Latest Commodities News & Reports

crude oil

US Supply Concerns Undermine Crude Oil Prices, No Support From Dollar Retreat

The latest drilling rigs data has reinforced concerns surrounding rising US supply with the negative impact amplified by renewed doubts surrounding the growth outlook...

Silver Prices Extend Rally Toward $18 as Dollar Selloff Intensifies

Silver prices rose more than 1% on Monday, as precious metals caught another tailwind from a falling U.S. dollar, while stocks sold off in...
steel prices

Palladium Prices Stage Hefty Advance, Rise to Multi-Year Highs

Palladium prices are seeing a significant amount of upside and even after they set a fresh two-year high on Thursday they saw more strength...
crude oil

Oil Prices Weekly Forecast March 27-31

Oil prices ended last week's trading with a bounce after dropping to a low for the week at $47.00/barrel on Wednesday. The contract for...

Gold Prices Weekly Forecast March 27-31

Gold prices started off last week's trading on a strong note and followed through to the upside into Thursday, peaking at $1253.3/ounce. Sellers then...
natural gas

Natural Gas Prices Still Trying to Push Above 50% Retracement Level

Natural gas prices are higher in today's trading, with the contract for April delivery on the New York Mercantile Exchange at $3.07/MMBtu, up 0.62%...
crude oil

Baker Hughes US Oil Rig Count Increases To 652, 10th Successive Weekly Gain

The latest Baker Hughes North American rig count data recorded an increase in total rigs to 809 in the week ending March 24th from...
uranium price

Spot Uranium Prices Edge Higher, Market Optimism Remains

Uranium spot prices added another $1.00 in the week through March 20 reaching $25.50 per lb. Spot uranium prices climbed in December and January,...

Coffee Prices Slightly Lower, Supply Situations Prevents Robusta Sell-Off

Both arabica and robusta coffee futures were slightly lower on Friday, with the commodities steadying a bit following a large, mid-week sell-off. On Wednesday,...
crude oil
natural gas

Commodities are raw materials intended for use or consumption. There are three main commodity classifications: Agriculture commodities (often referred to as soft commodities), energy commodities, and metal commodities (referred to as hard commodities).

The most commonly traded commodities are crude oil, gold, silver, and copper.

How Are Commodities Traded?

Commodity markets can include physical delivery, referred to as a spot contract. Most trades, however, are carried out through derivative trading using futures, forwards, CFD’s, and options.

  • Futures contracts are carried out through regulated commodity exchanges. There are a number of international commodity exchanges; the world’s largest futures exchange is the Chicago Mercantile Exchange (CME). Other notable exchanges include the New York Mercantile Exchange, and the London Metal Exchange.

Futures contracts have been the most popular method of trading commodities. The introduction of CFD’s in the late 1990s popularized commodity trading as the usage of leverage was permitted.

  • CFD’s are now offered by most brokers, including brokers that focus primarily on currency trading. While the range of products offered on CFD trading varies from one broker to another, at a minimum, most will offer to trade in crude oil, gold, and silver.
  • Forward contracts introduce the element of time into the equation. The method has been commonly used in agricultural trading, to avoid fluctuations in price ahead of harvesting a crop. The forward contract would allow farmers to set the price on their crops in advance, eliminating risk as a result of price fluctuations. Trading on forward contracts has expanded outside of its original intended use, and contracts are now traded for speculative purposes in a broad range of commodities.

What are Commodities Correlated With?

As the US dollar is the largest traded currency in the world, there is a loose inverse correlation between the value of the dollar and commodity assets.

While the US dollar carries a correlation with the broader commodity market, individual currencies tend to have correlations with individual commodities. In the currency markets, resource-driven economies are referred to as commodity currencies. New Zealand, for example, relies heavily on their dairy trade exports, and therefore fluctuations in dairy prices stand to affect their economy, and as a result, stand to impact their currency. In Australia, copper exports have created a link between their currency and the commodity. Canada produces oil, and their currency carries a strong correlation with oil prices.

Metals have been defined as safe haven assets. During periods of market uncertainty, or what is commonly known as risk aversion, gold prices tend to go up. Risk sentiment shifts in the global financial markets are not the only influence on gold; the precious metal is also bought as a hedge during extended times of low inflation.

Factors That Affect Commodity Markets

In its most general form, supply and demand drive commodity markets. Individual commodity classifications and individual commodities are driven by different influences. Oil, for example, is sensitive to decisions made by the Organization of the Petroleum Exporting Countries (OPEC). Gold prices are influenced by risk sentiment and global inflation levels. The price of gold then influences other commodities under the metals umbrella.

Agricultural commodities are affected by seasonality patterns that can be related to weather conditions, which consequently affect supply. Global events and natural disasters can impact the commodity market, as an example, a hurricane in an agricultural-driven economy would simultaneously increase demand for gold while suppressing prices in agriculture commodities.


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UK Currency -US Dollar GBP/USD

Trump Defeat Undermines FTSE 100 Index, Losses Pared In Late Trading

Negative reaction to President Trump’s healthcare defeat undermined the FTSE index on Monday with losses compounded by Sterling’s advance against the dollar, although the...

China News: Shanghai Composite Index Shrugs Off Big Profits In Industrial Sector

The Shanghai Composite Index fell slightly to start the week, slipping 2.49 points to close the day at 3,266.96 for a loss of 0.08...

Analyst Sees Major Catalyst for BioPharmX Corp (BPMX) in Coming Months

Earlier this morning, HC Wainwright announced that it was reaffirming a Buy rating on BioPharmX Corp (NYSE MKT:BPMX), and maintained a price target of...
factory production line

March Dallas Fed Manufacturing Index Declined To 16.9, Sentiment Still Strong

The Dallas Federal Reserve Texas manufacturing outlook survey declined to 16.9 from 24.5 the previous month. This was the lowest reading for three months,...

Consider Microsoft (MSFT) Stock for Solid Dividends

Microsoft Corporation (NASDAQ:MSFT) appears to be a solid investment for defensive investors considering its strong dividends and steady share price appreciation. Since 2007, the...