Page 88 - MEX-Yearbook-2017

MEX Almanac

February 2017

Precious Metals an oversupply. The price of heating oil declined by a very small margin
The month of February saw the precious metals treading the northern road. because of warmer-than-normal weather in key regions across the U.S. for
Heightened investor uncertainty about the health of the stock market uptrend the rest of the winter. Heating need decreased in the warm winter weather
and concerns about inflation are two signals that precious metals market was across the U.S. that declined the price of natural gas over the period by
traded upward. The election of Donald Trump and the upcoming election about 15%.
in the wake of Brexit were the sources of uncertainty about the future. The
price of gold inclined because the value of the dollar was weakened and Open Close % Change
Federal Reserve hinted that the rate hike might be in works. In order to grab
the opportunity to buy bullion as a hedge against political uncertainty in the Brent Crude 5619 5607 -0.21%
United States and Europe, there was a huge demand for gold and as a result,
the price increased. The price of silver increased by 4.77% this month due Crude Oil 5336 5413 1.44%
to the soaring demand and anemic supply. Previously mining companies
cut back the exploration of silver as silver price were down which created Heating Oil 43.58 43.52 -0.14%
a deficiency in supply later. There was a slight decrease in production of
platinum in South Africa. The high diesel shares in the European vehicle fleet Natural Gas 313.9 267.9 -14.65%
and the increment of automotive industry all over the world increased the
prices of platinum and palladium this month. Agro
This month, cocoa prices slumped to an eight-year low due to an abundant
Gold Open Close % Change supply. In the largest cocoa producing country of Ivory Coast, cocoa beans
Silver 39000 40545 3.96% are piling up at warehouse and ports due to excess supply. However, the
Platinum 563.8 590.7 4.77% demand had been declined due to the health consciousness of consumers
Palladium 33355 4.00% on consuming chocolates. The demand for inferior quality of coffee from
32072.5 25204 3.72% the rest of Latin America was great. Futures of coffee in Newyork and
24301 London had seen selling pressure in this month. The improved economy had
upgraded the price of corn slightly this month. After a supply shortage pushed
Base Metals up local prices in India, Indian exporters cancelled orders and thus the price
Copper price had been little up and down this month but it settled at the of cotton soared in the month of February. The fast depleting cotton stocks
bearish mode. With the increasing technological development, the demand with ginners and shortage of quality cotton also triggered strong buying from
of consumption of copper in China and whole world was increasing in a fast small millers who were running short of cotton stocks that increased the price
trend. A rise in construction building, power infrastructure, transportation, of cotton. American farmers planted more soybeans than corn this year for
home appliances and manufacturing increased the demand of copper. There the first time in 35 years. The harvest of soybean in Brazil’s important state
was strike of workers at world’s largest copper mine Escondida where they Mato Grosso was well ahead of last year’s pace. Thus the improvement in
went on strike over negotiations on benefits and compensation. This gave supply brought down the price of soybean. The expectations of rising output
pressure on price of copper to increase but somehow it managed to close and tracking weaker performing rival oils diminished the price of soybean
its market at bearish mode at the end of the month. oil. Sugar price was down by 6.33% since it remained pressured by the
expectation that southern Brazil would produce maximum amount of sugar
supported by the climate was favorable enough. The production of wheat
declined in all producing areas of the USA and all other wheat planted acres
that reduced the stocks amid the price increase.

Copper Open Close % Change Open Close % Change
600 591.9 -1.35% 209.3 197.3 -5.73%
328.4 310.4 -5.48%
Energy Cocoa 14.12 14.17 0.35%
The market of energy commodities came up in a mixed trend over the Coffee 165 167.98 1.81%
period of month during February. Other than crude oil, all other energy Corn 74.66 70.84 -5.12%
commodities went on bearish trend. Supplies of Brent crude was increased Cotton 37.52 37.49 -0.08%
as S&P Global Platt added a new crude oil stream to its Dated Brent that Soybean Oil 45.18 42.32 -6.33%
decreased the price of Brent crude. The price of oil increased since investors Soybean 15.25 15.4 0.98%
bid up contracts on the heels of growing optimism about compliance to a Sugar
global pact to curb crude output. OPEC and producers including Russia Wheat
aimed to cut production by around 1.8 million barrels per day to drain
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)

87 | MEX NEPAL YEAR BOOK 2017