Commodity Price Barometer: May 2013
- By: Natalie Staffurth
Posted in: Blog, Commodities
The Greenfields Research Commodity Price Barometer gives an somewhat rainy and stormy view of commodities this month. The vast majority of commodities dipped in price during April, the only exceptions being bismuth, cobalt, molybdenum and gallium, and even these all remain below their five-year averages. Even when excluding the rare earths, there are more “rainy” and “stormy” commodities than “dry” and “fair”, showing that the market has at least temporarily come of its recent Chinese induced historical highs. Whether this heeds an end to the “supercycle” and a return to long term historical norms, or is just a temporary blip is now a big question across the industry.
The Greenfields Research Commodity Price Barometer ranks commodity prices on a barometer style rating of stormy (low) through rain, change (medium) and fair to dry (high) comparing current spot prices to five-year prevailing averages. Again, like a barometer, commodity prices are further divided into those rising and falling from their previous month’s position.
Iron ore, palladium and tantalum remain at recent historical highs although all have seen a reverse in trend of the rising prices of last month. Silver is the big faller moving from “dry” to “changeable” in just one month. Tin followed on a similar trajectory. This means that the “dry and rising” category is empty of any commodities, as is the “fair and rising” category. Gold continues its run in the “fair but falling” group and, after a promising performance over the last two months, is joined by tungsten which has seen a recent dip in prices.
Antimony continues its downward trend and has now fallen into the “changeable” category, where there are an increasing number of commodities. The “changeable and falling” group is by far the largest group in the barometer, containing copper, indium, lead, platinum, silver and tin as well as a sole rare earths metal dysprosium.
Bucking the trend is bismuth, which continues it stay in the “changeable but rising” class, as well as cobalt, molybdenum and gallium which have changed from being “stormy and falling” last month to “stormy but rising” commodities. Conversely “stormy” rhodium has switched from “rising” to “falling” this month, joining the lower value rare earths – cerium, lanthanum, samarium, yttrium and now neodymium – as the worst performing commodities.
The high-value rare earths, europium and terbium; and the mid-value rare earths, gadolinium and praseodymium, are in the “rainy and falling” category, although gadolinium has in fact shown no change in average monthly price since the beginning of the year. They are joined in this group by base metals nickel and zinc, after a brief respite last month, uranium.
Overall, when excluding the rare earths (which generally perform in a similar manner) there are now more “rainy” and “stormy” commodities than “dry” and “fair”, showing that there has been a widespread reversal in the broader commodities market. Unsurprisingly there are only four “rising” commodities out of a total of 20 included in the barometer (excluding the rare earths) indicating an unsettled market in the short term, the whether this is a temporary blip or a structural change is unclear.
As ever if you feel there are any interesting “mineable” commodities missing from the barometer, please let us know and we’ll see if they can be added.
Dry (and rising) +25% above 5 year average with month-on-month increase
Dry (but falling) +25% above 5 year average with month-on-month decrease
Fair (and rising) +10% above 5 year average with month-on-month increase
Fair (but falling) +10% above 5 year average with month-on-month decrease
Changeable (but rising) between -10% to +10% of the 5yr average with month-on-month increase
Changeable (and falling) between -10% to +10% of the 5yr average with month-on-month decrease
Rainy (but rising) -10% below 5 year average with month-on-month increase
Rainy (and falling) -10% below 5 year average with month-on-month decrease
- Gadolinium (no monthly change in price)
Stormy (but rising) -25% below 5 year average with month-on-month increase
Stormy (and falling) -25% below 5 year average with month-on-month decrease
Prices are April monthly averages compared to the five-year average (May2008-April 2013), except for uranium and iron ore where March 2013 monthly average prices are compared to the five-year average (April 2008-March 2013).
All commodity prices are from our friends at Metal Pages, except gold and silver which come from the London Bullion Market Association; and iron ore and uranium, which come from Index Mundi.
Product specifications are Antimony Regulus min 99.65% Grade II (EU); Bismuth min 99.99% (EU); Cobalt min 99.3% Russian (EU); LME Cash Copper; Gallium 99.99% CIF Main Airport (EU); LMBA Gold morning fixing; Indium min 99.99% (EU); China import Iron Ore Fines 62% FE spot (CFR Tianjin port); LME Cash Lead; Molybdenum Roasted Concentrates (Oxide) Mo 57% (EU) Mo; LME Cash Lead; Platinum 99.95% AM/PM fixes (EU); Palladium 99.95% AM/PM fixes (EU); Rhodium min 99.9% (EU); LMBA Silver Fixing; Tantalite basis 30% Ta2O5 (EU) Ta2O5; LME Cash Tin; Tungsten APT (EU); Index Mundi UxC Uranium U3O8 Swap Futures End of Day Settlement Price; LME cash zinc; Ce Oxide 99% min FOB China (CN); Dy Oxide 99% min FOB China (CN); Eu Oxide 99.9% min FOB China (CN); Gd Oxide 99% min FOB China (CN); La Oxide 99% min FOB China (CN); Nd Oxide 99% min FOB China (CN); Pr Oxide 99% min FOB China (CN); Sm Oxide 99% min FOB China (CN); Tb Oxide 99% min FOB China (CN); and Y Oxide 99.999% min FOB China (CN).