sessions due to stronger US dollar. Prices traded down over 2% this week after hitting its important weekly resistance at $ 1220. We can expect Gold prices to trade bearish till $ 1170 to $ 1150 in coming days. We can expect a trend reversal for a medium term target of $ 1130 to $ 1100 levels. Gold in MCX Futures trading lower for the first time in the last five weeks. Prices down over 1.6% and finding its support at Rs. 28100 for near term. Earlier we can see prices not able to sustain above its important key resistance at Rs.28800 levels. We can expect prices to trade bearish in coming days till Rs.27700 to Rs.27500 levels. The Significance levels for Next week is 28870-28935 is Up side and 28100-27960 is Down Side. GOLD CHART-
Chart Details - The statistical and technical indicators suggest that gold was going ahead and that it was due for a correction. one key indicator is the moving average of convergence/divergence, which is also known as MACD, and on a weekly basis the MACD and Parabolic SAR are indicating that the next move for gold will be up. As Gold prices and gold mining stocks approach resistance we will keep an eye on their performance relative to the movements in other asset classes. A pullback from resistance is very likely but the question is if the pullback evolves into a deeper correction or a bullish consolidation. In the meantime we have focused on buying quality and value in the junior space while maintaining some cash. The good buying opportunity we noted a month ago has passed but another one will come soon one way or another MCX gold is getting support at 28150 and below same could see a test of 27980 level, And resistance is now likely to be seen at 28800, a move above could see prices testing 28950. Monday, 30 January 2017
SILVER - Silver trading weak for the fourth day in a row, refer our continuous updates that Silver medium term trend remain bearish and expect to fall back to $16 to $15.5 levels. We can expect even a deeper correction below $15.5 till $15 mark. MCX Silver Futures looking for a sharper downside in coming days. Next downside is on the row below Rs.40500 till Rs.39000 to Rs.38000 levels shortly. The Crucial levels of Silver for Next week is 41810-41980 is up side and 40850-40520 is Down side.
Detail of Chart - On the Above Given Daily Chart of Silver is preserved the psychological support 39200. MCX Silver is getting support at 40850 and below same could see a test of 39590 level, And resistance is now likely to be seen at 41685, a move above could see prices testing 41950.
✍ MCX DAILY LEVELS DAILY
EXPIRY DATE
R4
R3
R2
R1
PP
ALUMINIUM
30-DEC-2016
130
128
126
125
124
421
415
409
406
403
COPPER
28-FEB-2016
S1
S2
S3
S4
122
120
118
400
397
391
385
123
CRUDE OIL
19-OCT-2016
3944
3840
3736
3672
3632
3568
3528
3424
3320
GOLD
03-FEB-2016
29168
28870
28572
28462
28274
28164
27976
27678
27380
172
167
162
159
157
154
152
147
142
27-DEC-2015
251
243
235
231
227
223
219
211
203
NICKEL
30-DEC-2016
712
690
668
657
646
635
624
610
602
SILVER
03-MARCH-2016
45021
43752
42483
41957
41214
40688
39945
38676
ZINC
30-DEC-2016
199
195
191
189
187
185
183
179
LEAD NATURAL
30-DEC-2016
GAS
37407 175
✍ MCX WEEKLY LEVELS WEEKLY
EXPIRY
R4
R3
R2
R1
PP
S1
S2
S3
S4
ALUMINIUM
30-DEC-2016
140
135
130
127
125
122
120
115
110
447
432
417
411
402
396
387
372
357
3989
3868
3747
3678
3626
3557
3505
3384
3263
30748
29976
29204
28778
28432
28006
27660
26888
26116
COPPER CRUDE OIL GOLD
28-FEB-2016 19-OCT-2016 03-FEB-2016
LEAD
30-DEC-2016
182
174
166
161
158
153
150
142
134
NATURAL GAS
27-DEC-2015
264
251
238
233
225
220
212
199
186
NICKEL
30-DEC-2016
772
732
692
669
652
629
612
572
532
41275
40627
39821
38367
188
184
181
174
SILVER ZINC
03-MARCH-2016 45637 44183 30-DEC-2016
209
202
42729 195
42081 191
36916 167
✍ FOREX DAILY LEVELS DAILY
EXPIRY
R4
R3
R2
R1
PP
S1
S2
S3
S4
USDINR
DATE 26-OCT2016
68.72
68.42
68.12
67.98
67.34
67.08
66.92
66.68
66.24
EURINR
26-OCT2016
76.67
75.06
73.93
71.48
71.01
70.82
69.86
68.03
67.50
GBPINR
26-OCT2016
89.63
88.42
84.66
82.58
80.85
79.16
77.82
75.14
73.63
JPYINR
26-OCT2016
62.52
61.98
59.47
57.95
56.88
56.46
56.05
55.85
55..43
✍ FOREX WEEKLY LEVELS WEEKLY
EXPIRY
R4
R3
R2
R1
PP
S1
S2
S3
S4
USDINR
DATE 26-OCT2016
69.83
68.64
68.16
68.02
67.94
67.24
67.04
66.84
66.28
EURINR
26-OCT2016
80.92
78.54
76.51
72.80
69.52
68.16
67.12
66.03
64.17
GBPINR
26-OCT2016
96.53
94.35
91.14
88.17
84.15
82.36
80.52
78.36
74.13
JPYINR
26-OCT2016
69.65
67.58
65.36
63.52
61.79
58.14
56.96
51.28
50.03
✍ NCDEX DAILY LEVELS DAILY
EXPIRY
SYOREFIDR
20-JAN-2016
R3
R2
R1
PP
S1
S2
S3
S4
727
720
713
708
706
701
699
692
685
SYBEANIDR
20-JAN-2016
3113
3089
3065
3056
3041
3032
3017
2993
2969
RMSEED
20-JAN-2016
4013
3967
3921
3897
3875
3851
3829
3783
3737
JEERAUNJHA
20-JAN-2016
20443
19628
18813
18357
17998
17542
17183
16368
15553
GUARSEED10
20-JAN-2016
3351
3326
3301
3291
3276
3266
3251
3226
3201
TMC
20-APR-2016
7113
6981
6849
6773
6717
6641
6585
6453
6321
DATE
R4
✍ NCDEX WEEKLY LEVELS WEEKLY
EXPIRY
R4
R3
R2
R1
PP
S1
S2
S3
S4
SYOREFIDR
20-JAN-2016
763
746
729
722
712
705
695
678
661
SYBEANIDR
20-JAN-2016
3387
3281
3175
3110
3069
3004
2963
2857
2751
RMSEED
20-JAN-2016
4184
4087
3990
3932
3893
3835
3796
3699
3602
JEERAUNJHA
20-JAN-2016
20443
19628
18813
18357 17998 17542 17183
16368
15553
GUARSEED10
20-JAN-2016
3787
3629
3471
3377
3313
3219
3155
2997
2839
TMC
20-APR-2016
8126
7690
7254
6976
6818
6540
6382
5946
5510
DATE
MCX - WEEKLY NEWS LETTERS ✍ INTERNATIONAL UPDATES ( BULLION & ENERGY ) Gold ended little changed on Friday, after weaker-than-expected figures on U.S. fourth quarter growth dampened expectations for a faster rate of interest rate hikes this year. Gold for April delivery settled at $1,190.0 on the Comex division of the New York Mercantile Exchange. The precious metal was 1.35% lower for the week, as the stronger U.S. dollar weighed. The annual rate of economic growth slowed to 1.9% in the three months to December the Commerce Department reported Friday, slowing sharply from the 3.5% rate of growth seen in the third quarter. The economy grew just 1.6% in 2016 as a whole, the slowest rate of growth since 2011. The slowdown in growth prompted speculation that the Federal Reserve will avoid hiking interest rates too quickly. Investors also remained cautious as they pondered the economic implications of President Donald Trump's pledges of increased fiscal spending, tax cuts and protectionism. Elsewhere in precious metals trading, silver was at $ 17.16 a troy ounce late Friday and ended the week little changed. Copper was trading at $ 2.69 a pound late Friday and ended the week up 2.86%, and platinum was up 0.69% on the day at $ 988.45 an ounce. In the week ahead, markets will be paying close attention to Friday’s U.S. nonfarm payrolls report for January as well as Wednesday’s policy statement by the Fed. Investors will also be watching central bank meetings in Japan and the UK. Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, January 30 Financial markets in China will be closed for the Lunar New Year holiday. In the euro zone, Germany is to release preliminary data on inflation. The U.S. is to release figures on personal income and spending as well as a report on pending home sales. Tuesday, January 31 Markets in China will be closed for the Lunar New Year holiday. The Bank of Japan is to announce its benchmark interest rate and publish a policy statement which outlines economic conditions and the factors affecting the monetary policy decision. The announcement is to be followed by a press conference.
The euro zone is to release preliminary estimates of consumer price inflation and fourth quarter GDP. European Central Bank President Mario Draghi is to speak at an event in Frankfurt. Canada is to publish its monthly report on GDP. The U.S. is to release private sector data on consumer confidence. Bank of Canada Governor Stephen Poloz is to speak at an event in Alberta. Wednesday, February 1 Markets in China will remain shut for the Lunar New Year holiday. China is to release survey data on manufacturing and service sector activity. New Zealand is to publish its quarterly employment report. The UK is to release data on manufacturing activity. The European Commission is to publish its latest economic forecasts for the European Union. The U.S. is to release the ADP nonfarm payrolls report for January and the Institute for Supply Management is to release its manufacturing PMI. The Federal Reserve is to announce its benchmark interest rate and publish a monetary policy statement.
Thursday, February 2 Markets in China will remain shut for the Lunar New Year holiday. Australia is to release data on building approvals and the trade balance. The UK is to release data on manufacturing activity. The Bank of England is to announce its benchmark interest rate and publish the minutes of its monetary policy meeting along with its quarterly inflation report. BoE Governor Mark Carney, along with other policymakers will also hold a press conference to discuss the inflation report.
ECB President Mario Draghi is to speak at an event in Slovenia. The U.S. is to publish data on initial jobless claims and labor costs.
Friday, February 3 China is to publish its Caixin manufacturing PMI. The UK is to release data on manufacturing activity. Chicago Fed President Charles Evans is to speak. The U.S. is to round up the week data on factory orders and the non-farm payrolls report for January, while the ISM is to release its services PMI. Gold demand in India improved this week, boosted by a fall in prices overseas, although some consumers waited to see if hopes for an import duty cut in the government's budget next week will be realised. Global gold prices on Friday hit a two-week low on a stronger dollar keeping the metal on track to record their first weekly loss since late December. "Wedding season demand has improved. The price correction is also luring in customers," said Harshad Ajmera, the proprietor of JJ Gold House, a wholesaler in the eastern Indian city of Kolkata. Dealers in India, the world's second-largest consumer of the metal, were charging a premium of up to $2 an ounce this week over official domestic prices, unchanged from last week. The domestic price includes a 10 percent import tax. "Few jewellers are delaying purchases expecting import duty cut in the budget, but some think this may not happen," said a Mumbai-based dealer with a private bank. The bullion industry has been urging a reduction in the duty to combat smuggling, which has increased since India raised import duty to 10 percent in August 2013 in an effort to narrow a gaping current account deficit. "The government is going to implement GST this year. At the time of implementation, it may reduce import duty to adjust overall duty structure on gold," said a Mumbai-based dealer with a private bank. The trade ministry has requested the finance ministry to cut the import duty to 6 percent, according to a senior government official. The Indian government will present on Feb. 1 its budget for the 2017/18 financial year starting April 1. the local market, gold prices MAUc1 were trading around 28,150 rupees per 10 grams on Friday, after falling to 26,862 rupees last month, the lowest level since Feb. 2, 2016 Demand in China waned further, ahead of the week-long Lunar New Year Holiday, forcing premiums in the top-consumer nation to narrow to nearly $6 from $14 last week. "It has been extremely quiet despite the correction in prices," said Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong. In Hong Kong and Singapore, premiums were mostly unchanged from previous week's premium of around $1 - $1.40 an ounce. China's net gold imports via main conduit Hong Kong rose 2.7 percent in December over the previous month. in Tokyo were flat against a discount of 50 cents last week, traders said.
Gold fell to a two-week low on Thursday as the dollar firmed and equity markets rallied, but expectations that the greenback's climb may be coming to an end helped limit losses. Spot gold prices XAU= were down 1 percent at $1,187.93 an ounce by 3:02 p.m. EST, after tapping $1,184.03, its lowest since Jan. 11. U.S. gold futures GCcv1 settled down 0.7 percent at $ 1,189.80. A stronger U.S. currency makes dollar-denominated commodities more expensive for holders of other currencies, potentially curbing demand. "The dollar is a little bit stronger this morning, yields are up a bit and that's why gold is below $ 1,200," U.S. Treasury yields later weakened, but the general strength in equities and yields have been fueled by U.S. President Donald Trump's signals that he plans to increase public spending. Expectations of a boost to growth have recently had a diminishing impact on the dollar. "Trump's victory has unleashed one of the strongest expressions of business and financial optimism in history, starkly affecting variables central to gold's short-term trading patterns. "Should our suspicions bear out that reigning euphoria proves short-lived, recent market dislocations will provide excellent entry points for a wide array of investment assets." Investors abandoning gold can be seen in the holdings of SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, which fell 0.6 percent to 799.07 tonnes on Wednesday. Also undermining sentiment was weak physical demand in India due to higher prices, while Chinese demand is weaker ahead of the Lunar New Year holiday, traders said. Palladium XPD= slid 1 percent to $722 an ounce, after touching a three-week low at $711.15. It fell more than 7 percent on Wednesday, its worst one-day fall since April 2013. "Previously, palladium had failed on three consecutive days to exceed the psychologically important $800 per troy ounce mark, giving rise to a more gloomy technical picture," Palladium is used in autocatalysts and has been boosted by expectations of stronger demand for cars but the outlook for growth is now less bright. "Car ownership rates in the U.S. peaked a couple of years ago, which means most of the cars sold are just replacement demand," Menke said. "China has cut car subsidies so sales there will probably be lower this year." silver XAG= fell 0.9 percent to $16.79 an ounce, while platinum XPT= inched up 0.08 percent to $ 978.50. Gold prices were at a two-week low in European morning trade on Thursday, as stocks around the world extended a rally after the Dow climbed past 20,000 for the first time overnight, dampening the metal’s safe-haven appeal. Gold for February delivery on the Comex division of the New York Mercantile Exchange fell $2.00, or around 0.2%, to $1,195.85 a troy ounce by 4:10AM ET, after declining $13.00, or about 1.1%, a day earlier. Prices of the yellow metal slumped to their lowest since January 13 at $ 1,192.60 on Wednesday, pulling back from two-month highs of $ 1,219.40 touched earlier this week. Global stocks remained in full rally-mode on Thursday as investors snapped up equities amid an improved corporate earnings outlook, reducing demand for safe-haven assets such as gold and government bonds.
The Dow closed atop the 20,000-mark for the first time on Wednesday, boosted by solid earnings. Investors are also turning more optimistic as President Donald Trump begins to offer more details of his policies. Trump signed two executive orders on Tuesday to move forward with construction of the controversial Keystone XL and Dakota Access oil pipelines, rolling back key Obama administration environmental actions in favor of expanding energy infrastructure. He also signed orders rolling back some regulation and environmental rules, in order to expedite approval of infrastructure projects. But concerns over his protectionist stance remain after Trump signed executive orders on immigration on Wednesday, including one of border security and the intent to build a wall along the U.S.-Mexico border. Earlier this week, the president signed to formally withdraw the U.S. from the Trans-Pacific Partnership trade deal and vowed to renegotiate the North American Free Trade Agreement with leaders of Canada and Mexico. Market players will continue to focus on Trump for further details on his promises of tax reform, infrastructure spending and deregulation, as well as insight regarding policies on China and the domestic economy. The U.S. dollar index, which measures the greenback’s strength against a tradeweighted basket of six major currencies, was at 100.10 in European morning trade, after falling to a seven-week low of 99.77 overnight. Also on the Comex, silver futures for March delivery dropped 6.2 cents, or 0.4%, to $16.91 a troy ounce. Meanwhile, platinum tacked on 0.4% to $985.20, while palladium added 0.6% to $740.17 an ounce, after plunging 7.5% in the prior session. Elsewhere in metals trading, copper futures rose 0.8 cents, or about 0.3%, to $2.718 a pound, the most since June 2015, amid hopes for an infrastructure boost in the U.S. Gold fell to a two-week low on Thursday as the dollar firmed and equity markets rallied, but expectations that the greenback's climb may be coming to an end helped limit losses. Spot gold prices XAU= were down 1 percent at $1,187.93 an ounce by 3:02 p.m. EST (2002 GMT), after tapping $1,184.03, its lowest since Jan. 11. U.S. gold futures GCcv1 settled down 0.7 percent at $1,189.80. A stronger U.S. currency makes dollar-denominated commodities more expensive for holders of other currencies, potentially curbing demand. "The dollar is a little bit stronger this morning, yields are up a bit and that's why gold is below $1,200," said Julius Baer analyst Carsten Menke. U.S. Treasury yields later weakened, but the general strength in equities and yields have been fueled by U.S. President Donald Trump's signals that he plans to increase public spending. Expectations of a boost to growth have recently had a diminishing impact on the dollar. "Trump's victory has unleashed one of the strongest expressions of business and financial optimism in history, starkly affecting variables central to gold's short-term trading patterns," Should our suspicions bear out that reigning
euphoria proves short-lived, recent market dislocations will provide excellent entry points for a wide array of investment assets." Investors abandoning gold can be seen in the holdings of SPDR Gold Trust GLD , the world's largest gold-backed exchange-traded fund, which fell 0.6 percent to 799.07 tonnes on Wednesday. Also undermining sentiment was weak physical demand in India due to higher prices, while Chinese demand is weaker ahead of the Lunar New Year holiday, traders said. Palladium XPD= slid 1 percent to $722 an ounce, after touching a three-week low at $711.15. It fell more than 7 percent on Wednesday, its worst one-day fall since April 2013. "Previously, palladium had failed on three consecutive days to exceed the psychologically important $800 per troy ounce mark, giving rise to a more gloomy technical picture," Palladium is used in autocatalysts and has been boosted by expectations of stronger demand for cars but the outlook for growth is now less bright. "Car ownership rates in the U.S. peaked a couple of years ago, which means most of the cars sold are just replacement demand," Menke said. "China has cut car subsidies so sales there will probably be lower this year." silver XAG= fell 0.9 percent to $ 16.79 an ounce, while platinum XPT= inched up 0.08 percent to $ 978.50. Gold prices were at a two-week low in European morning trade on Thursday, as stocks around the world extended a rally after the Dow climbed past 20,000 for the first time overnight, dampening the metal’s safe-haven appeal. Gold for February delivery on the Comex division of the New York Mercantile Exchange fell $2.00, or around 0.2%, to $1,195.85 a troy ounce by 4:10AM ET, after declining $13.00, or about 1.1%, a day earlier. Prices of the yellow metal slumped to their lowest since January 13 at $1,192.60 on Wednesday, pulling back from two-month highs of $1,219.40 touched earlier this week. Global stocks remained in full rally-mode on Thursday as investors snapped up equities amid an improved corporate earnings outlook, reducing demand for safe-haven assets such as gold and government bonds. The Dow closed atop the 20,000-mark for the first time on Wednesday, boosted by solid earnings. Investors are also turning more optimistic as President Donald Trump begins to offer more details of his policies. Trump signed two executive orders on Tuesday to move forward with construction of the controversial Keystone XL and Dakota Access oil pipelines, rolling back key Obama administration environmental actions in favor of expanding energy infrastructure. He also signed orders rolling back some regulation and environmental rules, in order to expedite approval of infrastructure projects. But concerns over his protectionist stance remain after Trump signed executive orders on immigration on Wednesday, including one of border security and the intent to build a wall along the U.S.-Mexico border. Earlier this week, the president signed to formally withdraw the U.S. from the Trans-Pacific Partnership trade deal and vowed to renegotiate the North American Free Trade Agreement with leaders of Canada and Mexico. Market players will continue to focus on Trump for further details on his promises of tax reform, infrastructure spending and deregulation, as well as insight regarding policies on China and the domestic economy. The U.S. dollar index, which measures the greenback’s strength against a tradeweighted basket of six major currencies, was at 100.10 in European morning trade, after falling to a
seven-week low of 99.77 overnight. Also on the Comex, silver futures for March delivery dropped 6.2 cents, or 0.4%, to $16.91 a troy ounce. Meanwhile, platinum tacked on 0.4% to $985.20, while palladium added 0.6% to $740.17 an ounce, after plunging 7.5% in the prior session. Elsewhere in metals trading, copper futures rose 0.8 cents, or about 0.3%, to $2.718 a pound, the most since June 2015, amid hopes for an infrastructure boost in the U.S. Gold prices edged lower during European morning trade on Wednesday, moving further away from this week's two-month high as the metal’s safe-haven appeal was dampened amid a rally in global equity markets. Gold for February delivery on the Comex division of the New York Mercantile Exchange fell $8.15, or around 0.7%, to $1,202.65 a troy ounce by 3:50AM ET , after declining $4.80, or 0.4%, a day earlier. Prices of the yellow metal jumped to a two-month peak of $1,219.40 on Monday. Global stocks were in rally-mode, with the S&P 500 and Nasdaq setting record highs on Tuesday, as investors snapped up equities amid an improved corporate earnings outlook, reducing demand for safe-haven assets such as gold and government bonds. Market players will continue to focus on U.S. President Donald Trump for further details on his promises of tax reform, infrastructure spending and deregulation, as well as insight regarding policies on China and the domestic economy. Trump signed two executive orders on Tuesday to move forward with construction of the controversial Keystone XL and Dakota Access oil pipelines, rolling back key Obama administration environmental actions in favor of expanding energy infrastructure. He also met with chief executives of the Big Three U.S. automakers to push for more cars to be built in the U.S. Earlier this week, Trump signed to formally withdraw the U.S. from the 12-nation Trans-Pacific Partnership trade deal, distancing America from its Asian allies. He also vowed to renegotiate the North American Free Trade Agreement with leaders of Canada and Mexico. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was at 100.27 in European morning trade, not far from a seven-week low of 99.88 touched earlier this week. Also on the Comex, silver futures for March delivery dropped 18.3 cents, or 1.1%, to $17.00 a troy ounce during morning hours in London. Meanwhile, platinum lost 1.5% to $992.85, while palladium slumped 1.6% to $782.90 an ounce. Elsewhere in metals trading, copper futures rose 0.8 cents, or about 0.3%, to $2.716 a pound amid hopes for an infrastructure boost in the U.S.
Gold prices edged lower during European morning trade on Tuesday, pulling back from the prior session's two-month peak as the dollar firmed after earlier losses. Gold for February delivery on the Comex division of the New York Mercantile Exchange dipped $ 2.00, or around 0.2%, to $ 1,213.55 a troy ounce by 4:10AM ET, after rallying $ 10.70, or 0.9%, a day earlier. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.2% at 100.15, recovering after slumping to a seven-week low of 99.88 earlier. The dollar sold off after President Donald Trump's nominee for Treasury Secretary Steven Mnuchin said that an "excessively strong" dollar can have negative short-term impacts on the U.S. economy. Mnuchin is still awaiting confirmation by the Senate, which has yet to schedule a vote. Prices of the yellow metal jumped to $ 1,219.40 on Monday, a level not seen since November 22, as the U.S. dollar tumbled amid uncertainty around the economic policies of new U.S. President Donald Trump. In his latest executive order, Trump signed to formally withdraw the U.S. from the 12-nation Trans-Pacific Partnership trade deal, distancing America from its Asian allies. Trump has also vowed to renegotiate the North American Free Trade Agreement with leaders of Canada and Mexico. Global financial markets will continue to focus on Trump for further details on his promises of tax reform, infrastructure spending and deregulation, as well as insight regarding policies on China and the domestic economy. The president vowed “massive” cuts in taxes and said he could reduce regulations by "75% or more" to help businesses create more jobs in the U.S. in a meeting with top executives of U.S. companies at the White House on Monday. Trump also reiterated his pledge to impose a hefty border tax. Trump plans to meet with automotive executives at the White House on Tuesday. Also on the Comex, silver futures for March delivery dipped 3.4 cents, or 0.2%, to $ 17.15 a troy ounce during morning hours in London. Meanwhile, platinum tacked on 0.6% to $985.35, while palladium added 0.9% to $ 778.33 an ounce. Elsewhere in metals trading, copper futures rose 0.6 cents, or about 0.3%, to $ 2.654 a pound. Gold prices rose sharply during European morning trade on Monday, hitting the strongest level in around two months as the U.S. dollar tumbled amid uncertainty around the economic policies of new U.S. President Donald Trump. Gold for February delivery on the Comex division of the New York Mercantile Exchange touched a session high of $ 1,219.40 a troy ounce, a level not seen since November 22. It was last at $ 1,214.50 by 3:10AM ET, up almost $10.00, or 0.8%. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.5% at 100.25 in early trade, after slumping to a seven-week low of 100.17 earlier. The dollar sold off after President Trump struck a protectionist tone in his inauguration speech on Friday, disappointing investors who hoped to hear further details on his promises of tax cuts and other stimulus. Dollar weakness usually benefits gold, as it boosts the metal's appeal as an alternative asset and makes dollar-priced commodities cheaper for holders of other currencies. Investors will get back to the
business of watching economic data for fresh indications on the health of the economy in the week ahead, with Friday's advanced reading for U.S. growth in the spotlight. Besides the GDP report, this week's calendar also features U.S. data on existing home sales on Tuesday, initial jobless claims and new home sales on Thursday, followed by durable goods orders and revised consumer sentiment on Friday. A recent string of solid data reinforced the view that the U.S. economy is sufficiently robust to warrant higher interest rates in the months ahead. The Federal Reserve indicated last month that at least three rate increases were in the offing for 2017, according to a forecast of interest rates from members of the central bank, known as the dot-plot. However, traders remained unconvinced. Instead, markets are pricing in just two rate hikes during the course of this year, according to Investing.com’s Fed Rate Monitor Tool. A delay in raising interest rates would be seen as positive for gold, a non-interest-bearing asset, and negative for the dollar. Also on the Comex, silver futures for March delivery tacked on 11.0 cents, or about 0.7%, at $ 17.14 a troy ounce during morning hours in London. Gold ended higher on Friday, buoyed by the weaker dollar as the inauguration of Donald Trump as U.S. president fueled uncertainty about the direction of fiscal and economic policy. Gold for February delivery settled up 0.67% at $1,209.5 on the Comex division of the New York Mercantile Exchange. The metal was 0.75% higher for the week, helped by a broad weakening of the U.S. dollar. The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.33% to 100.77 late Friday. The index has fallen 1.49% so far this month amid worries over Trump's protectionist stance and following recent remarks in which he said the dollar was too strong. On Friday, Trump said his administration would put "America first" and also promised new roads, bridges and highways. But market sentiment was hit by the negative tone of the speech, which underlined uncertainty over how Trump will govern. Elsewhere in precious metals trading, silver was at $17.09 a troy ounce late Friday, and ended the week with gains of 1.59%. Copper was trading at $2.61 a pound late Friday and ended the week down 2.35% as traders locked in profits after prices hit seven-week peaks. Platinum was up 2.66% on the day at $981.8 an ounce, trimming the week’s losses to 0.6%. In the week ahead, the economic calendar is light but Trump's policy plans in his first days in office are likely to dominate headlines. Investors will also be awaiting a first look at fourth quarter growth from the U.S. on Friday and from the U.K. a day earlier. Tuesday’s data on euro area private sector activity will also be closely watched. Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, January 23 Canada is to publish data on wholesale sales. ECB President Mario Draghi is to speak at an event in Italy.
Tuesday, January 24 The euro zone is to release data on private sector business activity. The U.K. High Court is to deliver a ruling regarding the government's ability to bypass parliament and initiate Britain’s exit from the European Union by triggering Article 50. The U.K. is also to release data on public sector borrowing. The U.S. is to report on existing home sales.
Wednesday, January 25 Australia is to publish data on inflation. The Ifo Institute is to report on German business climate.
Thursday, January 26 New Zealand is to publish its monthly inflation report. The U.K. is to release the preliminary reading on fourth quarter growth. The U.S. is to release data on initial jobless claims and new home sales.
Friday, January 27 Shanghai stock exchange will be shut for a holiday. The U.S. is to round up the week with a preliminary estimate of fourth quarter economic growth, as well as a report on durable goods orders and revised data on consumer sentiment. Gold demand slowed in India this week as buyers Postponed purchases on expectation of a cut in import duty and after a rebound in prices, while it was tepid across other major trading centres in Asia. In India, the world's second-largest consumer of the metal, dealers were charging a premium of up to $ 2 an ounce this week over official domestic prices that include a 10 percent import tax. The premiums were
at $ 1 last week. "Buyers are anticipating a cut in import duty in the budget. That is prompting them to delay purchases said. The Indian government will present on Feb. 1 its budget for the 2017/18 financial year starting on April 1. bullion industry has urged the government to cut the import duty to combat smuggling, which has increased since India raised the levy to 10 percent in August 2013 in a bid to narrow its current account deficit. A senior government official said earlier this month that the trade ministry has requested the finance ministry to cut the import duty to 6 percent. are also confused due to volatility in prices," said a Mumbai-based dealer with a private bank. "Investment demand has fallen substantially since the government banned higher-value currency notes." Gold MAUc1 was trading around 28,665 rupees per 10 grams on Friday. It fell to 26,862 rupees last month, the lowest level since Feb. 2, 2016. International gold prices were broadly steady on Friday, with spot gold XAU= on track for its fourth straight weekly gain, buoyed by a weaker dollar ahead of the inauguration of Donald Trump as U.S. President. In top consumer China, demand slowed on higher prices, a trader with a Chinese import bank said, causing premiums to shrink to $ 14 from $ 17 earlier this week. In Hong Kong and Singapore, premiums were quoted at around $ 1 - $ 1.30 an ounce, largely unchanged from last week. "Whenever prices go up over $ 1,190-$ 1,200, demand starts to slow down. Towards the Chinese New Year, the demand is usually sluggish and that's been the case this time," said Ronald Leung, chief dealer at Lee Cheong Gold Dealers in Hong Kong. Prices in Tokyo were at a discount of 50 cents this week compared with a discount of $ 1 last week. "Industrial demand picked up ahead of the Chinese New Year. However, we have seen more buybacks from dealers due to higher prices in Japan," a Tokyo-based trader said.
� ENERGY Oil prices extended declines on Monday, dragged down by signs of growing output in the United States that would partly offset production cuts by OPEC and other producers. London Brent crude for March delivery LCOc1 was down 26 cents at $55.26 a barrel by 0005 GMT after settling down 72 cents on Friday. NYMEX crude for March delivery CLc1 was down 22 cents at $52.95 a barrel. The U.S. weekly oil and gas rig count from Baker Hughes showed that U.S. drillers added 15 oil rigs in the week, the 12th gain in 13 weeks. That brought the total count to 566, the most since November 2015. The Organization of the Petroleum Exporting Countries and other producers, including Russia, agreed to cut output by almost 1.8 million barrels per day in the first half of 2017 to relieve a two-year supply overhang. But U.S. oil production has been rising, with the International Energy Agency forecasting total U.S. output growth of 320,000 bpd in 2017 to an average of 12.8 million bpd. rise in U.S. output should not be unexpected. "However we expect the reductions being made by OPEC will far exceed any rise in the U.S. and quickly reduce the global inventory that has been built up over the past two years. Hedge funds and money managers boosted bullish wagers on U.S. crude oil to the highest level since
mid-2014, Commodity Futures Trading Commission data showed on Friday, as agreed output cuts by the world's top producers began to eat into a global glut. Donald Trump on Sunday defended his move to ban entry of refugees and people from seven Muslim-majority nations and said the United States would resume issuing visas for all countries in the next 90 days as he faced rising criticism at home and abroad and new protests in U.S. cities. Oil futures finished lower on Friday, logging a modest weekly loss, as investors turned their attention to rising production in the U.S. and away from OPEC and other producers' commitment to curbing global oversupply. On the New York Mercantile Exchange, crude oil for delivery in March slumped 61 cents, or around 1.1%, to end at $53.17 a barrel by close of trade. Futures touched a high of $54.08 earlier, the strongest level since January 6. For the week, New York-traded oil futures lost 5 cents, or about 0.1%. Elsewhere, on the ICE Futures Exchange in London, Brent oil for March delivery declined 72 cents, or nearly 1.3%, to settle at $55.45 a barrel by close of trade Friday. Prices climbed to a three-week high of $56.55 in the prior session. London-traded Brent futures scored a gain of 7 cents, or approximately 0.1%, on the week. Prices dropped to the lowest levels of the session after oilfield services provider Baker Hughes said late Friday that the number of rigs drilling for oil in the U.S. increased by 15 last week, the 12th gain in 13 weeks. That brought the total count to 566, the most since November 2015. The data raised concerns that the ongoing rebound in U.S. shale production could derail efforts by other major producers to rebalance global oil supply and demand. Futures have been trading in a narrow range around the low-to-mid $50s over the past month as sentiment in oil markets has been torn between expectations of a rebound in U.S. shale production and hopes that oversupply may be curbed by output cuts announced by major global producers. OPEC and non-OPEC countries have made a strong start to lowering their oil output under the first such pact in more than a decade as global producers look to reduce oversupply and support prices. January 1 marked the official start of the deal agreed by OPEC and non-OPEC member countries such as Russia in November last year to reduce output by almost 1.8 million barrels per day to 32.5 million for the next six months. The deal, if carried out as planned, should reduce global supply by about 2%. Elsewhere on Nymex, gasoline futures for February dipped 1.5 cents, or 1% to $1.527 a gallon. It ended down about 2.5% for the week. February heating oil shed 2.2 cents, or 1.4%, to finish at $1.618 a gallon. For the week, the fuel lost around 1.7%. Natural gas futures for March delivery slipped 3.9 cents, or nearly 1.2%, to $3.358 per million British thermal units. It posted a weekly gain of around 0.3%. In the week ahead, market participants will eye fresh weekly information on U.S. stockpiles of crude and refined products on Tuesday and Wednesday to gauge the strength of demand in the world’s largest oil consumer. Traders will also continue to pay
close attention to comments from global oil producers for further evidence that they are complying with their agreement to reduce output this year. Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. Tuesday, January 31 The American Petroleum Institute, an industry group, is to publish its weekly report on U.S. oil supplies.
Wednesday, February 1 The U.S. Energy Information Administration is to release weekly data on oil and gasoline stockpiles.
Thursday, February 2 The U.S. EIA is to produce a weekly report on natural gas supplies in storage.
Friday, February 3 Baker Hughes will release weekly data on the U.S. oil rig count. Oil prices slipped on Friday, extending losses after data suggested drilling is ramping up in the United States, prompting investor concern about how effective OPEC and other producers will be at supporting prices by cutting supplies. U.S. crude CLc1 futures for March delivery settled down 61 cents, or 1.1 percent, at $53.17 a barrel. Brent was down 72 cents at $55.52 a barrel. The U.S. weekly oil and gas rig count from Baker Hughes showed that U.S. drillers added 15 oil rigs in the week, the 12th gain in 13 weeks. That brought the total count to 566, the most since November 2015. "We're in a holding pattern at this point in time," said Mark Watkins, regional investment manager at U.S. Bank Private Client Group. "Supply is a big factor right now and you have the U.S. really filling that gap that OPEC has left open." Prices had risen during Asian trading, though activity was thin due to the start of the Lunar New Year holiday in much of that region, including China and Singapore. The Organization of the Petroleum Exporting Countries and other producers, including Russia, agreed to cut output by almost 1.8 million barrels per day (bpd) in the first half of 2017 to relieve a two-year supply overhang. But U.S. oil production has been rising, with the International Energy Agency
forecasting total U.S. output growth of 320,000 bpd in 2017 to an average of 12.8 million bpd. factors affected prices this week, such as gains in Iran's monthly oil exports in February and resilient production in Libya. A glitch in North Sea Buzzard crude production provided support. market participants warned of more volatility ahead as speculators react to even small developments in the physical markets. U.S. Commodity Futures Trading Commission data showed that in the week to Jan. 24, hedge funds and other speculators boosted bullish wagers on U.S. crude oil to the highest since mid 2014. that speculative net long positions in Brent and WTI are already at a record-high level, the correction potential is therefore growing all the time. OPEC oil output is set to fall by 900,000 barrels per day this month, a company that tracks OPEC supply said on Friday, pointing to a strong start by the exporter group in implementing a supply cut deal. South Sudan plans to more than double oil production to 290,000 barrels per day in fiscal 2017/2018, the finance minister said on Friday, indicating a target higher than the level recorded shortly before conflict erupted in late 2013. Only a handful of cargoes were still available including Nemba, Pazflor, Plutonio and Saturno.
NIGERIA Trading slowed as sellers reassessed market values following a string of tender awards that helped clear out a backlog of cargoes. Qua Iboe cargoes were being offered at around dated Brent plus $1.00 a barrel, firming on a smaller programme. The Erha programme emerged with five cargoes in March, including one deferred from the endFebruary. Oil fell Friday in thin trade as the Chinese Lunar New Year holiday kicked off. Brent crude was off 54 cents, or 0.96%, at $55.70 at 07:30 ET. U.S. crude shed 35 cents, or 0.65%, to $53.43. The market is looking to the latest Baker Hughes weekly U.S. rig count data later in the session. The number of rigs operating in the U.S. in the previous week rose to 551, the highest level since November 2015. An increase in North American shale activity could undermine the impact of agreed oil output cuts. OPEC and non-OPEC producers have agreed to cut output by some 1.8 million barrels a day in the first half of this year. The dollar index edged higher. A stronger dollar weakens demand for oil. Oil prices dipped on Friday, with rising crude output from the United States offsetting efforts by OPEC and other producers to cut supplies to prop up the market. Brent crude futures LCOc1 , the international benchmark for oil prices, were trading at $ 56.14 per barrel at 0132 GMT, down 10 cents from their last close. U.S. West Texas Intermediate crude futures
dropped 2 cents to $53.76 a barrel. Traders said that efforts by the Organization of the Petroleum Exporting Countries and other producers including Russia to cut supplies to reduce a global fuel overhang were being offset by rising output in the United States, resulting in range-bound prices. "Market participants are hyper-focused on two issues: shale's response to higher prices and OPEC compliance. "Producers and OPEC countries are all talking their books, yet the jury is still out," it added, referring to widespread scepticism over compliance with announced cuts. The British bank said it expected Brent and WTI prices to average $55 and $53 per barrel respectively for the first quarter. OPEC and other producers have agreed to cut production by almost 1.8 million barrels per day for the first half of 2017 to fight a supply overhang that has seen between 1 million and 2 million bpd of crude being produced in excess of consumption over the past two years. U.S. oil production, however, has risen by around half a million bpd since mid-2016 to 8.96 million bpd, offsetting significant amounts of any OPEC-led supply cut. Oil prices jumped 2 percent on Thursday, boosted by the ongoing rally in the U.S. stock market, although gains in crude futures were capped by plentiful supplies and bulging inventories in spite of efforts by producers to cut output. U.S. light crude futures CLc1 were up 96 cents to $53.71 a barrel, a gain of 1.8 percent, while Brent crude LCOc1 rose $1.04, or 1.9 percent, to $56.12 by 1:41 p.m. ET. U.S. crude popped to a peak of $54.06, its highest in more than three weeks, as Wall Street opened at 9:30 a.m. ET and added to the previous session's rally that had lifted the Dow Jones Industrial Average to close above 20,000 for the first time. Major averages were little changed in the afternoon.Robert Yawger, director of energy futures at Mizuho Americas, said traders may keep be adding more long positions in oil that are already at two-and-a-half-year highs. market is pushing for $55 oil here and ultimately it seems determined to get there," Yawger said. "The speculators have an interest in pushing this thing to the upside, which has much do with this (rally) as anything else." Oil's gains were limited by Wednesday's U.S. inventory figures showing an increase of 2.8 million barrels last week in U.S. crude inventories to 488.3 million barrels. Gasoline inventories rose sharply, putting current stocks at 253 million barrels, highest in this century for this time of year. That has caused refining margins to wither; the U.S. refined product crack spread CL321-1=R hit a low of $12.79 a barrel on Thursday, lowest since November, before recovering to $13.30. U.S. crude oil production has risen 6.3 percent since the middle of last year to 8.96 million barrels per day. Rising U.S. output and inventories should somewhat offset output cuts agreed to by the Organization of the Petroleum Exporting Countries and other producers, including Russia, hoping to reduce a global glut. crude benchmarks have stayed within narrow trading ranges since OPEC agreed to limit production, but that may not last if U.S. production keeps rising. "We still believe there are more arguments in favor of prices breaking out of their current corridor and embarking on a downward trajectory," said Carsten Fritsch, senior commodities analyst at Commerzbank in Frankfurt. Industry data suggests OPEC and other exporters have made progress toward their agreed output reduction of
almost 1.8 million bpd during the first half of 2017. Oil prices edged up on Thursday, driven up by a weakening dollar, but gains were capped by plentiful supplies and inventories despite an effort by OPEC and other producers to cut output and prop up the market. Brent crude futures LCOc1 , the international benchmark for oil prices, were trading at $55.44 per barrel at 0137 GMT, up 36 cents from their last close. U.S. West Texas Intermediate crude futures CLc1 were at $53.07 a barrel, up 32 cents. Traders said that the increase was largely down to a weakening dollar .DXY , which has lost 3.9 percent in value since its January peak. Since oil is traded in dollar, a cheaper greenback makes fuel purchases less costly for countries using other currencies, potentially spurring demand. However, oil price gains were capped by data from the U.S. Energy Information Administration which showed a 2.84 million barrels increase in commercial crude inventories to 488.3 million barrels, which add to a 6.3 percent rise in U.S. oil production since the middle of last year to 8.96 million barrels per day. estimates that crude oil and other liquids inventories grew by 2.0 million barrels per day in the fourth quarter of 2016, driven by an increase in production and a significant, but seasonal, drop in consumption," the agency said. Rising U.S. inventories and output are countering efforts by the Organisation of the Petroleum Exporting Countries and other producers including Russia to cut supplies by a almost 1.8 million bpd during the first half of 2017 in an effort to end a global glut. Oil prices dipped on Friday as rising crude output from the United States was offsetting efforts by OPEC and other producers to prop up the market by cutting supplies. Brent crude futures LCOc1 , the international benchmark for oil prices, were trading at $ 56.17 per barrel at 0556 GMT, down 7 cents from their last close. U.S. West Texas Intermediate crude futures CLc1 were at $ 53.77 a barrel, down 1 cent. Trading activity during Asian business hours was extremely low due to the start of the Lunar New Year holiday in most countries of the region, including China and Singapore. Traders said growth in U.S. output was counteracting efforts by the Organization of the Petroleum Exporting Countries and other producers including Russia to reduce a global fuel overhang, resulting in range-bound prices. "U.S. producer hedging via futures and increasing shale production offset the progress OPEC has made with its production cut implementation. "Market participants are hyper-focused on two issues: shale's response to higher prices and OPEC compliance. "Producers and OPEC countries are all talking their books, yet the jury is still out," it added, referring to widespread scepticism over compliance with announced cuts. The British bank said it expected Brent and WTI prices to average $ 55 and $ 53 per barrel respectively for the first quarter. OPEC and other producers have agreed to cut production by almost 1.8 million barrels per day for the first half of 2017 to fight a supply overhang that has seen between 1 million and 2 million bpd of crude being produced in excess of consumption over the past two years.
U.S. oil production, however, has risen by around half a million barrels per day since mid-2016 to 8.96 million bpd. Oil prices dipped on Friday, with rising crude output from the United States offsetting efforts by OPEC and other producers to cut supplies to prop up the market. Brent crude futures LCOc1 , the international benchmark for oil prices, were trading at $ 56.14 per barrel at 0132 GMT, down 10 cents from their last close. U.S. West Texas Intermediate crude futures dropped 2 cents to $ 53.76 a barrel. Traders said that efforts by the Organization of the Petroleum Exporting Countries and other producers including Russia to cut supplies to reduce a global fuel overhang were being offset by rising output in the United States, resulting in range-bound prices. "Market participants are hyper-focused on two issues: shale's response to higher prices and OPEC compliance," "Producers and OPEC countries are all talking their books, yet the jury is still out," it added, referring to widespread scepticism over compliance with announced cuts. The British bank said it expected Brent and WTI prices to average $ 55 and $53 per barrel respectively for the first quarter. OPEC and other producers have agreed to cut production by almost 1.8 million barrels per day for the first half of 2017 to fight a supply overhang that has seen between 1 million and 2 million bpd of crude being produced in excess of consumption over the past two years. U.S. oil production, however, has risen by around half a million bpd since mid-2016 to 8.96 million bpd, offsetting significant amounts of any OPEC-led supply cut. Oil eased Wednesday ahead of official U.S. crude inventory data. Brent crude was off 49 cents, or 0.88%, at $54.95 at 08:00 ET. U.S. crude shed 48 cents, or 0.90%, to $52.70. American Petroleum Institute data Tuesday showed a rise of 2.9 million barrels in U.S. crude stocks in the latest week. Official Energy Information Administration figures later Wednesday are forecast to show a build-up of 2.8 million barrels in crude inventories. The stockpile data weighed on upbeat sentiment on compliance levels with agreed output cuts. OPEC and non-OPEC producers have agreed to cut output by some 1.8 million barrels a day in the first half of this year. U.S. oil climbed on Tuesday as the dollar weakened, but an increase in drilling activity in the United States is likely to keep a lid on prices. U.S. West Texas Intermediate crude futures CLc1 were up 14 cents at $ 52.89 a barrel by 0023 GMT. Brent crude LCOc1 , the international benchmark for oil prices, was yet to start trading. The dollar slumped to a seven-week low against a currency basket on Monday, weighed by concerns about the early days of U.S. President Donald Trump's administration that have so far been marred by protests, a protectionist inauguration speech and angry comments on Twitter. A weaker dollar makes greenback-priced commodities cheaper for importer holding other currencies. "Another strong increase in drilling rigs operating in the U.S. took the gloss off the better-than-expected adherence by OPEC to the agreed production cuts. "President Trump's comments that the U.S. would
end its dependence on imported oil also added to the unease in the market." U.S. drillers added the most rigs in nearly four years, data from energy services company Baker Hughes showed on Friday, extending an eight-month drilling recovery. oil production has risen by more than 6 percent since mid2016, though it remains 7 percent below the 2015 peak. It is back to levels seen in late 2014, when strong U.S. crude output contributed to a crash in oil prices. The increase in U.S. production is offsetting plans to reduce output by the Organization of the Petroleum Exporting Countries and other producers. Those countries have made a strong start to lowering their oil output under the first such pact in more than a decade, energy ministers said on Sunday. Iraq's oil minister said on Monday that most oil majors working on its territory were participating in oil output reductions agreed as part of the deal. Oil prices fell 1 percent on Monday as signs of a strong recovery in U.S. drilling largely overshadowed news that OPEC and Non-OPEC producers were on track to meet output reduction goals. Ministers representing members of the Organization of the Petroleum Exporting Countries and Non-OPEC producers said at a meeting in Vienna on Sunday that of the almost 1.8 million barrels per day they had agreed to remove from the market starting on Jan. 1, 1.5 million barrel per day had already been cut. comments over the weekend at the OPEC compliance meeting that cuts in OPEC/Non-OPEC production were ahead of schedule, a sharp rise in U.S. rig counts and talk of large increases in capital spending seem to be souring the bullish mood," . U.S. drillers added the most rigs in nearly four years last week, data from energy services company Baker Hughes showed on Friday, extending an eight-month drilling recovery. crude LCOc1 settled down 26 cents, or 0.5 percent, at $ 55.23 a barrel. U.S. crude futures CLc1 closed the session at $ 52.75 a barrel, down 0.9 percent, or 47 cents. Prices pared some losses after Iraq's oil minister said it was too early to say whether the deal needed to be extended and that he expected oil prices to rise to $ 60-$ 65 per barrel. a technical perspective, both contracts remain - for the time being - above their respective key support levels. The trend therefore remains bullish for oil until the charts say otherwise. U.S. oil production has risen by more than 6 percent since mid-2016, though it remains 7 percent below the 2015 peak. It is back to levels of late 2014, when strong U.S. crude output contributed to a crash in oil prices. "There is a widely held view that prices should be higher because that is what Saudi Arabia is strongly pushing for through immediate supply cuts, but there is concern as to the speed and scale of the response of U.S. shale oil supply to higher prices," Standard Chartered said in a note. "While we have argued that U.S. shale cannot increase fast enough to balance cuts in production elsewhere, we think that market concerns on the potential U.S. response are still providing short-term resistance to prices heading closer to $ 60." U.S. President Donald Trump has pledged to impose a hefty border tax on companies that want to import products to the United States. market speculators added to bullish bets last week, showing increased optimism about higher prices. a record high gross long position 3067651MLNG among money managers in NYMEX crude oil futures and options leaves the market ripe for a correction. Benchmark oil prices fell on Monday, dragging down West African outright oil prices with them, as the
market reacted to an increase in the oil rig count in the United States. Angola's oil shipments to China rose by 13 percent in 2016, to 43.74 million tonnes, making it the thirdlargest supplier behind Russia and Saudi Arabia. Italy's Eni said it will deepen its involvement in Nigeria's energy industry, increasing oil and gas exploration and helping to restore one of the country's ailing refineries, the company said in a statement on Monday. Rapid trading of Angolan cargoes slowed somewhat on Monday as some suppliers awaited results from pending tenders. State firm Sonangol had sold out less than a week after the programme was released and all cargoes moved at initial offer levels. Chinese buyers have taken most of the March-loading spot cargoes that have traded. Analysts JBC Energy said that heavier grades should continue to garner strong support in spite of spring refinery maintenance, with falling fuel oil exports from Russia and Latin America boosting cracks for the product. They added that a 15-month low in the Brent-Dubai spread was also keeping open the arbitrage window into Asia.
NIGERIA Nigerian cargoes loading in February dwindled to about a handful from almost 20 last week, but some were simply deferred to March loading, traders said. Tenders from India were a key outlet, with HPCL taking two million barrels last week and tenders from BPCL and IOC promising to absorb more. U.S. east coast refiners were also buying Nigerian crude. March export plans showed an increase in Bonny Light, Agbami, Amenam and Escravos loadings. Qua Iboe was above the revised February plan because two February cargoes were pushed into March.
There were no March cargoes of EA or Okwori, traders said. Only two Bonga cargoes were scheduled because the field had planned maintenance. Export plans for grades including Erha, Forcados, Oyo and Pennington were still pending.
TENDERS India's BPCL issued a tender to buy crude loading in February and March, traders said. Fellow Indian state oil company IOC was also running two tenders to buy oil, one for February and March loading oil and the second for March-loading oil only. Total had placed one cargo of Qua Iboe and one of Bonny Light into the tender it won last week to supply India's HPCL with March-loading oil
Oil fell Monday as a jump in the U.S. rig count outweighed an upbeat output cut compliance meeting. Brent crude shed 48 cents, or 0.87%, to $55.01 at 07:45 ET. U.S. crude lost 62 cents, or 1.16%, to $52.60. Baker Hughes U.S. rig count data Friday showed a jump of 29 to 551, the highest level in 14 months. That could point to higher U.S. shale output, which could offset the positive impact of the output cuts. OPEC and non-OPEC producers held a meeting on the implementation of the cuts over the weekend. The accord calls for a reduction of some 1.8 million barrels a day in the first half of this year. Saudi Energy Minister Khalid al-Falih estimated the level of compliance at already 80%. Oil prices edged up on Monday, supported by statements from oil producers over the weekend that an output cut was being successfully implemented, but markets were held back by a surge in drilling that suggested U.S. production would rise further. Brent crude futures LCOc1 , the international benchmark for oil prices, were trading at $55.57 per barrel at 0016 GMT, up 8 cents from their last close. U.S. West Texas Intermediate crude futures were up 8 cents at $ 53.30 a barrel. "Oil rallied strongly as oil producers met to discuss the adherence to the production cut agreement. Saudi Arabian Energy Minister Khalid al-Falih said that producers have cut 1.5 million barrel per day so far in 2017. "Prices reversed these gains after data showed another pickup in drilling activity," it added. U.S. energy companies last week added the most rigs drilling for new production in almost four years. Drillers added 29 rigs in the week to Jan. 20, bringing the total count up to 551, the most since November 2015, energy services firm Baker Hughes BHI.N said on Friday. oil production levels have risen over 6 percent since mid-2016, and although they remain 7 percent below their historic 2015 peak, they are back to levels of late 2014, when high U.S. crude output contributed to a crash in oil prices. Oil futures finished higher on Friday, logging a modest weekly gain with traders encouraged by signs that global supply is tightening in wake of a planned agreement by major crude producers to cut output. On the ICE Futures Exchange in London, Brent oil for March delivery rallied $1.33, or about 2.5%, to
settle at $ 55.45 a barrel by close of trade Friday. London-traded Brent futures scored a gain of 4 cents, or approximately 0.1%, on the week. Elsewhere, on the New York Mercantile Exchange, crude oil for delivery in March jumped $1.10, or around 2.1%, to end at $53.22 a barrel by close of trade. For the week, New York-traded oil futures rose 5 cents, or nearly 0.1%. Oil jumped on Friday after Saudi Arabia’s Energy Minister Khalid al-Falih, speaking at the World Economic Forum in Davos, said that 1.5 million barrels a day of the roughly 1.8 million in cuts pledged by OPEC and non-OPEC countries have already been taken out of the market. The upbeat comments added to signs that the oil market is rebalancing. Prices, however, finished off the session's highs after data showed a sharp weekly rise in the number of active U.S. rigs drilling for oil. According to oilfield services provider Baker Hughes, the number of rigs drilling for oil in the U.S. jumped by 29 last week to 551, the largest weekly increase since a recovery in the rig count began in June and the highest level in around 14 months. The data raised concerns that the ongoing rebound in U.S. shale production could derail efforts by other major producers to rebalance global oil supply and demand. In a monthly report issued this week, the International Energy Agency said OPEC production has slowed, declining by 320,000 barrels a day to 33.09 million barrels in December. January 1 marked the official start of the deal agreed by OPEC and non-OPEC member countries such as Russia in November last year to reduce output by almost 1.8 million barrels per day to 32.5 million for the next six months. The deal, if carried out as planned, should reduce global supply by about 2%. Some traders remain skeptical that the planned cuts will be as substantial as the market currently expects. While some major oil producers, such as Saudi Arabia and Kuwait, have so far showed signs that they are sticking to their pledge to cut back output, others, such as Libya and Iraq have ramped up production. A monitoring committee charged with tracking adherence to the global deal is due to meet in Vienna for the first time on January 22. Elsewhere on Nymex, gasoline futures for February rose 3.1 cents, or about 2.1% to $1.566 a gallon. It ended down about 2.9% for the week. February heating oil tacked on 2.7 cents, or 1.7%, to finish at $1.645 a gallon. For the week, the fuel declined around 0.3%. Natural gas futures for February delivery sank 16.4 cents, or nearly 4.9%, to $3.204 per million British thermal units. It posted a weekly loss of more than 6% on forecasts for warmer winter weather. In the week ahead, market participants will eye fresh weekly information on U.S. stockpiles of crude and refined products on Tuesday and Wednesday to gauge the strength of demand in the world’s largest oil consumer/ Traders will also continue to pay close attention to comments from global oil producers for further evidence that they are complying with their agreement to reduce output this year. Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Tuesday, January 24 The American Petroleum Institute, an industry group, is to publish its weekly report on U.S. oil supplies. Wednesday, January 25 The U.S. Energy Information Administration is to release weekly data on oil and gasoline stockpiles. Thursday, January 26 The U.S. EIA is to produce a weekly report on natural gas supplies in storage. Friday, January 27 Baker Hughes will release weekly data on the U.S. oil rig count. Oil prices rose more than 2 percent on Friday on expectations that this weekend's meeting of the world's top oil producers would demonstrate compliance to a global output cut deal, but rising U.S. drilling activity limited gains. Members of the Organization of the Petroleum Exporting Countries and some other producing countries including Russia will meet in Vienna this weekend to establish a mechanism to verify compliance with a deal to cut 1.8 million barrels per day of output, OPEC's secretary general told Reuters. Arabia's energy minister said 1.5 million bpd had already been taken out of the market. "The petroleum markets are moving higher in Friday trade on the latest round of positive talk about how much supply oil producers have taken offline ahead of Sunday's review by OPEC and non-OPEC representatives in Vienna. Brent crude LCOc1 ended the session up $ 1.33, or 2.5 percent, at $ 55.49 a barrel. U.S. crude for February delivery CLc1 closed up by $ 1.05, or 2 percent, at $ 52.42 a barrel before expiring. The more active March contract settled up 2.1 percent at $ 53.22. For the week, both contracts were largely unchanged. Prices pared gains after data from energy services firm Baker Hughes showed U.S. drilling companies this week added the most oil rigs in nearly four years. Swelling oil stockpiles in the U.S. and rising shale production could threaten market rebalancing, analysts said. "For a lasting balance to be restored on the oil market and the very high stocks reduced, the agreement will need to be strictly implemented over a considerable period of time," Commerzbank said in a note. "This is particularly true given that U.S. oil production is rising again and given that the oil supply from Libya and Nigeria may be expanded." U.S. crude inventories USOILC=ECI unexpectedly soared 2.3 million barrels last week as refineries sharply slowed production, while gasoline builds were much larger than expected amid weak demand, the Energy Information Administration said on Thursday. funds rushed to place bullish wagers on U.S. crude oil in the week to Jan. 17, boosting their net long positions to the highest levels since July 2014, data from the U.S. Commodity Futures Trading Commission showed. long positions in NYMEX futures and options 3067651MLNG among speculators soared to the highest on record, based on publicly
available data going back to 2006. Libya's National Oil Corporation, meanwhile, said production had now climbed to 722,000 bpd, resuming its rise after poor weather had caused a small dip. Schieldrop, chief commodities analyst at SEB Markets, said Brent crude was starting to move into a trading range around $ 55 as the production cut deal placed a floor price of $ 50, while U.S. shale oil producers capped the upside at US$ 60. Oil prices edged higher on Tuesday ahead of weekly U.S. inventory data on evidence the global market is tightening as lower production by OPEC and other exporters drains stocks. Increased drilling in the United States, however, could keep a lid on prices. Brent LCOc1 futures gained 21 cents, or 0.4 percent, to settle at $ 55.44 a barrel, while U.S. West Texas Intermediate CLc1 gained 43 cents or 0.8 percent, to $ 53.18 per barrel. That put WTI up for a fourth day in a row, its longest winning streak since the end of December. Post settlement, prices pared gains after weekly inventory data from The American Petroleum Institute showed U.S. crude, gasoline and diesel stocks all rose last week. The Energy Information Administration will report its data at 10:30 a.m. EST on Wednesday. Ministers from the Organization of the Petroleum Exporting Countries and big producers outside the group said on Sunday that of the almost 1.8 million barrels per day they had agreed to remove from the market starting on Jan. 1, 1.5 million bpd had already been cut. Arabia's oil output is likely to drop to around 9.9 million bpd in January, according to industry sources and shipping data. The kingdom said it pumped 10.47 million bpd in December. comments out of OPEC are the primary reasons for the price increase on Tuesday. That and recent weakness in the dollar, which is actually masking some serious weakness in oil. The U.S. dollar .DXY settled at a seven-week low against a basket of currencies on Monday, but was up nearly 0.15 percent Tuesday afternoon. A weaker greenback makes dollar-denominated crude less expensive for users of other currencies. Bernstein Energy said global oil inventories declined 24 million barrels to 5.7 billion barrels in the fourth quarter of last year from the previous quarter. This amounts to about 60 days of world oil consumption. "This is the biggest quarterly decline since the fourth quarter of 2013, confirming that inventory builds are now reversing as the market shifts from oversupply to undersupply. Analysts, however, estimated U.S. crude stocks increased by about 2.8 million barrels in the week to Jan. 20. The push by Republicans in the U.S. House of Representatives for a shift to borderadjusted corporate tax could push WTI prices higher than Brent, triggering large-scale domestic production, according to analysts at Goldman Sachs. expect WTI could move to a $ 10 per barrel premium to Brent from a $ 3 discount - a $ 13 relative move immediately." Brent's premium to WTI WTCLc1-LCOc1 narrowed on Tuesday by about 26 cents to $ 2.22 per barrel. U.S. drillers last week added the most rigs in nearly four years, data from energy services company Baker Hughes showed on Friday, extending an eight-month drilling recovery. is gradually coming to the realization that they may have received more than they bargained for in re-activating U.S. drilling activity," Jim Ritterbusch, president of Chicago-based energy advisory firm Ritterbusch & Associates, said in a note. U.S. oil production has risen by more than 6 percent since mid-2016, though it remains 7 percent below
the 2015 peak. It is back to levels reached in late 2014, when strong U.S. crude output contributed to a crash in oil prices.
BASE METAL’S OUTLOOK : BASE METAL GUIDE Trading Ideas: ✍ NICKEL Nickel trading range for the day is 625-668. Nickel dropped as pressure continues due to rise in dollar and Indonesia’s move to relax its export ban. Economic growth in the U.S. slowed by more than anticipated in the final three months of 2016, according to a report released by the Commerce Department. Nickel ore inventories at seven major Chinese ports kept dropping in the week ending Jan. 26.
✍ ZINC Zinc trading range for the day is 184.1-190.3. Zinc prices ended with losses as a stronger US currency dented international investors’ demand. China’s refined zinc output was 465,000 tonnes in December, down 1.8% month-on-month. Inventories at zinc downstream producers averaged 9 days sufficient to production in January, compared to around 14 days in the same period of last year
✍ COPPER Copper trading range for the day is 397.9-408.3. Copper prices ended with losses as the dollar strengthened, with trading volumes lean as the week-long Lunar New Year holiday kicks off in China. However downside seen limited buoyed by expectations that supply disruptions could tighten the market. Freeport-McMoRan warned it would need to start slashing output at its Indonesia mine to about 40 percent of capacity if it fails to get a government export permit.
BASE METALS – ✍ STEEL
1. A revival in India’s steel consumption from the weakest estimated growth in at least four years hinges on the government boosting spending on infrastructure, housing and road projects to absorb record output. Finance Minister Arun Jaitley will announce Feb. 1 higher outlays for national highways, rural roads, railways and low-cost housing, Goldman Sachs Group Inc. predicted in a Jan. 19 report. Any major budget initiatives in infrastructure and construction would stimulate domestic steel demand, according to Seshagiri Rao, joint managing director at India’s second-biggest mill, JSW Steel Limited. Mills in India such as JSW, Steel Authority of India Ltd. and Tata Steel Ltd. are projected to produce a record amount of the metal this year in anticipation of Prime Minister Narendra Modi’s infrastructure push. 2. When U.S. President Donald Trump signed orders to revive two controversial energy pipeline projects this week, he pledged to require new pipelines to use American-made steel, a gesture to workers in the hard-hit industry who helped propel him to power. But U.S. steelmakers will receive negligible benefit from the multi-billion dollar Keystone XL project, one of the two projects Trump ordered to proceed, because they have limited ability to meet the stringent materials requirements for the TransCanada TRP.TO line. Economists said Trump's order has many loopholes to enforcement and could violate international trade law. Meanwhile, in the quiet prairie town of Gascoyne, North Dakota, deer wander among gleaming stacks of steel tubing intended for the Keystone pipeline. The government on Tuesday said imposition of minimum import price on steel is a short-term measure and it is taking permanent measures to counter unfair trade practices in line with international norms. " Birender Singh steel minister had emphasised that MIP is a short-term measure and not of a permanent nature," the steel ministry said in a statement on Tuesday. The ministry's statement was in response to some media reports. The media reports that quoted the steel minister gave an impression that that MIP on steel will be discontinued after February 4, the ministry said.
✍ NICKEL LME base metals except Nickel traded higher last week as weakness in the DX in the earlier half post Trump’s protectionist comments in his inauguration speech spurred gains in dollar denominated commodities. MCX base metals apart from Nickel traded higher in line with international trends.
✍ COPPER Last week, LME Copper prices gained 2 percent and jumped to $5857/t as President Trump’s inauguration speech signaled a protectionist stance on trade and other issues, thereby hurting DX. Also, supply disruption came to the fore after BHP, the world's largest miner by market value, said that it is likely to produce 1.62 million metric tons copper this fiscal year, down 2% on a prior forecast,
following a sharp fall in first-half output. BHP is also facing challenges at copper operations in Chile, where workers at its Escondida copper mine, the world's biggest, have threatened to strike over a pay dispute as an existing wage agreement expires at the end of this month. However, sharp upside was restricted as US dollar sharply rebounded owing to optimism over US economic growth outlook. MCX copper prices traded higher by 3.6 percent last week to close at Rs.407 per kg. LME Copper prices are trading lower by 0.2 percent at $5886/t. Copper will likely trade lower today as investors turned cautious after President Donald Trump took his 'America First' policy to another level and introduced immigration curbs, prompting a wave of caution across the globe. Also, prices will witness pressure citing subdued demand in Chinaowing to week long Lunar New Year holiday. We expect MCX copper prices to trade lower in line with international trends.
✍ STEEL A revival in India’s steel consumption from the weakest estimated growth in at least four years hinges on the government boosting spending on infrastructure, housing and road projects to absorb record output. Finance Minister Arun Jaitley will announce Feb. 1 higher outlays for national highways, rural roads, railways and low-cost housing, Goldman Sachs Group Inc. predicted in a Jan. 19 report.
NCDEX - WEEKLY MARKET REVIEW FUNDAMENTALS – ✍ SOYBEAN Soybean futures closed lower last week due to good supplies and higher demand at lower prices. The supplies in the physical market is continue to be adequate as production during kharif is higher by more than 57% this season compared to last year. The bulk buyers and oil millers are quite active at lower levels keeping pressure on prices. U.S. soybean futures closed lower on Friday as prospects for higher supply of the crop improved in South America. The weather remains favorable (for crop production) in Brazil and improving in Argentina.
✍ REFINE SOY OIL Refined soy oil futures closed lower last week on good supplies and lower demand from the bulk buyers and retail consumers. It is still trading in a narrow range as prices try to consolidate and looking for any strong fundamentals. Moreover, the tariff,. value of crude soyoil was reduced by $ 23 per tonnes to $ 869 for the second fortnight of January, which is the second consecutive reduction in three months by the government. India's edible oil imports fell
nearly 17% on year to 1.17 mt in December, according to data released by the Solvent Extractors' Association of India. India import of soybean oil has declined to 2.32 lt in Dec from 4.90 lt in the yearago period as supplies of soybean is good at lower prices.
✍ CRUDE PALM OIL CPO Futures closed lower last week on reports of steady supplies and demand in the physical market. As per SEA data, India Nov-Dec RBD palmolein import 486,502 tonnes, up 5% on year and Dec RBD palmolein import 245,554 tonnes vs 231,810 tonnes year ago. Malaysian palm oil futures fell on expectation for 12% increased production in 2017 and strengthening ringgit. However, Palm oil export data showed rising demand, as shipments rose 9.3 % in the Jan. 1-25 period versus the previous month, two cargo surveyors said on Wednesday.
✍ SUGAR Sugar Futures on NCDEX closed higher last week on reports that sugar production in the country set to dip to seven-year low this season due to shortage of cane which will lead to early closure of sugar crushing. Indian Sugar Mills Association has lowered sugar production estimate for 2016-17 to 21.3 mt, down by about 9 % as compared to its estimate of 23.37 mt, projected in September 2016. ISMA has arrived at these figures, based on satellite images, at a meeting held in Hyderabad. Moreover, India's sugar production by mid-January is down by 6% as compared to the same period of previous year. Raw sugar futures on ICE closed higher last week as the market participants anticipated India might import sugar. Drought has curtailed production in the western state of Maharashtra and the southern state of Karnataka, boosting domestic prices and raising the prospect of Indian imports. Moreover, as per CFTC data, speculators upped their bullish stance in raw sugar by 3,747 contracts to 161,630 in the week to Jan. 17.
✍ KOTAN/KAPAS Cotton prices on MCX closed higher last week on good demand from the bulk buyers on reports of lower production. However, Kapas prices closed lower on anticipation of improved supplies in the physical market. Meanwhile, Cotton Association of India has revised its cotton crop estimate downward at 341 lakh bales (each of 170 kg) for the year 2016-17 as against the earlier estimate of 346 lakh bales, projected in October. ICE cotton futures closed higher last week supported by strong export sales data and expectation of good global demand. As per USDA reports, U.S. exporters have already sold 38 percent of expected shipments, topping the five-year average of 32 %. Consumption will probably
outstrip production by 1.24 mt this year, as per Cotlook. That can help to erode global stockpiles, which the USDA estimates at 90.6 million bales, each weighing 480 pounds (218 kilograms).
SPICES ✍ JEERA Jeera futures closed higher on last week due to forecast of fall in jeera production by 12 % to 387,000 tonnes during 2016-17 due to lower acreage and adverse weather conditions in the jeera producing states of Gujarat and Rajasthan. The new jeera crop started arriving in the key spot market of Unjha in Gujarat this week, with daily average arrivals at 150200 bags (1 bag = 55 kg). As per second advance estimates for 2016/17, production of Jeera in Gujarat will be 2.21 lakh tonnes, down almost 11% compared to last year production of 2.38 lt. Moreover, Jeera acreage this season is also down in Gujarat compared to last year. As on 23-Jan-17, Gujarat farmers have planted jeera in 2,78,700 hectares, down by 16,500 hectares compared to last year acreage of 2,95,200 hectares till same period. On the export front, Jeera exports in India are likely to rise 22% to 120,000 tonnes in 2016-17 (Apr-Mar), compared with shipments of 98,700 tonnes a year ago, because of robust demand from overseas market and negligible stocks in other exporting nations. Turmeric futures closed lower last week on anticipation of better supplies of new turmeric crops. However, good up country demand and buying interest among the stockists may keep the prices volatile. On the export front, country exported about 65,848 tonnes of turmeric during April-Oct period, up by 27% to 51,910 tonnes compared last year, as per government data.
✍ SUGAR 1. The sugar industry has come out with a solution to rein in sugar prices which are hovering around Rs 40kg in the wholesale market raising the worry level of the government. It wants the government to withdraw cess on the commodity to make it cheaper by Rs 1.24kg. This cess, which is paid by sugar mills and passed on to consumers, goes to the Sugar Development Fund (SDF) for rehabilitation and modernisation of sugar mills. The government has collected an estimated Rs 2,500 crore through cess. “The government is already thinking of doing away with SDF and sugar cess and subsuming it with GST. We, at our meeting to be held on Wednesday, will discuss about recommending to the government the doing away of both (taxes) with immediate effect,“ T Sarita Reddy, president of the Indian Sugar Mills Association , said. 2. The Central government is not comfortable with sugar prices hovering around ` . 40kg in the wholesale market, especially with assembly elections round the corner and with major sugarproducer Maharashtra likely to project a 10% fall in production compared to initial estimates. Due to the rising prices, the Centre has summoned cane commissioners of the sugar producing states on Tuesday to assess
the production and stock situation. Maharashtra's production figures are being keenly observed by the sugar industry.
✍ COFFEE Coffee exporters are finding it difficult to source coffee as growers are holding on to stock anticipating higher prices. Coffee prices have been rising globally with reports of lower output in Brazil and Vietnam, the top coffee growing nations.India exports close to 70% of its total coffee production. “Exporters are not taking big or ders as arrivals are 30% to 40 % down from a year ago. We are adopting a wait and watch policy and expect arrivals to increase at least by February,“ said Ramesh Rajah, president of the Coffee Exporters Association of India. Harvest is in full swing with plucking of arabica beans nearing completion while that of robusta has started. “Some exports are taking place with carryover stock of robusta mostly ,“ Rajah said.
✍ WHEAT India may see a bumper wheat harvest this year as higher planting, cold waves in the past two weeks and a forecast for more rainfall and chilly weather have boosted crop prospects after worries that a moderate winter would hit yields. “Across the country, wheat crop is progressing well. We are expecting yields to increase and production can easily cross 95 million tonnes,“ said Trilochan Mohapatra, secretary at Department of Agricultural Research and Education. India received a bumper crop in 2013-14 at 95.85 million tonnes, but two years of unfavourable weather hurt production. India, the world's second largest wheat grower after China, produced 93.50 million tonnes on 29.25 million hectares in 2015-16. The area under cultivation jumped to 31.31 million hectare this year till Jan 20. The normal area under wheat planting (five-year average) is 30.41 million hectare. “The harvest will probably jump from the previous year and cross 95 million tonnes,“ said Rajnikant Rai, chief operating officer of agriculture business at ITC LtdBSE 0.16 %, one of the biggest wheat buyers. “According to our internal survey, the wheat crop is perfectly alright with a good winter season. The crop is developing well across all major wheat belts from Madhya Pradesh, Punjab, Haryana to UP.“
✍ EDIBLE OIL Edible oil consumers are becoming increasingly price conscious post demonetisation, say players like Adani Wilmar, Vimal Oils and others. Not only are consumers increasingly shifting from one oil type to another on the basis of price movement, thereby opting cheaper products, but also preferring to buy oils in smaller packs of one or two litre, as against 5-15 litres pack previously. Cotton prices are up 7.5 per cent in January on lower arrivals despite estimates of a bumper output this year. The benchmark, Shankar 6 variety, was traded at Rs 11,979 a quintal on January 24, a rise of Rs
850 from early this month. Other varieties of fibre have moved up similarly. The agriculture ministry in its first advance estimates projected India’s cotton output at 32.12 million bales 170 kg each in 2016-17, up from 30.15 million bales in 2015-16. Wary of potential under-reporting by millers, the Union food ministry has asked states to double-check if lower sugar production of 22.5 million tonnes estimated for the second straight year in 2016-17 is correct. The states have been told not to depend solely on Union agriculture ministry's cane production data for calculating likely sugar output amid doubts about farm production figures, especially in the case of wheat. In a meeting with sugar-producing states on Tuesday, the Union food ministry officials noticed not much change in the sugar production data submitted by the states except Uttar Pradesh, which quoted a higher figure. After analysing the figures, the ministry maintained that the country's overall production is projected to be 22.5 million tonnes in the 2016-17 marketing year (OctoberSeptember). A senior food ministry official said the production numbers will be revised later after taking into account likely sugar output from mid-year cane crop in April-May in Maharashtra and Karnataka. The Indian Sugar Mills Association has reduced its production assessment for the ongoing sugar season, 2016-17 (October to September), to 21.3 million tonnes, down nine% from the earlier 23.4 mt. The fall is largely as “some mills have closed their operations in drought affected areas, mostly in Maharashtra and Karnataka, and field reports that sugarcane availability in these two states is lower than earlier expectations”, said Isma.
✍ JEERA Jeera (Cumin) output in India may fall by 12 per cent to 387,000 tonnes during 2016-17 due to lower acreage and adverse weather conditions. The country had produced 438,000 tonne of the spice in 201516. Gujarat, the highest jeera-producing state in the country, has reported a fall in area under the crop by six per cent to 278,700 hectares in 2016-17, from 295,200 hectares in 2015-16, according to state agriculture department data. As per the second advance estimate of the Gujarat government, the state is estimating 212,000 tonnes of jeera production for the year 2016-17. Last year it was around 238,000 tonnes. India has retained its sugar output forecast for 2016-17 season at 22.5 million tonnes, a top government official said, after a meeting of representatives from India's leading sugar-producing states. "We will meet again after two weeks to re-assess these production numbers," said the official, who requested anonymity.
✍ EDIBLE OIL Edible oil consumers are becoming increasingly price conscious post demonetisation, say players like
Adani Wilmar, Vimal Oils and others. Not only are consumers increasingly shifting from one oil type to another on the basis of price movement, thereby opting cheaper products, but also preferring to buy oils in smaller packs of one or two litre, as against 5-15 litres pack previously. The trend of shift among edible oil consumers from one oil type to another on the basis of price has risen sharply, say players. For instance, if two years ago two out of 10 consumers used to follow the price trend, the same has doubled to 4-5 buyers following price movements. However, for now, the trend is prominent in urban areas. As sowing of rabi crops reaches its last stage, the area covered is more than in 2015, but compared to the last normal monsoon year of 2013, the acreage does not show a significant rise. Both 2014 and 2015 were drought years. This year, sowing is complete in around 98.4 per cent of the normal area. Till January 20, rabi crops have been sown on 62.83 million hectares, six per cent more than last year and around 34 per cent more than the average of the last five years. Wheat, the largest rabi crop has been planted in 31.31 million hectares, 7.25 per cent.
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