Commodity

Commodity markets in 2020

Oil prices slide on Libyan export talks, surging European virus cases

Oil declined as Libya signaled the resumption of some crude exports, while surging coronavirus cases clouded the outlook for demand and weighed on risky assets. Futures in New York fell 2.1 percent toward $40 a barrel. Libya is moving closer to reopening its battered oil industry after it told companies to resume production at some fields that are free of foreign mercenaries and fighters. This will add to already rising supply from OPEC+ nations, and comes as virus infections are starting to increase again in many places around the world. The UK said it’s close to a “tipping point” with the public health crisis, while there were predictions of at least one more virus cycle in America. That helped drive down European equities by the most since July, while U.S. stock futures also dropped.

GE: Industrial giant will stop building coal-fired power plants

US industrial giant General Electric said it would shut or sell sites as it prioritised its renewable energy and power generation businesses. It comes ahead of a US Presidential election in which the candidates hold starkly different views on coal. NGO the Natural Resources Defense Council said the move was “about time”. GE has said in the past it would focus less on fossil fuels, reflecting the growing acceptance of cleaner energy sources in US power grids. But just five years ago, it struck its biggest ever deal – paying almost £10bn for a business that produced coal-fuelled turbines.

Olam urges international brands to adopt new rice eco-label

Olam International is calling for retailers and food brands to back the new “Sustainable Rice Platform-Verified” Assurance Scheme and consumer pack label*, which will allow consumers to choose products that directly support efforts to increase farmer incomes and reduce the environmental impact of rice production. Speaking ahead of UN Climate Week, Paul Nicholson, Head of Rice Research and Sustainability for Olam’s global rice business said, “Unlike crops such as coffee and cocoa, consumers have no awareness of the sustainability issues associated with rice, and therefore, no impetus to change them. This label can help galvanise consumer action behind rice – an affordable food that’s unique in its international appeal and the largest food source on earth. “I know that a label cannot transform a sector overnight, but it can give consumers a chance to catalyse real change. It can give brands a purpose-driven marketing campaign and allow brands and retailers to lead from the front.

India turns net exporter of steel to China for the first time in years

The COVID-19 pandemic and the nationwide lockdown may have disrupted domestic demand, steel manufacturers in India have been boosted by a surge in exports, especially to our neighbour China, even as border tensions have risen between the two countries. Between April and August, as domestic demand slumped, 60-80 percent of the total steel produced by Indian companies was exported with China accounting for 45 percent of the total steel exports, according to credit rating agency CRISIL. “India turned net exporter of steel to China for the first time in several years, with 69 percent of semi-finished steel and 28 percent of finished steel heading there between April and August,” it said. In the same period, border tensions between India and China have risen sharply following violent clashes in the Galwan Valley in Ladakh. India reciprocated by banning several leading Chinese smartphone apps and barred Chinese companies from participating in road projects and government contracts. According to the World Steel Association, China was the largest steel producer in the world in 2019, with crude steel production of 996.3 million tonnes. India was the second-largest, with crude steel production of 111.2 million tonnes. Between January and June 2020, while China’s steel production rose 1.4 percent to 499.01 million tonnes, India’s steel production slumped 24.2 percent to 43.13 million tonnes.

Tulare county leads nation in milk production

When it comes to dairy production in the nation, Tulare County is second to none. Tulare County was the nation’s top dairy producer in the nation in 2019, with a gross value of $1.61 billion. That information is provided as part of Tulare County’s annual agricultural report, which will be presented to the Tulare County Board of Supervisors at their meeting on Tuesday. The overall gross production value reported in the 2019 Tulare County Crop and Livestock Report was more than $7.5 billion. That’s a 4 percent increase over 2018’s value of more than $7.2 billion. Those figures represent gross returns to producers and aren’t net profits. The gross value of milk in Tulare County actually declined by 4.3 percent in 2019 as that value was closer to $1.7 billion in 2018. And total milk production in Tulare County decreased by 11 percent. But milk still represented 21.5 percent of Tulare County’s total agricultural value in 2019 and Tulare County still remained No.1 in the nation in milk production gross value. Fruit and nut producers made up for declines in milk, nursery products, field crops and in livestock and poultry to account for an overall increase in gross value in Tulare County agriculture for 2019. Tulare County’s fruit and nut products were valued at more than $4.5 billion in 2019, an 11 percent increase. Increases in almonds, pistachios and tangerines were a large part of that increase. Livestock and poultry’s gross value of more than $665 million in 2019 was a 4.2 percent decrease from 2019. The decrease was mostly due to a lower per unit value for cattle. Field crop production went down by 5 percent from 2018 to just below $500 million. Less acreage for several field crops was the main cause of the decrease.