COMMODITIES-Biggest wheat week in 6 months; arabica surges too
* Wheat up 5 pct for the week, biggest weekly rise since July
* Arabica coffee at 2-month highs as grower selling slows
NEW YORK, Jan 18 (Reuters) - Wheat posted its biggest weekly gain in six months as it rallied Friday on concerns of dry weather in the U.S. wheat belt while arabica coffee surged to a 2-month high as growers became more restrained in selling. Oil prices recovered from an early dip also to finish the week up after news that the U.S. House of Representatives will consider a bill to raise the debt ceiling enough to allow the country to pay its bills for another three months. But gains in oil were capped by a surprise drop in U.S. consumer sentiment to the lowest level in more than a year, with many consumers citing fallout from the ongoing fiscal wrangling in Washington. Copper ended up too for both the day and week, bolstered by better-than-expected fourth quarter growth in top consumer China's economy. The Thomson Reuters-Jefferies CRB index settled up for the day and for a second week in a row, after 11 of the 19 markets on the commodities bellwether ended in positive territory. Natural gas led the CRB's gains, rising more than 2 percent on forecasts for cold weather over the 10 days that should boost U.S. heating demand.
WHEAT ENTICES NEW BUYING Wheat knocked out its high from earlier this week late in Friday's session, enticing a new rebound of buying. Chicago-traded wheat for March delivery ended up 10 cents, or 1.3 percent, at $7.91-1/4 per bushel, just off the session high of $7.93-3/4 and good for the highest settlement since Dec. 26. The contract gained 5 percent for the week in the second straight weekly gain. Dry conditions are forecast through the end of the month in the Plains states that grow most of the wheat in the country, John Dee, meteorologist for Global Weather Monitoring, said on Friday. "The hard red winter wheat belt in the Plains looks quiet and dry but cooler next week, but there shouldn't be a cold air threat in the Plains," Dee said.
COFFEE UP ON SHORT COVERING, LEAF RUST Coffee futures trading in New York and London extended their gains on short-covering and reports of coffee leaf rust in Central America. New York's arabica for March settled up 0.80 cent, or 0.5 percent, at $1.5630 per lb. The contract ended the week up 1.9 percent. Arabica is mostly produced in Brazil and elsewhere in central and south America. Rabobank said in a research note that "disciplined" grower selling, coupled with concerns about 2013/14 Central American output, are forecast "to reduce speculators' shorts and drive prices higher in the first quarter of 2013." London's robusta for March turned lower, finishing down $2 at $1,976 a tonne, after hitting a two-month high at $1,989. Robusta is largely grown in Vietnam. "We're seeing coverage in both markets to alleviate the heavy sales we've been getting from Vietnam," said Sterling Smith, futures specialist for Citigroup in Chicago. "There's a very large short position that needs to work itself off here."
OIL UP AS HEDGE FUNDS BUILD POSITIONS Brent crude oil closed at $111.89 a barrel, up 0.7 percent for the session and 1.1 percent for the week. U.S. crude settled at $95.56, up 0.1 percent higher for the session and up 2 percent for the week. Hedge funds and other large speculators have increased their positions in U.S. crude oil by almost 50 percent in New York and London since early November, data from the U.S. Commodity Futures Trading Commission showed on Friday. Prices have risen
Prices at 5:23 p.m. EST (2223 GMT)
LAST/ NET PCT YTD CLOSE CHG CHG CHG US crude 95.25 -0.24 -0.3% 3.7% Brent crude 111.66 0.56 0.5% 0.5% Natural gas 3.566 0.072 2.1% 6.4%US gold 1687.00 -3.80 -0.2% 0.7% Gold 1684.40 1.06 0.1% 0.6% US Copper 367.90 1.70 0.5% 0.7% LME Copper 8061.00 7.00 0.1% 1.6% Dollar 80.034 0.385 0.5% 4.3%US corn 727.50 3.00 0.4% 4.2% US soybeans 1429.25 -1.00 -0.1% 0.7% US wheat 791.25 10.00 1.3% 1.7%US Coffee 156.30 0.80 0.5% 8.7% US Cocoa 2285.00 -15.00 -0.7% 2.2% US Sugar 18.37 -0.05 -0.3% -5.8%US silver 31.932 0.122 0.4% 5.6% US platinum 1672.10 -25.70 -1.5% 8.7% US palladium 722.75 -3.40 -0.5% 2.8%