Commodity Prices – Translate Company Thu, 21 Oct 2021 14:54:20 +0000 en-US hourly 1 Commodity Prices – Translate Company 32 32 World Bank sees ‘significant’ inflation risk from high energy prices Thu, 21 Oct 2021 14:06:00 +0000 A participant stands near a World Bank logo during the 2018 annual meeting of the International Monetary Fund – World Bank in Nusa Dua, Bali, Indonesia, October 12, 2018. REUTERS / Johannes P. Christo

  • Crude oil prices will average $ 70 / barrel in 2021
  • Energy prices are expected to decline in the second half of 2022
  • Other price peaks possible in the short term

WASHINGTON, Oct.21 (Reuters) – Energy prices are expected to rise in 2022 after jumping more than 80% in 2021, fueling significant near-term risks to global inflation in many developing countries, said the World Bank in its latest Commodity Markets Outlook on Thursday.

The Multilateral Development Bank said energy prices are expected to start falling in the second half of 2022 as supply constraints ease, with non-energy prices such as agriculture and metals also set to fall afterwards. strong gains in 2021.

“Soaring energy prices pose significant near-term risks to global inflation and, if sustained, could also weigh on growth in energy-importing countries,” said Ayhan Kose, economist in Head and Director of the World Bank’s Prospects Group, which produces the Outlook Report.

“The sharp rise in commodity prices is proving more pronounced than expected. Recent price volatility could complicate policy choices as countries recover from last year’s global recession.”

The bank noted that prices for some commodities had reached or exceeded levels in 2021 not seen since peaking a decade earlier.

Prices for natural gas and coal, for example, have reached record highs amid supply constraints and rebounding demand for electricity, although they are expected to decline in 2022 as demand declines and as supply improves, the bank said.

He warned that further price spikes could occur in the near term given current low stocks and persistent supply bottlenecks. Other risk factors included extreme weather events, the uneven recovery of COVID-19 and the threat of new epidemics, as well as disruptions to the supply chain and environmental policies.

Rising food prices have also led to higher food price inflation and raised questions about food security in several developing countries, he said.

The bank forecast crude oil prices to hit $ 74 / bbl in 2022, supported by stronger demand from a projection of $ 70 / bbl in 2021, before falling to $ 65 / bbl in 2023.

The use of crude oil as a substitute for natural gas posed a major upside risk to the demand outlook, although rising energy prices could begin to weigh on global growth.

The bank predicts a 5% drop in metal prices in 2022 after rising 48% in 2021. It said farm prices are expected to decline slightly next year after jumping 22% this year.

He warned that changing weather patterns due to climate change also posed an increasing risk to energy markets, potentially affecting both demand and supply.

He said countries could benefit by speeding up the installation of renewable energy sources and reducing their dependence on fossil fuels.

Reporting by Andrea Shalal; edited by Diane Craft

Our Standards: Thomson Reuters Trust Principles.

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Australian Origin Energy expects to benefit from rising commodity prices Wed, 20 Oct 2021 01:26:38 +0000

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October 20 (Reuters)Australian electricity retailer and gas producer Origin Energy ORG.AX said on Wednesday that high commodity prices are expected to offset lower profits from its activity in energy markets.

Oil and natural gas prices have skyrocketed globally as activity recovers from lulls from the pandemic, causing disruption in energy-intensive sectors and soaring energy prices for consumers.

Origin’s comments at an annual general meeting came months after reporting a sharp drop in FY2022 profits for its energy markets business, which is suffering from a collapse in wholesale prices. electricity.

He said, however, that with oil prices over $ 80 a barrel, much higher than the figure on which he based his forecast in August, he expected to reap the benefits of higher prices. WHERE

Origin said FY2022 breakeven costs were expected to be between $ 20 and $ 25 per barrel, while it projected cash flow of over A $ 1 billion after hedging with Australian Pacific LNG (APLNG).

“With the price of oil significantly higher than the US $ 68 / bbl on which we based our forecast, today we reiterate the rise of a higher oil price,” Managing Director Frank Calabria said in a statement. speech.

The company left its baseline profit forecast for energy markets for fiscal 2022 unchanged between A $ 450 million and A $ 600 million.

The Sydney-based company said a decline in profits from its energy markets division should be more than offset by a strong performance from its APLNG business.

APLNG is one of the largest natural gas producers in Eastern Australia and is a joint venture between Origin, ConocoPhillips COP.N and Sinopec 600028.SS.

(Reporting by Harish Sridharan in Bengaluru, additional reporting by Nikhil Kurian Nainan; Editing by Subhranshu Sahu)


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Indian cenbank says longer political support needed for sustained economic recovery Mon, 18 Oct 2021 16:31:00 +0000 A worker walks past the Reserve Bank of India (RBI) logo in their office in New Delhi, India, July 8, 2019. REUTERS / Anushree Fadnavis / File Photo

NEW DELHI, October 18 (Reuters) – India’s central bank said on Monday that political support was needed longer for a lasting recovery of Asia’s third-largest economy after a coronavirus-induced slowdown, even as demand s ‘is straightened.

Earlier this month, the Reserve Bank of India’s (RBI) Monetary Policy Committee kept interest rates at record highs and reiterated the need to only lift pandemic-era stimulus measures gradually to help the nascent economic recovery.

“Premature tightening could lead to the stagflation that everyone fears, wiping out growth just as the economy recovers,” the RBI said in its monthly bulletin.

Perhaps the need of the hour is not to focus “so resolutely” on standardization but on supply-side reforms to alleviate bottlenecks, labor shortages and shortages. high commodity prices, especially crude oil, the central bank added.

India’s economy rebounded in the April-June quarter even as a devastating second wave of COVID-19 swept the country, growing over 20% year-over-year, driven by a sharp increase in manufacturing and higher consumer spending.

The central bank said global semiconductor shortages, high commodity prices and input costs, and potential volatility in global financial markets are downside risks to the domestic growth outlook.

The resurgence in edible oil prices in the recent period is also of concern, he said.

Reporting by Aftab Ahmed and Swati Bhat; edited by David Evans and Bill Berkrot

Our Standards: The Thomson Reuters Trust Principles.

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Price hikes should not hurt growth Sun, 17 Oct 2021 03:33:02 +0000


The recent surge in petroleum product prices and electricity tariffs is not expected to hurt economic growth in the current fiscal year, despite the fact that the price hike will immediately raise the inflation rate by about a percentage point.

“Strong inflows of workers’ remittances, growth in export earnings, a significant increase in wheat and sugar production, and rebound in cotton production will support the achievement of economic growth of nearly 5% in FY 22, ”Pak-Kuwait Investment Company (PKIC) Head of Research Samiullah Tariq said while speaking to The Express Tribune.

Previously, Pakistan’s central bank had forecast economic growth in the order of 4-5%, while Pakistan’s Tehreek-e-Insaf (PTI) government had set the growth target of 4.8% for the country. 2021-2022 fiscal year.

The country recorded a growth of 4% in the previous fiscal year 2020-21.

The expected increase in the inflation rate has reinforced the central bank’s arguments for a gradual increase in interest rates by 1 to 1.25 percentage points over the next year.

“The government and the central bank should continue to take measures to create a balance between the rate of inflation and economic growth …

Previously, the government had increased electricity tariffs by 1.39 rupees per unit to fulfill the International Monetary Fund (IMF) condition for the resumption of the $ 6 billion loan program.

It also passes on rising crude oil prices on the international market to local consumers. As a result, the price of gasoline shot up by Rs 10.49 to a record high of Rs 137.79 per liter.

Likewise, the price of high speed diesel and light diesel increased from Rs 12.44 and Rs 8.84 to Rs 134.48 per liter and Rs 108.35 per liter respectively.

“The sharp increase in petroleum product prices and electricity tariffs should immediately raise the inflation rate by 1 to 1.25 percentage points,” Tariq said.

Both experts said the massive rise in global commodity prices was unsustainable. Prices are expected to fall in a few months following an improvement in the supply chain for global raw materials and a drop in demand.

“The prices of petroleum products could fall in the second half (January-June) of the current fiscal year,” Tariq said.

“With the current fiscal year still in its first months (October being the fourth month), there are still eight months to balance the economy and meet the growth target.”

“If global commodity prices had remained stable over the past few months, Pakistan would easily have achieved economic growth of over 5%. “

The government has rightly passed on the increase in the price of petroleum products to consumers in order to avoid mismanagement of finances. “No one would have bailed out the country if the government had absorbed the price hike.”

Inflation would remain close and close to the upper limit of 9% of the central bank’s projection of 7-9% for the year “with a rationalization of world commodity prices in the coming months,” he said. he declares.

Abbas, however, expects annual inflation to slightly exceed the upper limit of 9% and reach 9.25% in FY22, as prices for LNG, coal, fertilizers and food products. (like wheat, sugar, and cooking oil) have also skyrocketed. in the world market. They contribute to imported inflation.

The soaring reading of inflation may have an impact on the purchasing power of people belonging to low and middle income groups. However, this would not hurt the demand for essential commodities in the economy.

The country would continue to import essential products, including energy and food. While cutting imports of luxury cars and non-essential items was already the responsibility of the government to calm the overheating economy, he said.

“The noticeable growth of the large-scale manufacturing (LSM) sector suggests that the country would succeed in achieving the set economic growth target of 4.8% (in FY 22),” he said. declared.

The government and the central bank take steps from time to time to control inflation and support growth. In this regard, they imposed regulatory duties on imports and demanded traders to prepay the import amount of 100%.

Reading inflation slightly higher, however, would support the central bank to implement its past idea of ​​gradually raising the benchmark interest rate over the next year.

Posted in The Express Tribune, October 17e, 2021.

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Rising demand is just a factor of inflation, supply chain problems Fri, 15 Oct 2021 16:07:00 +0000

By Dan Molinski

U.S. officials have blamed inflation and supply chain issues on surging demand amid an economic recovery, but data suggests that increased demand may not be a huge factor, and some Rather, analysts point the finger at labor shortages and extreme government spending.

As demand increases, data on oil consumption – a key indicator of aggregate demand – shows that the increase in demand was much larger in the second half of last year. This year has in fact seen a slow and seemingly manageable recovery in demand as the United States continues its rehabilitation a year after the economic collapse from March to June 2020.

White House Press Secretary Jen Psaki, who has been asked all week about why prices are rising so quickly, why some grocery store shelves are bare and why ships full of goods are anchored at sea, suggested these are signs of an improving economy now in recovery mode from the coronavirus.

“We are at this point because the unemployment rate has gone down and halved, because people are traveling and because demand is increasing and the economy is restarting,” said Jen Psaki, press officer. from the White House, later adding: “It was inevitable that there would be economic challenges as a result of the pandemic.”

But the United States took its biggest strides towards economic recovery more than a year ago. EIA data shows that U.S. oil and fuel consumption of 19.5 million barrels per day in the first quarter of 2020 collapsed to just 16.1 million barrels per day in the second quarter when the pandemic hit. hit. But 70% of that drop in demand was immediately recouped in the third quarter of 2020, when oil consumption fell back to 18.5 million, as many economically important states such as Texas and Florida reopened their economies and ignored Covid restrictions.

And since this big rebound in demand in the third quarter of 2020, the demand for oil in the United States has slowly and steadily recovered to reach 20.2 million barrels per day, according to the US government agency. These slow and stable trends are similar when looking at overall energy consumption which includes electricity consumption and natural gas consumption.

Yet the prices of commodities such as food and gasoline have seen their biggest increases in just the past two weeks, and annual consumer inflation has hit a 13-year high of 5.4% per month. last, according to data from Wednesday. According to AAA, the national average price of a gallon of regular gasoline hit a seven-year high of $ 3.31 per gallon today, an increase of almost 5% from just two weeks ago . The inordinate budget spending in Washington can be a big reason.

“Rising inflation has some common features such as supply chain issues and soaring commodity prices, but we also suspect that the US economy has been a bit too hot under these circumstances, and this created more of an inflation problem, “Steve Barrow told Standard Bank. “Although US growth is stronger than most of its peers, it has been ‘bought’ by massive fiscal stimulus. The government has so far spent over 25% of GDP on fiscal stimulus. direct; a figure well above almost any other country. In the euro area, for example, the eight largest countries spent a simple average of 9%. “

Barrow noted that the U.S. current account deficit has grown 84% since the pandemic, while the eurozone has actually seen its surplus increase by 39% over the same period. And he said stronger U.S. growth hasn’t pulled more workers into the job.

“Right now, employment in the United States is around 97% of its pre-Covid levels while the figure for the eurozone is closer to 99%,” Barrow said.

Write to Dan Molinski at

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]]> 0 Latest news headlines: Chinese factory door inflation hits 26-year high Thu, 14 Oct 2021 03:44:57 +0000

Singapore’s central bank will tighten monetary policy slightly after the country reported strong economic growth in the third quarter.

The Singapore Monetary Authority said it would “slightly increase” the slope of the band it uses to control exchange rates on Thursday.

The country also saw gross domestic product growth of 6.5% year-on-year in the third quarter of 2021. The economy grew 0.8% from the previous quarter, rebounding from the contraction of 1.4 % reported in July, the Commerce and Information Ministry said. Growth is in line with analysts’ expectations.

The ministry added that the economy had benefited from strong global demand for Singaporean semiconductors and electronics.

Meanwhile, the country’s central bank said the global economic recovery and domestic rebound from the second-quarter setback is creating cost pressures that will push inflation up to between 1% and 2% next year.

“Over the next few quarters, rising import and labor costs, as well as the pickup in domestic activity, will support a generalized pickup in inflation. Imported inflationary pressures are expected to persist for some time amid strengthening global demand and persistent supply constraints, “the bank said in a statement, adding that its latest adjustment” will ensure price stability over the medium term. “.

Unlike most monetary authorities, which focus on interest rates, Singapore controls prices by keeping the exchange rates between its currency and those of its major trading partners within a certain range, the extent of which it does not publicly disclose. fork.

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Nigeria’s commodities exchange poised to push food prices down Tue, 12 Oct 2021 16:40:35 +0000

… Deploys warehouses across the country

By Emma Ujah, Abuja office manager