58628 Commodity Markets Review December 10, 2010 DECPG, The World Bank Non-energy commodity prices rose for a fifth Agriculture prices rose 5.3 percent in straight month in November, up 3.4 percent, November, up a sixth straight month, with despite slight strengthening of the dollar. There strong gains in most indices, particularly fats & was large volatility during the month, with oils and raw materials. Since end-November prices of many exchange traded commodities wheat prices surged 21 percent on concerns that peaking early in November then declining heavy rains in Australia will reduce production. sharply before recovering more recently. Groundnut oil prices jumped 30 percent in Crude oil prices increased 3.4 percent in November due to lower production in Argentina November, up for a fourth month, averaging and export ban in India. Other main oilseeds $84.5/bbl. However, prices surged to nearly prices posted strong increases due to strong $90/bbl in early December, due to higher Chinese import demand and various weather- refining runs and falling stocks. Strong distillate related supply shortfalls this year. Cotton prices demand globally has been augmented by cold surged 22 percent on strong demand and low weather in Europe and, more recently, in the global stocks, while rubber prices climbed 10 U.S. Distillate demand in China surged because percent as wet weather in Asia curbed supply. of policy measures to meet energy efficiency Base metal prices rose 0.8 percent in goals under the 11th Five-Year Plan during 2005- November, up a fifth straight month, with gains 2010. Local Chinese authorities have cut off in copper outweighing declines in all other power to large industrial users, who have turned metals. Copper prices rose 2.1 percent (rising to diesel power generators. OPEC meets above $9000/ton in early December) on falling December 11th and is not expected to raise inventories, slow mine supply growth, and quotas, as prices remain in the broad $70-90/bbl expectations of the potential impact of range that OPEC ministers deem comfortable. physically-backed exchange traded funds Natural gas prices in the U.S. jumped 8.6 (ETFs). ETF Securities announced that they will percent in November due to strong heating launch the first physically-backed ETFs for demand from cold weather. However, prices copper, nickel and tin on December 10 in remained at a relatively low $3.7/mmbtu, due to London, and that ETFs in aluminum, lead and large stocks and growth in domestic production. zinc will be available in 2011. Among precious European gas prices rose 3.6 percent, also on metals, silver prices increased 13.2 percent on cold weather, and stand at $8.6/mmbtu in part strong investment and industrial demand, the due to indexation of imported gas to oil prices. former partly a hedge against potential inflation. Major Price Indices Agriculture Prices - Sub-Indices Indices of Nominal US$ Prices (2000=100) Indices of Nominal US$ Prices (2000=100) 350 300 Base Metals Raw Materials 275 300 Beverages 250 250 225 Energy 200 200 Agriculture Food 175 150 150 100 125 Nov-08 May-09 Nov-09 May-10 Nov-10 Nov-08 May-09 Nov-09 May-10 Nov-10 Prepared in the Development Economics Prospects Group (DECPG) by Shane Streifel, John Baffes and Betty Dow. Katherine Rollins is task assistant. 1 Major Movers November1 percent on stronger demand owing to extreme Groundnut oil prices soared 29.8 percent due to cold weather and sharp drawdown of weak exports from Argentina and the ongoing inventories. ban on exports by India. Tin prices fell 3.1 percent due to rising Cotton prices surged 22.2 percent due to strong inventories and large production increases in demand, low global stocks, and supply shortfalls Indonesia as producers responded to recent this year. record-high prices. Palmkernel oil and coconut oil prices (close Zinc prices declined 3.4 percent on higher substitutes) rose 16.5 percent and 7.7 percent, stocks and over-supply conditions, although respectively, due to weak coconut oil supply and warehouse financing deals have absorbed a overall demand strength for edible oils. significant portion of the excess metal. Palm oil and soybean oil prices (close Nickel prices decreased 3.8 percent because of substitutes) jumped 13.5 percent and 8.0 percent, rising inventories and expectations of large respectively, on strong Chinese import demand capacity additions in 2011. and shortage of competing oils, the latter partly November Percent Changes in Price (Nominal US $) due to weather-induced shortfalls in Eastern -10 0 10 20 30 40 50 60 Europe and Central Asia. Silver prices climbed 13.2 percent due to strong Groundnut oil Cotton, A Index 115.4 investment and industrial demand. Palmkernel oil Urea fertilizer prices rose 11.2 percent reflecting 126.6 Palm oil strong demand in the U.S. and Europe, and Silver concerns about lower exports from China. Urea, bulk Rubber, Singapore 69.4 Rubber prices increased 9.7 percent because of Natural gas, US weather-related supply problems in key South- Soybean oil East Asian suppliers, and higher crude oil prices. Coffee, robusta Natural gas (U.S.) prices rose 8.6 percent on Coconut oil 108.7 Coffee, arabica strong space heating demand late in the month Sugar, world owing to cold weather. Soybeans Coffee robusta and arabica prices increased Rice, Thai, 5% Coal, Australia 7.9 percent and 7.3 percent, respectively, due to Soybean meal tight supplies in Vietnam (robusta) and Natural gas, Europe Nov'10/Oct '10 Colombia (arabica). Crude oil, average spot Nov '10/Nov '09 Sugar prices rose 7.1 percent on weather-related Sawnwood Malaysia DAP supply problems in Australia and India. 102.6 Copper Soybean and soybean meal prices increased Gold 6.7 percent and 5.2 percent, respectively, due to TSP 103.0 strong demand in China, supply problems in Potassium chloride -21.7 Wheat, US, HRW Argentina, and lower U.S. crop estimates. LNG Rice prices increased 5.9 percent on strong Sorghum import demand in China and lower supplies Maize because of floods in Thailand, Vietnam and Beef Phosphate rock Pakistan this year. Lead Coal prices rose 5.4 percent because of strong Tea, avg 3 auctions cold-weather demand in Europe, and wet- Aluminum Cocoa weather production problems in Australia and -14.0 Logs, Malaysia Colombia. Tin 70.8 Natural gas (Europe) prices increased 3.6 Zinc Nickel 1 Percent change of average November 2010 prices compared to average October 2010 prices in nominal U.S. dollars (graph includes 12-month changes in grey). 2 COMMODITY PRICE DATA Annual averages Quarterly averages M onthly averages Jan-Dec Jan-Dec Jan-Nov Jul-Sep Oct-Dec Jan-Mar Apr-Jun Jul-Sep Sep Oct Nov Commodity Unit 2008 2009 2010 2009 2009 2010 2010 2010 2010 2010 2010 Energy Coal, Australia a/ $/mt 1 0 27.1 71.84 96.81 71.31 77.66 95.19 99.49 93.55 94.88 97.45 102.75 Crude oil, avg, spot a/ $/bbl 96.99 61.76 78.04 68.21 75.50 77.06 78.18 75.51 76.12 81 .72 84.53 Crude oil, Brent a/ $/bbl 97.64 61.86 78.53 68.37 74.97 76.65 78.69 76.41 77.79 82.92 85.67 Crude oil, Dubai a/ $/bbl 93.78 61.75 77.06 68.07 75.46 75.86 77.98 74.04 75.27 80.34 83.70 Crude oil, West Texas Int. a/ $/bbl 99.56 61.65 78.54 68.21 76.08 78.67 77.85 76.08 75.29 81 .90 84.24 Natural gas Index a/ 2000=100 267.89 153.47 155.90 123.35 149.43 170.29 147.50 155.07 150.41 144.66 51 1 .60 Natural gas, Europe a/ $/mmbtu 13.41 8.71 8.25 6.91 7.81 8.84 7.51 8.26 8.28 8.29 8.59 Natural gas, US a/ $/mmbtu 8.86 3.95 4.40 3.17 4.36 5.15 4.32 4.28 3.90 3.43 3.73 Natural gas LNG, Japan a/ $/mmbtu 12.53 8.94 10.87 7.91 9.33 10.32 10.95 1 1 .22 1 .03 1 1 1 .00 15 1 .1 Non Energy Commodities Agriculture Beverages Cocoa b/ c/kg 257.71 288.88 313.96 296.36 341.81 329.71 321 .02 305.87 287.49 292.75 291.03 Coffee, Arabica b/ c/kg 308.16 7.1 31 1 421.55 322.75 341.67 353.67 392.00 468.49 490.99 479.81 514.73 Coffee, robusta b/ c/kg 232.09 164.42 170.52 160.09 156.44 150.80 160.97 1 5 83.1 79.1 1 9 187.99 202.91 Tea, auctions (3), average b/ c/kg 242.05 272.40 287.07 303.61 301.87 279.01 276.38 295.1 2 299.60 303.47 302.82 Tea, Colombo auctions b/ c/kg 278.93 313.72 326.90 356.08 338.02 335.13 6.1 31 9 322.1 0 334.88 337.24 338.36 Tea, Kolkata auctions b/ c/kg 225.46 251.53 279.47 273.03 284.43 215.82 273.99 320.57 8.1 31 8 324.68 318.34 Tea, Mombasa auctions b/ c/kg 221.76 251.96 254.85 281.72 283.1 7 286.08 238.94 242.68 245.75 248.50 251.75 Food Fats and Oils Coconut oil b/ $/mt 1224.00 725.38 1070.57 1 71 .00 734.33 834.33 954.67 1 1 58.67 1275.00 41 1 2.00 521 1 .30 Copra $/mt 815.68 479.69 712.83 468.75 490.50 556.67 634.27 769.33 847.00 947.00 01 1 3.30 Groundnut oil b/ $/mt 31 2 21 .1 1 1 83.67 1372.23 1 1 33.33 1 1 52.00 1358.67 1352.00 301 1 .33 1270.00 331 1 .00 1727.50 Palm oil b/ $/mt 948.54 682.83 872.12 678.67 732.33 807.67 813.00 874.67 912.00 987.00 1 1 20.30 Palmkernel oil $/mt 1 1 29.50 700.00 1 28.09 1 699.67 760.33 922.33 1033.67 1 .33 1 61 1260.00 41 1 2.00 1645.00 Soybean meal b/ $/mt 424.42 407.69 373.46 430.67 41 .83 1 369.33 342.00 378.25 396.00 409.00 430.30 Soybean oil b/ $/mt 1258.25 848.69 976.11 856.00 921.00 917.33 875.67 983.75 1042.00 1 1 57.00 1250.00 Soybeans b/ $/mt 522.83 436.92 440.96 454.00 439.00 416.67 408.67 451.92 470.00 493.00 525.80 Grains Barley b/ $/mt 200.52 128.32 155.55 122.01 145.50 143.63 146.89 61 1 .90 1 2 68.1 174.62 179.09 Maize b/ $/mt 223.12 165.51 180.05 51 1 .30 167.84 162.72 157.73 1 .74 81 205.89 235.81 238.18 Rice, Thailand, 5% b/ $/mt 650.19 554.99 484.99 539.00 542.25 535.33 452.44 457.02 476.50 486.00 514.50 Rice, Thailand, 25% $/mt n.a. 458.07 438.03 441 .42 462.77 476.96 399.11 41 8.53 448.00 457.00 477.50 Rice, Thailand, 35% $/mt n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. * Rice,Thai, A1.Special / Super $/mt 482.28 326.36 380.95 309.67 346.13 400.73 333.83 376.93 41 2.00 428.25 427.75 Sorghum $/mt 207.83 51 1 .05 160.30 139.33 163.80 156.85 142.58 153.57 184.90 201.04 203.25 Wheat, Canada $/mt 454.59 300.52 303.62 271 .23 283.42 278.99 260.86 326.1 5 364.97 365.63 376.21 Wheat, US, HRW b/ $/mt 326.03 224.07 216.04 208.77 205.38 195.42 177.38 237.91 271 .67 270.23 274.08 Wheat US SRW $/mt 271.52 185.95 222.50 165.22 195.60 193.52 186.90 253.40 276.31 267.49 278.52 Other Food Bananas EU $/mt 1 1 1 87.71 1 44.90 996.80 11 1 7.76 1 01 032.38 1 3.97 1 028.98 932.60 974.09 1003.34 1034.76 Bananas US b/ $/mt 844.21 847.1 4 865.33 826.30 81 2.98 781 .06 862.10 921.61 880.50 916.32 908.06 Fishmeal $/mt 1 1 33.08 1230.25 1702.32 1275.67 1 534.67 1 81 660.00 1 3.67 1663.00 1 71 645.00 1 0.00 1 605.50 Meat, beef b/ c/kg 31 3.80 263.65 331 .57 273.1 5 273.46 4.1 31 8 342.36 330.88 335.1 0 .1 341 6 343.92 Meat, chicken b/ c/kg 169.62 1 .65 71 72.1 1 5 173.87 1 4 65.1 67.1 1 9 172.97 175.99 175.91 1 73.86 71 1 .31 Meat, sheep c/kg 458.51 427.65 493.76 453.29 450.11 447.65 486.84 507.99 533.36 550.31 553.64 Oranges b/ $/mt 1 1 07.31 909.04 1068.94 860.87 1 06.87 1 1 008.53 1083.57 1 1 62.86 1046.85 1086.32 907.09 Shrimp, Mexico b/ c/kg 1068.53 945.09 n.a. 970.03 864.39 826.73 945.23 n.a. 1 n.a. 1 79.47 1240.10 Sugar EU domestic b/ c/kg 69.69 52.44 44.27 55.43 49.11 46.38 42.66 43.29 43.90 45.41 44.55 Sugar US domestic b/ c/kg 46.86 54.88 78.75 57.31 70.48 84.31 69.62 78.20 84.15 84.29 85.62 Sugar, world b/ c/kg 28.21 40.00 45.58 46.98 50.29 51.82 34.93 42.94 49.63 54.26 58.09 Raw M aterials Timber Logs, Cameroon $/cum 526.89 421.47 427.84 414.87 449.45 431.42 407.97 426.33 432.02 458.88 450.17 Logs, Malaysia b/ $/cum 292.30 287.20 275.59 279.63 .1 271 4 253.60 253.51 293.50 310.91 316.36 313.32 Plywood c/sheets 645.45 564.62 567.88 561.55 558.38 557.22 566.32 572.28 575.35 578.23 581.00 Sawnwood, Cameroon $/cum 958.28 748.92 810.93 779.05 806.25 804.11 787.12 1 81 .77 827.1 2 867.42 843.82 Sawnwood, Malaysia b/ $/cum 889.09 805.52 843.84 771.41 807.37 787.85 832.59 879.78 875.96 880.17 901.45 Woodpulp $/mt 820.16 614.60 866.69 627.68 715.63 780.95 875.53 912.95 906.59 915.26 910.00 Other Raw M aterials Cotton A Index b/ c/kg 157.39 138.20 215.43 41 1 .90 157.70 178.76 199.29 205.20 230.89 278.99 340.97 Cotton Memphis c/kg 61 1 .29 145.25 220.91 148.80 172.36 183.63 200.11 214.95 234.79 284.95 349.06 Rubber, US c/kg 284.08 214.64 377.19 221.05 284.69 345.17 381.47 360.68 375.89 422.85 464.29 Rubber, Singapore b/ c/kg 258.63 192.07 355.40 199.33 256.51 318.60 372.72 337.46 353.34 392.48 430.61 continued on next page a/ Included in the energy index (2000=100) b/ Included in the non-energy index (2000=1 00) c/ Steel not included in the non-energy index d/ base metals plus iron ore e/ Includes aluminum, copper, lead, nickel, tin and zinc $ = US dollar ¢ = US cent bbl = barrel cum = cubic meter dmtu = Dry Metric Ton Unit kg = kilogram mmbtu = million British thermal units mt = metric ton toz = troy oz n.a. = not available n.q. = no quotation 3 COMMODITY PRICE DATA Annual averages Quarterly averages M onthly averages Jan-Dec Jan-Dec Jan-Nov Jul-Sep Oct-Dec Jan-Mar Apr-Jun Jul-Sep Sep Oct Nov 2008 2009 2010 2009 2009 2010 2010 2010 2010 2010 2010 Fertilizers DAP b/ $/mt 967.2 323.1 492.2 309.6 316.9 464.8 458.2 494.1 525.0 575.0 588.0 Phosphate rock b/ $/mt 345.6 1 .7 21 21 1 .5 90.0 90.0 102.1 125.0 125.0 125.0 140.0 140.0 Potassium chloride b/ $/mt 570.1 630.4 329.9 506.8 423.0 334.0 316.1 334.2 337.5 335.0 340.6 TSP b/ $/mt 879.4 257.4 373.7 224.7 235.7 31 6.9 357.4 389.6 428.0 455.0 463.8 Urea, E. Europe, bulk b/ $/mt 492.7 249.6 280.7 241.6 248.3 281 .0 237.2 279.2 315.0 329.4 366.4 M etals and M inerals Aluminum b/ $/mt 2,573 1,665 2,1 57 ,81 1 2 2,003 2,1 63 2,096 2,090 2,1 62 2,347 2,333 Copper b/ $/mt 6,956 5,150 7,388 5,859 6,648 7,232 7,027 7,243 7,709 8,292 8,470 Gold $/toz 872 973 1 0 ,21 960 ,1 1 02 1 09 ,1 ,1 1 96 1,227 1,271 1,342 1,370 Iron ore b/ c/dmtu 140.6 01 1 .0 159.9 01 1 .0 01 1 .0 1 .0 01 152.0 21 2.0 21 2.0 182.0 182.0 Lead b/ c/kg 209.1 1 .9 71 21 2.4 192.8 229.3 222.1 195.0 203.2 21 8.4 238.0 237.7 Nickel b/ $/mt ,1 1 21 1 14,655 21,600 17,700 17,528 19,959 22,476 21 91 ,1 22,643 23,807 22,909 Silver c/toz 1,500 1,469 1,936 1,477 1,760 1,693 1,838 1,901 2,061 2,347 2,657 Steel products index c/ 2000=100 289 227 229 211 207 21 1 241 232 235 235 233 c/ $/mt Steel cr coilsheet, Japan, Reinstated 966 783 81 3 700 700 725 838 850 850 850 850 c/ $/mt Steel hr coilsheet, Japan, Reinstated 883 683 71 3 600 600 625 738 750 750 750 750 Steel, rebar, Japan, Reinstated c/ $/mt 760 486 564 500 522 546 621 533 530 550 550 c/ Steel wire rod, Japan, Reinstated $/mt ,01 1 0 969 71 8 857 81 4 751 767 678 670 660 650 Tin b/ c/kg 1,851 1,357 1,988 1,459 1 7 ,51 1,721 1,786 2,055 2,270 2,634 2,552 Zinc b/ c/kg 187.5 165.5 21 5.0 176.1 221 .4 228.9 202.6 201 .3 21 5.1 237.2 229.2 NEW World Bank commodity price indices for low and middle income countries( 2000 =100) Energy 342.0 21 4.3 267.8 230.3 256.1 266.1 267.7 259.5 261.1 277.7 287.8 Non Energy Commodities 272.0 21 3.2 265.3 21 9.8 235.2 244.2 252.2 275.5 286.9 296.2 306.2 Agriculture 229.5 197.8 227.1 199.5 21 2.6 21 6.6 21 5.4 228.6 237.9 251 .5 264.9 Beverages 21 0.0 21 9.9 251 .6 226.4 247.9 242.5 246.9 259.2 255.9 257.3 264.6 Food 247.4 205.1 21 9.8 206.4 21 3.7 21 3.1 201 .0 221.9 234.2 248.6 260.7 Fats and Oils 277.3 21 6.2 238.3 220.9 224.5 224.7 21 9.7 241.1 252.3 269.7 295.3 Grains 281 .7 21 4.9 21 0.7 202.3 21 0.8 205.1 186.6 212.5 234.3 249.5 255.9 Other Food 177.1 1 .6 81 203.6 91 1 .2 202.0 205.1 189.4 205.3 210.5 220.2 219.6 Raw Materials 195.7 168.7 232.5 168.9 192.0 1 21 .9 234.4 229.2 237.6 255.6 275.0 Timber 150.5 138.9 142.6 133.6 137.3 132.7 138.6 149.4 150.9 152.1 154.5 Other Raw Materials 245.3 201 .4 330.8 207.5 251 .8 298.6 339.1 316.5 332.5 368.8 406.8 Fertilizers 566.7 293.0 274.6 252.1 242.8 259.0 253.3 278.5 299.8 31 5.3 332.7 Metals and Minerals d/ 325.7 235.6 342.5 257.6 280.8 299.0 327.5 371.4 385.8 385.7 387.8 Base Metals e/ 287.9 208.9 293.0 236.0 264.6 287.0 280.9 286.5 304.3 328.5 331.0 a/ Included in the energy index (2000=100) b/ Included in the non-energy index (2000=1 00) c/ Steel not included in the non-energy index d/ base metals plus iron ore e/ Includes aluminum, copper, lead, nickel, tin and zinc $ = US dollar ¢ = US cent bbl = barrel cum = cubic meter dmtu = Dry Metric Ton Unit kg = kilogram mmbtu = million British thermal units mt = metric ton toz = troy oz n.a. = not available n.q. = no quotation 4 Selected Commodity Prices, Nominal US dollars, 2005-2010 Coal, Australia ($/mt) 190 150 110 70 30 Nov-05 Nov-06 Nov-07 Nov-08 Nov-09 Nov-10 Natural Gas, US ($/million btu) 14 11 8 5 2 Nov-05 Nov-06 Nov-07 Nov-08 Nov-09 Nov-10 Silver (cents/ troy oz) 2000 1600 1200 800 400 Nov-05 Nov-06 Nov-07 Nov-08 Nov-09 Nov-10 5 Selected Commodity Prices, Nominal US dollars, 2005-2010 Cont'd Bananas, US ($/mt) 1050 850 650 450 250 Nov-05 Nov-06 Nov-07 Nov-08 Nov-09 Nov-10 6 Selected Commodity Prices, Nominal US dollars, 2005-2010 Cont'd 7