2024-10-21 07:40

NAPERVILLE, Illinois, Oct 20 (Reuters) - Each week since late August, speculators covered short positions across U.S. grains and oilseeds as weather and geopolitical risks increased supply uncertainties worldwide. But funds snapped that stretch of short covering in the week ended Oct. 15, adding new gross short positions in CBOT corn, soybean meal and soybeans. That flipped overall grain and oilseed sentiment back to bearish after the establishment of a net long in the prior week, the first in 13 months. Price action was heavy across CBOT markets in the week ended Oct. 15. Corn led losses with the most-active contract down 4.6%. Soymeal declined 3.5%, soybeans and wheat eased about 2.5% each, and soyoil slid 1.5%. During that week, money managers increased their net short position in CBOT corn futures and options to 86,988 contracts from 23,729 in the previous week, which had been funds’ least bearish corn stance since early August 2023. That move included more than 57,000 new gross short positions, the most for any week since June. Money managers also added nearly 25,000 gross short positions in CBOT soybean meal, a weekly record in data back to 2006. But this accounted for just 60% of the net selling through Oct. 15 as funds aggressively pitched longs, too. That slashed the managed money net meal long to 55,711 futures and options contracts versus 96,588 a week earlier, marking near-record net selling. The week ended Oct. 15 broke money managers’ seven-week streak of net buying in CBOT soybean futures and options, as they expanded their net short to 40,341 contracts from 21,798 in the prior week. This was primarily due to new shorts, but funds added a handful of gross soybean longs for a fifth straight week. They continued to cover shorts in CBOT soybean oil, but exiting longs trimmed the managed money net long in soyoil by about 5,600 on the week to 26,938 futures and options contracts. Despite the price slide, money managers trimmed their net short in CBOT wheat futures and options to 26,013 contracts, down nearly 3,500 on the week. That is among funds’ least bearish wheat views within the last two years. However, CBOT wheat futures plunged nearly 3% on Friday to four-week lows with better weather forecasts for parched wheat regions including top exporter, Russia. Russia further headlined wheat news on Friday amid plans for grain exporters to sell directly to sovereign buyers, which could be damaging for international trading houses. Moscow is also seeking more control over global food prices by setting up a grain exchange with BRICS countries. This increases uncertainty for rival suppliers, including the United States, which has seen respectable grain and oilseed export demand as of late, particularly for corn. In addition to monitoring demand, market participants this week will be paying attention to the ongoing U.S. corn and soybean harvest as well as the soybean planting pace in Brazil, which has recently been slower than normal due to dryness. Karen Braun is a market analyst for Reuters. Views expressed above are her own. Sign up here. https://www.reuters.com/markets/europe/funds-rejuvenate-cbot-corn-soy-bearishness-after-short-covering-streak-2024-10-21/

2024-10-21 07:32

BEIJING, Oct 21 (Reuters) - Iron ore futures rose on Monday as near-term demand remained firm and the latest rate cut in top consumer China lifted sentiment, but gains were capped by caution on exactly how much boost the steel market would receive. The most-traded January iron ore contract on China's Dalian Commodity Exchange (DCE) ended daytime trade 1.45% higher at 769.5 yuan ($108.18) a metric ton. The benchmark November iron ore on the Singapore Exchange climbed 0.41% to $102.1 a ton, as of 0701 GMT. Near-term demand for the key steelmaking raw material held firm thanks to better steel margins, said analysts. Daily average hot metal output gained for a seventh straight week, rising 0.5% to 2.34 million tons as of Oct. 18, while profitability climbed for the eighth consecutive week to 74.46%, a survey of steelmakers conducted by consultancy Mysteel showed. Meanwhile, China cut benchmark lending rates at the monthly fixing on Monday after trimming other policy rates last month as part of a package of stimulus measures to revive the economy, boosting the broad commodities markets including steel and iron ore. Price gains, however, were capped by lingering doubts on a quick boost in demand from the raft of stimulus measures in the world's second-largest economy, which is also the world's biggest consumer of metals. "While the focus on reducing inventory is likely to speed up the recovery, it will have little impact on steel and iron demand in the short term," analysts at ANZ said in a note. Other steelmaking ingredients on the DCE gained, with coking coal and coke adding 1.3% and 0.6%, respectively. Steel benchmarks on the Shanghai Futures Exchange advanced. Rebar rose 1.08%, hot-rolled coil added 0.95%, wire rod ticked up 0.14% and stainless steel edged up 0.69%. ($1 = 7.1131 Chinese yuan) Sign up here. https://www.reuters.com/markets/commodities/iron-ore-gains-firm-near-term-demand-more-china-rate-cuts-2024-10-21/

2024-10-21 06:41

LONDON, Oct 21 (Reuters) - Oil prices rose on Monday, recouping some of last week's more than 7% decline on worries about demand in China, the world's top oil importer, and easing concerns about potential supply disruptions in the Middle East. Brent crude futures were up $1.05, or 1.4%, at $74.11 a barrel at 1233 GMT. U.S. West Texas Intermediate crude futures were $1.21, or 1.8%, higher at $70.43 a barrel. Brent settled more than 7% lower last week, while WTI lost around 8%. Those were the contracts' biggest weekly declines since Sept. 2, due to slowing economic growth in China and falling risk premiums in the Middle East. China on Monday cut benchmark lending rates as anticipated, part of a broader package of stimulus measures to revive the economy. Data on Friday showed China's economy grew at the slowest pace since early 2023 in the third quarter, fuelling growing concerns about oil demand. Saudi Aramco's CEO told an energy conference in Singapore on Monday that he was still "fairly bullish" on China's oil demand in light of stepped-up policy support aimed at boosting growth, and on rising demand for jet fuel and liquid-to-chemicals. "Geopolitical tensions in the Middle East and the positive oil demand comments from the CEO of Aramco are likely supporting oil prices," UBS analyst Giovanni Staunovo said. The U.S. Energy Information Administration said on Friday weekly oilfield production rose by 100,000 barrels per day to a record 13.5 million bpd during the week ended Oct. 11. Meanwhile, U.S. envoy Amos Hochstein will hold talks with Lebanese officials in Beirut on Monday on conditions for a ceasefire between Israel and Hezbollah, two sources told Reuters, as Israel expanded its air campaign on the group's financial assets overnight. Sign up here. https://www.reuters.com/business/energy/oil-prices-steady-after-7-weekly-drop-2024-10-21/

2024-10-21 06:17

JAKARTA, Oct 21 (Reuters) - Indonesia's new government aims to revive oil and gas production, with plans to cut regulations, reactivate idle wells and enhance output at producing assets in hopes of reversing a decades-long decline in output, officials have said. President Prabowo Subianto, who took the oath of office on Sunday, also plans to build on the previous administration's efforts to tap massive gas discoveries in South Andaman and lift biofuels use. Formerly a member of the Organization of the Petroleum Exporting Countries (OPEC), Indonesia's oil production has declined to under 600,000 barrels per day (bpd) this year from a peak of around 1.6 million bpd in the 1990s due to ageing blocks and sluggish investment. At the same time, oil consumption in the world's fourth-most populous country has more than doubled to 1.5 million bpd, leading to imports of oil and fuel products that have averaged $28 billion annually in the past decade. "We must have energy self-sufficiency and we are capable to be self-sufficient," Prabowo said in his inauguration speech, citing rising geopolitical tension. While Prabowo's predecessors also sought to reverse declining production, investment has been hindered by red tape and as well as competition for funding, including from renewables. Indonesia has announced large gas discoveries in recent years and is keen to accelerate development to take advantage of rising LNG (liquefied natural gas) demand locally and abroad. "We will remove various regulations that hinder the exploration process, cutting from 320 permits to 140 permits, and we will slash those further to shorten the process," Bahlil Lahadalia, Prabowo's energy minister, said on Oct. 14. Komaidi Notonegoro, energy analyst at ReforMiner Institute, said exploration and production contractors must deal with 19 often-rival agencies to secure permits. "The oil and gas contractors should be busy looking for new reserves instead of taking care of permits, it takes too much time," he said. REACTIVATING IDLE WELLS To increase production, the new government plans to push reactivation of nearly 5,000 idle wells, Bahlil said. "Our target is to increase oil production by around 200,000 bpd by optimising idle wells and by technology intervention," Bahlil said last week, without specifying a timeline. The government is also pushing for more projects using so-called enhanced oil recovery (EOR) to extract oil from aging wells which require added cost. ExxonMobil Corp (XOM.N) , opens new tab and state oil firm Pertamina are each in early EOR stages on separate projects. "The government's main concern is volume, but these contractors are running a business. The question is, whether the government will be willing to compensate" for the added cost, Komaidi said. To reduce liquefied petroleum gas (LPG) imports, the new government aims to double production of the cooking fuel from 1.7 million tons per year, Bahlil said. Indonesia imports around 70% of the 8 million tons of LPG it consumes annually. Prabowo also has ambitious targets to increase biodiesel and bioethanol use, which some experts have said should be his main energy sector focus. "We have to be realistic. Prabowo can no longer rely on oil and gas," Fahmy Radhi of Gadjah Mada University said. "It is best if he put renewable energy as a high priority and focus on that from the get-go." Prabowo plans to increase the share of palm oil-based fuel in diesel to a world-leading 50%, from 35% now, and on Sunday listed cassava and corn, in addition to palm, as potential biofuel feedstocks. Sign up here. https://www.reuters.com/business/energy/prabowo-aims-boost-indonesias-energy-security-through-oil-gas-reforms-biofuels-2024-10-21/

2024-10-21 05:52

Silver scales highest level since late-2012 Gold has risen nearly 32% so far this year Gold could slow down while silver picks up, analyst says Oct 21 (Reuters) - Gold took a breather after surging to a record high on Monday, as higher U.S. Treasury yields and dollar offset support from growing uncertainties surrounding the U.S. presidential election and the Middle East war. Spot gold was little changed at $2,723.25 per ounce, as of 1:35 p.m. ET (1735 GMT), after hitting a record $2,740.37 earlier in the session. U.S. gold futures settled 0.3% higher at $2,738.9. "The 10-year yields are moving a lot higher, the dollar index got stronger. And that's putting some weight on gold," said Daniel Pavilonis, senior market strategist at RJO Futures. Benchmark 10-year Treasury yields rose to a 12-week high, while the dollar index gained, making gold more expensive for overseas buyers. Bullion, considered a hedge against political and economic uncertainty, has climbed over 32% so far this year, shattering multiple record peaks as the Federal Reserve's interest rate cut combined with safe-haven demand set up a perfect storm for gold. "We're getting closer to the U.S. elections, a couple of weeks out now... we're seeing geopolitics play out in the Middle East, Israel, Iran, whatever kind of stuff is going on behind the scenes," Pavilonis said. With the U.S. presidential election just over two weeks away, former President Donald Trump and Vice President Kamala Harris are caught in a knife-edge battle to win over some of the more competitive states. Meanwhile, hundreds of Beirut residents fled their homes as Israel prepared to attack sites linked to the financial operations of Hezbollah, aggravating fears of conflict escalation. "We look for gold to reach to $2,900/oz over the next 12 months, supported by further rate cuts by the Fed," UBS analyst Giovanni Staunovo said. Traders now see an 85% chance of a quarter basis point cut by the Fed in November. Spot silver rose 0.6% to $33.85 per ounce after hitting its highest since late-2012 earlier in the session. "We could see maybe gold slow down its speed and silver start to pick up and catch up with gold," Pavilonis added. Platinum fell 0.7% to $1,006.25 per ounce. Palladium dropped 2.4% to $1,054.07. Sign up here. https://www.reuters.com/markets/commodities/gold-hits-fresh-high-record-setting-rally-amid-global-uncertainties-2024-10-21/

2024-10-21 05:47

S&P 500, Dow end lower European shares finish down Gold prices reach new highs Brent crude settle nearly 2% higher Dollar index gains NEW YORK, Oct 21 (Reuters) - Global equity markets lost ground on Monday as traders remained cautious amid rising geopolitical tensions and uncertainty overthe U.S. presidential election, helping to push gold futures to new highs. The Israeli military is continuing its attacks against Lebanon's Hezbollah militant group, with hundreds of Beirut residents fleeing their homes late on Sunday as explosions rocked the Lebanese capital. Gold prices surged to a record high on Monday and were little changed at $2,719.33 an ounce . U.S. gold futures settled 0.3% higher at $2,738.9. The benchmark S&P 500 and Dow finished lower, with defensive stocks including real estate and healthcare among the leading drags. The Nasdaq closed slightly stronger, with Nvidia (NVDA.O) , opens new tab finishing at a record high, ahead of a busy week for corporate earnings. The Dow Jones Industrial Average (.DJI) , opens new tab fell 0.80%, to 42,931.60, the S&P 500 (.SPX) , opens new tab fell 0.18% to 5,853.98 and the Nasdaq Composite (.IXIC) , opens new tab rose 0.27% to 18,540.01. The European shares (.STOXX) , opens new tab index lost 0.66%, while MSCI's gauge of stocks across the globe (.MIWD00000PUS) , opens new tab fell 0.37%. Overnight in Asia, MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) , opens new tab closed 0.5% lower. "There's just tension around the earning season kicking off in earnest and then, of course, the elections two weeks away even though we haven't had the typical anxiety over elections that we normally see in September and October," said James St. Aubin, chief investment officer at Ocean Park Asset Management in Santa Monica, California. Oil prices settled up nearly 2% after a more than 7% drop last week. Brent crude futures settled up 1.68% at $74.29 a barrel, while U.S. West Texas Intermediate crude futures were 1.94% higher at $70.56 a barrel. Markets are pricing in a 89.3% chance for a cut of 25 basis points (bps) at the Fed's November meeting, with an 10.7% chance of the central bank holding rates steady, according to CME's FedWatch Tool , opens new tab. The yield on benchmark U.S. 10-year notes rose 11.9 basis points to 4.194%. The dollar climbed, buoyed by a rise in U.S. bond yields. The euro was down 0.46% at $1.0815, while the pound weakened 0.51% to $1.2982. Against the Japanese yen , the dollar strengthened 0.86% to 150.79. The European Central Bank (ECB) last week cut rates for the third time this year. Data on Monday showed German producer prices fell more than expected in September. The dollar index , which tracks its performance against a basket of currencies including the yen and the euro, rose 0.49% to 103.97. "Between the combination of escalating or still-high Middle East tensions, and we're only a handful of days away from the (U.S. election), it could be that the market is getting nervous ahead of that and people are squaring some of their positions," said Wasif Latif, president and chief investment officer at Sarmaya Partners. Sign up here. https://www.reuters.com/markets/global-markets-wrapup-1-2024-10-21/