Page 102 - MEX-Yearbook-2017

MEX Almanac

August 2017

Precious Metals rose despite the peak summer driving season. However, a bullish trend was
In the month of August, all four metals across the precious metals bracket seen in natural gas as damage from Tropical Storm Harvey was seen halting
witnessed bullish trend. Gold rose to a two-month high as geopolitical production and pipeline operations. The damage from the hurricane, together
tensions over North Korea fueled safe-haven demand, while doubts about with subsequent raining and flooding, disturbed natural gas production in the
U.S. President Donald Trump’s ability to enact pro-business policies pushed Eagle Ford shale basin and Gulf of Mexico. The storm had taken about 14
U.S. bond yields and the dollar lower. North Korea dismissed warnings by percent the nation’s refining capacity offline. The national average price of
U.S. President Donald Trump that it would face “fire and fury” if it threatened gasoline rose, as major refineries in the Houston area closed down.
the United States as a “load of nonsense”, and outlined detailed plans for a
missile strike near the Pacific territory of Guam. Silver prices climbed to fresh Brent Crude Open Close % Change
two-month highs amid a bout of risk aversion that was triggered by North Crude Oil 5231.00 5229.00 -0.04%
Korea tensions. Silver values rose as haven buying drove precious metals Heating Oil 4978.00 4731.00 -4.96%
higher. Platinum and palladium climbed as the U.S. imposed further sanctions Natural Gas 43.73 46.29 5.85%
on the world’s second-biggest producer as concern about the political tension 278.60 303.30 8.87%
between Russia and America escalates. The scarcity of physical palladium
and a strong borrowing market developed among users and speculators which Agro
took the prices of palladium to a 16-year high. Platinum prices shot up on the August witnessed bearish patterns across the agro commodities except for
back of declining supply and increasing demand from the automobile sector cotton and soybean oil. After an optimistic reports about the next main
across the globe. growing season by farmers of the Ivory Coast, the cocoa prices underwent
bearish for the month. Coffee price declined and hit one-month low because of
Gold Open Close % Change lower physical demand and a stronger dollar. Corn price dipped to the lowest
Silver 40837.50 42472.50 4.00% level for six weeks, after wetter forecasts and an unexpected improvement
Platinum 539.70 561.30 4.00% in U.S. crop conditions. Unfavorable weather conditions in Texas led to
Palladium 30270.00 32180.00 6.31% the destruction of a portion of unharvested crop by rain and high winds
28434.00 29956.00 5.35% resulting in the hike of the cotton price. A US decision to hike import duties
on soya oil-based biodiesel from major producing economies like Indonesia
Base Metals and Argentina for allegedly subsidizing their biodiesel exporters triggered
Copper rose to a near three-year high on signs of stronger demand in top price hike. With more rain and cooler temperatures that was expected in the
consumer China while inventories fell in London warehouses. Increased coming weeks in the central US, price of soybean has gone down. The price
growth forecasts from the International Monetary Fund were complemented of sugar fell from a two-month high after technical resistance, firmer dollar
by Chinese government remarks about the possible curtailment of scrap and continued producer selling. The wheat price declined and hit the lowest
copper imports to give the metal its best weekly performance in five months. since mid-June. Because of heavy inventory and largely non-threatening
Copper benefited from supply disruptions due to Beijing-imposed capacity weather for U.S. crops, there is a bearish trend in Chicago grain and oilseed
curbs and declining stocks with firm demand from China. futures and options.

Copper Open Close % Change Open Close % Change
637.50 678.50 6.43% 207.70 192.10 -7.51%
306.30 284.10 -7.25%
Energy Cocoa 14.50 13.30 -8.28%
The price of energy commodities saw mixed trend over the period of a Coffee 154.56 157.34 1.80%
month during August as the price of Brent Crude and crude oil declined Corn 76.24 76.54 0.39%
and price of heating oil and natural gas rose. Increasing OPEC production Cotton 36.32 34.38 -5.34%
and increasing OPEC exports are the reason the market had been trading Soybean Oil 32.76 31.42 -4.09%
lower. Oil prices tumbled triggered by a stronger US Dollar, concerns over Soybean 17.27 14.96 -13.38%
growing supply from non-OPEC producers, and signs of potential slower Sugar
oil demand growth in China. Oil prices fell on news that refinery runs in Wheat
China dropped in July. Furthermore, fall in the oil price was triggered by
concerns of oversupply as Libyan output improved and US fuel inventories The figures above are the percentage change in the prices of corresponding commodity over the
corresponding month. % change is calculated as ((Close-Open)/Open*100)

101 | MEX NEPAL YEAR BOOK 2017