ANZ Commodity Daily 597 300312

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ANZ RESEARCH COMMODITY DAILY March 30, 2012 Contacts: Mark Pervan Natalie Robertson +613 9273 3716 | mark.pervan@anz.com +613 9273 3415 | natalie.robertson@anz.com MARKET HIGHLIGHTS ã ã ã ã Oil declined on potential strategic stockpile release Gold unchanged, but weaker oil weighing on prices Base metals mixed, nickel the worst performer Coal prices fell slightly. Chinese buyers returning OVERNIGHT WRAP Overnight Themes – It was another softer session for commodity markets, dragged by declin
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    ANZ RESEARCH COMMODITY DAILY   Contacts: Mark Pervan +613 9273 3716 | mark.pervan@anz.comNatalie Robertson +613 9273 3415 | natalie.robertson@anz.com MARKET HIGHLIGHTS OVERNIGHT WRAP ã   Oil declined on potential strategic stockpile release ã   Gold unchanged, but weaker oil weighing on prices ã   Base metals mixed, nickel the worst performer ã   Coal prices fell slightly. Chinese buyers returning OVERNIGHT RANKED PRICE MOVES (%)   (2.7)(2.4)(1.6)(0.5)(0.5)(0.2)(0.1)(0.0)0.20.50.60.90.91.2(4.0) (3.0) (2.0) (1.0) 0.0 1.0 2.0WTI OilNickelAluminiumPlatinumCoal (NEWC)S&P 500GoldUSD (DXY)CopperZincSilverBaltic FreightLeadTin   WEEK-TO-DATE RANKED PRICE MOVES (%)   (7.1)(2.4)(1.6)(0.8)0.40.70.70.81.01.31.32.12.73.1(9.0) (7.0) (5.0) (3.0) (1.0) 1.0 3.0 5.0NickelWTI OilAluminiumUSD (DXY)PlatinumCopperZincS&P 500GoldCoal (NEWC)LeadSilverTinBaltic Freight   Sources: Bloomberg, ANZ Commodity Strategy    Overnight Themes – It was another softer session forcommodity markets, dragged by declines in oil and equitymarkets and modest gains in the US dollar. Portfolioadjustments ahead of quarter-end and the recent trend of softening US economic readings also pressured commoditymarkets. Higher than expected US weekly jobless claims dataweighed on sentiment. Following revisions to the seasonallyadjusted data, the rate of decline in jobless claims has not beenaltered and therefore our forecasts for non-farm payrollsremain unchanged. We continue to expect non-farm payrolls of around +240k over coming months with slight upside risk toMarch. The slight upward revision (of around 15k) to the levelof jobless claims is now more closely aligned to our modelpredictions for non-farm payrolls. This Sunday, China’s OfficialPMI data for March (ANZ: 51.2, mkt: 50.6) will be watched.      Crude benchmarks declined , with US prices falling to thelowest levels since mid-February and Brent prices at a two-week low. Recent talks by US and European officials over apotential release of strategic stockpiles added to Saudi ArabianOil Minister’s recent rhetoric against high oil prices, pressuringthe market. Last year when strategic stockpiles were released,crude prices dropped around 8%, with Brent crude impactedmore heavily than WTI. Overnight WTI fell more than Brent,widening Brent’s premium to around US$20/bbl. The magnitudeof WTI losses escalated after prices broke below US$104/bbl,the lower end of the recent trading range. Meanwhile Brent stillappears to be supported by Total’s disruption in the North Seaand violence in Sudan.      Gold unchanged around US$1,662/oz . Weakness in USequities and adverse currency markets weighed on gold duringthe session. Ongoing declines in energy prices may have spilledover into the gold market, weighing on inflationaryexpectations.      Base metals were mixed again , with nickel the worstperformer. According to Norilsk Nickel (top producer), nickelprices should average just under US$20,000/t this year, whichwas almost the average level of the first quarter. The mineradded that at current prices close to US$17,000/t around 5%of global production is unprofitable and about 8% of globalcapacity is at risk. On the flipside, copper and zinc may havereceived support from statistics showing Japan’s exports of refined copper and zinc to China doubling in February fromJanuary, as Chinese buyers boost purchases ahead of thesecond quarter.      Newcastle coal futures fell slightly to US$109/t , afterbouncing yesterday from US$107/t levels. Chinese buyers weresaid to be buying South African supplies on a 5500 NAR basis,priced at a discount of $1-2/t on a delivered basis than coalssrcinating from Australia. For coking coal, an expectedimprovement in global steel markets after bottoming thisquarter (according to POSCO) and pick-up in daily crude steeloutput in China in the beginning of March could be supportive.   March 30, 2012    COMMODITY DATA Close1 Day1 Wk1 Mth3 MthClose1 Day1 Wk1 Mth3 Mth LME BASE METALS (US$/t) LME BASE METALS (kt) Aluminium 2,094(1.6) (1.6) (9.4)4.0 Aluminium 5,069(0.1) (0.3) (0.7)1.8 Copper 8,382 0.2 0.7(2.8)11.3 Copper 256(0.2)0.1(12.5) (30.6) Nickel 17,078(2.4) (7.1) (12.0) (8.6)Nickel 100(0.0)2.2 0.9 11.2 Zinc 1,999 0.5 0.7(4.0)9.9 Zinc 898(0.1)0.9 3.5 9.4 Lead 2,005 0.9 1.3(5.9)1.1 Lead 377(0.0)0.8 1.8 7.1 Tin 22,634 1.2 2.7(4.6)14.3 Tin 13(0.2)1.9 21.8 13.8 PRECIOUS METALS (US$/oz) Close1 Day1 Wk1 Mth3 Mth Gold 1,662(0.1)1.0(3.3)2.4 Gold (A$/oz) 1,606 0.1 1.3 0.9 1.6 S&P 500 1,403(0.2)0.8 2.1 9.5Silver 32.2 0.6 2.1(9.1)9.9 VIX Volatility Index 15 0.1(0.6) (10.3) (27.9) Platinum 1,628(0.5)0.4(4.2)15.0 CRB Index 306(1.8) (2.0) (5.7) (0.8) Palladium 646(0.3) (1.5) (9.9)1.2 LME Metals Index 3,548(0.4) (0.3) (5.4)7.6 ENERGY (US$/bbl) Close1 Day1 Wk1 Mth3 Mth WTI Oil* 103(2.7) (2.4) (5.6)1.0Brent Oil* 123(1.4) (0.5) (2.9)8.7 Baltic Freight Rate 930 0.9 3.1 21.9(34.8) Sing Gasoil 0.5% 137 0.0 0.7 2.8 5.4 Baltic Capesize 1,386 1.8 0.1(9.2) (43.9)Sing Fuel Oil 180cst   (US$/t) 751 0.0 0.6 1.9 3.2 Baltic Panamax 1,044 0.4 1.8 24.4(33.5) OTHER (US$/t) Baltic Handysize 566 0.0 4.8 31.9 0.5China HR Coil (RmB/t) 4,376 0.1 0.5 2.2 3.6 Close1 Day1 Wk1 Mth3 Mth Richards Bay Coal API4 104(0.1)0.9 0.2(2.4) Newcastle Coal*** 109(0.5)1.3(2.3) (3.3)DXY - USD Index 79.1(0.0) (0.8)0.4(2.2) Australia Coking Coal** 208 …(0.4) (3.4) (9.6)AUD/USD - Aussie 1.035(0.2) (0.3) (4.2)0.8 Iron Ore Spot 148 0.0 1.7 3.1 5.6 NZD/USD - Kiwi 0.815(0.1)0.8(2.9)4.4 CommoditiesInventories% Change% Change% ChangeCurrencies% ChangeKey Indices% ChangeFreight   105110115120125130Mar May Jul Sep Nov Jan NEWCASTLE COAL US$/t1,3001,4001,5001,6001,7001,8001,9002,000Mar May Jul Sep Nov Jan GOLD US$/oz708090100110120Mar May Jul Sep Nov Jan WTI OIL US$/bbl0.940.971.001.031.061.091.12Mar May Jul Sep Nov Jan AUD A$16,00018,00020,00022,00024,00026,00028,00030,000Mar May Jul Sep Nov Jan NICKEL US$/t6,5007,5008,5009,50010,500Mar May Jul Sep Nov Jan COPPER US$/t1,9002,1002,3002,5002,7002,900Mar May Jul Sep Nov Jan ALUMINIUM US$/t1,6001,8002,0002,2002,4002,600Mar May Jul Sep Nov Jan ZINC US$/tUS$/t25.030.035.040.045.050.0Mar May Jul Sep Nov Jan SILVER US$/oz   Notes: * Front-month futures ** Weekly prices ***Newcastle ICE coal futures contractSources: Bloomberg, McCloskey, ANZ Commodity Strategy    ANZ FORECASTS ANZ Forecast Table 1   COMMODITY UnitJun-11Sep-11Dec-11Mar-12Jun-12Sep-12Dec-12Mar-13Jun-13Sep-13Dec-13BASE METALS Aluminium US$/lb 1.18 1.09 0.95 0.96 1.01 1.02 1.05 1.06 1.05 1.05 1.06Copper US$/lb 4.16 4.07 3.41 3.62 3.85 3.98 4.08 4.08 4.13 4.15 3.95Nickel US$/lb 11.05 9.98 8.34 8.70 9.15 9.70 10.15 10.25 10.40 10.45 10.15Zinc US$/lb 1.02 1.01 0.86 0.87 0.90 0.91 0.95 0.98 1.01 1.03 1.04Lead US$/lb 1.16 1.11 0.90 0.94 0.96 0.96 0.99 1.02 1.05 1.06 1.07Tin US$/lb 13.08 11.16 9.45 9.09 9.45 9.75 10.30 10.55 10.80 10.95 10.80 PRECIOUS METALS Gold US$/oz 1,508 1,706 1,683 1,632 1,740 1,790 1,815 1,855 1,870 1,830 1,770Platinum US$/oz 1,785 1,771 1,531 1,526 1,685 1,700 1,700 1,765 1,795 1,765 1,725Palladium US$/oz 760 752 630 673 700 730 775 820 850 850 838Silver US$/oz 38.5 38.9 31.8 31.2 34.8 35.3 36.2 37.4 37.5 36.9 36.3 ENERGY WTI NYMEX US$/bbl 102.5 89.5 94.1 102.4 107.0 108.5 111.0 114.5 116.5 116.0 114.5Dated Brent US$/bbl 117.0 112.9 109.3 115.8 123.5 122.5 123.0 124.5 125.0 123.5 121.0Uranium US$/lb 56.4 51.8 52.6 53.1 56.0 60.5 65.0 68.5 71.5 74.0 76.0 BULKS Thermal coal 2 US$/t 130.0 130.0 130.0 130.0 115.0 115.0 115.0 115.0 125.0 125.0 125.0Premium hard coking US$/t 330.0 315.0 285.0 235.0 206.0 215.0 220.0 220.0 225.0 225.0 220.0Hard coking US$/t 300.0 290.0 265.0 225.0 196.0 195.0 200.0 200.0 200.0 200.0 195.0Semi-soft coking coal US$/t 275.0 230.0 208.0 171.0 151.0 170.0 175.0 175.0 175.0 175.0 170.0Iron ore lump US$/t 206.1 202.0 177.6 168.0 175.2 180.0 183.9 183.9 181.5 176.7 173.2Iron ore fines US$/t 171.8 168.3 148.0 140.0 146.0 150.0 152.0 152.0 150.0 146.0 142.0 OTHER METALS Alumina US$/t 326 300 262 265 278 280 288 291 288 288 291Molybdenum US$/lb 16.7 14.6 13.4 13.8 14.8 15.8 16.3 16.5 16.8 16.9 16.7Cobalt US$/lb 18.3 17.1 15.1 14.8 15.3 16.2 16.8 17.0 17.5 18.0 18.0 EXCHANGE RATES AUD/USD US$ 1.08 1.05 1.04 1.08 1.10 1.10 1.10 1.10 1.10 1.10 1.10NZD/USD US$ 0.82 0.83 0.79 0.84 0.86 0.86 0.88 0.90 0.90 0.90 0.90EUR/USD US$ 1.46 1.41 1.35 1.33 1.35 1.36 1.37 1.37 1.37 1.36 1.34USD/JPY ¥ 81.03 76.78 77.48 78.77 77.67 75.67 73.00 70.67 70.00 70.00 70.00USD/CAD C$ 0.96 0.99 1.01 0.99 0.99 1.00 1.02 1.04 1.06 1.08 1.10USD/CNY Yuan 6.46 6.38 6.36 6.35 6.29 6.23 6.17 6.12 6.08 6.03 5.99  Note 1: Average prices Note 2: Thermal coal prices are for JPY year starting April 1 Note 3: Historical data are actualsSources: Bloomberg, ANZ      The distribution of this document may be restricted by law in certain jurisdictions. Persons who receive this document must inform themselves aboutand observe all relevant restrictions. COUNTRY/REGION SPECIFIC INFORMATION:AUSTRALIA.  This document is distributed in Australia by Australia and New Zealand Banking Group Limited (ABN 11 005 357 522) (“ANZ”). ANZholds an Australian Financial Services licence no. 234527. A copy of ANZ's Financial Services Guide is available athttp://www.anz.com/documents/AU/aboutANZ/FinancialServicesGuide.pdf and is available upon request from your ANZ pointof contact. If trading strategies or recommendations are included in this document, they are solely for the information of ‘wholesale clients’ (asdefined in section 761G of the Corporations Act 2001 Cth  ). Persons who receive this document must inform themselves about and observe allrelevant restrictions.  BRAZIL.  This document is distributed in Brazil by Australia and New Zealand Banking Group Limited (ABN 11 005 357 522) only for the informationof the Central Bank of Brazil. 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