It’s been a busy week for us in the news industry. Japan’s prime minister resigned and was promptly hospitalized; several big earthquakes hit Indonesia; Hurricane Humberto came out of nowhere, hitting the Texas-Louisiana coast with 85-mph winds; and the news highlighter for my little Commodity Store this week – crude oil prices hitting a record peak, crossing the $80 threshold to settle at $80.20 a barrel in New York on Thursday.
The 1983 comedy movie 'Trading Places' should be required viewing for those with a taste for investing in commodity markets. Now I've got your attention ... orange juice futures, or to go by their official market designation -- Frozen Concentrated Orange Juice -- take center stage this week. Especially now, during hurricane season.
D'OH!! I heard Homer Simpson is betting big on the uranium market. He buried a pile of luminous rocks in his backyard about a year ago … and he’s still waiting for the check to arrive. In the meantime, Marge couldn’t help but notice a strange breed of two-headed rabbit gamboling around the site where Homer stashed the glowing ore. Clearly, Springfield’s most famous resident has been the recipient of less than sound financial advice and probably needs to re-assess his investment strategy.
A decade on from Asia's financial crisis, the oil market has witnessed an unprecedented bull run. The surge in prices has seemed unsustainable with some commentators likening the jump to the dot com tech bubble. However, this particular bubble in the commodities market shows no signs of bursting as long as the twin powerhouses in the region -- China and India -- continue to grow.
A decline in sugar prices has left a bitter aftertaste in the mouths of some commodity investors. A 12-month chart chronicling New York Board of Trade sugar futures says it all -- the sweetener has dropped more than 41% -- from a peak of almost 18 cents a pound to its current 6.5 cent price. Bad news bears for commodity bulls like Jim Rogers.
In the post-apocalyptic world of the action movie “Mad Max Beyond the Thunderdome”, road warriors dueled in muscle cars fueled by pig waste. Fortunately for us today, extreme gasoline shortages are not a reality, though record pump prices are. This means we won't be replacing refineries with swine farms anytime soon. Still, high-energy costs, the toll taken on the environment and a steady decline in easily recoverable sources of oil and gas do mean the hunt for alternatives to traditional fossil fuels is gathering momentum.
Chocoholics be warned – the recent decline in the price of cocoa, the main ingredient for chocolate, won't necessarily mean a Cadbury's bar will be any cheaper at your candy store. Sorry chocolate lovers but prices are not set to melt any time soon.
Oil markets are nervous animals nowadays. Given the tensions between Iran and the U.K. since late March over Tehran's seizure of 15 British sailors, the prospect of diplomatic efforts failing to solve the stand-off haunted the market. That's raised fears of a military confrontation in the Persian Gulf. After Iran pardoned and freed the 15 sailors, the market was so relieved that oil prices dropped by over $2.
Coffee. Fragrant, strong and desirable. Consumption is growing and supply is expected to dwindle in some producer-nations such as Brazil, hurt by dry conditions. The coffee market is big business.
Consider this the next time you're enjoying your in-flight movie and sipping a complimentary Sauvignon Blanc at 30,000 feet: the fuel powering the engines, keeping your jet at cruising altitude and speeding you onwards to your destination is the single biggest cost airlines must bear.
Even as U.S. crude prices are expected to touch $100 this week as the strengthening Tropical Storm Isaac threatens to disrupt offshore oil production in the Gulf of Mexico, experts say the upside will likely be short-lived, recommending investors sell into the rally.
Benchmark oil prices will likely extend gains this week after Fed Chief Ben Bernanke kept stimulus in play at his speech in Jackson Hole and as the industry assesses the damage in the Gulf of Mexico after tropical storm Isaac forced the closure of almost all offshore oil production.