Open: New York Session | Forex, Metals, Oil, Agriculture August 06, 2020



Global wheat production in the 2019/20 season was approximately 764 MMT, thus in the 2020/21 season, wheat production is projected to be slightly higher than last season’s figure. Wheat production in the (EU-27+U.K) 2020/21 season is forecast at approximately 139.5 million tons, a 10% decrease compared to last season’s figure, which was approximately 154.9 million tons. Wheat production in France is forecast at 31.1 million tons, a drop from last season’s production estimates, which were approximately 39.55 million tons.
Wheat production in North Dakota, which accounts for 50% of spring wheat in the U.S., is revised lower by 4 bushels per acre year over year. The decrease in winter wheat production m/m is mainly attributed to a reduction in harvested areas from 24.3 million acres to 23.4 million acres. Wheat production in the 2020/21 season is projected to remain high, despite the downward revisions in production from major producing countries.
In the 2020/21 season, wheat production in the U.S was forecast at 1,866 million bushels, according to data released by the USDA. Wheat prices were volatile for most of last year, as the highest recorded price was slightly above $5.5 per bushel and the lowest price was $4.1 per bushel. Winter wheat production is forecast at 1.217 billion bushels, a 3% decrease year over year. Despite the downward revision in production forecasts, global wheat production is projected to be a record high.


The Australian dollar powered to marginal news highs for the year as the move against the US dollar continued yesterday. Like gold, silver has benefited from a massive increase in monetary demand, mainly driven by a decline in the dollar and US real rates. MARKETS TODAY OIL: Oil prices slipped just below five-month highs, with support from a weak dollar and falling U.S. crude inventories undermined by bearish sentiment about fuel demand. Since May, the euro has gained almost 10% vis-à-vis the US dollar and is at the highest level in more than two years.
Gold prices rose boosted by its safe-haven allure, while the dollar index was little changed. Gold prices rose boosted by its safe-haven allure, while the U.S. dollar index was little changed. Gene comments on stock, bond, dollar, oil & gold markets, with a particular emphasis on monetary policy, technology issues and S&P intraday action. Gold Meanwhile, gold continues to rise as the dollar continues to sink.
The pair now eye 1.3200 and potentially higher although the move will be also based on how the currently weak US dollar behaves after Friday’s US Labor Report. FOREX: The dollar gained as appetite for risk dwindled in London, as markets waited for U.S. jobs data and updates about fiscal aid negotiations in Washington.


Also, the significant increase in the gold:silver ratio in Q1 (reflecting investor preference for gold over silver) made silver prices extremely cheap judging by historical standards. Source: own processing, using data of Royal Gold Although gold sales declined, the improved gold prices were able to prevent the revenues from a more meaningful decline. In Q4, Royal Gold’s gold equivalent sales amounted to 70,100 toz of gold equivalent. The silver and copper prices declined, but it didn’t have a major impact, as around 75% of Royal Gold’s sales are usually attributable to gold.
Since the silver market is much smaller than the gold market, the impact of investment demand on silver prices is relatively much stronger. In fact, silver has historically outperformed gold in a gold bull market. Although silver’s demand is relatively more exposed to the industrial cycle than gold’s demand, silver possesses safe-haven characteristics, which have boosted significantly its investment demand in recent months.
In 2002 when gold was $300 per ounce, MAM recommended to its investors to put 50% of their investment assets into physical gold stored outside the banking system.
However, if the gold price continues to grow, Royal Gold’s share price will most probably follow. Right now, as the gold price stands above $2,000/toz, Royal Gold’s share price stands above $145.


Shares in oil and gas companies slid this year as oil prices crashed, but they underperformed other sectors for a decade even before the Covid-19 pandemic destroyed oil demand. Canada’s biggest oil producer said average prices for its natural gas, a byproduct of crude production, rose 2.5% to C$2.03 per barrel in the reported quarter. To summarize, we anticipate crude oil to enter a long-term consolidation phase as the self-correction in supply/demand continues in the oil market.
Crude oil inventories fell 7.4 million bbl in the week to Jul 31st. According to the American Petroleum Institute (API) on Tuesday, crude oil inventories dropped by 8.6 million barrels, which was significantly more than analysts’ expectations. US crude oil stocks fell sharply, supported by refining rates that hit their highest since March according to data by the US EIA. The draw in crude oil inventories and build in refined product inventories were higher than forecasted.
The oil and gas sector is unable to earn its dividends from earnings right now, based on low energy prices. Average realized prices for crude and natural gas liquids, however, plunged over 70% to C$18.97 per barrel in the second quarter, before risk management. We do not expect this time to be any different, with OPEC+ set to roll back production cuts following the stabilization of oil prices.

United States

The social media giant on Wednesday took down a post by U.S. President Donald Trump, which the company said violated its rules against sharing misinformation about the coronavirus. Time out | Twitter and Facebook blocked a video shared by accounts linked to Trump for violating their policies on coronavirus misinformation. Twitter Inc. and Facebook Inc. blocked a video shared by accounts linked to President Trump for violating their policies on coronavirus misinformation.
Three US social media sites censured president Donald Trump’s claims that children were “virtually immune” to Covid-19, with Facebook calling the president’s post “harmful Covid misinformation”. By the Way Twitter and Facebook blocked a video shared by accounts linked to Donald Trump for violating their policies on virus misinformation. The posts were a video clip from a Fox News interview with President Trump about reopening schools, in which he claims children are “almost immune” to COVID-19.
The post contained a video clip, from an interview with Fox & Friends earlier in the day, in which Trump claimed that children are “almost immune” to COVID-19. The US Small Business Administration (SBA) said on Monday that the billionaire rapper’s Yeezy brand had been cleared to receive $5 million (£4m) under the government’s small-business loan program. The greenback trades lower amid concerns that rising coronavirus cases will result in the US economic recovery lagging behind other countries.
Nonetheless, the stock markets are moving more or less based upon Federal Reserve liquidity, as the central bank continues to bail out Wall Street every time it drops.


Beijing exempted foreign banks from extending loan relief to SMEs, people familiar said. The sales come amid rising political tensions between Washington and Beijing. TikTok, which is not available in China, has tried to put distance between it and Beijing, where the app’s owners, ByteDance, are located.


During this period the UK still remains in the EU’s customs union and single market and must comply with all EU rules. Just think of the ongoing trade conflicts, Brexit uncertainty and dramatic loss of external demand due to the COVID-19 crisis, which has put pressure on supply chains. The transition period is necessary to allow EU and UK negotiators time to agree on what the future relationship will look like. The EU wants to show life is better inside the ‘bloc’ and that countries cannot ‘cherry-pick’ certain benefits without the obligations.
With Beirut s repair bill expected to run into billions of dollars, Lebanese are waiting to see if Macron s visit will bring any relief. By now, I have built up excellent skills and experience in analyzing macroeconomic and political developments in Europe, the Eurozone and Germany, including ECB watching. The reduction in global production figures is mainly attributed to a decrease in production from the U.S., Russia, and the EU.
Needless to say, neither Mayor Michael Mueller nor members of Angela Merkel s cabinet were impressed by this show of defiance. less The United Kingdom (UK) left the European Union (EU) on 31 January 2020. Should eurozone policymakers, and should the ECB worry?