Bloomberg News

Gold Rises for 11th Year, Oil Advances: Commodities at the Close

December 30, 2011

Dec. 30 (Bloomberg) -- The Standard & Poor’s GSCI gauge of 24 commodities fell to close at 644.91 at 3:50 p.m.

The UBS Bloomberg CMCI index of 26 raw materials rose to 1,520.804 at 4:11 p.m.

PRECIOUS METALS

Gold rose the most this month, capping an 11th straight annual advance, on speculation that demand will climb from jewelers and investors.

Gold fell 4.7 percent in the previous six sessions to the lowest level since July 7 as the dollar gained against the euro, curbing demand for the metal as an alternative investment. That may boost seasonal purchases, said Marc Ground, a commodities strategist at Standard Bank Plc. In the first quarter of 2011, jewelry demand jumped 12 percent from a year earlier in India, the world’s biggest buyer, according to World Gold Council data.

Gold futures for February delivery climbed 1.7 percent to settle at $1,566.80 an ounce at 1:35 p.m. on the Comex in New York, ending the longest slump since March 2009.

Silver futures for March delivery jumped 2.2 percent to $27.915 an ounce on the Comex, paring its decline for 2011 to 9.8 percent, the first annual drop since 2008.

On the New York Mercantile Exchange, palladium futures for March delivery climbed 5.2 percent to $656.15 an ounce, rising the most since Oct. 21. The metal dropped 18 percent in 2011. Platinum futures for April delivery advanced 2.8 percent to $1,404.90 an ounce and declined 21 percent this year.

Precious metal markets: {NI PCMKTS <GO>}

BASE METALS

Copper rose the most in two weeks, paring the first annual decline since 2008, on bets that U.S. growth will buoy metals demand as the economy slows in China.

The U.S. expanded at a rate of 1.8 percent this year and will probably increase 2.1 percent in 2012, according to the median of 70 economist estimates compiled by Bloomberg. A private report yesterday showed more Americans than forecast signed contracts to buy previously owned homes in November. The average house uses about 400 pounds (181 kilograms) of copper in the U.S., the world’s second-biggest consumer.

Copper futures for March delivery climbed 2 percent to close at $3.436 a pound at 1:18 p.m. on the Comex in New York, the biggest gain for a most-active contract since Dec. 16. The rally capped a quarterly increase of 9 percent, the first in a year.

On the London Metal Exchange, copper for delivery in three months rose 2.4 percent to $7,600 a metric ton ($3.45 a pound). Tin, aluminum, lead, nickel and zinc also gained in London.

The LME Index of the six main metals traded on the U.K. exchange has tumbled 22 percent in 2011 after more than doubling in the previous two years. Tin led declines, dropping 29 percent. Aluminum had the smallest loss, falling 18 percent.

CRUDE OIL

Crude oil pared a third annual increase as Chinese manufacturing contracted for a second month in December, spurring concern that demand from the world’s second-largest crude-consuming country may slow.

Futures dropped 0.8 percent after the report by HSBC Holdings Plc and Markit Economics also showed China’s exports fell for the first time in three months as Europe’s debt crisis reduced orders. Oil advanced 8.2 percent in 2011 as a collapse in Libyan exports cut supply, U.S. stimulus measures revived the economy and Iran threatened to close the Strait of Hormuz.

Crude for February delivery slid 82 cents to settle at $98.83 a barrel on the New York Mercantile Exchange. Prices slipped 1.5 percent this month and 0.9 percent this week. Oil surged 25 percent in the three months ended today, the biggest quarterly gain since June 2009.

Brent oil for February settlement dropped 63 cents, or 0.6 percent, to $107.38 a barrel on the London-based ICE Futures Europe Exchange, up 13 percent this year.

Crude oil futures: {NI CRMKTS <GO>}

Europe physical crude: {NI CNSMKT <GO>}

U.S. physical crude: {NI CRGMKT <GO>}

Asia physical crude: {NI CRAMKT <GO>}

OIL PRODUCTS

Heating oil rose, widening its third consecutive yearly gain, on speculation demand for U.S. diesel exports will increase after three refineries in Europe began shutting down.

Futures rose as Petroplus Holdings AG, Europe’s largest independent refiner by capacity, said it will suspend operations at three plants in the region after banks froze $1 billion of the company’s loans, cutting crude supplies. The sites have a combined processing capacity of 337,300 barrels of crude a day, and the closures may reduce European supplies of diesel.

January-delivery heating oil rose 1.75 cents, or 0.6 percent, to settle at $2.935 a gallon on the New York Mercantile Exchange. Prices rose 15 percent in 2011, after gaining 20 percent in 2010.

Gasoline futures for January rose 0.62 cent to $2.6863 a gallon. Prices gained 9.5 percent this year, after rising 20 percent last year and doubling in 2009. Gasoline is down 22 percent from the 2011 peak of $3.4648 on April 29.

U.S. oil product futures: {NI OPFMKT <GO>}

U.S. oil products: {NI OPUMKT <GO>}

Asia oil products: {NI OPAMKT <GO>}

Europe oil products: {NI OPEMKT <GO>}

NATURAL GAS

Natural-gas futures fell below $3 for the first time in more than two years as mild weather and record production contribute to a growing stockpile surplus.

Gas capped a 32 percent annual drop, the biggest decline since 2006, as forecasts for above-normal temperatures in January spurred speculation that inventories of the heating fuel will stay above average levels during the winter months, when demand is strongest.

Natural gas for February delivery fell 3.8 cents, or 1.3 percent, to $2.989 per million British thermal units on the New York Mercantile Exchange, the lowest settlement since Sept. 11, 2009. The futures fell for the fourth straight year.

U.S. natural gas: {NI NUSMKT <GO>}

U.K. natural gas: {NI NUKMKT <GO>}

GRAINS, OILSEEDS

Corn rose, capping a third straight annual gain, and soybeans climbed on concern that bad weather will cause irreversible damage to Argentina’s crops.

Argentina will be dry during the next 10 days with temperatures averaging above-normal, increasing stress on reproducing corn, Global Weather Monitoring said in a report today. At least 19 percent of the crops have yet to be planted, the Buenos Aires Cereals Exchange said yesterday. Reduced South American output may boost demand for supplies from the U.S., the world’s top producer.

Corn futures for March delivery rose 1.3 percent to close at $6.465 a bushel at 1:15 p.m. on the Chicago Board of Trade. The price touched $6.485, the highest level since Nov. 17.

Soybean futures for March delivery climbed 0.9 percent to $12.0775 a bushel on the CBOT, the first gain in three sessions. The oilseed slumped 14 percent in 2011, the first annual decline since 2008.

Wheat futures for March delivery rose 1.2 percent to settle at $6.5275 a bushel on the CBOT. The price is up 13 percent since mid-December. Futures fell 18 percent this year, capping the biggest annual slump since 2008, on increasing world output.

Grain markets: {NI GRMKTS <GO>}

SOFT COMMODITIES

Coffee rose, paring its first annual drop since 2008, on signs that supplies remain tight. Sugar fell while cocoa rose.

In the season started Oct. 1, global coffee output will fall 3.4 percent from a year earlier to 128.6 million bags as bad weather hurts crops in Central America and Colombia, the International Coffee Organization said Dec. 13. Demand has climbed 2.5 percent annually in the past decade, according to the ICO. A bag weighs 60 kilograms, or 132 pounds.

Arabica coffee futures for March delivery climbed 1.2 percent to settle at $2.2685 a pound at 2 p.m. on ICE Futures U.S. in New York. The commodity retreated 5.7 percent in 2011, after advancing 77 percent last year and 21 percent in 2009.

Raw sugar for March delivery dropped 0.9 percent to close at 23.3 cents a pound on ICE. This year, the sweetener tumbled 27 percent, the first annual decline since 2007, as expanding production in Asia and Europe more than offset a drop in output in Brazil, the world’s leading cane grower.

Cocoa for March delivery gained 1.2 percent to $2,109 a metric ton in New York, halting a five-session slump. The commodity plunged 31 percent this year, the biggest annual loss since 1999. Output is rising in western Africa, the largest producing region, amid concern that the European debt crisis will curb demand for the chocolate ingredient.

In London futures trading, robusta coffee advanced, refined sugar declined and cocoa rose on NYSE Liffe.

Soft commodities markets: {NI SOMKTS <GO>}

LIVESTOCK

Cattle futures fell, capping the longest slump since October, on speculation that demand for beef may slow after U.S. prices climbed to the highest in a month. Hogs gained.

Wholesale choice beef fell at midday for the first time in three days, after rallying 19 percent in a year and yesterday reaching $1.9468 a pound, the highest level since Nov. 29, U.S. Department of Agriculture data show. Export sales of beef fell 6.7 percent to 13,693 metric tons in the week ended Dec. 22, from a week earlier, the government said today.

Cattle futures for February delivery fell 0.7 percent to settle at $1.2145 a pound at 1 p.m. on the Chicago Mercantile Exchange, after dropping to $1.214, the lowest level since Dec. 22. Prices slipped for a fourth day, the longest slump since Oct. 31. The commodity was up 12 percent this year, the third straight advance, on the outlook for decreasing production.

Feeder-cattle futures for March settlement dropped 0.7 percent to $1.488 a pound on the CME. The price reached a record $1.508 on Dec. 28. Futures rallied 20 percent in 2011.

Hog futures for February settlement rose 0.4 percent to close at 84.3 cents a pound in Chicago, capping a 5.7 percent gain for the year.

Livestock markets: {NI LVMKTS <GO>}

--Editors: Charlotte Porter, Richard Stubbe

To contact the reporter on this story: Mario Parker in Chicago at mparker22@bloomberg.net

To contact the editor responsible for this story: Bill Banker at bbanker@bloomberg.net


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