Raw materials: barely aluminum and sugar, the gold still shines

Among the main metals listed on the London Metal Exchange (LME), aluminum remains the most fragile price, notes Daniel Briesemann of Commerzbank.

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Aluminum prices were trending lower this week, recording a four-year low on Monday, squeezed between low demand and high supply.

Among the main metals listed on the London Metal Exchange (LME), aluminum remains the most fragile price, notes Daniel Briesemann of Commerzbank.

“On Monday, for example, he was the only one in the red,” hitting a new low since the start of 2016, at $ 1,465.50 a tonne.

Demand, particularly for the automotive industry, is paralyzed by the drastic measures put in place to stem the spread of the new coronavirus when “the supply is still high,” said Mr. Briesemann.

The low price “makes life more and more difficult for producers,” he added, and China’s largest state-owned aluminum company “is now looking to cut production.”

On the London Metal Exchange, which has been traded remotely since March 23 in application of sanitary measures, the tonne of aluminum for delivery in three months traded at $ 1,473.50 Thursday at 1:10 p.m. GMT, against 1,481.50 dollars the Friday before at closing.

Copper resumed colors this week, in line with the previous one. The ton was worth 5,024.50 dollars at the same time, against 4,839.50 dollars last Friday.

The gold is still shining

After stalling last week, gold has recovered its colors this week, helped by measures taken by central banks to support the economy hit hard by the health crisis.

“Gold continues to appreciate in these troubled times,” said Craig Erlam, analyst at Oanda.

The yellow metal “still seems to be taking advantage of the ambient risk and the policies implemented by central banks all over the world,” he added.

The United States Federal Reserve (Fed) struck a big blow on Thursday by announcing $ 2.3 trillion in new loans to “support the economy”, intended especially for businesses and local communities who are suffering from the pandemic of Covid-19.

Its safe haven status also provides price support as the pandemic, whose toll approached the 90,000 dead worldwide on Thursday, worsens.

“Gold is still a sought-after asset but its situation could change” to its disadvantage “when a climate of confidence in the economy returns,” nuanced Edward Moya, another analyst from Oanda.

On the London Bullion Market, the ounce of gold was worth $ 1,680.14 Thursday at 1:25 p.m. GMT, against $ 1,620.81 the previous Friday at the close.

Sugar patina

Sugar prices have stagnated this week at historically low levels due to an imbalance between supply and demand accentuated by the Covid-19 pandemic and its economic consequences.

“The world market fell in March as a result of the coronavirus pandemic,” said the International Sugar Organization (ISO) in its latest monthly report released Wednesday.

“Demand will grow more slowly than normal in 2020, or even decrease in some areas,” warned Rabobank analysts. At the same time, the currencies of producing countries depreciate, “which encourages the production and export of sugar,” they added.

Currently low oil prices also put pressure on sugar prices as they encourage refineries to limit the use of sugar cane for ethanol production, which increases the availability of sugar on the market. worldwide.

The recovery “can however be sustained because the industry and individuals will be tempted to make stocks” once the crisis has subsided, analysts at the Dutch bank added.

In London, the ton of WHITE SUGAR for delivery in July was worth Thursday at 13.35 GMT 122.45 dollars, against 116.50 dollars the previous Friday at the end of the session. In New York, the pound of RAW SUGAR for July delivery was worth 10.44 cents, up from 10.33 cents six days earlier.

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