COMMODITIES-Gasoline surges on US refinery news; sugar up too

Mon Jan 28, 2013 5:11pm EST

* Gasoline at 3-month high on news Hess refinery to close
    * Sugar reaches two-week high on short-covering
    * Copper edges higher on better US durable goods data
    * Gold little changed as investors await Fed meeting
    * Coming up: Jan U.S. consumer confidence data on Tuesday

    By Barani Krishnan
    NEW YORK, Jan 28 (Reuters) - Gasoline hit a near 3-month
high on Monday following news that an oil refinery in the U.S.
Northeast region will close, while sugar rose to a 2-week top as
some speculators with bearish positions on the sweetener bought
them back.
    Copper  advanced as better-than-expected U.S.
durable goods data lifted confidence about growth and demand in
the world's largest economy, although uneasiness about growth in
production of the metal kept prices in check. 
    In precious metals, gold  was a touch lower as
investors took to the sidelines ahead of a U.S. Federal Reserve
meeting later in the week. They hope the central bank will
provide more details on its monetary easing policy that could
lend direction to the safe-haven metal. 
    "Surveying the commodity landscape in general, it seems to
us that a number of safe haven refuges, including gold, the
Japanese yen, US Treasury bond, and the Swiss Franc, have all
been under pressure lately, as investors become more comfortable
parking their capital in riskier asset classes like the Euro and
equity markets," Edward Meir, analyst at INTL FC Stone, wrote in
a commentary on metals.
    A slew of U.S. economic data due this week, including a
reading on consumer confidence for January on Tuesday, could
help direction, Meir said.
    Grains markets   gained slightly on
worries that dry weather will trim output in Argentina, the
world's top exporter of soy products and second-largest producer
of corn. 
    The Thomson Reuters-Jefferies CRB Index, a global
indicator for commodities, settled up 0.3 percent after 16 of
the 19 markets it tracks settled in positive territory.
    Gasoline and sugar were among the CRB's biggest gainers for
the session, rising about 2 percent each.
    
    GASOLINE IN 8-DAY LONG RALLY
    Gasoline prices have rallied without a stop for nearly two
weeks due to concerns about tighter a supply due to refinery
maintenance work. Demand ahead of the U.S. summer driving period
has added to the market's strength.
    On Tuesday, the front-month gasoline contract in New York
 settled at $2.9348 a gallon, after gaining 8 percent
over the past eight sessions. Oil prices also rose, with
benchmark Brent crude finishing 20 cents up at $113.48 a
barrel.
    The latest run-up came after Hess Corp said it will
shut a New Jersey refinery by end of February as part of plans
to sell its oil storage terminal network and exit the oil
refining business. The planned closure of the 70,000
barrel-per-day refinery in Port Reading raised concerns about
dwindling fuel supplies on the U.S. East Coast. 
    Stocks of gasoline on the East Coast are already trailing
last year's levels by 10 percent, due to a spate of refinery
closures that cut capacity in the region as well in the
Caribbean and Europe - major exporters to New York Harbor - as
well as supply problems caused by Hurricane Sandy.
    "The market is pricing in concern about the supply of
gasoline this summer and the news about Hess is supporting
this," said Stephen Schork, founder and editor of The Schork
Report in Philadelphia. 
    
    SUGAR UP IN HEFTY VOLUME
    Raw sugar futures in New York vaulted higher on hefty volume
on speculative short-covering, after the large short position in
the market had prompted some to unwind their bearish positions.
    Speculators increased their net short position in sugar to
the biggest in seven years on ICE Futures U.S. in the volatile
week to Jan. 22, U.S. Commodity Futures Trading Commission data
showed on Friday. 
    "The record short on ICE has helped the market move
forward," said James Kirkup, director of sugar brokerage at ABN
AMRO Markets. 
    The most-active March raw sugar contract on ICE 
settled up 0.35 cent at 18.73 cents a lb, paring earlier gains
after reaching 18.96 cents, its highest level since Jan. 14.
    Volume was nearly 70 percent above the 30-day norm,
preliminary Thomson Reuters data showed.
    "Potentially there's more to be done," said Michael
McDougall, a vice president at Newedge USA, referring to the
expectation for more short-covering. 
    
 Prices at 4:25 p.m. EST (2125 GMT)      
                             LAST/      NET    PCT     YTD
                             CLOSE      CHG    CHG     CHG
 US crude                    96.55     0.67   0.7%    5.2%
 Brent crude                113.49     0.21   0.2%    2.1%
 Natural gas                 3.289   -0.155  -4.5%   -1.9%
 
 US gold                   1652.90    -3.70  -0.2%   -1.4%
 Gold                      1655.38    -3.11  -0.2%   -1.1%
 US Copper                  366.15     0.95   0.3%    0.2%
 LME Copper                8050.00    20.00   0.2%    1.5%
 Dollar                     79.804    0.056   0.1%    4.0%
                              
 
 US corn                    729.25     8.50   1.2%    4.4%
 US soybeans               1447.75     6.75   0.5%    2.0%
 US wheat                   779.25     2.75   0.4%    0.2%
 
 US Coffee                  149.00     0.70   0.5%    3.6%
 US Cocoa                  2161.00   -12.00  -0.6%   -3.4%
 US Sugar                    18.73     0.35   1.9%   -4.0%
 
 US silver                  30.780   -0.426  -1.4%    1.8%
 US platinum               1661.20   -32.70  -1.9%    8.0%
 US palladium               740.55    -0.45  -0.1%    5.3%
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