COMMODITIES-Fed doubts about stimulus pressure gold, oil

Thu Jan 3, 2013 5:00pm EST

* Gold down after some Fed policymakes suggest QE to end
soon
    * Oil, industrial metals under pressure from economic
worries
    * Soybeans down for 3rd session as China canceled orders
    * Coming up: U.S. Dec. nonfarm payrolls Friday

    By Frank Tang
    NEW YORK, Jan 3 (Reuters) - Commodities prices on Thursday
surrendered some of the previous session's gains, hit by signs
that Federal Reserve officials are increasingly concerned about
the potential risks of its asset purchases on financial markets.
    After the release of the Fed December policy meeting minutes
showing a reticence about further increases in the central
bank's $2.9 trillion balance sheet, gold and silver got
hammered.
    Crude oil prices also fell after the Fed minutes showed
several officials thought it would be appropriate to slow or
stop asset purchases before year end. 
    "With the news that some policymakers suggested that the Fed
could withdraw QE before the end of year, that put a dent on one
of the underpinnings on gold, which is expansionary monetary
policy," said Mark Luschini, chief investment strategist of
Janney Montgomery Scott, a broker-dealer which manages $54
billion in assets.
    Spot gold was down 1.4 percent at $1,663.39 by 3:59
p.m. EST (2059 GMT), while U.S. COMEX gold futures for
February delivery settled down $14.20 an ounce at $1,674.60.
Silver tumbled nearly 3 percent. 
    The Thomson Reuters-Jefferies CRB index, which
tracks 19 commodities, gave up most of its gains from Wednesday.
    
    BASE METALS, OIL BROADLY DOWN
    Industrial metals trading on the London Metal Exchange ended
lower across the board, with aluminium futures closed at
$2,116, down 2 percent from $2,160, while zinc and lead
 prices also finished down.
    Copper fell from an 11-week high reached on Wednesday. The
metal's futures in London closed at $8,154 a tonne, down
slightly from $8,210. U.S. COMEX copper futures for March
delivery fell further after the Fed minutes, down more
than 1 percent.
    Oil prices also slipped from 11-week highs.
    Brent crude settled 33 cents lower at $112.14 a
barrel. U.S. crude fell 20 cents to settle at $92.92 a
barrel, erasing smaller gains from earlier in the day after the
Fed minutes were released. 

    CANCELED ORDER PRESSURES SOYBEAN
    U.S. soybean prices fell for the third consecutive trading
session, extending losses after China, the world's biggest soy
importer, canceled orders for U.S. soy and on expectations for
bumper crops in South America.
    "We're about two weeks away from the start of probably a
record Brazilian soybean harvest, that and China canceling beans
took soybeans down," said Art Liming, futures specialist for
Citigroup.
    Private exporters reported the cancellation of 315,000
tonnes of soybeans sold to China for delivery this marketing
year, the U.S. Department of Agriculture said. 
    Chicago Board Of Trade March soybeans were down 5-3/4
cents per bushel at $13.86-1/2, March wheat was up 1/4 at
$7.55-1/2 and March corn was down 1-1/2 at $6.89-1/4.
    In soft commodities, raw sugar futures on ICE Futures U.S.
fell more than 3 percent and arabica coffee turned lower after
hitting a seven-week high as commodities came under pressure
with the dollar rising on concerns about looming U.S. political
battles over the budget.
    March raw sugar futures on ICE dropped 3.2 percent to
finish at 19.06 cents per lb, having earlier dropped 4.1 percent
to a session low of 18.89 cents.
    
 Prices at 3:59 p.m. EST (2059 GMT)                        
 
                              LAST      NET    PCT     
                                        CHG    CHG     
 US crude                    92.67    -0.45  -0.5%   
 Brent crude                111.80    -0.67  -0.6%    
 Natural gas                 3.190   -0.044  -1.4%    
 
 US gold                   1664.30   -24.50  -1.5%    
 Gold                      1663.39   -22.96  -1.4%    
 US Copper                  369.15    -4.45  -1.2%    
 LME Copper                8163.85   -45.15  -0.6%    
 Dollar                     80.435    0.590   0.7%    
 
 US corn                    688.25    -2.50  -0.4%    
 US soybeans               1403.25    -2.50  -0.2%   
 US wheat                   756.00     0.75   0.1%   
 
 US Coffee                  145.85    -3.55  -2.4%  
 US Cocoa                  2264.00     5.00   0.2%    
 US Sugar                    19.06    -0.63  -3.2%  
 
 US silver                  30.145   -0.862  -2.8%    
 US platinum               1576.70    11.60   0.7%   
 US palladium               692.05   -15.90  -2.3%
A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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