Pakistan Commodities_Demand recovery continues!, (AKD Daily, Jun 10, 2021)
AKD Daily
Pakistan Commodities: Demand recovery continues!
- Commodity bull cycle continues to gain steam where re-opening of economies post improved vaccination has led to increase in demand while supply struggles to catch up. However, peak still remains to be witnessed in our opinion with vaccine roll-out still facing some hindrances in some major economies.
- Among major commodities, oil prices inched upwards in May’21, averaging at US$67.97/bbl, up 38/60% CYTD/FYTD as COVID-19 cases in India subside while demand recovery is expected to be sufficient for any potential increase in future supply.
- China has been at the center of surge in coal and scrap prices with Chinese ban on imports from Australia providing fuel to rally in coal prices. Meanwhile increased ratio of scrap in raw material mix of Chinese blast furnace operators has led to scrap prices sustaining high ground.
- With commodity cycle remaining upbeat, inflationary pressures are not expected to subside and as global vaccine roll-out improves, demand is only expected to increase while the supply will take time to catch up. Hence, with Pakistan relying heavily on import of commodities, we expect negative reverberations of the current commodity up-cycle on current account and inflation.
AKD Research
AKD Securities Ltd. is one of the leading securities firm in Pakistan, providing a comprehensive range of investor focused services, including equity brokerage, economic and securities research, investment banking and financial advisory services. AKD Securities accounts for more than 6% of the average daily value of the Karachi Stock Exchange. AKD Securities was the first brokerage house to launch an online trading platform in Pakistan in November 2002 and now has the largest market share with over 6000 customers. This has helped diversify and expand the retail investor base in the country and ushered in a whole new universe of investors to the stock market.
AKD Securities Ltd. caters to a diversified group of domestic and international institutional investors, high net worth individuals and upscale retail clients, including expatriate Pakistanis. With high quality research, unparalleled execution and distribution capability for both regular and large block trades, AKD Securities Ltd. has earned an outstanding reputation in the Pakistani securities industry.Outside of commercial banks, AKD Securities Ltd. is one of the biggest capital market firms in the country. AKD Securities is the leader in raising and providing risk capital in underwriting, market making and mergers and acquisitions in Pakistan. Good corporate governance and professionalism are emphasized throughout the firm and AKD Securities Ltd. is amongst the very few companies to have introduced a firm-wide comprehensive CODE of ETHICS, overseen by an independent compliance manager.Ultimately, our success is based on the quality of service we provide to our customers and the trust and confidence reposed in us by them. Our focus, therefore, remains on customer satisfaction at all levels in the company.
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