Abans Group Commodity World Round Up

22 Mar - 26 Mar

1. Oil Prices Drop On Third Wave of Coronavirus Lockdowns

Mar 25, 2021

The third wave of European COVID-19 cases and vaccine rollout delays impacted fuel demand. The European Union is at the start of a third wave of the COVID-19 pandemic, the president of the European Commission warned Thursday. As fuel demand worries persist and prices fall, there are growing expectations that the Organization of the Petroleum Exporting Countries and allies, or OPEC+, will extend current supply curbs into May when the cartel convenes on Apr. 1.

Source: Investing

2. Bank of Canada Set to Slow Its Bond Buying

Mar 24, 2021

The Bank of Canada is signalling that it will be the first Group of Seven central banks to start taking its foot off the gas as the nation’s economic recovery from the Covid-19 crisis accelerates. Canada’s central bank has been buying a minimum of C$4 billion ($3.2 billion) in government bonds each week, accumulating more than C$250 billion of the securities over the past year. That pace is likely no longer warranted with an outlook that appears to improve dramatically by the week, helped by a recovery in commodity prices and a robust housing market.

Source: Bloomberg

3. ICSG: copper production is stable and Chinese demand remains firm

Mar 24, 2021

The latest International Copper Study Group (ICSG) report has shown that despite a decline in Australia (-3.5%) global copper production remained stable. This is impressive as the world's mining firms have had to deal with mine closures due to the COVID-19 pandemic. Last year, world copper production grew by around 1.5 per cent in 2020, while primary production was up by 2.8 per cent. The preliminary data did not include specific production numbers for Australia. Preliminary data from the ICSG suggests the world’s refined copper balance for 2020 had a deficit of 560,000 tonnes due to strong Chinese demand. However, outside China copper usage declined by 10% and the strong Chinese demands were confirmed as the nation saw a 38 per cent (1.2 million tonnes) boost to its copper imports for 2020.

Source: Reuters

4. IMF chief aims for $650 billion expansion of emergency reserve by June

Mar 24, 2021

International Monetary Fund Managing Director Kristalina Georgieva on Tuesday said she would present the IMF's board with a formal proposal for a possible $650 billion expansion of the Fund's emergency reserves by June. In a statement released late on Tuesday, Georgieva said the new allocation of SDRs, the IMF's currency, would add a substantial, direct liquidity boost to countries, without increasing their debt burdens. It would also free up resources for member countries to help fight the coronavirus pandemic, support vaccination programs and other urgent measures, she said.

Source: Reuters

5. The European Central Bank increase bond purchases by nearly half last week

Mar 22, 2021

The European Central Bank increase bond purchases by nearly half last week, ramping up its stimulus efforts to keep a lid on borrowing costs and convince sceptical investors it would do what it took to restrain bond yields. The euro zone’s central bank bought 28 billion euros worth of bonds last week across its stimulus programmes, a 48% increase over the previous week and the biggest weekly amount since Dec. 4.

Source: Reuters

6. Aluminium hits highest since 2018

Mar 22, 2021

Aluminium prices rose on Monday to their highest level since June 2018 as investors worried that Chinese efforts to reduce smelter pollution will restrict output and supply will fall short of demand. China accounts for around 60% of global aluminium output but the government is expected to curtail capacity growth, with Inner Mongolia ordering some smelter closures this month.

Source: Reuters

7. Global oil markets under pressure as Asia destocks, China imports slowed

Mar 26, 2021

Crude oil producers from Europe, Africa and the United States faced difficulties selling to Asia, especially China, as buyers took cheaper oil from storage while refinery maintenance has reduced demand, industry sources said on Thursday. Chinese independent refiners, which account for a fifth of the country’s imports, have slowed imports in the second quarter because of refinery maintenance, strong Brent prices and a large influx of supplies, including Iranian oil, in the first quarter. U.S. crude arrivals in Asia are expected to drop to about 30 million barrels in April, the lowest since June 2020, according to initial assessments from Refinitiv Oil Research on Eikon.

Source: hellenicshippingnews.com

8. OPEC+ Will Keep A Lid On Oil Production

Mar 24, 2021

As per reports from Reuters, OPEC+ will likely decide to keep oil production essentially steady for another month. Saudi Arabia and the UAE have both spoke out in favour of the need to tread lightly when it comes to how much oil is put into the market. And this week is perhaps proof positive that the group would be wise to heed. Even if OPEC holds production steady for April—or allows a couple of eager producers to ramp up just slightly—there remain a couple of wildcards that threaten OPEC’s ability to keep supplies tight: Libya and Iran.

Source: Oilprice