Commodity prices traded mixed this week as dealers reacted to US stimulus expectations amid weaker growth worries across the globe.
Raw material futures, which had been falling early in the week, recovered some lost ground after US Federal Reserve chief nominee Janet Yellen defended the US central bank’s US$85 billion-a-month bond-buying program and rejected suggestions that it had generated fresh bubbles in property or stock markets.
The comments on Thursday at her confirmation hearing before the Senate Banking Committee “spurred expectations that any form of [stimulus] tapering would not occur anytime soon”, said Vanessa Tan, an investment analyst at Phillip Futures in Singapore.
OIL: Crude futures diverged, with New York prices hitting five-month lows amid strong supplies in the US, while Brent was supported by unrest in Libya, traders said.
By Friday on London’s Intercontinental Exchange, Brent North Sea crude for delivery in January stood at US$107.88 a barrel compared with US$104.47 for the expired December contract a week earlier.
On the New York Mercantile Exchange, West Texas Intermediate or light sweet crude for December fell to US$93.83 a barrel from US$94.44.
PRECIOUS METALS: Gold prices ended the week higher overall in the wake of Yellen’s remarks regarding US stimulus.
“The ‘Yellen’ effect has managed to push gold... higher as her dovish overtones put any ideas of near-term tapering on the back-burner,” Triland Metals said.
By late Friday on the London Bullion Market, the price of gold edged up to US$1,287.25 an ounce from US$1,285.50 a week earlier.
Silver slipped to US$20.63 an ounce from US$21.70.
On the London Platinum and Palladium Market, platinum fell to US$1,438 an ounce from US$1,446.
Palladium dropped to US$729 an ounce from US$757.
BASE METALS: Industrial metals retreated across the board amid speculation that China could revise down its growth forecast for next year.
A Triland Metals broker said that “leaks from China’s high political meeting regarding future growth targets have haunted the markets.”
However, China on Friday pledged ambitious reforms to loosen the communist authorities’ grip on the world’s second-largest economy, as leaders chart the way forward for the next decade.
The ruling party issued a document detailing economic reforms following a key meeting, known as the Third Plenum, which ended earlier this week.
Meanwhile, official data on Thursday showed that a weak eurozone recovery slowed to a “snail’s pace” in the third quarter, with powerhouse Germany off its stride and France hit by a surprise contraction.
The 17-nation eurozone economy grew just 0.1 percent in the three months to September after a gain of 0.3 percent in the previous quarter, the Eurostat statistics agency said.
Germany, Europe’s largest economy, eked out growth of 0.3 percent, down from 0.7 percent in the second quarter, while France slipped back, its economy shrinking 0.1 percent after a gain of 0.5 percent.
By Friday on the London Metal Exchange, copper for delivery in three months dropped to US$6,965.50 a tonne from US$7,115 a week earlier.
Three-month aluminum fell to US$1,784.50 a tonne from US$1,803.7, and three-month lead dropped to US$2,089 a tonne from US$2,128.
Three-month tin grew to US$22,900 a tonne from US$22,850, while three-month nickel declined to US$13,712 a tonne from US$13,912.
Three-month zinc slipped to US$1,885 a tonne from US$1,891.
SUGAR: Prices hit three-month lows in London at US$464.4 a tonne.
“Traders have noticed that the world still has plenty of sugar available and that the demand is not really strong,” Price Futures Group analyst Jack Scoville said.
By Friday on the ICE Futures US exchange, the price of unrefined sugar for delivery in March slid to US$0.1761 a pound (0.45kg) from US$0.1808 a week earlier.
On LIFFE, London’s futures exchange, the price of a tonne of white sugar for March tumbled to US$465.90 from US$481.50 a week earlier.