Crude retraces from lower levels

Renewed supply worries chased crude prices higher on both the New York Mercantile Exchange (Nymex) and International Petroleum Exchange (IPE). Militants attacking US embassy at Jeddah, disruptions in Nigeria and OPEC indicating a production cut fuelled current increase in crude oil prices. By the close of trade, Brent futures for January delivery on the IPE climbed 29 cents to US$39.65 per barrel, after having pushed above US$40 in early hours. January Nymex light crude futures settled at US$42.98, up 44 cents.

Crude oil prices have lost almost 15% in the last four trading sessions, the biggest decline since the start of the Iraq war.

Gold eases as dollar recovers

Gold ended lower at US$455.90/456 a troy ounce, after reaching 16-years high, as dollar recovered from the lower levels against the euro. Silver also moved lower. In the domestic bullion markets, standard gold lost Rs45 to end the day at Rs6,575, per 10 gm. Pure gold also fell by a similar margin to Rs6,610 from Rs6,655 previously. Silver ready (.999) finished lower at Rs12,265 compared to Rs12,300 previously.

China steel import fell 17%

China steel import has fell by 17% during the first ten month of the current calendar year. However, the country is making a glaring exception to its policy of damping investment growth by approving the construction of three big steel mills which are expected to free the country from its dependence on imports in about three years. China, which produces more steel than the US and Japan combined, imported 37.2mn tons, or US$19.9bn worth of steel products in 2003 from countries including India, Ukraine and Belarus - making it one of the top importer. But as Chinese mills produced increasingly sophisticated products this year, imports fell 17% in the first 10 months to 25.6mn tons.

Steady run in rubber prices

Story: Domestic rubber market has witnessed a steady trend on Monday. Scattered buying from the covering groups and purchase agents kept the sheet rubber price slightly high at Rs50.25 (50) a kg, while the other grades closed unchanged on Saturday. The prices kept lying in a soft pitch as the buyers willingness to buy at low but growers were not interested to sell. The transactions were in a low key. At TOCOM, the January futures for RSS 3 closed at 125.6 yen against 126 yen on Friday. The spot rubber rates per kg were as follows: RSS 4 50.25 (50); RSS 5 48.50 (48.50); ungraded 46.25 (46.25); ISNR 20 49.00 (49) and latex 60 per cent 38.50 (38.50).

Weak trend to persist in guar

Guar seed spot prices may continue to rule weak in the next few days on restricted demand against increased supply. Guar spot prices at major trading centres - Jodhpur and Bikaner — have declined sharply by Rs150 or 10% to Rs1,560-1,570 per quintal in just one month as daily inflows have peaked. Guar seed January 2005 contracts at the NCDEX have also declined significantly by Rs250 to end at Rs1,709 per quintal on last Saturday, from Rs1,970 per quintal as on October 21, 2004, first day of the contract.

Monsoon tentative; dry spell continues in Kerala

The northeast monsoon made a tentative return to circulation resulting in feeble rain activity at isolated places in the southern districts in the State during the four-day period ending December 5. Otherwise, dry weather prevailed for the most parts, with meteorologists not able to predict the timing of the next spell of rain. But they seemed to concur on the view that the reverse monsoon would last till the end of the month.

The Agromet Bulletin dated December 6 issued by the Met Office, Thiruvananthapuram, said that the northeast monsoon was weak over the State on December 3. Rain had occurred at isolated places on December 3 and 4. Largely dry weather prevailed on December 2 and 5.

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