Reuters
Fri Aug 31, 2012 3:42pm EDT
* Commodities bellwether CRB rises 3 pct in Aug; up 3rd month in row
* US crude leads gains, rising nearly 10 pct for month
* Soybeans up 7 pct for Aug, cocoa 9 pct
By Barani Krishnan
NEW YORK, Aug 31 (Reuters) – Commodities rose broadly on Friday, ending August with a third straight month of gains, after strong rallies through most of the month in oil, soybeans
and cocoa.
Gold prices also advanced on renewed bets for a U.S. stimulus, while copper eked out a more modest gain due to persistent worries about demand from top buyer China and global
economic recovery.
Oil prices rose nearly 10 percent in August due to output problems in the North Sea and resurgence in Middle East tensions that bolstered London’s benchmark Brent oil. A pick up in U.S.
energy consumption also boosted New York crude futures.
Soybeans extended their June-July rally amid fear of more crop destruction from the drought that ravaged the farm belt in the U.S. Midwest. Adverse crop weather also boosted prices of
West African cocoa beans, giving cocoa futures in New York their biggest monthly gain since May.
The 19-commodity Thomson Reuters-Jefferies CRB index settled August’s trade up by more than 3 percent, carrying through with its 4 percent gain in June and 5 percent in May.
For Friday alone, the commodities bellwether rose nearly 1 percent as strong U.S. economic data offset initial market disappointment over the Federal Reserve’s reluctance to immediately approve a third round of quantitative easing to stimulate the economy.
“The hope of another round of QE from the Fed is not off the table, it’s just kicked down the road,” said Adam Sarhan, chief executive of Sarhan Capital, after Fed Chairman Ben Bernanke told a gathering of world central bankers in Jackson Hole, Wyoming, that large-scale asset purchases remained an option to boost the economy.
London’s Brent crude oil closed at $114.57 a barrel, up 1.7 percent on the day. It rose more than 9 percent for the month, to chart its best performance since February. Brent has been supported by a drop in supply from the North Sea due to oilfield maintenance, while fighting in Syria and tension over Iran’s nuclear programme has also bolstered the market.
“Fundamentally, the market could come down, but there is this general fear factor around Iran, Syria, Israel and hurricanes which is not going to go away any time soon,” said Tony Machacek, a broker at Jefferies Bache.
U.S. crude settled at $96.47 a barrel, up 2 percent on the day. It rose almost 10 percent on the month, for its strong advance since October 2011. U.S. crude is the main component of the CRB, accounting for nearly a quarter of the commodity index’s total weighting. Up until last week, U.S. crude inventories had fallen for four weeks in a row due to heavy draws that indicated higher demand for oil in the world’s largest energy consumer.
Data released on Friday also hinted at some improvement in the U.S. economy that could further boost demand for energy. U.S. factory orders rose sharply in August, jumping by 2.8 percent for its biggest rise in 12 months and well ahead of economist expectations for a 1.9 percent increase.
The Thomson Reuters/University of Michigan Surveys of Consumers’ final August consumer sentiment index also gained, reaching 74.3 from 73.6 in the preliminary August report.
Soybean futures on the Chicago Board of Trade were on course to a third straight month of gains, albeit at a more modest pace than their double-digit advance in two previous months.
CBOT’s key November soybeans contract hovered near $17.60 a bushel for a 7 percent gain on the month, versus July’s 15 percent and June’s 12 percent.
The contract was down slightly in Friday’s trade as players took some profit on record highs of above $17.71 a bushel set in the previous day’s trade.
U.S. cocoa futures hit nine-month highs as trading for August drew to a close, as traders worried about a lack of sunshine and cooler temperatures in West Africa that could hurt crops in the world’s top cocoa-growing region. New York’s key cocoa futures contract, December, settled up $9, or 0.3 percent, at $2,610 per tonne, after touching $2,647 — its highest since January. For the month, it rose 9 percent. U.S. gold futures rose 5 percent for August, rising for a third straight month. New York-traded copper gained 1 percent on the month, after a 2 percent slide in July.
Prices at 3:02 p.m. EDT (1902 GMT)
LAST/ NET PCT YTD
CLOSE CHG CHG CHG
US crude 96.41 1.79 1.9% -2.4%
Brent crude 114.71 2.07 1.8% 6.8%
Natural gas 2.799 0.051 1.9% -6.4%
US gold 1687.60 30.50 1.8% 7.7%
Gold 1687.30 31.76 1.9% 7.9%
US Copper 345.40 1.35 0.4% 0.5%
Dollar 81.244 -0.450 -0.6% 1.3%
CRB 309.560 3.050 1.0% 1.4%
US corn 808.75 -6.25 -0.8% 25.1%
US soybeans 1757.50 0.00 0.0% 46.6%
US wheat 911.00 0.00 0.0% 39.6%
US Coffee 164.75 1.35 0.8% -27.8%
US Cocoa 2610.00 9.00 0.3% 23.8%
US Sugar 19.78 0.03 0.2% -14.9%
US silver 31.370 1.003 3.3% 12.4%
US platinum 1536.30 33.60 2.2% 9.4%
US palladium 627.95 13.05 2.1% -4.3%