Commodities and Oil Likely to Rise This Week

123jump.com Staff
30 Nov, -0001
New York City

The demand for cement will rise as the hurricane Dennis marches through the Gulf Coast of Mexico and worsen the current shortage in Texas and Florida. At the center of the hurricane wind speed is expected to be as high as 85 mph. The copper maket remains tight as strike moves into the seocnd week in Chile and Arizona. Indian Sikh temples are attacked in the wake of London bombings.

In the wake of bombings in London, two mosques in northwest England and a Sikh temple in Leeds were attacked by arsonists. The British muslims which form 4% of population and 2 million in size are largely from India, Bangladesh and Pakistan.

The strike at Asarco mines, subsidiary of Grupo Mexico enters the tenth day. The 190,000 ton production capacity could be cut in half if the strike continues beyond three weeks as it did in 1990 and three months in 1990. In a separate news China' largest copper consumer reported that the use of recycled copper has increased to 1/3rd of the total copper consumption in China. The copper prices are trading at 15-year high.

The strikes at mines in Arizona and in Chile drove copper prices higher by one percent. Copper inventories according to London Metal’s Exchange survey are at 30-year low and latest read showed a drop of 1% to 29,150 metric ton.

According to Portland Cement Association cement prices are likely to rise in the U.S. as demand outstrips the supply by 25%. The U.S. demand of 130 million tons exceeds the domestic supply of 100 million tons. The shortfall has been harder and harder to feel as cement import from Thailand are getting difficult. American lawmakers are reconsidering to reduce or abolish the current tariffs on cement imported from Mexico.

Australia’s policy of mandatory detention of illegal immigrants or asylum seekers is under fire from a section in government. Currently Australia holds 897 people including 59 children are in detention. Several of them have spent years behind bars in remote area not accessible to reporters or human rights activists. According to government report 92% of the refugees in the last decade were economic refugees. Australia uses the threat of terrorism to keep this people behind bars.

Inflation data to be released this week for Europe are likely to confirm the revised inflation from 1.9% to 2.1% for the Eurozone and a sharply downward revision of British 2005 GDP growth rate to 2%, slowest since the current economic expansion began in 1992. France is likely to register higher industrial out put and higher inflation but Italy is likely to reflect lower industrial activity. Tuesday reporting of June inflation for Britain is likely to be reported at 1.9% just shy of 2% target set by the Central Bank.

Oil traders in NY could not decide whether to hold on to the gains or take profit on the recent rally on energy futures. In the end oil futures lost momentum of the day and turned in loss of $1.10 and closed at $59.63 per barrel. While gold fell 40 cents but silver was up 4 cents and copper traded up 2.05 cents closing at $1.556 per pound.

According to Boston Globe news report Mark Wolfe, executive director of the National Energy Assistance Directors' Association in Washington, is projecting that the average family's heating oil bill this coming winter will be $1,541, which is 22 percent, or about $278, more than last winter and 62 percent, or $589, more than the winter of 2003-2004. In making his projection for this coming winter, Wolfe used an average price of $2.22 a gallon for heating oil. Nearly 9 percent of US households, according to the Census Bureau, heat their homes with heating oil. Most of those homes are located here in the Northeast.

The recently ended seven week paper industry strike in Finland has resulted in $2 billion loss to the country. Finland produces 4% of world’s paper and forms 60% of European magazine needs. 25% Paper export forms 25% of Finland’s export.

Oil traders in NY could not decide whether to hold on to the gains or take profit on the recent rally on energy futures. In the end oil futures lost momentum of the day and turned in loss of $1.10 and closed at $59.63 per barrel. While gold fell 40 cents but silver was up 4 cents and copper traded up 2.05 cents closing at $1.556 per pound.

Singapore Air’s CEO Chew Seng ruled out possible merger between Quantas Air and Singapore Air under the current ‘regulatory structure’. The largest Asian carrier by market cap reported S$1.39 billion dollars for the fiscal year ended in March.