Brent crude oil futures settled slightly higher at $72.9 per barrel on Friday, recovering some earlier losses but still posting a 2.5% decline for the week. The recovery came as the US dollar softened from two-year highs, with data indicating cooling inflation just two days after the Federal Reserve’s interest rate cut. China’s energy outlook added to market uncertainty, as Sinopec predicted crude imports could peak by 2025 and oil consumption by 2027. These forecasts contributed to the weekly losses in global oil benchmarks. OPEC+ downgraded its 2024 demand growth outlook for the fifth consecutive time, highlighting the need for supply discipline. Geopolitical tensions increased as the G7 explored stricter measures on Russian oil price caps.Additionally, President-elect Trump raised the possibility of tariffs on the EU if it doesn’t address trade imbalances, particularly in U.S. oil and gas.

Brent Settles Slightly Higher, Posts Weekly Losses

WTI crude oil futures gained 0.1% to close at $69.46 per barrel on Friday, recovering some earlier losses but still posting a 3% decline for the week. The recovery came as the US dollar softened from two-year highs, with data indicating cooling inflation just two days after the Federal Reserve’s interest rate cut. China’s energy outlook added to market uncertainty, as Sinopec predicted crude imports could peak by 2025 and oil consumption by 2027. These forecasts contributed to the weekly losses in global oil benchmarks. OPEC+ downgraded its 2024 demand growth outlook for the fifth consecutive time, highlighting the need for supply discipline. Geopolitical tensions increased as the G7 explored stricter measures on Russian oil price caps.Additionally, President-elect Trump raised the possibility of tariffs on the EU if it doesn’t address trade imbalances, particularly in U.S. oil and gas.

Crude Oil Edges Higher on Friday

Rice decreased to a 35-month low of 14.04 USD/cwt. Over the past 4 weeks, Rice lost 7.35%, and in the last 12 months, it decreased 20.26%.

Rice Hits 35-month Low

Rice decreased below 14, according to trading on a contract for difference (CFD).

Rice traded below 14 USD/cwt

The Baltic Exchange's main sea freight index, which tracks rates for ships ferrying dry bulk commodities, halted its three-day losing streak on Friday, rising about 1.4% to 990 points. The capesize index, which typically transports 150,000-ton cargoes such as iron ore and coal, rose 36 points to 1,115 points; and the panamax index, which usually carries 60,000-70,000 tons of coal or grain cargo, increased 12 points to 976 points. Meanwhile, the supramax index eased 4 points to its lowest since August last year at 940 points. For the week, the benchmark index was down about 5.8%.

Baltic Dry Index Rebounds, Still Posts Weekly Fall

US natural gas futures rose further to over $3.65 per MMBtu on Friday, the highest in over one year, as bets of stronger global LNG demand magnified the outlook of higher domestic consumption. Fresh forecasts of a cold front in the US halfway through January drove the industry to raise demand forecasts by 18 billion cubic feet into the weekend. This coincided with data from the EIA showing that gas storages fell by over 100bcf for the second straight week, deepening the anticipated start to the withdrawal season. In turn, the decreasing likelihood that Europe will continue to receive Russian gas through Ukraine drove investors to take long LNG positions as EU members search for alternative gas sources. This raises demand for US LNG at the turn of the US presidency, with President-elect Trump pledging to issue more LNG export permits, driving firms to favor more profitable exports instead of cheaper gas sales domestically due to the ample domestic supply.

Natural Gas Extends Rally to 1-Year High

European natural gas futures rose to over €43.5 per megawatt-hour on Friday, extending the rebound from the over one-month low of €39 touched on December 16th amid the decreasing likelihood that central European economies will be able to extend flows of Russian gas after the turn of the year. Utilities from Slovakia and Hungary are preparing for gas flows from Russia through Ukraine to halt after the end of December, rushing to find alternative sources and driving traders to pile on long contracts of LNG. Moscow and Kyiv both stated that the deal will not be renewed but are still having discussions with delegations over extension possibilities, despite the EU Commission’s will to continue phasing out Russian fossil fuels. Other major gas consumer continued to source contracts from other providers, with major German utilities inking LNG agreements with the UAE’s ADNOC, while the UK's record wind power generation enabled electricity exports to the continent.

EU Natural Gas Extends Rebound

Copper futures stabilized around $4.04 per pound on Friday, but were on track to decline by over 2% for the week, as a hawkish Federal Reserve outlook and demand uncertainties in China weighed on prices. Earlier this week, the Fed delivered a widely anticipated quarter-point rate cut but signaled fewer reductions in 2025 due to persistent inflation. Recent US economic data, including weekly jobless claims and a revised third-quarter GDP, also indicated robust activity, reinforcing expectations of higher interest rates. Meanwhile, economic uncertainty in China and the absence of detailed policy plans raised concerns about future demand. Additionally, the looming threat of higher US tariffs under the incoming Trump administration added further uncertainty to the market outlook.

Copper Stabilizes, Set for Weekly Decline

Malaysian palm oil futures were almost steady, hovering around MYR 4,500 per tonne after five sessions of losses. Traders analyzed reports that Indonesia plans to raise its crude palm oil export levy to 10% from 7.5% to fund higher biodiesel subsidies. Starting in January, the country will implement the B40 biodiesel mandate, up from the current B35. Meanwhile, demand from key buyer China was closely monitored, as purchases may increase ahead of the Lunar New Year at the end of January. Bargain buying also emerged after prices hit an eight-week low in the prior session. For the week, palm oil futures were set to decline for the second consecutive period, falling about 8% so far, as cargo surveyors noted that Malaysian exports fell between 6.7% and 9.8% in the first 15 days of December. Overall, sentiment remained mixed, with pressure from India’s decision to extend its suspension of trading derivative contracts for key agricultural commodities until January to curb food inflation.

Palm Oil Set for Second Straight Weekly Losses

Gold traded around $2,600 per ounce on Friday, set for a weekly decline, pressured by a hawkish outlook from the Federal Reserve. On Wednesday, the Fed signaled a more cautious approach to further easing, with dot plot projections indicating only two rate cuts next year. Recent US GDP data also highlighted the economy's resilience, and consumer spending was revised upwards, supporting the case for slower easing. This outlook has weighed on gold demand, as limited monetary easing reduces the appeal of non-yielding assets like bullion. Meanwhile, gold's near-term outlook could face further challenges from weakening physical demand in key consumer India, with government officials expecting a sharp decline in gold imports in December. Still, the metal has surged about 25% this year, driven by US monetary easing, safe-haven demand, and central bank purchases.

Gold Set for Weekly Decline

Brent crude oil futures fell below $73 per barrel on Friday, heading for a weekly decline as a strong US dollar continued to pressure the dollar-denominated commodity. On Wednesday, the Federal Reserve signaled a slower pace of rate cuts next year, driving the greenback to a two-year high and raising concerns about potential impacts on fuel demand. Adding further pressure, Sinopec, China’s largest refiner, announced Thursday that the nation’s gasoline demand peaked last year, further dimming the outlook for the world’s top crude importer. Earlier in the week, oil found support from EIA data showing a larger-than-expected draw in US crude stocks in mid-December, as well as Kazakhstan’s backing of OPEC+'s extended cuts, reversing plans to boost output. Meanwhile, crude is on track for a yearly decline, trading within its narrowest range since 2019, amid weak Chinese demand and rising non-OPEC production.

Brent Heads for Weekly Loss

WTI crude oil futures fell around $69 per barrel on Friday, heading for a weekly decline as a strong US dollar continued to pressure the dollar-denominated commodity. On Wednesday, the Federal Reserve signaled a slower pace of rate cuts next year, driving the greenback to a two-year high and raising concerns about potential impacts on fuel demand. Adding further pressure, Sinopec, China’s largest refiner, announced Thursday that the nation’s gasoline demand peaked last year, further dimming the outlook for the world’s top crude importer. Earlier in the week, oil found support from EIA data showing a larger-than-expected draw in US crude stocks in mid-December, as well as Kazakhstan’s backing of OPEC+'s extended cuts, reversing plans to boost output. Meanwhile, crude is on track for a yearly decline, trading within its narrowest range since 2019, amid weak Chinese demand and rising non-OPEC production.

Oil Heads for Weekly Loss

Soybean futures rebounded to $9.6 per bushel on Thursday after hitting their lowest level since August, supported by technical buying, and competitive pressure from other exporting regions. Soybean prices remain under strain from expectations of a record Brazilian harvest, weak Chinese demand, and a decline in soyoil prices amid uncertainties over U.S. biofuel policy. The imminent South American soybean harvest is expected to exert further pressure on the market. Meanwhile, large wheat crops from Argentina and Australia have eased concerns about declining Russian supply. The U.S. dollar, which surged to a two-year high on Wednesday following the Federal Reserve’s slower rate-cut outlook, has made U.S. crops less competitive globally, adding another challenge for exporters.

Soybean Futures Rebound

Natural gas increased to a 13-month high of 3.59 USD/MMBtu. Over the past 4 weeks, Natural gas gained 12.47%, and in the last 12 months, it increased 62.64%.

Natural gas Hits 13-month High

Natural gas increased to a 4-week high of 3.57 USD/MMBtu. Over the past 4 weeks, Natural gas gained 11.28%, and in the last 12 months, it increased 60.92%.

Natural gas Hits 4-week High

U.S. heating oil futures stabilized around $2.24 per gallon, approaching the three-week high of $2.27 reached on December 13, driven by signs of tight supply, though pressure from the strong U.S. dollar weighed on the dollar-denominated commodity. The latest EIA report showed a significant 3.18 million-barrel draw in distillate stockpiles, far exceeding the expected 0.8 million-barrel build for the week ending December 13. Heating oil inventories also fell by 304,000 barrels, further tightening already constrained refinery supplies. Meanwhile, the dollar surged to a two-year high after the Fed cut borrowing costs as expected but signaled fewer rate cuts next year, raising concerns about the potential impact on heating demand.

Heating Oil Stabilizes

Cocoa is down by 5.52%

Cotton decreased to a 4-week low of 67.58 USd/Lbs. Over the past 4 weeks, Cotton lost 1.75%, and in the last 12 months, it decreased 14.59%.

Cotton Hits 4-week Low

Lumber prices have rebounded to around $560 per thousand board feet, up from a seven-week low of $531 on December 16th, driven by strong demand and supply constraints. U.S. existing home sales rose by 4.8% in November, the highest in eight months, reflecting growing momentum in the housing market, with more buyers entering as job growth continues, housing inventory rises, and consumers adjust to mortgage rates between 6% and 7%. Additionally, building permits surged by 6.1% in November, the highest level since February 2024, signaling strong future construction activity. On the supply side, production cuts and mill closures are restricting lumber availability as Western Forest Products reduced output by 30 million board feet, and Canfor Corp. shut two mills, cutting annual production by 670 million board feet. These supply limitations, coupled with U.S. tariffs on Canadian softwood lumber and rising import tariffs amid the China trade dispute, are pushing prices higher.

Lumber Rebounds Driven by Strong Demand

US natural gas futures extended the recent rise to $3.5 per MMBtu on Thursday, the highest in over one year, as bets of stronger global LNG demand magnified robust domestic consumption. Data from the EIA showed that utilities withdrew more than 100 billion cubic feet of natural gas from storage for a second straight week, extending an earlier withdrawal season. Also, uncertainty on whether Europe will continue to receive Russian gas flows through Ukraine drove investors to take long LNG positions as EU members search for alternative gas sources. This raises demand for US LNG at the turn of the US presidency, with President-elect Trump pledging to issue more LNG export permits, driving firms to favor more profitable exports instead of cheaper gas sales domestically due to the ample supply in the US. In the meantime, another report from the EIA showed that domestic natural gas consumption is set to break a new record in 2024, largely due to higher demand from the electric power sector.

Natural Gas Rises to 1-Year High

The Baltic Exchange's main sea freight index, which tracks rates for ships ferrying dry bulk commodities, was down for the third straight session on Thursday, slipping around 5.5% to a fresh low since July 2023 at 976 points. The capesize index, which typically transports 150,000-ton cargoes such as iron ore and coal, sank 158 points to a new low since September 2023 at 1,079 points; and the supramax index eased 3 points to its lowest since August last year at 944 points. Meanwhile, the panamax index, which usually carries 60,000-70,000 tons of coal or grain cargo, rose 7 points to 964 points, though still hovering at its lowest since July 2023.

Baltic Dry Index Extends Slide Into 3rd Day

Aluminum futures fell to $2,520 per tonne in December, their lowest in three months, and in line with the broad pressure for industrial metals in dollar exchanges as a strong greenback and ample supply for the metal magnified the impact of uncertain demand. The latest data showed that the output of primary aluminum in China rose by 3.6% from the previous year in November. This matched stronger supply earlier in the year as rainfall in the production hub of Yunnan supported the creation of hydropower for smelters. In turn, Beijing’s willingness to let the yuan devalue drove prices for base metals with Chinese manufacturing hubs to pull back in dollar-denominated exchanges. This balanced against soaring alumina prices due to supply disruptions and Beijing’s decision to end tax rebates on exports of semi-manufactured aluminum products in December, removing around five million tonnes of supply from the international market according to industry estimates.

Aluminum Drops to 3-Month Low

Uranium futures fell to below $75 per pound in December, the lowest in over one year, amid the ongoing view of ample supply for mined uranium. Kazatomprom, the world’s top producer, is due to raise production of Uranium next year despite recent struggles to secure sulfuric acid. Western miners are also due to increase the availability in the market, with UBS forecasting higher supply from Paladin Energy and Boss Energy. Earlier, Russia banned sales of enriched uranium to the US in response to Washington’s decision to ban imports of Russian nuclear fuel. Still, restrictions from both parties are flexible and allow waivers in case of tight market conditions, limiting the jeopardy that the policies place on global supply. While enrichment prices to transform uranium into nuclear fuel hover near record highs due to the supply chain disruptions since the start of Russia's invasion of Ukraine, relatively ample availability of yellowcake maintained prices are their recent lows.

Uranium Falls to Over 1-Year Low

Nickel futures fell to $15,260 per tonne in December, the lowest in over four years amid pressure from a stronger dollar, uncertain demand, and ample levels of supply. High levels of production from Indonesia, the world’s top supplier, persisted through the second half of 2024. This extended the soaring supply levels brought by the surge of Chinese smelting projects in Indonesia after the latter prohibited the export of nickel ores in 2020. Indonesia was the host of 44 nickel smelting operations as of September, compared with four 10 years prior. The supply glut prompted Indonesian authorities to consider halving nearly nickel mining permits next year, in line with earlier reports that the state may place quotas on domestic smelters. Adding to the bearish pressure, new technology used by Chinese battery producers started to use technologies that refrain from using nickel, further denting the outlook for the metal.

Nickel Slumps to 4-Year Low

Palladium futures sank to below $900 per ounce to hover near their lowest in over four months, setting up an over 18% slump for the full year amid pressure from slowing industrial demand, hawkish monetary policy by the Fed, and an outlook of robust supply. The Federal Reserve projected only two rate cuts next year in its latest meeting, half than its earlier projections, to trigger sharp selling for non-interest-yielding assets. In turn, the World Platinum Investment Council (WPIC) noted that the slowing demand for internal combustion engines, which take palladium as input for their catalytic converters and account for 90% of palladium consumption, pressured prices throughout the year due to a slowing Chinese economy and increasing preference for electric vehicles. Lastly, market players expect output to rise next year amid ample secondary supply from Russia and strong mining output from South Africa, driving palladium price benchmarks to underperform their platinum counterparts.

Palladium Set for Near 20% Slump in 2024

Platinum futures fell to $920 per ounce in December, trading near their lowest levels in over three months, consolidating its significant underperformance to other bullion assets as slowing industrial demand magnified the pressure from hawkish signals by the Federal Reserve. The Fed downwardly revised its projections for rate cuts next year, suggesting a recalibrated balance of risk between high inflation and a softening labor market, and raising the opportunity cost of holding precious metals. In turn, the World Platinum Investment Council (WPIC) noted that the slowing demand for internal combustion engines, which take platinum as inputs through their catalytic converter, pressured prices throughout the year due to a slowing Chinese economy and increasing preference for electric vehicles. This was enough to offset expectations that the platinum market would remain in a deficit in 2025 amid a decline in refined production in South Africa, Zimbabwe, Russia, and North America

Platinum Hovers Near 3-Month Low

US natural gas futures rose to above $3.4 per MMBtu on Thursday, approaching the one-year high of $3.5 tested in December as bets of stronger global LNG demand magnified robust domestic consumption. Uncertainty on whether Europe will continue to receive Russian gas flows through Ukraine drove investors to take long LNG positions as EU members search for alternative gas sources. This raises demand for US LNG at the turn of the US presidency, with President-elect Trump stating that his administration is against holding back on LNG export permits, driving firms to favor more profitable exports instead of cheaper gas sales domestically due to the ample supply in the US. In the meantime, new data from the EIA showed that domestic natural gas consumption is set to break a new record in 2024, largely due to higher demand from the electric power sector. Investors now await weekly storage data from the EIA, set to show an extension to the anticipated drawing season that started last month.

Natural Gas Rises Toward 1-Year High

European natural gas futures held at the €41 per megawatt-hour mark on Thursday, trimming the sharp rebound from the prior session as markets continued to assess the availability of Russian natural gas for Europe following the turn of the year. Slovakia announced that it is closer to a solution to keep Russian fuel flowing through Ukraine next year following meetings with Kyiv and Moscow. A deal would maintain supply streams to the continent through the winter as the current deal has Russian gas flows terminating at the end of the month, limiting supply for key clients in Italy and Austria as well. Still, the EU's goal of ending the dependency on Russian fossil fuels drove funds to take long positions in European gas. Economies still continued to search for supply alternatives in the uncertain situation, with major German utilities inking LNG agreements with the UAE’s ADNOC, while the UK's record wind power generation enabled electricity exports to the continent.

EU Natural Gas Holds Pullback

HRC Steel decreased to a 17-week low of 671.00 USD/T. Over the past 4 weeks, Hot-Rolled Coil Steel lost 1.32%, and in the last 12 months, it decreased 40.25%.

HRC Steel Hits 17-week Low

Iron ore prices for cargoes with 62% iron content fell below $105 per ton in mid-December after the US Federal Reserve delivered a widely expected 25 basis point rate cut but signaled fewer rate reductions in 2025. The Fed now forecasts just two more rate cuts next year, down from the four projected in its September outlook. This policy shift strengthened the dollar and pushed Treasury yields higher, putting pressure on commodities and other risk assets. Ongoing economic uncertainty, coupled with the lack of detailed policy plans from China—the world’s largest consumer of iron ore—also weighed on sentiment. On the supply side, BHP Group, one of the world’s largest iron ore producers, resumed operations at two mines in Western Australia after a temporary halt due to heavy rains.

Iron Ore Prices Fall After Fed’s Hawkish Cut

Copper futures fell toward $4 per pound on Thursday, continuing a recent decline as the dollar and Treasury yields surged following the US Federal Reserve’s widely anticipated quarter-point rate cut earlier this week. However, the Fed signaled fewer rate reductions in 2025 than previously expected, projecting only two cuts next year, down from the four it forecast in September. Ongoing economic uncertainty and the lack of detailed policy plans from China, the world’s top copper consumer, also weighed on copper and other industrial metals. Despite these challenges, markets remain hopeful for additional rate cuts and further reductions in China’s bank reserve requirement ratios next year. Fiscal support is also expected to play a crucial role in boosting domestic demand and mitigating the impact of potential US tariff increases.

Copper Prices Extend Decline on Hawkish Fed Signals

Malaysian palm oil futures hovered below MYR 4,500 per tonne, marking their sixth straight session of losses and notching an eight-week low. The bearish mood was driven by India’s extension of its suspension on trading derivative contracts for key farm commodities, including crude palm oil and rapeseed, until January to curb food inflation. Weighing further on sentiment were forecasts for a record soybean crop in Brazil early next year and a new US plan permitting gasoline sales with higher ethanol blending. Regarding shipments, Malaysian palm oil exports fell by 6.7% to 9.8% during the December 1–15 period, according to cargo surveyors. Market uncertainty also persisted over Indonesia’s biodiesel mandates, as Jakarta has yet to allocate higher blending quotas. However, losses were limited by optimism that demand from key buyer China could recover ahead of the Lunar New Year festivals. Meanwhile, the EU Parliament approved delaying its deforestation law implementation to December 2025.

Palm Oil Falls for 6th Session to Hit 8-Week Low

Zinc decreased to a 4-week low of 2966.00 USD/T. Over the past 4 weeks, Zinc lost 0.5%, and in the last 12 months, it increased 15.27%.

Zinc Hits 4-week Low

Gold rose above $2,610 per ounce on Thursday, likely due to a technical recovery after losing more than 2% in the previous session. The decline followed the Federal Reserve’s hawkish signal of fewer rate cuts next year, with the dot plot projections showing only two rate cuts in 2025, supported by strong GDP growth and persistent inflation. This outlook has pressured gold demand, as limited monetary easing reduces the appeal of non-yielding assets like bullion. Traders will now closely watch upcoming US GDP and PCE inflation data this week, which could further shape monetary policy expectations. Gold has surged over 27% this year, heading for its largest annual gain since 2010, driven by US monetary easing, strong safe-haven demand, and robust central bank purchases.

Gold Rises on Likely Technical Recovery

Brent crude oil futures fell below $73 per barrel on Thursday, reversing gains from the previous session, as the strength of the US dollar pressured the dollar-denominated commodity. The greenback surged to an over two-year high after Fed officials cut borrowing costs as expected but signaled fewer rate cuts next year. This slower easing approach also raised concerns about potential impacts on fuel demand. Meanwhile, oil found some support after EIA data showed that US crude oil stocks fell by nearly 1 million barrels in the second week of December, extending the 1.4-million-barrel draw from the previous week. Additionally, Kazakhstan plans to comply with OPEC+'s extended oil cuts next year, reversing earlier plans to raise output to 190 thousand barrels per day, joining the UAE in supporting the extension. Still, expectations of ample output from non-OPEC+ members, including the US, Canada, and Brazil, dampen optimism.

Brent Falls as Strong US Dollar Weighs

WTI crude oil futures fell below $70 per barrel on Thursday, reversing gains from the previous session, as the strength of the US dollar pressured the dollar-denominated commodity. The greenback surged to an over two-year high after Fed officials cut borrowing costs as expected but signaled fewer rate cuts next year. This slower easing approach also raised concerns about potential impacts on fuel demand. Meanwhile, oil found some support after EIA data showed that US crude oil stocks fell by nearly 1 million barrels in the second week of December, extending the 1.4-million-barrel draw from the previous week. Additionally, Kazakhstan plans to comply with OPEC+'s extended oil cuts next year, reversing earlier plans to raise output to 190 thousand barrels per day, joining the UAE in supporting the extension. Still, expectations of ample output from non-OPEC+ members, including the US, Canada, and Brazil, dampen optimism.

Oil Falls as Strong US Dollar Weighs

Solar Energy Index decreased to a 4-1/2-year low of 33.36 USD. Over the past 4 weeks, Solar Energy Index lost 1.47%, and in the last 12 months, it decreased 36.56%.

Solar Energy Index Hits 4-1/2-year Low

Copper futures sank to below $4.05 per pound in December, its lowest in over three months, pressured by a surge in the dollar and uncertain demand for industrial metals from key consumers. The Fed lowered its funds rate as expected but unveiled hawkish expectations for next year by projecting fewer rate cuts and higher PCE inflation, triggering a surge for the greenback. Consequently, metals priced in US dollars declined amid lower demand from foreign economies. This added to pressure from low industrial demand from the US and China. The S&P PMI showed that the US manufacturing sector continued to contract more than expected in November. Additionally, lack of detail from China regarding its pledges of proactive fiscal support added to concerns that the signals are prioritizing optics over concrete action. The latest PMI data showed that Chinese manufacturing activity expanded only slightly in November, showing limited reaction to the ample monetary easing from September.

Copper Falls to 3-Month Low

Silver decreased to a 5-week low of 29.64 USD/t.oz. Over the past 4 weeks, Silver lost 5.03%, and in the last 12 months, it increased 23.67%.

Silver Hits 5-week Low

Solar Energy Index decreased to a 4-week low of 33.85 USD. Over the past 4 weeks, Solar Energy Index lost 0.65%, and in the last 12 months, it decreased 36.03%.

Solar Energy Index Hits 4-week Low

Copper decreased to a 14-week low of 4.04 USD/Lbs. Over the past 4 weeks, Copper lost 2.05%, and in the last 12 months, it increased 3.95%.

Copper Hits 14-week Low

Gold decreased to a 4-week low of 2605.00 USD/t.oz. Over the past 4 weeks, Gold lost 1.1%, and in the last 12 months, it increased 27.74%.

Gold Hits 4-week Low

Silver sank to below $29 per ounce in December, the lowest in three months, amid pressure from a hawkish Federal Reserve and a poor outlook for silver’s industrial utility. The Federal Reserve projected fewer rate cuts for next year to signal that the FOMC is heeding to stubbornly high underlying inflation and upside inflation risks from the outlook of expansionary fiscal policy and tariffs from the incoming Trump presidential administration. This magnified concerns of poor demand for silver as an industrial input, which led the metal to underperform gold in the fourth quarter. Overcapacity in China’s solar panel industry drove photovoltaic companies to sign up to a government self-discipline program that may regulate supply, limiting the outlook of silver input demand. Pressure was also noted from the threat of a yuan devaluation in accordance with China's looser monetary policy stance, lowering asking prices from the world's top exporter.

Silver Falls after Hawkish Fed Signals

Gold dropped below $2,620 per ounce on Wednesday after the Federal Reserve delivered a third consecutive 0.25% rate cut, reducing its key interest rate to 4.25%-4.5%. The Fed signaled limited easing ahead, projecting only two rate cuts in 2025 amid solid GDP growth and persistent inflation.This outlook has added pressure to gold demand, as the prospect of limited monetary easing reduces the appeal of non-yielding assets like bullion.Still, the precious metal has surged over 28% this year, on track for its largest annual gain since 2010, driven by U.S. monetary easing, heightened safe-haven demand, and robust central bank purchases. In addition, Indian gold imports soared to a record high in November following a reduction in customs levies, with full-year demand from the key consumer expected to grow 7% in 2024, the second-highest level since 2015.

Gold Extends Losses After Fed Decision

Rice futures hovered around $14.8 per hundredweight, their lowest since mid-November, amid expectations of increased supply. India’s rice reserves reached a record 44.1 million metric tons in December, far exceeding the government target of 7.6 million tons, potentially boosting exports and easing global prices. Meanwhile, the USDA’s December WASDE report for 2024/25 indicated fractionally lower supplies and consumption, higher trade, and modestly reduced ending stocks. Global rice supplies for 2024/25 were cut by 0.3 million tons to 712.8 million, mainly due to lower production in the Philippines due to November typhoon damage. Consumption was reduced by 0.1 million tons to 530.3 million, with declines in Cambodia and Nepal partially offset by increases in Brazil and Indonesia. Ending stocks were cut by 0.2 million tons to 182.5 million, though they remain over 3 million tons higher than 2023/24, driven by India’s higher reserves.

Rice Futures at 1-Month Low

WTI crude oil futures rose to over $74 per barrel on Wednesday, extending gains from morning trading and approaching their highest in one month amid fresh developments that jeopardize the view of ample supply. Data from the EIA showed that crude oil stocks in the US fell by nearly 1 million barrels in the second week of December, extending the 1.4-million-barrel draw from the previous week. Additionally, the same report showed that US exports rose to 1.8 million barrels in the period, the most since July. In turn, other reports indicated that Kazakhstan intends to comply with the prolonged oil cuts mandated by OPEC+ for next year, reversing from previous signals that it would instead raise output to the original level of 190 thousand barrels per day. This added to the signal of other members adhering to an extension of output cuts, namely the UAE. Still, expectations for non-OPEC+ members, namely the US, Canada, and Brazil, to deliver ample output limited gains.

Brent Crude Rises Past $74

WTI crude oil futures rose to over $71 per barrel on Wednesday, extending gains from morning trading and approaching their highest in one month amid fresh developments that jeopardize the view of ample supply. Data from the EIA showed that crude oil stocks in the US fell by nearly 1 million barrels in the second week of December, extending the 1.4-million-barrel draw from the previous week. Additionally, the same report showed that US exports rose to 1.8 million barrels in the period, the most since July. In turn, other reports indicated that Kazakhstan intends to comply with the prolonged oil cuts mandated by OPEC+ for next year, reversing from previous signals that it would instead raise output to the original level of 190 thousand barrels per day. This added to the signal of other members adhering to an extension of output cuts, namely the UAE. Still, expectations for non-OPEC+ members, namely the US, Canada, and Brazil, to deliver ample output limited gains.

WTI Crude Oil Approaches 1-Month High

U.S. heating oil futures rose above $2.26 per gallon, approaching the three-week high of $2.27 reached on December 13, amid evidence of tight supply and rising crude oil prices, which pushed heating oil costs higher as refiners faced increased production expenses. The latest EIA report revealed a significant draw in distillate stockpiles of 3.18 million barrels, far exceeding the expected 0.8 million barrel build for the week ending December 13. Similarly, heating oil inventories fell by 304,000 barrels, further tightening already reduced refinery supplies.

Heating Oil Rises on Reduced Supply

Rice decreased to a 4-week low of 14.85 USD/cwt. Over the past 4 weeks, Rice lost 1.55%, and in the last 12 months, it decreased 15.2%.

Rice Hits 4-week Low

The Baltic Exchange's main sea freight index, which tracks rates for ships ferrying dry bulk commodities, eased for a second straight session on Wednesday, slumping about 2.4% to its lowest since July 2023 at 1,028 points, on lower rates across all vessels. The capesize index, which typically transports 150,000-ton cargoes such as iron ore and coal, fell 71 points to its lowest since September 2023 at 1,237 points; and the panamax index, which usually carries 60,000-70,000 tons of coal or grain cargo, decreased 2 points to its lowest since July 2023 at 957 points. Among smaller vessels, the supramax index was down 2 points to its lowest since August last year at 947 points.

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