Global commodity prices mostly fell last year on worries the ongoing eurozone debt crisis and a potential global economic slowdown would hammer demand for raw materials.
“Commodity prices [ended] 2011 with a whimper,” said Capital Economics analyst Julian Jessop, noting that crude oil and gold were the only raw materials to register significant increases.
“This [was] a year of two parts for commodity markets, with broad-based strength in the first four months, led by oil, giving way to general weakness since May,” Jessop added.
OIL: Prices rose by about 13 percent in London and 9 percent in New York this year, but fell this week in volatile holiday-shortened trade before the New Year break.
Unrest in the crude-producing Middle East and North Africa region had sparked hefty price gains earlier this year amid the so-called Arab Spring.
London Brent oil surged as high as US$127.02 per barrel in April and New York crude hit a two-and-a-half year peak at US$114.83 in early May.
Prices soared after uprisings toppled the long-standing leaders of Tunisia, Egypt and Yemen, while unrest also rocked other parts of the oil-rich region — especially key crude producer Libya.
Libya was producing about 1.4 million barrels per day of mostly high-value light sweet crude before the uprising at the start of the year. About 85 percent of Libyan output was exported to Europe and the break in supply contributed to the surge in Brent prices.
By Friday on London’s Intercontinental Exchange, Brent North Sea crude for delivery in February dipped to US$107.02 a barrel compared with US$107.72 a week earlier.
On the New York Mercantile Exchange, West Texas Intermediate, or light sweet crude, for February stood at US$98.99 a barrel compared with US$99.63.
PRECIOUS METALS: Gold scored a record last year, but has since fallen heavily on profit taking and the stronger US dollar.
“The deepening of the sovereign crisis in Europe since mid-year has had a profound impact on investors’ risk appetite and there has been widespread liquidation across assets,” BNP Paribas analyst Anne-Laure Tremblay said. “Uncertainty means that key investors are largely remaining on the sidelines.”
Gold, which in September hit a record high above US$1,900 an ounce, has also tumbled in the final quarter of last year mainly due to a rising greenback.
A strong greenback makes US dollar-denominated commodities like gold more expensive for buyers holding rival currencies, denting demand and prices.
The precious metal still won more than 10 percent last year, after racking up a 30 percent gain in 2010.
By Friday on the London Bullion Market, gold sank to US$1,574.50 an ounce from US$1,607.54 the previous week.
Silver eased to US$28.18 an ounce from US$29.22.
On the London Platinum and Palladium Market, platinum fell to US$1,381 an ounce from US$1,436.
Palladium retreated to US$636 an ounce from US$653.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to