(Recasts with rally in coffee; updates with settlements in CRB,
gold and cocoa)
By Barani Krishnan
NEW YORK, Jan 3 Gold rose to two-week highs on
Friday and coffee and cocoa also rallied while many other
commodities fell after a snowstorm slammed the U.S. northeast,
keeping traders from their desks and thinning market volumes.
A firmer dollar also weakened demand for commodities
priced in the U.S. currency from holders of the euro.
U.S. stocks pared gains while bond prices remained modestly
higher after Federal Reserve Chairman Ben Bernanke expressed
cautious optimism about the economy, saying the central bank
will stick to a stimulative policy even as it buys fewer bonds.
The 19-commodity Thomson Reuters/Core Commodity CRB index
settled down 0.3 percent after a heavy snowstorm and
dangerously low temperatures hit the northeastern United States,
delaying flights, paralysing road travel and closing schools and
For the week, the CRB fell 2.7 percent, its worst weekly
slide in two months, after factoring in losses in three of the
past four trading sessions.
"The outlook for commodities isn't all that great in 2014,
and with the confluence of the snowstorm and back-to-back
holidays, it isn't surprising that we're seeing a slow trot into
the new year," said Adam Sarhan, president at Sarhan Capital, a
New York-based financial advisory.
Gold rose to a two-week high as the precious metal saw fresh
buying after hitting a six-month low earlier this week. Weaker
global demand for equities since the start of the year also
helped bullion recapture some its faded allure as a safe-haven
The spot price of bullion was up 1 percent at above
$1,236 an ounce after hitting $1,238.70 earlier - its highest
since Dec. 18. For the week, it rose 2 percent.
Gold has been on the rebound since losing nearly 30 percent
in 2013, ending a 12-year bull run, largely due to Fed's move to
unwind its long-running monetary stimulus.
Analysts, however, cautioned that it was too early in the
year to say if bullion would sustain its nascent recovery.
"We need to make a solid move back above the $1,270 area to
really rattle the cage," said Ole Hansen, head of commodity
strategy at Saxo Bank. "That would take us above the recent
highs and would signal a break of this downtrend that we've had
Arabica coffee surged more than percent, its sharpest
one-day gain in nearly four months, as speculators covered their
New York-traded arabica for March delivery closed up
4.95 cents, or 4.4 percent, to close at $1.1635 per pound.
London-traded robusta coffee also rallied, with the March
contract rising $30, or 1.9 percent, to end at
$1,644 a tonne.
Cocoa futures rebounded from seven-week lows in the previous
New York's March cocoa rose 2.4 percent to $2,699 a
London's March cocoa was also up 2.4 percent, at
1,717 pounds a tonne.
Fundamentally, the outlook for cocoa had improved with
many traders predicting a sharp tail-off in cocoa arrivals at
ports in top growing country Ivory Coast in the coming weeks
because of drier than normal weather.
Prices at 3:57 p.m. EST (2057 GMT)
LAST/ NET PCT YTD
CLOSE CHG CHG CHG
US crude 94.20 -1.24 -1.3% 2.6%
Brent crude 106.96 -0.82 -0.8% -3.7%
Natural gas 4.304 -0.017 -0.4% 28.4%
US gold 1238.60 13.40 1.1% -26.1%
Gold 1237.21 12.70 1.0% -26.1%
US Copper 3.36 -0.03 -0.8% -8.1%
LME Copper 7315.00 -78.00 -1.1% -7.8%
Dollar 80.883 0.253 0.3% 5.4%
CRB 276.530 -0.878 -0.3% -6.3%
US corn 423.50 3.50 0.8% -39.3%
US soybeans 1289.25 2.25 0.2% -9.1%
US wheat 605.75 8.75 1.5% -22.1%
US Coffee 116.35 4.95 4.4% -19.1%
US Cocoa 2699.00 63.00 2.4% 20.7%
US Sugar 16.08 -0.21 -1.3% -17.6%
US silver 20.211 20.010 1.6% -33.1%
US platinum 1411.50 9.60 0.0% -8.3%
US palladium 731.20 0.95 0.1% 4.0%
(Editing by Grant McCool and Diane Craft)