Oil falls from a decade high
Oil fell more than 2% after prices hit their highest in about a decade, on hopes that the United States and Iran would soon reach a nuclear deal that could add more oil to a market in short supply.
Trading was volatile, however, as investors initially placed orders sending prices to multi-year highs on worries that Russian sanctions would disrupt oil supplies.
Russia exports 4 to 5 million barrels of crude oil per day, but companies are now moving away from Russian supplies and scrambling for other types of oil.
Closing session 3/3, Brent crude oil fell $2.47 or 2.2% to $110.46/barrel, WTI fell $2.93 or 2.6% to $107.67/barrel.
Both grades rose to multi-year highs this session, with Brent hitting $119.84 a barrel, the highest since May 2012 and WTI the highest since September 2008 at 116.57. USD/barrel.
A new sanction announced by the White House on March 2 bans the export of specific refining technology, making it difficult for Russia to modernize its refineries.
Brent has gained nearly 25% since Russia launched its military operation in Ukraine on February 24.
Media reports suggest that the US and Iran are close to finalizing a deal that could bring more than a million barrels of oil a day, or about 1% of global supply, back to the market.
This supply relief can only partially fill the gap left by buyers cutting back on oil purchases from Russia, which accounts for about 8% of global oil exports.
Rystand Energy chief executive Jarand Rystad said it expected Russia’s oil exports to fall by 1 million bpd from the indirect impact of sanctions. He expected oil prices may continue to increase, possibly surpassing 130 USD/barrel.
Palladium highest in more than 7 months, gold rises
Palladium continued to rise to the highest level in more than seven months, as concerns about supply shortages following harsh sanctions on Russia, while the crisis in Ukraine and rising inflation boosted gold demand.
Spot palladium rose 4.1% to $2,779.09 an ounce (at 1:39 a.m. local time on March 4), the highest level since mid-July 2021. Western countries have imposed sanctions on Russia, which accounts for 40% of the world’s palladium production.
Spot gold rose 0.4 percent to $1,933.31 an ounce and U.S. gold for April delivery closed up 0.7 percent at $1,935.90 an ounce.
Investors await more clues about US interest rate hikes as Fed Chairman Jerome Powell testifies before congress for a second day.
Base Metals Rise
Aluminum, copper and nickel prices raced to new highs as more sanctions on Russia threaten to disrupt the flow of goods from the main producer.
Russia produces industrial and precious metals as well as natural gas that is used to generate electricity for the production of goods.
Sanctions on Russia’s banks have disrupted the supply of raw materials to global markets, at a time when inventories of aluminum and other metals are at multi-year lows.
The sanctions caused the world’s three largest container shipping lines to stop shipping goods to and from Russia.
Nickel prices on the London Metal Exchange (LME) rose to their highest since April 2011 at $27,976 a tonne. Closing up 5.4% to 27,300 USD/ton.
LME aluminum rose 5% to $3,744 a tonne after hitting a record $3,755 a tonne, while copper rose 1.7% to $10,323 a tonne.
The price of the metal for immediate delivery is higher than that of the three-month futures contract, indicating a lack of supply in the LME market. Nickel stocks on the LME were at 77,784 tonnes, the lowest since 2019 with 52% of which already booked for delivery.
Output from Chile’s major copper miners fell in January, hit mainly by weak performance at state miner Codelco.
Iron ore increased
Dalian and Singapore iron ore soars on growing hopes of improving steelmaking component demand in China, following reports of possible easing of Covid-19 restrictions in the top steel-producing country this world.
The May iron ore contract on the Dalian Commodity Exchange closed up 6.8% to 797.5 yuan ($126.27) a tonne, after rising about 9.7% to its highest since from 11/2.
On the Singapore Exchange, April iron ore futures rose 7% to $159.55 a tonne after hitting a high of $162.40 a tonne in this session.
In the spot market, imported iron ore traded at $147.5 per tonne on March 2, the highest since February 14, according to data from consulting firm SteelHome.
China’s prices of steel and other steelmaking components also continued to rise after market regulators last month sought to rein in soaring coal and iron ore prices.
Hot rolled coil in Shanghai increased by 2.6%, bar steel increased by 0.6%, stainless steel increased by 4.8%.
Stable Japanese rubber
Japanese rubber prices closed steady on fears of global inflation balancing with the prediction that rising oil prices could encourage the shift from natural rubber to synthetic rubber.
The August rubber contract on the Osaka exchange closed up 0.1 JPY to 260 JPY ($2.25)/kg.
While the sharp increase in crude oil and raw material prices did not cause rubber prices to rise today, rubber prices did not fall and remained supported.
The crisis in Ukraine could damage the Japanese economy by costing families and companies higher prices for fuel and goods, signaling the need to maintain massive stimulus to support economic growth. fragile recovery.
The price of rubber for May term in Shanghai increased by 70 CNY to close at 13,980 CNY (US$2,212.38)/ton.
Vietnam rice prices increase
Vietnam’s export rice prices rose this week as trade routes to China reopened, and some traders bet extra demand from customers looking for alternative sources due to the crisis. crisis in Ukraine.
Vietnam’s 5% broken rice price was offered at $400/ton compared with $395-400/ton a week ago.
A trader in Bangkok said the situation in Ukraine may slightly increase shipping fees.
The price of Thai 5% broken rice increased slightly to 403-400 USD/ton from 400 USD/ton last week.
Another trader said the crisis has not affected Thailand’s rice exports as Russia and Ukraine are not their major trading partners.
Demand for rice from India, the world’s top exporter, improved, but the price of 5% broken parboiled rice was unchanged at $370-376 a tonne due to the weakening rupee.
Indian farmers could harvest a record 127.93 million tonnes of rice compared with 124.37 million tonnes last year.
Meanwhile, rice prices in Bangladesh are high, despite good stocks.
Reduced coffee
Arabica coffee for May delivery closed down 6.3 US cents, or 2.7%, at $2,2290/lb, having fallen to a two-month low at $2.2175.
Dealers say the fund’s selling is putting pressure on prices while also noting that coffee exports to Russia may fall due to payment problems.
Robusta coffee for May delivery fell $17, or 0.8%, to $2,013 a tonne, a 6-month low.
Vietnam’s coffee prices fell, according to London prices in the context of supply chain disruptions and payment methods as well as soaring oil prices due to the Russia-Ukraine conflict.
As of March 3, the price of coffee for May futures in London has dropped more than 7.6% or $ 166 in the past week, to the lowest level since June 2021.
Farmers in the Central Highlands sold coffee at 38,900 – 41,000 VND (1.7 – 1.8 USD)/kg, down from 40,600 – 41,800 VND a week ago.
Traders in Vietnam have offered to sell grade 2 robusta coffee with 5% black and broken beans at a discount of $325/ton compared to the July futures contract in London, a week before the deduction was at $330-$340. /ton.
Vietnam’s coffee exports in the two months of this year increased by 3.4% over the same period last year to 293,000 tons. Exports in March alone were estimated at 130,000 tons, worth US$304 million.
The Indonesian market was closed on March 3 for a public holiday. Coffee is offered at a discount of $170 from the March and April contracts in London.
Sugar prices increase
Raw sugar for May delivery rose 0.29 US cents, or 1.6%, to 18.93 US cents/lb, the highest in five weeks.
Dealers say the market continues to be supported by high energy prices.
Brazil exported 1.72 million tons of sugar in February compared with 1.82 million tons a year ago.
May white sugar futures closed up $7, or 1.4%, at $522.2 a tonne.
The highest corn for 9 years, the highest wheat for 14 years
U.S. corn prices surged with near-terms to a nine-year high as the conflict in Ukraine cut off supplies from the Black Sea and boosted demand for U.S. exports.
CBOT May corn futures rose 35 cents at the trading limit, to its highest level since December 2012. This contract closed up only 22-3/4 US cents reached 7.47-3/4 USD/bushel.
Chicago wheat spiked to a 14-year high due to export cuts from the Black Sea region, which provides nearly a third of global exports.
CBOT wheat for May futures closed up 75 cents, the limit for a one-day gain, to $11.34 a bushel, the highest since March 2008.
Chicago soybeans rose on strong demand but then retreated on profit taking, with prices near multi-year highs.
CBOT soybean for May term closed up 4-3/4 US cents to 16.67 – 3/4 USD/bushel.
Prices of some key items on the morning of March 4:
