Commodity Blog

Commodity news, technical and fundamental analysis, market data on precious metals, energies, industrial metals, and soft commodities


Oil & Copper Drop on Europe, Coffee Falls on Excessive Supply

May 23, 2012 at 23:42 by Vladimir Vyun

Commodities, including oil and copper, fell today on fears that Greece would exit the eurozone. The worries drove the euro to the lowest level since 2010, pushing the dollar higher. The strengthening US currency weakened most raw materials. The European leaders are meeting tonight at Brussels, but most analysts do not believe that the meeting would provide any solid result. Implementation of eurobonds may help European countries, but Germany strongly opposes that idea. The Standard & Poor’s GSCI Spot Index, of 24 commodities lost as much as 2.3 percent today to the lowest level this year. Crude oil also declined as US inventories swelled 0.9 million barrels to 382.5 million barrels last week. July futures for delivery of crude oil slid as much as $1.95 to $89.90 per barrel on NYMEX today, the lowest price since October 21. Brent crude fell from $108.11 to $106.16 per barrel as of 23:16 GMT today on ICE, reaching $105.39 intraday — the lowest settlement since December 20. Copper price dropped from $3.4675 to $3.4250 per pound on COMEX, touching earlier $3.3920 — the low last seen in December 29.

Coffee also suffered from the general negative market sentiment. Additionally, prices were under pressure on prospects for higher output from Brazil and Colombia. Rabobank International estimated that global coffee production may exceed demand by 5.3 million bags in the year starting in October. Coffer spot price was down from $1.7350 to $1.6510 per pound on ICE today. Analysts say that the $1.65 level may bottom in the near term, but gains would be limited by growing exports from South American countries.

If you have any questions and comments on the commodities today, use the form below to reply.

Leave a Reply