Pakistan Commodities_COVID scare makes commodities lose steam , (AKD Daily, Aug 10, 2021)
AKD Daily
Pakistan Commodities: COVID scare makes commodities lose steam
- Jul’21 marks the slowest monthly surge in TRJ CRY index since Mar’21, +2.2%MoM as commodity complex appeared to be running out of steam, with downward corrections seen in metals (scrap prices down 10%MoM) and agriculture (FAO index down 1.2%MoM) over Jun’21. However, energy remains well supported with short term outlook largely depending on OPEC+ policy and resurging COVID cases globally.
- Oil prices averaged US$75/bbl in early Jul’21, as the OPEC+ failed to reach a deal on production quotas for the period of Aug’21 to Dec’21. However, it cooled down in the latter half of the month as Saudi and UAE managed to reach compromise (benchmark production for UAE revised upwards) and clarity over oil production levels ensued.
- Coal prices continue to sustain high grounds, currently trading at USD134/ton against average USD121/ton for Jul’21 while CYTD, coal prices are up 54%. Similarly, DAP prices averaged at US$657/MT in Jul’21, +6%MoM amid global shortage of the commodity and uptrend in global energy prices.
- Short term outlook for commodities is clouded by rapidly spreading COVID-delta variant, weakness in Chinese economic data and strengthening dollar index (+1.2% since Jul’21) following hawkish Fed comments and a very strong US job report.
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Maple Leaf Cement Factory is engaged in the production and sale of white cement, grey cement and clinker. Co. is a subsidiary of Kohinoor Textile Mills Limited.
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