Commodity Blog

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Oil & Wheat Jump on China, Wheat Drops on Weather

May 21, 2012 at 22:35 by Vladimir Vyun

Commodities advanced today as China’s Premier Wen Jiabao said that the country would focus on boosting economic growth. China is one of the world’s biggest importers of raw materials, therefore faster growth of the Asian nation means rising demand for commodities.

Crude oil had additional bullish factor as Goldman Sachs stated that demand for crude exceeds supply even as Saudi Arabia ramp up production. As for rubber, it is bolstered by demand in Thailand.

June futures for delivery of crude oil advanced as much as $1.09 to $92.57 per barrel on NYMEX, posting the biggest gain since May 1. Brent oil climbed from $107.20 to $109.30 per barrel as of 22:29 GMT on ICE today. Contract for delivery rubber of in September jumped 2.7 percent to $3,910 per ton on the Shanghai Futures Exchange.

Wheat, on the other hand, ended its rally on forecast that rains in Russia and Ukraine. Earlier, the agricultural commodity rallied as drought in the Eastern European countries threatened crops. Output may be lower than the previous estimates despite improving weather. Wheat capped its five-day rally today, closing at $6.9925 per pound on CBoT today after opening at $7.0025 and reaching $7.2175 — the highest intraday price since September 6.

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

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