Commodity Market Summary
Crude oil gained 1.6-percent today, with the July contract settling $2.62 higher at $130.93 a barrel. Saber rattling by Nigerian rebels, Morgan Stanley forecasting $150 oil, and Gordon Brown mentioning an oil shock contributed to oils climb higher today.
British Prime Minister Gordon Brown was quoted in the Guardian newspaper saying "The global economy is facing the third great oil shock of recent decades". He is calling for an international plan to deal with soaring prices.
Nigerian rebels said they plan on caring out a series of car bombings in the oil producing Niger Delta to mark President Umaru Yar'Adua's first year in office. Rebels on Monday blew up a major Royal Dutch Shell pipeline in the southern region.
Reformulated gasoline settled 4 cents higher at $3.42 a gallon, July heating oil settled 3 cents higher to $3.83 a gallon, and July natural gas settled 8 cents higher at $11.88 per million British thermal units.
Gold fell nearly 1-percent today, with the August contract settling $7.80 lower at $905 an ounce. The US dollar climbed higher for the third straight day on building speculation that the next move for interest rates is higher, reducing demand for precious metals as a hedge against inflation.
U.S. durable goods declined a modest .5-percent in April. Strength in electronics offset a sharp drop in orders for airplanes and cars. The .5-percent decline was well below analysts expectations for a 2.8-percent decline.
Interest rate futures are showing a 43-percent chance the Fed funds rate will raise to 2.25-percent by December 16 compared with last weeks 38-percent chance.
July silver settled 5 cents lower at $17.415 an ounce, July platinum settled $48.20 lower at $2,128.10 an ounce, June palladium settled $13.35 lower at $443.95 an ounce, and July copper settled 2 cents lower at $3.72 a pound.
Soybeans closed 1.8-percent higher today, with the July contract settling 25 cents higher at $13.72 3/4 a bushel. Argentine farmers are halting sales of crops and livestock for the next week in protest over canceled talks by officials. This is the third protest in the past 2-months over increasing export taxes.
Demand for soybeans traditionally shift from the U.S. to South America this time of year as farmers in Argentina have just harvested, while farmers in the U.S. are beginning to plant. Any disruptions add pressure to already tight U.S. supplies.
July soy-meal settled $8.70 higher at $343.70 per short ton, and July soy-oil settled 45 points higher at 62.65 cents per pound.
Corn closed nearly 1-percent lower today, with the July contract settling 5 1/2 cents lower at $5.92 1/2 a bushel. News that the U.S. Department of Agriculture is releasing about 24 million acres, previously held in the Conservation Reserve Program, for livestock grazing. This would slightly reduce grain demand in animal feed.
Rice closed limit-down for the third straight session, with the July contract plummeting $1.15 to $18.45 per hundredweight. Improving planting conditions in the U.S. and a lift of export bans in Cambodia, and Vietnam was noted for today's 6.2-percent decline.
After the close Tuesday, the USDA reported rice plantings as of Sunday climbed to 94-percent, compared to the prior week's 84-percent, slightly below last years level of 97-percent.
July wheat closed unchanged at $7.59 a bushel, July oats settled 4 cents lower at $3.90 a bushel.
Coffee bounced 2.7-percent higher today, with the July contract settling 360 points higher at $1.3560 a pound. Short-covering after falling to a 2 1/2-week low yesterday was noted for the bounce higher in coffee futures today.
Orange juice closed 2.1-percent lower today with the July contract settling 230 points lower at $1.0580 a pound. Weak demand and climbing estimates for this year's Florida crop, continues to weigh on orange juice.
July cotton settled 24 points higher at 66.49 cents a pound, July sugar settled 4 points higher at 10.11 cents a pound, and July cocoa settled $32 higher at $2,622 a metric ton.
Cattle futures were higher today, with August feeder cattle settling 55 points higher at $115.80 per hundredweight. Firm cash prices were noted for the gains in cattle. August live cattle settled 12 points higher at $101.62 per hundredweight.
Hogs were mixed today, with July pork bellies settling 145 points lower at $73.20 per hundredweight. Speculation that cash prices are topping out sent pork lower. July lean hogs settled 7 points higher at $76.05 per hundredweight.