Close: London Session | Forex, Metals, Oil, Agriculture July 30, 2020

Agriculture

Output has been declining since a record 7.7 mln bags were produced in 2016/17, mainly due to poor global coffee prices. but the drop is by no means sufficient to put the market on a better footing. Fundamentally, coffee production has been in reverse gear in 2019/20 but the drop is by no means sufficient to put the market on a better footing. In fact, coffee production in 2019/20 is not only the highest ever in a Brazilian off-year but also the second-highest ever after the record 2018/19 harvest.
Access the latest vessel line-up information for Argentina and Brazil agriculture commodities imports and exports and China soybean imports, and to see the latest updates for Egypt wheat and soybean imports, Saudi Arabia wheat and corn imports, and Malaysia palm oil. Global coffee supplies are still expected to be plentiful this season, despite a drop in production in 2019/20. But a message is being sent to the most recalcitrant parts of Europe: wake up and smell the coffee – or brew your own.
Honduras harvested only about 6.6 mln bags of coffee in 2019/20, down from 7.2 mln a year ago. Farmers are no longer moving from coffee to pepper as black pepper prices have been falling continuously over the past five years. One of London’s best steaks is now just 10.If you’re in the business of selling coffee or beer, the pandemic is providing something of a boom, but it’s a different story for European manufacturers in the aviation and auto sectors.

Currencies

A recovery of the Brazilian real to about BRL5.15 per US dollar from levels close to BRL6 hit in mid-May did not help to support prices, indicating how bearish the market sentiment is in the short term. less As we come into Thursday, we’re looking at a market that’s seen a whole lot of Dollar weakness and we believe the Buck has been hit a little too hard and fast at this point, with the door opening up for a healthy rebound. It’s a testimony to dollar weakness how modest was the response to these comments but they may not be best totally ignored.
The Fed had extended all its lending programs earlier in the week, and on Wednesday it extended its emergency swap lines and repurchase facilities with foreign central banks to maintain worldwide dollar liquidity during the pandemic and to keep authorities from having to sell Treasuries in the open market to get dollars. By Investing.com – Jul 30, 2020 140 The dollar initially advanced as the bank reiterated its commitment to using all its tools, but fell short of hinting at specific measures.
They also benefit when the dollar is weaker and lumber prices go higher. But in the past couple of weeks, coinciding nicely with a massive rally in the precious metals, there’s been a deluge of talk about the end of the dollar. But it’s not easy to dismiss it when all of a sudden Schiff is everywhere, taking the bait to be the guy who will tell everyone that the dollar is going to fail because, you know, money printing.
It may gall him and other Austrians that the dollar can still be so thoroughly debased and still make up 62% of total foreign exchange reserves the world over or still dominate global trade (latest SWIFT Data).

Metals

Investors last week had already pushed gold prices past the record last set in August 2011. Gold bugs will be celebrating the new highs for gold by popping champagne bottles and letting the bubbly flow. Traders have been drunk on moves in stocks, gold, silver, and to a lesser extent oil, but after weeks of celebrating, it appears the trade wants to chill out. Of course holding physical gold carries with it various problems, like insuring the gold and having a place where it can be stored.
In recent days, gold prices have hit record highs. It was widely feared at the time that the gold price was poised to break down below $1,000.
Since then, however, courageous contrarians have been rewarded by the gold price rising 75% and 6:52 am ET Real interest rates are back on investors’ minds with the collapse in yields on inflation-protected securities helping raise gold prices to fresh records in recent days. This is also reflected in the valuation: mark-to-market adjustments made by Russian investment firm Aton indicate that at the gold price of $1,930/ounce, Polymetal is trading at a discount of 7% relative to its 1-year average EV/EBITDA multiple of 7.6 (currently 7.1).
All that can safely be said is that the price will be ramped up until it starts falling, and then the cycle repeats.

Oil

Shell and Total opened Big Oil earnings with surprise profits on trading gains from buying and selling oil. For a company like Parsley Energy whose production mix is heavily tilted towards crude oil, the large decline in realized oil prices will considerably hurt the company’s earnings. I also expect Parsley Energy to report a double-digit drop in oil production from 126,600 bpd of oil produced in the first quarter. As oil prices rise to $40/bbl, Parsley Energy’s future output might stabilize and it could generate strong levels of free cash flows.
In this backdrop, the shale oil drillers, who usually sell their crude at a slight discount against the benchmark, are expected to realize low levels of oil prices. The improvement in oil prices to $40 a barrel has put Parsley Energy in a good position to stabilize production, grow earnings, and post strong levels of free cash flows in the future. It restored most of the production in June as oil prices improved to $30s a barrel but said that it would work with just 4-5 rigs and 1-2 crews.
Instead, the spending might follow the company’s drilling activity, bottoming in the second quarter as the company took a frac holiday and idled rigs and gradually climbing in the second half of the year as the company ramps up drilling following improvement in oil prices to $40s a barrel range. Parsley Energy’s outlook is looking better now as the improvement in oil prices to $40s a barrel range will push the company’s earnings higher.
It will likely realize low levels of oil prices of $20s a barrel for the second quarter but might report an increase in the third quarter which will give a boost to earnings.

United States

A police officer gestures during a Black Lives Matter event near the BOK Centre in Tulsa, Oklahoma ahead of a campaign rally by Donald Trump AP Trump supporters take their seats in the BOK Centre in Tulsa, Oklahoma ahead of a campaign rally by the president. A protester shouts at Donald Trump supporters outside a rally in Tulsa, Oklahoma REUTERS Eric Trump, Donald Trump’s second son, in the BOK Centre in Tulsa, Oklahoma ahead of a campaign rally A protester shouts at Donald Trump supporters outside a rally in Tulsa, Oklahoma REUTERS Eric Trump, Donald Trump’s second son, in the BOK Centre in Tulsa, Oklahoma ahead of a campaign rally
Many people in the crowd were choosing not to wear face masks despite medical recommendations during the coronavirus pandemic AP Merchandise vendors wearing face masks at the BOK Centre in Tulsa, Oklahoma ahead of a Donald Trump rally Getty Trump supporter Scott Hilliard, left, argues with Black Lives Matter protester Eugene Smith near the BOK Centre in Tulsa, Oklahoma ahead of a campaign rally by the president AP A Trump supporter and a Black Lives Matter protester face off in Tulsa, Oklahoma ahead of a campaign rally by Donald Trump AFP via
Many people in the crowd were choosing not to wear face masks despite medical recommendations during the coronavirus pandemic AP Merchandise vendors wearing face masks at the BOK Centre in Tulsa, Oklahoma ahead of a Donald Trump rally Getty Trump supporter Scott Hilliard, left, argues with Black Lives Matter protester Eugene Smith near the BOK Centre in Tulsa, Oklahoma ahead of a campaign rally by the president AP A Trump supporter and a Black Lives Matter protester face off in Tulsa, Oklahoma ahead of a campaign rally by Donald Trump AFP via
Former Vice President Joe Biden, the presumptive Democratic presidential nominee, slammed Mr Trump for, if the Times’ latest reporting is true doing “worse than nothing” while knowing about the operation for months.
as, in the words of US President Trump, they won’t be taken for a “sucker” any longer. The Supreme Court ruled in January that the Trump administration could move forward with the plan, but that was before the pandemic.
> UK Politics Close Former prime minister got nervous and flustered during ‘humiliating’ conversations with US president, Carl Bernstein investigation reveals Donald Trump repeatedly tried to demean Theresa May when she was UK prime minister during a series of “humiliating and bullying” conversations, according to a US report. A woman speaks to police officers during a protest against racial injustice outside a Donald Trump rally in Tulsa, Oklahoma REUTERS Brad Parscale, Donald Trump’s campaign manager, in Tulsa, Oklahoma ahead of the president’s first rally in three months

China

After Hong Kong | Fears are growing that China’s President Xi Jinping wants to cement his place alongside Mao and Deng by recapture authority over Taiwan, a prize that s eluded Communist Party leaders for decades. Hong Kong, newly tamed under President Xi Jinping s national security law, is only the latest place to test Beijing s patience. In an online press conference for British media Liu Xiaoming, acknowledged that the disagreements over human rights abuses in Xinjiang, tech giant Huawei, and Hong Kong had “seriously poisoned the atmosphere”.
> UK Politics China’s ambassador to Britain has warned that “Cold War warriors” want to damage relations between Beijing and Britain and spark a new conflict. Of the domestic cases, 96 were recorded in Xinjiang, the far-flung western province occupied by China’s Muslim Uiyghers, a minority ethnic group that has been subjected to unimaginable brutality by the government in Beijing, which has herded more than a million of them into concentration-camp-like settings.
Since the days of Mao Zedong, China s leaders have bolstered their legitimacy by reclaiming and subsequently subduing rebellious parts of the country s far-flung corners most notably the huge territories of Tibet and Xinjiang.
Beijing’s ambassador, who spoke for around an hour in an address punctuated with propaganda videos, rejected claims of abuse against Uighur Muslims, describing claims by human rights groups as “the lies of the century”. Beijing has also grown increasingly angry at U.S. arms sales to the island. News > UK

Europe

PA PA JD Wetherspoon Chairman Tim Martin speaks as people wave flags Reuters Getty Brexit supporters wave Union flags as they watch the big screen AFP via Getty Brexit Party leader, Nigel Farage arrives Reuters Brexit supporters gather AP Ann Widdecombe speaks to pro-Brexit supporters PA Brexit supporters wave Union flags as they watch the big screen AFP via Getty AFP via Getty People PA PA JD Wetherspoon Chairman Tim Martin speaks as people wave flags Reuters Getty Brexit supporters wave Union flags as they watch the big screen AFP via Getty Brexit Party leader, Nigel Farage arrives Reuters Brexit supporters gather AP Ann Widdecombe speaks to pro-Brexit supporters PA Brexit supporters wave Union flags as they watch the big screen AFP via Getty AFP via Getty People
Reuters A pro-Brexit supporter jumps on an EU flag PA Getty AFP via Getty PA Getty AP Getty Reuters A pro-Brexit supporter jumps on an EU flag PA Getty AFP via Getty PA Getty AP Getty
PA Shoppers observe a minute’s silence in Tescos in Shoreham Getty Firefighters outside Godstone fire station PA Getty PA Hospital workers take part in a protest calling on the British government to provide PPE across Britain for all workers in care, the NHS and other vital public services after a nationwide minute’s silence at University College Hospital in London AP A man waves Union flags from a small car as he drives past Brexit supporters gathering AFP via Getty A pro-Brexit supporter pours beer onto an EU flag PA Getty An EU flag lies trampled in the mud Getty Getty PA PA Getty Getty PA AFP via Getty Pro-Brexit supporters celebrating in Parliament Square, after the UK left the European Union on 31 January.
A man waves Union flags from a small car as he drives past Brexit supporters gathering AFP via Getty A pro-Brexit supporter pours beer onto an EU flag PA Getty An EU flag lies trampled in the mud Getty Getty PA PA Getty Getty PA AFP via Getty Ending 47 years of membership PA Big Ben, shows the hands at eleven o’clock at night AFP via Getty Pro Brexit supporters attend the Brexit Day Celebration Party hosted by Leave Means
Ending 47 years of membership PA Big Ben, shows the hands at eleven o’clock at night AFP via Getty Pro Brexit supporters attend the Brexit Day Celebration Party hosted by Leave Means Leave Getty Brexit Party leader Nigel Farage smiles on stage

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