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Commodity Important Updates for 8 August 2016

Commodity Important Updates for 8 August 2016

Imports plummeted 12.5% year-on-year in July, almost double the pace expected.

Chinas trade surplus grew to US$52.3 billion in July from $48.11 billion the previous month, coming in larger than the market forecast of $48.00 billion.

Chinas merchandise trade surplus unexpectedly expanded in July after imports fell sharply, but the fourth-straight decline in exports could spell trouble for the world’s second-biggest economy.

Turmeric trading range for the day is 8032-8352.Turmeric prices gained due to pick up in physical demand at the spot market. There is expectation of lower arrivals and good upcountry demand is supporting prices. At Erode market estimated market supply was at 6000 quintals, higher by 1000 quintals from previous trading day. In Nizamabad, a major spot market in AP, the price ended at 8476.15 rupees gained 42.1 rupees.

Aluminium trading range for the day is 108.4-110.8. Aluminium prices ended with gains as inventories tracked by exchanges in London and Shanghai declined, signaling tighter supplies. Support also seen to Aluminium prices as Chinese Aluminium smelters reverse output cuts. Stockpiles of aluminum held in SHFE warehouses fell to the lowest since 2011 and those tracked by the LME had the biggest weekly drop since 2006. Warehouse stock for Aluminium at LME was at 2265050mt that is down by -6425mt.

Naturalgas trading range for the day is 182.9-191.3.Natural gas prices fell as concerns about an uptick in production and forecasts of milder weather pressured the market. Weather reports have forecasted moderating temperatures over the next six to 10 days, which could be putting downward pressure on natural gas prices. The U.S. Energy Information Administration said storage levels shrank by 6 billion cubic feet of gas in the week ending July 29. U.S. natural gas supplies fell for the first time in the summer in a decade.

Jeera trading range for the day is 19445-20135.Jeera dropped on profit booking after gained on expectation of fresh export demand at the spot market. As per 4thadvance estimate of Gujarat State for 2015-16, production is pegged at 2.38 lt compared to 1.97 lt in 2014-15.NCDEX accredited warehouses jeera stocks gained by 54 tonnes to 6347 tonnes. In Unjha, a key spot market in Gujarat, jeera edged up by 133.35 rupees to end at 19433.35 rupee per 100 kg.

Soyabean trading range for the day is 3525-3657.Soyabean prices dropped followed by higher planting of the summer-sown oilseed. Data published by the SOPA showed exports of soybean meal in July slipped by 60% to 12,272 tons. NCDEX accredited warehouses soyabean stocks dropped by 60 tonnes to 1930 tonnes. At the Indore spot market in top producer MP, soybean dropped -14 rupee to 3798 rupee per 100 kgs.

Menthaoil trading range for the day is 914.5-945.1.Mentha oil spot at Sambhal closed at 1067.80 per 1kg. Spot prices is down by Rs.-3.70-.Mentha oil prices dropped amid a fall in physical demand from major consuming industries in the domestic spot market. The preliminary mandi source suggests that production of menthol is likely to be around 34-35000 tonnes during 2016-17.Mint product exports have declined substantially from the export basket by 18% in terms of volume and 4% in terms of value year-on-year.

Nickel trading range for the day is 700.4-725.4.Nickel prices gained as Philippines suspends operation of a seventh local nickel miner The Philippines supplied 95 percent of Chinas nickel ore imports in the first six months of 2016, according to Chinese customs data. Global stocks are high a suspension or closure of more mines could drive refined nickel prices up further. Warehouse stock for Nickel at LME was at 369492mt that is down by -2256mt.

Zinc trading range for the day is 150.7-152.5. Zinc prices gained as support seen as mine-output cuts including those at Glencore Plc reduced supply. Zinc stocks in LME approved warehouses have fallen about 30 percent since September last year to 430,075 tonnes. The closure of zinc mines in Australia and overseas is pushing up the price of zinc, which has already risen 60 per cent this year to around $US2,240 a tonne. Warehouse stock for Zinc at LME was at 429700mt that is down by -375mt.

Zinc trading range for the day is 150.7-152.5. Zinc prices gained as support seen as mine-output cuts including those at Glencore Plc reduced supply. Zinc stocks in LME approved warehouses have fallen about 30 percent since September last year to 430,075 tonnes. The closure of zinc mines in Australia and overseas is pushing up the price of zinc, which has already risen 60 per cent this year to around $US2,240 a tonne. Warehouse stock for Zinc at LME was at 429700mt that is down by -375mt.

Copper trading range for the day is 316.3-324.9.Copper prices dropped amid mounting concern that economic stimulus planned around the world won’t be enough to push up demand. Goldman Sachs Group Inc., forecasts that the price may slump to $4,000 a metric ton over 12 months as mine supply picks up. ICSG reported global copper ore output is expected to increase at an annual rate of 1 million tonnes or 4% by the year 2019.Warehouse stock for Copper at LME was at 206650mt that is down by -2650mt.

Crudeoil trading range for the day is 2722-2852.Crude oil prices remained under pressure as a glut of crude and refined products weighed on markets and investors eyed a possible stutter in Chinas imports. There are also growing worries that Chinas imports are weakening from records set in 2015 and this year. Near record high OPEC output has been a drag on oil prices over recent months, with the cartels members continuing to boost crude production. Genscape said that stockpiles at the Cushing, Oklahoma delivery hub fell by over 89,000 barrels during the week to August 2.

Silver trading range for the day is 45138-48256.Silver dropped after a better-than-expected jobs report dented safe-haven demand and increased concerns that Fed could raise interest rates in the coming months. Nonfarm payrolls increased by 255,000 jobs last month as hiring rose broadly after an upwardly revised 292,000 surge in June U.S. employment increased more than expected in July and wages picked up, which should bolster expectations of an acceleration in economic growth. Fed Chair Janet Yellen has said the economy needs to create just under 100,000 jobs a month to keep up with population growth.

Gold trading range for the day is 30792-32060.Gold fell as the dollar rose after U.S. data showed employment increased more than expected in July Physical gold sales remained sluggish in Asia, but appetite is expected to pick up with festive seasons approaching in top markets India and China. SPDR gold trust holdings gained by 0.73% i.e. 7.13 tonnes to 980.34 tonnes from 973.21 tonnes. Indias gold imports fell for a sixth straight month in July as weak demand and record high discounts prompted banks and refineries to reduce overseas purchases.

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