Energy Update OPEC+ is obviously worried about demand As expected, OPEC+ extended its 9.7m bpd production cut for another month (until end-July). Given that prices have rallied strongly in recent weeks, the group’s caution reflects the still-high level... 8th June 2020 · 2 mins read
Commodities Update China’s commodity imports close to a trough Although China’s commodity imports volumes dropped in May, we expect the recent infrastructure-related fiscal support measures to lift domestic demand and commodity imports in the coming months. 8th June 2020 · 2 mins read
Commodities Update Natural rubber to regain some of its bounce by 2021 Consumption of natural rubber (NR) will be hit by sharply lower vehicle production this year. That said, we think that a revival in both demand and oil prices later in the year should give a lift to... 5th June 2020 · 3 mins read
Energy Update OPEC+ to extend duration of deeper output cuts OPEC+ is expected to meet in the next few days. Despite reports of rifts amongst its members, we think that it will agree to extend its current 9.7m bpd production cut for at least another month. 5th June 2020 · 3 mins read
Industrial Metals Update Oversupply is far worse than exchange stocks suggest Exchange stocks are best used to judge the breadth of the downturn in metal demand, rather than the depth. With that in mind, we think that exchange stocks will help to tell us when demand for metal... 3rd June 2020 · 4 mins read
Energy Update Newcastle coal prices to remain grounded Coal prices should receive their usual seasonal uplift later this year. Nevertheless, we think that the average price of Newcastle coal will fall in 2020 and 2021 owing to weak demand and strong... 3rd June 2020 · 3 mins read
Commodities Update Slow rise in China PMIs no antidote for commodities China’s latest raft of PMIs showed a continued improvement in industrial activity in May, which is positive news for commodities demand. However, the pace of recovery remains slow. 1st June 2020 · 2 mins read
Industrial Metals Update Are China’s smelters starting to struggle? So far, there is only limited evidence that a lack of raw material is constraining output at Chinese smelters. But we think that will change in the months ahead. In our view, output is still most... 29th May 2020 · 5 mins read
Energy Update Geopolitics take a back seat … for now Quarantine measures associated with COVID-19 have seen geopolitical disputes, such as US-Iran tensions, seemingly fall under the radar of energy traders. That said, the national security law imposed... 28th May 2020 · 3 mins read
Commodities Update The Brazilian real and commodity prices Our forecast that the Brazilian real will recoup some lost ground by end-2020 should put upward pressure on the prices of its commodity exports. However, other factors, such as the health of the... 27th May 2020 · 3 mins read
Commodities Update Some initial thoughts on China’s NPC At the time of writing, we still lack the detail on China’s policy plans. That said, the headline expansion in the budget deficit and plans to boost credit growth are unequivocally positive for... 22nd May 2020 · 3 mins read
Industrial Metals Update China infrastructure splurge to prop up iron ore price The fiscal stimulus announced today at the National People’s Congress in China failed to make much of a splash in metals markets. Nevertheless, we think it will underpin stronger iron ore demand this... 22nd May 2020 · 2 mins read
Energy Update Natural gas price convergence to be short-lived In recent weeks, all three major natural gas benchmarks have traded at more-or-less the same price. Rather than a structural shift in the market, we think this probably reflects regional prices simply... 18th May 2020 · 2 mins read
Commodities Update The corn market to move into a surplus next season While we generally agree with the USDA’s latest projections for 2019/20, we suspect that they are being too optimistic on agricultural supply in 2020/21. Nevertheless, we expect a pick-up in corn... 13th May 2020 · 3 mins read
Energy Update Global oil supply to fall to a five-year low Low oil prices, OPEC+ production cuts and delays to investment should reduce global oil supply by over 6% this year. This is one reason why we expect prices to end the year higher. 11th May 2020 · 4 mins read
Commodities Update China’s commodity imports look set to fall China’s commodity imports have held up well so far this year, but weak external orders and subdued domestic demand point to lower volumes in the months to come. 7th May 2020 · 2 mins read
