Global economic concerns continued to play havoc with commodity markets last week as fears mounted over the spread of the European debt crisis and global economic growth leading to significant price falls for copper and steel.
Last week the US Department of Labor released data showing that no new net jobs had been created in August, which was worse than had been expected and stoked fears of a double dip recession.
Copper, which is considered a bell-weather of the global economy, fell 0.44% to end the week at $9050 per tonne. This represented a monthly price decline of 1.51% and led many analysts to speculate that the economic worries will see a reduction in demand for the metal.
Steel billets on the London Metal Exchange, meanwhile, saw their price slip by 10.87% to finish the week at $615 per tonne.
Speaking to Bloomberg, Hwang II Doo, senior trader at Korea Exchange Bank Futures Co., said, “In the short term, the copper market is under downward pressure from the weaker US jobs data and mounting concern about Europe’s sovereign-debt crisis, together with an increase in stockpiles in London and Shanghai.”
Sugar no.11 also saw its price fall last week as news emerged that European and Asian production was on the increase and is expected to make up any shortage from Brazil. Sugar ended the week at $2918 cents per pound, meaning a 3.44% weekly fall.
Coffee prices have been increasing consistently over the past month and last week was no different as it registered an increase of 3.69% and meant that over the month the price has risen by a staggering 21.51%.
Bloomberg has suggested that coffee is on the increase because of fears over the level of stockpiles held in Europe and supplies from Vietnam.
Elsewhere, and of interest to buyers in the grain markets, was news that both wheat and grain prices fell back over the week after seeing constant prices rises over the past few months. Wheat ended the week at $730 cents per bushel and corn ended the week at $750.20 cents per bushel.
Despite some good news for buyers, focus will now fix on economic data coming from the world’s leading economies and what this will mean for the commodities they buy.
