Open: New York Session | Forex, Metals, Oil, Agriculture October 29, 2020



Cocoa farming and trade are at the roots of the chocolate industry, and the consistent supply of cocoa plays a critical role in providing us with reasonably-priced chocolate. The chocolate industry relies on cocoa farming for supply of chocolate’s key ingredient. The above graphic maps the major trade flows of cocoa and allows us to dive deeper into its global supply chain. The consultancy said corn bid prices had risen to $236-$275 a tonne by Oct. 28 on a carriage-paid-to (CPT) basis.
Cocoa beans go through a number of stages before being used in chocolate products. MARKET NEWS U.S. soybean futures rose after earlier hitting a nine-day low as concerns about the economic impact of the COVID-19 pandemic loomed over prices. As a result, the equatorial regions of Africa, Central and South America, and Asia are optimal for cocoa farming. Based on how much cocoa comes from West Africa, it’s likely that most of the chocolates we eat have a little bit of Cote d’Ivoire and Ghana in them.
Growing cocoa has specific temperature, water, and humidity requirements. Yet, many cocoa farmers make less than .


Also, the dollar index hints at a possible appreciation in dollar, at least for intraday. As expected, the US dollar responded positively to the rise in VIX these last few days, which confirms our bullish view on the greenback in the near term. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.09 per cent to 93.49. The dollar index was slightly up, while gold prices were little changed as caution crept in ahead of the U.S. elections.
Gene comments on stock, bond, dollar, oil & gold markets, with a particular emphasis on monetary policy, technology issues and S&P intraday action. The US dollar and Japanese yen rallied hard in response to weak sentiment, while precious metals and oil fell sharply. The company said total spending decreased 10% on a constant dollar basis, and the number of processed transactions tumbled 13% from a year earlier. This comes despite a 4% increase in payment dollar volume and a 3% increase in processed transactions to approximately 37.4 billion.
Until then, the dollar bulls should be cautious.Trade strategyThe rupee, which has been declining gradually over the past few trading sessions, has breached the support of 74. Gold prices likewise fell as the dour mood drove liquidation, boosting the US Dollar and undermining the appeal of anti-fiat alternatives epitomized by the yellow metal.


Somasundaram PR, Managing Director (India), World Gold Council said gold demand in December quarter last year was 194 tonne. The increased gold production combined with a higher gold price led to record free-cash-flow, and 26% growth in revenue year-over-year. The strong increase in revenue growth was mostly attributed to the gold price, with Alamos’ average realized gold price improving from $1,448/oz to $1,882/oz. The miner, however, said it is on track to meet its 2021 production guidance and expects both gold and copper production to increase in the second quarter.
This decent quarter operationally has set the company up to meet its revised FY2020 production guidance of 420,000 gold ounces, with over 306,000 ounces produced year-to-date. (Source: Company Website) Finally, the company’s Mulatos Operations in Mexico had an outstanding quarter as well, with quarterly gold production of 41,100 ounces, up 26% year-over-year. We’ve finally begun the Q3 Earnings Season for the Gold Miners Index (GDX), and one of the first names to report its results is Alamos Gold (AGI).
Given the higher gold grades, Island maintained its industry-leading gold recovery rate of 97%.
He writes a daily letter, Ed Steer’s Gold and Silver Digest, and works closely with the Gold Anti-Trust Action Committee. From a throughput standpoint, Alamos processed 101,400~ tonnes at Island, down 1% year-over-year, but enjoyed grades that were 22% higher at 13.62 grams per tonne gold.


The oil and gas producer posted a quarterly loss in its third quarter, hammered by a steep decline in oil prices as pandemic-led travel restrictions crushed fuel demand. U.S. oil output reached around 13 million barrels per day in February before the coronavirus pandemic hit fuel demand. In line with plans to shrink its oil and gas portfolio, it said it would cut back its oil refineries from 14 sites to six “energy and chemical parks”. The Canadian oil and gas producer reported its third straight quarterly loss, hurt by a slump in crude prices and crash in fuel demand caused by the COVID-19 pandemic.
Furthermore, because of copious US shale oil supplies, the West and North African crude oil market continues to struggle with the ripple effects of the Atlantic basin being oversupplied. Still, the return of Libyan oil remains fragile even if production can reach half of its earlier level of one million barrels per day. Suncor said it produced 616,200 barrels of oil equivalent per day (boepd) in the quarter, down from 762,300 boepd in the year-ago quarter.
Cenovus said total quarterly production rose 5.2% to 471,799 barrels of oil equivalent per day (boepd). The latest data from the US Energy Information Administration shows US gasoline stocks rose by 1.9 million barrels, compared with an expected drop of nearly 2 million barrels. As a result, DLNG’s debt service payments are fixed until September 2024 at c. $17 million per quarter or $31,300 per day per annum on a vessel basis.

United States

In the US, the economic outlook is also clouded because prospects for a new fiscal stimulus package has been delayed, perhaps until next year. BEFORE THE BELL Wall Street futures were higher ahead of the U.S. third quarter GDP data and results from top technology companies later in the day. Wall Street futures were higher ahead of the U.S. third quarter GDP data and results from top technology companies later in the day. Looking at Merck’s (NYSE:MRK) response to strong earnings yesterday (big beat and raise) might be telling us President Trump’s prospects are better than suspected.
The global investment platform from Geojit presently offers investment options in the US stock market. A global upswell in Covid-19 cases has tarnished hopes for a lasting economic pickup even as political deadlock in the US has derailed scope for a near-term fiscal fillip. But the uncertainty around the US elections should not be overlooked, nor should the potential for a divided or gridlocked Congress, which may impede fiscal stimulus efforts.
“Going forward a clear outcome from the US election, clarity on stimulus package from the US, and the Indian government will guide the INR,” Bhatt said. New cases have soared past the peak levels since in summer, when many parts of the US were subject to strict lockdowns. Contracts linked to Nasdaq-100 climbed almost 1%, indicating that technology stocks will also climb after the New York opening bell.


What could replace it?Virus Update | Macron imposed a new national lockdown until Dec.1, though unlike in the spring, schools and factories will remain open. The big question is whether the new national lockdown announcements will prompt the ECB to take pre-emptive action today. But with German Chancellor Angela Merkel and French President Emmanuel Macron the latest European leaders to announce stringent new restrictions, the risks from holding fire are rising.
ET, followed by a press conference with President Christine Lagarde that will present new staff forecasts, as well as the latest commentary on inflation.
The market is expecting more stimulus to arrive from the ECB in December; however, the central bank might start to act earlier than expected. Merkel imposed a one-month partial shutdown starting Monday, the toughest restrictions since the end of a lockdown in the spring. She may also opt to lay the groundwork for more action in December when the ECB publishes new forecasts. With regard to market pricing, ECB €STR swaps imply a probability of one third for a 10bp deposit rate cut in December.
Most economists and investors still think the ECB will wait until December to take action, but they are being put on guard for a surprise. Next door in the U.K., Prime Minister Boris Johnson is under pressure to introduce another national lockdown.