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Platinum smashes past $2,100
Platinum hit a record $2,107 a troy ounce before easing back to $2,105, up 0.3 per cent since Friday following news of further problems in South Africa where power supply difficulties have caused widespread disruption to production. Anglo Platinum, the world's largest platinum producer, has closed its Polokwane smelter as repairs to electrical equipment will take four to six week's to complete. After reducing its output target for 2008 to 2.4m ounces last week, the company has not cut its guidance further as it has excess smelting and refining capacity. "The fact that the platinum price powered higher, even after Anglo Platinum's assurance that due to excess smelter capacity, it would meet production targets, is evidence of how tight investors believe market conditions to be," said James Steel of HSBC. Gold consolidated above $900, ending unchanged at $903.00 a troy ounce. Copper led the base metals sector higher with the red metal rising 3 per cent to $7,962.5 a tonne, helped by a large fall of 6,275 tonnes in LME stocks, which have shrunk to their lowest level since mid-October. The continuing decline in LME stocks may be a factor behind a notable shift in positioning by hedge funds. The latest data from the Commodity Futures Commission showed speculators moved to a net long position (betting on price gains) in the week ending February 12 for the first time since October. The CFTC information refers to positioning in New York and not in London where the vast majority of base metals trading occurs but analysts still pay attention to the data as a barometer of sentiment. Aluminium firmed 0.3 per cent to $2,827.5 a tonne, helped by a fall of 1,775 tonnes in LME stocks. Weather related disruptions to power supplies in China could prevent aluminium smelting capacity from returning to normal levels for some time, providing support for prices. Zinc, up 0.2 per cent at $2,367 a tonne, steadied after coming under pressure last week. Tensions between Venezuela and ExxonMobil provided support for oil prices last week. Over the weekend, Hugo Chávez, president, said he was considering a windfall tax on oil profits, helping push crude prices higher. Nymex March West Texas Intermediate gained 71 cents at $96.20 a barrel while ICE April Brent added 51 cents at $95.14 a barrel. Geopolitical tensions and colder US weather encouraged a large rise of 45.4 per cent in the speculative net long position for crude oil to 39,922 lots in the week ending February 12 when WTI reached $92.78. Trading in agricultural commodities in the US was closed for a public holiday. Severe drought in Australia has devastated the wheat crop in three of the past six years but good rains over the past three months should lead to a healthy crop in 2008/09, according to National Australia Bank, which has produced the first forecast for this year's harvest. NAB said the wheat crop could reach 26m tonnes, an increase of 74 per cent on the previous year. NAB's output forecast was based on conservative yield estimates, which if accompanied by an improvement in growing conditions could push the crop beyond the record 26.1m tonnes achieved in 2003/04. |
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Platinum continued its record breaking run on Monday while a jump in copper prices led to gains for base metals as commodity markets made a strong start to the week's trading.