By Barani Krishnan
NEW YORK, Feb 13 A benchmark index for global
commodities hit 10-1/2 month highs on Thursday, propelled as
natural gas rallied on crippling cold weather, wheat surged on
tight supplies and gold jumped on new jitters about the U.S.
Natural gas prices <0#NG:> jumped 8 percent while futures of
gasoline and heating oil rose half a percent as
yet another winter storm blanketed the U.S. East Coast, boosting
the demand outlook for heating fuel products.
U.S. government data also showed larger-than-normal
drawdowns in natural gas supply last week. Analysts said an
explosion on a major gas pipeline in southern Kentucky could
further strain a system already stretched by one of the coldest
winters in decades.
Soybean futures jumped nearly 2 percent, spurred by
technical buying and concerns that domestic stockpiles will
remain tight for the next year.
Gold rose 0.7 percent to a three-month high, as investors
bought the precious metal as a hedge against economic weakness
revealed in soft U.S. retail sales and job data.
The rally across the energy, agricultural and precious
metals markets drove the Thomson Reuters/Core Commodity Index
to a 10-1/2 month high.
The 19-commodity index was up half a percent by 2:00 p.m.
EST (1900 GMT), hitting its highest level since March 28, 2013.
In natural gas, the front-month contract on the New York
Mercantile Exchange settled up 40.1 cents, or 8.3
percent, at $5.223 per million British thermal units. The
session peak was $5.236 per mmBtu, a 1-week high.
"The weather's going to get warmer for sure," said Kyle
Cooper, managing director of research at Cypress Energy Capital
Management, a Houston-based hedge fund focused on natural gas.
"Unfortunately at this moment, we still have very cold
temperatures; unexpected events like the Kentucky pipeline blast
and a rather bullish draw report from last week."
In soybeans, the front-month March contract on the
Chicago Board of Trade gained 20 cents, or 1.5 percent, to
$13.43 a bushel. The peak for the day was $13.47-1/2, the
contract's highest since Sept. 12.
The U.S. Department of Agriculture forecast the domestic
soybean crop at 3.480 billion bushels for the 2014/15 crop year,
based on plantings of 78 million acres, with ending stocks
rising to just 203 million bushels. That compares with a crop of
2.289 billion bushels and ending stocks of 150 million bushels
in the 2013/14 marketing year.
By comparison, corn harvest for 2014/15 was seen at 14.260
billion bushels, with acreage forecast at 93.5 million and
ending stocks pegged at 2.607 billion. Corn production in the
2013/14 marketing year was 13.925 billion bushels with ending
stocks of 1.481 billion bushels.
"You have seen the beans be able to withstand the bearish
supply-demand report, Chinese cancellations, bearish weekly
export sales," said Mike Zuzolo, president of Global Commodity
Analytics. "I think the main reason is because they really
expect the new crop acres for beans will keep the supply side
very, very tight in relation to the corn."
The spot price of gold rose to $1,302.10 an ounce,
its highest since Nov. 8. It was last up 0.7 percent at
$1,300.01 an ounce by 11:25 a.m. EST (1625 GMT).
Investors turned to gold as a hedge after U.S. retail sales
fell unexpectedly in January. The number of Americans filing new
claims for unemployment benefits also rose last week, in the
latest signs of slowing economic growth.
Prices at 2:34 p.m. EST (1934 GMT)
LAST NET PCT
US crude 100.36 -0.01 0.0%
Brent crude 108.70 -0.09 -0.1%
Natural gas 5.197 0.375 7.8%
US gold 1300.90 5.90 0.5%
Gold 1300.49 9.92 0.8%
US Copper 3.25 -0.01 -0.2%
LME Copper 7141.75 -13.25 -0.2%
Dollar 80.333 -0.346 -0.4%
CRB 292.568 0.828 0.3%
US corn 440.25 0.50 0.1%
US soybeans 1342.25 19.25 1.5%
US wheat 595.00 8.00 1.4%
US Coffee 138.75 -2.30 -1.6%
US Cocoa 2910.00 -31.00 -1.1%
US Sugar 15.62 -0.19 -1.2%
US silver 20.435 0.001 0.5%
US platinum 1417.30 10.00 0.7%
US palladium 731.20 2.15 0.3%
(Editing by David Gregorio)