Food Prices Reach 19-Month High in November, U.N. Says-- Commodities Roundup

MARKET MOVEMENTS:

--Brent crude oil is down 1.3% at $71.14 a barrel

--European benchmark gas is down 0.7% at 46.20 euros a megawatt-hour

--Gold futures are up 0.1% at $2,651.40 a troy ounce

--LME three-month copper futures are up 0.2% at $9,109.50 a metric ton

TOP STORY:

Food Prices Reach 19-Month High in November, U.N. Says

Food prices climbed to a 19-month high in November driven by vegetable oils, data from the Food and Agriculture Organization of the United Nations showed on Friday.

The FAO's food price index, which tracks global prices for a basket of staple foods, averaged 127.5 points in November, a 0.5% increase from October's level and 5.7% higher than a year earlier. The index stands at its highest level since April 2023, but is still significantly below the record reached in March 2022 after Russia's invasion of Ukraine.

Vegetable-oil prices jumped 7.5% from the previous month--the sharpest rise since July 2022--fueled by higher quotations for palm, rapeseed, soy and sunflower oils. Dairy prices edged up 0.6%, boosted by a rebound in demand for milk powders and higher prices for butter and cheese.

OTHER STORIES:

Pelican Energy Partners Seeks to Ride Nuclear Renaissance

Pelican Energy Partners is applying lessons learned from years of backing oil-field-services companies as it deploys a $450 million fund focused on businesses that cater to nuclear power plants.

Managing Partner Mike Scott said the Houston-based firm so far has committed about one-third of the capital raised for Pelican Energy Partners Base Zero to eight companies. The fund closed in October above a $300 million target.

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Newmont Sells Colorado Gold Operation to SSR Mining for Up To $275M

Newmont said it agreed to sell a Colorado gold mine to SSR Mining for up to $275 million as it continues its divestment plan.

SSR Mining said Friday it will pay $100 million up front and up to $175 million in additional milestone-based payments for the Cripple Creek & Victor gold mine.

MARKET TALKS:

Gold Retreats After U.S. Hiring Bounced Back in November -- Market Talk

1438 GMT - Gold prices after the latest U.S. data showed the labor market bounced back in November. Futures are flat at $2,649 a troy ounce, after rising 0.5% earlier in the session. Fed officials are still expected to cut interest rates by 25 basis points at their next meeting, but the job data could make it easier for them to leave rates on hold if inflation data comes in warmer than anticipated next week. Friday's nonfarm payrolls report "matches the message from some of the alternative indicators suggesting that conditions in the labour market are stabilizing at a healthy level," Capital Economics' economist Stephen Brown says. "The CPI and PPI price data next week will be the main determinant of the Fed's interest rate decision this month." ([e-mail])

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Oversupply Concerns Overshadow OPEC+ Oil Price Support Efforts -- Market Talk

0900 ET - Concerns about oversupply and muted global growth remain at the forefront of oil market sentiment, which helps explain the weak reaction to the delay by OPEC+ in raising output, Fawad Razaqzada of Forex.com says in a note. While recent Chinese manufacturing data hinted at some recovery, broader demand growth remains tepid, he says. "The challenge now lies in whether supply adjustments can offset demand-side weaknesses. The immediate response after the OPEC+ meeting suggests that's not the case at these prices." WTI is off 1.2% at $67.51 a barrel and Brent down 1.1% at $71.32 a barrel. ([e-mail])

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OPEC+ Hike Delay Isn't Expected to Prevent Oil Price Decline -- Market Talk

1311 GMT - OPEC+'s production agreement won't reverse a downward trend in oil prices over the next couple of years due to structurally weak demand, Capital Economics' Hamad Hussain says. The unwinding of voluntary cuts over 18 months rather than 12 should offer some support, as it means fewer barrels will be returned to the market and the impact of curbs will be felt in 2026 too. Yet, Brent crude is still expected to fall to $70 a barrel by the end of 2025 and $60 a barrel by the end of 2026, according to the economist. The forecast reflects the impact of EVs on oil consumption in China, as well as the possibility that non-compliance within OPEC+ will become a bigger issue over the years as some members seek to boost market share. ([e-mail])

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Copper Expected to Be Volatile in 2025 -- Market Talk

1233 GMT - Copper prices are expected to experience substantial volatility next year, according to BMI analysts. Anticipated U.S. dollar strength and shifts in trade policies under a Trump presidency are seen as major headwinds for the red metal. Meanwhile, the outlook remains heavily dependent on market developments in top consumer China, with traders keeping a close eye on stimulus measures to revive the economy. LME three-month copper is up 0.6% at $9,148.00 a metric ton in afternoon trade in Europe as the U.S. dollar rally continues to cool. BMI forecasts the metal to average $9,300 a ton this year and $10,000 a ton the next. ([e-mail])

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Copper Rises on Prospects of Tighter Supplies in 2025 -- Market Talk

1117 GMT - Copper prices rise on prospects of tightening supply next year, but continue to trade in a tight range. "Copper treatment charges have been set at their lowest on record at $21.25 a ton," ANZ Research analysts say. "This is against a break-even level for Chinese smelters of $35-$40 a ton, which means many smelting plants will be loss making and shut down their processing." Treatment charges are fees paid to smelters for processing copper--a key step when raw copper ore is turned into a refined metal. Low fees mean smelters might not be making enough to cover their costs, which could potentially lead to a reduction in copper-processing capacity and disruptions to the supply chain. LME three-month copper is currently up 0.8% at $9,155.00 a metric ton and set for weekly gains of 1.5%. ([e-mail])

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OPEC+'s Agreement Signals Long-Term Price Support Efforts, DNB Says -- Market Talk

1042 GMT - OPEC+'s output policy agreement exceeded market expectations in some areas, signaling long-term price support, according to DNB Markets analysts. The headline delay to voluntary output curbs of 2.2 million barrels a day was widely expected, but the unwinding will now take place over 18 months--meaning the future monthly production hike declines to 120,000 barrels a day from 180,000 barrels a day. "These adjustments to the OPEC+ output policy indicate that OPEC+ is accepting that its mission to defend oil prices will drag on much longer than initially expected," analysts Helge Andre Martinsen and Tobias Ingebrigtsen say. "While there are frustrations within the group, its members still feel working together to collectively limit production is the best available strategy." ([e-mail])

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OPEC+'s Output Move Was a Positive Surprise, UBS Says -- Market Talk

1026 GMT - OPEC+'s extension of oil-production curbs surprised positively, signaling the group's commitment to market balance, says UBS's Giovanni Staunovo. The alliance aims to bring back some supplies starting from the second quarter of next year, but at a slower pace than previously planned. "This decision shows the group wants to continue to focus on its 'precautious, proactive, and pre-emptive' market stance, aiming to keep the oil market in balance," according to the strategist. The move will also allow OPEC+ members to get more clarity on the initial policy decisions of U.S. President-elect Donald Trump, Staunovo says. ([e-mail])

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Palm Oil Lower Amid Profit-Taking -- Market Talk

1010 GMT - Palm oil fell due to profit-taking after a recent rally in the past few days, said David Ng, a trader at Kuala Lumpur-based proprietary trading company Iceberg X. A weak export performance has also contributed to sluggishness in prices, Ng said. He sees CPO support at MYR5,080 and resistance at MYR5,200. The Bursa Malaysia Derivatives contract for February delivery edged down MYR3 to MYR5,132 a ton. ([e-mail])

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Brent Forecast at $71 a Barrel Next Year, ING Says -- Market Talk

1009 GMT - Brent crude is forecast to average $71 a barrel next year on expectations of a smaller global supply surplus after OPEC+ postponed a series of production increases, ING says. "Expectations for a smaller surplus means that downside for ICE Brent is likely more limited in 2025 than initially expected," ING's head of commodities strategy Warren Patterson says. Still, "the fact that the market will still be in surplus means that there is still downside in prices from current levels, particularly in 4Q25." ING had previously estimated Brent at an average of $69 a barrel. The international oil benchmark currently trades between $71 and $72 a barrel. ([e-mail])

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OPEC+ Move Left Market Indifferent, Swissquote Bank Says -- Market Talk

1002 GMT - The oil market seems disappointed by or at least indifferent to OPEC+'s extension of production curbs, Swissquote Bank's Ipek Ozkardeskaya says. Brent crude and WTI settled slightly lower in the previous trading session and are currently down 0.3% at $71.84 and $68.07 a barrel, respectively. "The problem is, oil bulls are not impressed, because OPEC's decision to delay its production restoration plans won't avert a global surplus," the senior analyst says in a note to clients. "OPEC's announcement, fully priced in, left the bears in control." ([e-mail])

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Gold Rebounds as Traders Await U.S. Jobs Data -- Market Talk

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12-06-24 0958ET