Commodity Snapshot shows Cocoa futures fell over 13% to $8,327.59 per tonne, extending losses to a second session in a volatile market. The most-active contract fell 17% to $8,800 a ton in New York, the biggest intraday drop since 1960.
Hershey and Mondelez International are set to report their first-quarter earnings this week, with investors eagerly anticipating comments on cost and demand issues due to increased cocoa price volatility.
Investor short covering and profit taking in agricultural markets led to contract-based outflows of $8.3 billion last week, while the global agricultural market’s estimated open interest value declined 3.6% to a seven-week low of $305.3 billion.
Precious metals declined amid traders anticipating the Federal Reserve’s policy decision on Wednesday, which is expected to maintain rates following a higher-than-expected US inflation report.
Energy
Crude oil (CL1:COM) +0.09% to $82.80.
Natural Gas (NG1:COM) +1.59% to $2.08.
Metals
Palladium (XPDUSD:CUR) -2.24% to $958.50.
Platinum (XPTUSD:CUR) -1.24% to $948.20.
Gold (XAUUSD:CUR) -0.74% to $2,315.76.
Agriculture
Corn (C_1:COM) -2.38% to $438.56.
Wheat (W_1:COM) -4.12% to $583.42.
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Gold prices are expected to gain for the first time since October due to the US Federal Reserve’s anticipated interest rate cut in June. The Reserve Bank of India’s gold holding increased to 812.3 tonnes in January, from 803.58 tonnes in December 2023. However, Commerzbank sees limited upside potential due to the mystery surrounding the price increase. It is unlikely that gold prices will fall back to February levels, as the Fed is expected to cut interest rates in June.
Spot gold was trading -0.3% lower at $2,176.89 an ounce as markets awaited the release of U.S. CPI data, which could influence the Federal Reserve’s policy path. A hotter-than-expected reading could delay the central bank’s easing cycle. Low interest rates help bullion by reducing the opportunity cost of holding the zero-yielding asset. A mixed tone prevailed across commodity sectors, with China’s economic growth concerns affecting bulks and supply concerns supporting industrial metals.
Natural gas and crude oil prices were trading in the green, while oil prices fell earlier due to persistent demand concerns in China. NS Trading president Hiroyuki Kikukawa said that concerns over weak demand in China outweighed the extension of supply cuts by OPEC+. Mixed US jobs data prompted some traders to adjust positions. However, losses will be capped by increased geopolitical risk, with the possibility of a ceasefire in the Hamas-Israel war and conflict expansion in Russia and its neighbors. Europe remains the most impacted region, as oil product shipments from Asia have fallen since January. OPEC+’s voluntary production cut agreement could tighten the market as demand recovers from its seasonal lull.
Natural gas and crude oil prices were trading in the green, while oil prices fell earlier due to persistent demand concerns in China. NS Trading president Hiroyuki Kikukawa said that concerns over weak demand in China outweighed the extension of supply cuts by OPEC+. Mixed US jobs data prompted some traders to adjust positions. However, losses will be capped by increased geopolitical risk, with the possibility of a ceasefire in the Hamas-Israel war and conflict expansion in Russia and its neighbors. Europe remains the most impacted region, as oil product shipments from Asia have fallen since January. OPEC+’s voluntary production cut agreement could tighten the market as demand recovers from its seasonal lull.