Category Archives: commodities

George Bush Gets Good News on Oil

Posted on April 16, 2008 by Felix

George Bush, who wants to slow down the growth of US carbon emissions, got great news today: oil’s over $115 a barrel! I look forward to the White House statement embracing the fact that market mechanisms are sure to reduce … Continue reading →

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Agricultural Subsidies: Still a Bad Idea

Posted on April 10, 2008 by Felix

If you want proof that the free-market intelligentsia really doesn’t get what it wants, all you need to do is look at agricultural subsidies. The right hates them because, well, they’re subsidies, and the left hates them because the beneficiaries … Continue reading →

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Petrochemical Datapoint of the Day

Posted on April 9, 2008 by Felix

Darren Rovell is on the baseball-cap beat: New Era raised prices on its 59Fifty hats by $4 last year because of a change in material from wool to polyester. No, that’s not a misprint. Polyester, it seems, is now more … Continue reading →

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Grain Conundrums

Posted on April 2, 2008 by Felix

Paul Krugman wonders this morning why food prices in general, and grain prices in particular, have spiked so dramatically: Demand has been rising for a number of years; bio-fuels is a big thing, but how much bigger is it this … Continue reading →

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Gold: Too Volatile to be a Safe Investment

Posted on April 1, 2008 by Felix

Eddy Elfenbein notes today that gold has dropped below $900 an ounce. Gold funds in general are suffering, with the biggest of them all, the $8.2 billion Merrill Lynch World Gold, down 10% in March. But they’re still bullish: The … Continue reading →

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Fuel Datapoint of the Day

Posted on March 13, 2008 by Felix

Steven Mufson reports on rising gas prices: Gasoline rose to a nationwide average of $3.246 a gallon for regular unleaded. Diesel, which has been setting records almost daily for the past three weeks, hit a nationwide average of $3.876 yesterday. … Continue reading →

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Is it a Good Time to Sell Gold Yet?

Posted on March 4, 2008 by Felix

With gold topping $980 an ounce, talk of the IMF selling some of its gold reserves is resurfacing again – apparently the US is in favor of "limited" sales, but might still veto any gold-sale proposal, if that makes any … Continue reading →

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Phibro: Beneficiary of Citi’s Benign Neglect

Posted on February 28, 2008 by Felix

Sticking with Citi, Ann Davis has a fantastic front-pager in today’s WSJ on Andrew Hill, who runs commodity-trading subsidiary Phibro. Go read it, it’s full of wonderful details, like Hill’s thousand-year-old castle in Germany, which recently housed a massive Schnabel … Continue reading →

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Chart of the Day: Oil and Gasoline Prices

Posted on February 21, 2008 by Felix

Are you ready for a 40% hike in gasoline prices? According to Barbara Kiviat, if the red line converges up to where the black line is now, that would put gas prices at about $4.23 a gallon, or 40% higher … Continue reading →

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China Datapoint of the Day, Aluminum Edition

Posted on February 13, 2008 by Felix

Back in 2004, Alcan put together a slide show on China’s role in the aluminum industry. It included this chart, showing Chinese aluminum consumption from 1960 onwards, and anticipating a rise of 82% between 2004 and 2010, to 7.3 kg … Continue reading →

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Exxon Mobil Plays Hardball With Venezuela

Posted on February 8, 2008 by Felix

Did you have any idea that the bonds of PDVSA, the Venezuelan state oil company, are trading at just 65.7 cents on the dollar? I didn’t, but are now, partly because of an injunction that Exxon Mobil has managed to … Continue reading →

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Japanese Garbage Datapoints of the Day

Posted on January 12, 2008 by Felix

The value of indium in Japan’s garbage dumps: $833 million The value of lead in Japan’s garbage dumps: $15 billion The value of silver in Japan’s garbage dumps: $30 billion The value of gold in Japan’s garbage dumps: $178 billion … Continue reading →

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The $100 Oil Trade: Was Arens the Seller?

Posted on January 7, 2008 by Felix

On Thursday, it seemed that the single $100 oil trade was a bit of a prank: Nymex trader Richard Arens basically spent $600 of his own money in order to be the person who first hit that mark. Now, however, … Continue reading →

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The Power of Round Numbers

Posted on January 3, 2008 by Felix

On Wednesday, Richard Arens decided to celebrate the new year by having a bit of fun. He’s a "local" who trades for his own account on the floor of the Nymex, and he bought exactly one crude oil contract at … Continue reading →

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Latin State Oil Company Datapoint of the Day

Posted on January 3, 2008 by Felix

In 2006, Venezuela’s PDVSA had revenues of $100 billion, on which it paid $36 billion in taxes. In 2007, Mexico’s Pemex had revenues of $100 billion, on which it paid $54 billion in taxes. (From "Woes mount for Mexico’s state … Continue reading →

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The Denomination Fallacy, Coffee Edition

Posted on December 24, 2007 by Felix

The denomination fallacy normally rears its economically-illiterate head with respect to oil prices. But in the Washington Post today, Anthony Faiola manages to apply it to coffee: For untold millions worldwide, the weak dollar has emerged as a troubling dark … Continue reading →

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The Case Against Peak Oil

Posted on December 17, 2007 by Felix

John Cassidy has a message for the peak-oil crowd: The tripling of oil prices since the summer of 2003 has unleashed forces that within the next two or three years will bring oil prices tumbling back down to below $50 … Continue reading →

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A Chinese Bid for Rio Tinto?

Posted on December 4, 2007 by Felix

It makes sense all the sense in the world that China, broadly defined, should make a bid for Rio Tinto. If it doesn’t, there’s a very good chance that the BHP-Rio merger will go through – a merger which would … Continue reading →

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Opec and the Denomination Fallacy

Posted on November 19, 2007 by Felix

Okay, let’s try and make this clear, for the umpteenth time. If countries with large dollar-based foreign-exchange reserves increasingly invest those reserves in euro-denominated assets rather than dollar-denominated assets, that’s bad for the dollar. That’s true whether the country in … Continue reading →

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Ag Prices: The Long Hemp, Short Corn Trade

Posted on October 2, 2007 by Felix

A funny thing, government interference in markets. The US government, thanks mainly to the fact that the Iowa caucus is politically very important, is doing its best to encourage the market in corn ethanol. But front-page articles in both the … Continue reading →

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