Gold prices have been relatively resilient in the past couple of months, fluctuating between $1300/oz and $1370/oz since late June
“Vyanne is responsible for analysing and reporting on the trends and developments in the agribusiness industry, working in conjunction with bankers in NAB’s Agribusiness division. ”
Vyanne joined NAB in early 2013 after spending four years in the Victorian Department of Treasury and Finance (DTF) as a macroeconomic and tax forecaster. In her time in DTF, she was heavily involved in the forecasting of the indicators of the household sector, prices and the amount of Goods and Services Tax (GST) that gets distributed to the state. She also participated actively in the preparation of the annual state publications such as the Budget papers and the Annual Financial Report.
At NAB, Vyanne is responsible for analysing and reporting on the trends and developments in the agribusiness industry, working in conjunction with bankers in NAB’s Agribusiness division.
Vyanne graduated with a bachelor degree in Arts and Social Sciences (honours in Economics) from the National University of Singapore and subsequently completed Masters of Applied Commerce (International) at the University of Melbourne. She is currently undertaking Masters of Economics at the University of Melbourne on a part-time basis.
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Since early November, oil prices have resumed a clear downward trend, punctuated by episodes of sharp declines during early to mid- December and the first half of January.
After recording gravity-defying price gains in April and May that are largely denominated by correlation with the USD, oil price movements have turned bearish in June and July-to- date.
Oil prices rebounded sharply in April and May, benefiting from a confluence of factors: a stall in the USD rally, signs of slowing inventory build-up in the US, as well as unabated geopolitical volatility in the Middle East marked by Yemen civil unrests.
In May, gold prices averaged at around US$1199 per ounce, largely unchanged compared to April. This reduction in volatility has largely been associated with contained macroeconomic volatility, as most major economies continue to be on a path of gradual recovery.
After the drastic falls towards the end of 2014, oil indexes started to exhibit some tentative signs of stabilisation since mid-January. Prices traded mainly around mid to high USD40s a barrel in the second half of the month, before breaking above USD50s in the first week of February.
The relative price stability that characterised Brent and Tapis in the first half of 2014 has been shaken of late by unexpectedly severe sectarian turmoil in Iraq. After Mosul fell on 10 June, Brent jumped 4% in a week and broke through $115 per barrel by 19 June.
Supported by still-low bond yields and more positive economic data from China and the US, global equity markets maintained their upward trend in May to close higher in general. However, commodities markets were more mixed.
In the past month, US natural gas prices moderated slightly on milder weather, but remained around 13% more than the same time last year on extremely low inventories. In contrast, the slide in European gas prices continued in May on low heating demand.
There are signs of stabilisation in the growth in the US and China: the US Fed proceeded with another US$10 billion cut in their monthly quantitative easing program to US$45 billion, while Chinese industrial activity gained some support from a series of targeted stimulus policies.
Post-farmgate agribusiness conditions fell significantly in the March quarter from a 9-year high in December quarter as supportive seasonal factors dissipated. However, a sustained period of positive readings suggests that underlying fundamentals remain strong.
Globally, commodity markets experienced heightened volatility in March, with the concerns of a slowdown in China and its first domestic bond default triggering some investor risk aversion.
Since mid-January, several idiosyncratic factors, such as the ramping up of takeaway capacity by the Keystone XL Pipeline, better US economic data and unseasonably cold weather, have propped West Texas Intermediate (WTI) prices relative to Tapis and Brent.
Global equity and commodity markets exhibited increased volatility in the past month, caused by heightened geopolitical tensions in Ukraine, adverse weather events in the US and news of a slowing Chinese economy. December quarter GDP result for Australia was close to trend.
In the past few months, US natural gas prices have staged some gravity defying movements, fuelled by unusually strong heating demand from the most extreme winter conditions affecting the US in about a quarter of the century.
Post-farmgate agribusiness conditions rose significantly to their highest level in 9 years in the December quarter, with across-the-board improvements in all the three components of trading, profitability and employment.
Australia is on track to be the third largest exporter of raw cotton in the world in 2013-14, with forecasts of just under one million tonnes according to the latest Rural Commodities Wrap. The AUD is forecast to track lower which should provide further benefits to exporters.
The global economy capped off 2013 on a strong note, with monthly measures of global industrial output and trade indicators picking up to finally be consistent with the more buoyant message that the advanced economy business surveys have been signalling since late 2012.
Average oil prices fell for the second consecutive month in November. In addition to the bearish sentiment in the crude oil futures market, oil prices have generally returned to be more aligned with the reality of fundamentals where ample supplies, have served to weigh on prices.
Global growth remains at a moderate sub-trend pace and it’s expected to pick up to slightly below trend in 2014. However, NAB business conditions remain weak and forward indicators deteriorated slightly. There are still no signs of a recovery in non-mining investment.
US natural gas prices showed significant volatility in the lead-up to the US government shutdown, but trended higher in September and October overall in anticipation of winter heating demand. British natural gas prices also tracked higher in the past two months.
Post‐farmgate agribusiness conditions maintained its momentum in the September quarter to remain in positive territory, with the profitability index recording its first positive reading in three years.
Global bond yields fell in September from the US Fed surprise decision not to initiate the tapering of its quantitative easing program. Meanwhile, commodity markets weakened further. The strong pace in the economic recovery in big advanced economies evident in the first half of the year
Global financial markets rallied strongly when US Federal Open Market Committee (FOMC) defied market expectations of a modest tapering and decided to leave retain the status quo on the pace of asset purchases.
Oil prices strengthened in July, reflecting heightened concerns over the security of supply with the violent unrest in Egypt, an uptick in Asian crude demand due to improved margins, as well as ramped up refinery runs and tight supply.
Post-farmgate agribusiness conditions rebounded in the June quarter to be mildly positive but confidence fell marginally. Customer demand remains the single most significant constraint to businesses’ future profitability. Expectations for capex plans surged to the highest in two years.
Global equity markets recovered earlier losses as it became clear that central banks would not rapidly turn off their monetary easing, although we still expect the US Federal Reserve to start tapering in the coming few weeks.
Global equity markets have come under downward pressure, but the latest data on activity is slightly more positive. Business sentiment about current conditions has picked up in advanced economies and growth in global industrial output is faster.
Global financial markets have taken a dive at the suggestions of the US Federal Reserve scaling back quantitative easing soon and the drying up of new stimulus initiatives by the Japanese government.
US natural gas prices trend higher on rising exporting prospects and forecasted warmer-than-average temperatures in the upcoming summer. British natural gas prices have returned to more normal levels as supply pressures ameliorate from restored Qatari deliveries and Norwegian production.
With the exception of dairy, the prices of most other agricultural commodities have headed south this month. In April, the Rural Commodity Index rose marginally USD terms by 0.8% while fell by 2% in AUD terms. This month, lamb is our commodity in focus.
After a positive December quarter result, the March quarter result has relapsed into negative territory, to be more consistent with the negative pattern observed in the three quarters prior to the December quarter. On balance, more survey respondents reported poor conditions than good.
Commodity markets remain bearish following disappointing global economic data outcomes in the US, China, and Europe. However, weaker growth has increased expectations for policy stimulus.
Global financial markets are digesting latest Euro-zone crisis (Cyprus) where bank depositors are being forced to take losses. Pre-crisis global financial markets had been on a strong rally, especially against the background of still sluggish economic performance in the…
Post‐farmgate agribusiness conditions lifted in the December quarter to be moderately positive after three consecutive quarters of decline. Customer demand, availability of suitable labour, government policy and regulation to act as constraints. Medium‐term expectations improved…
Global and domestic financial markets have continued to improve as confidence in the global economic outlook firms. Strong underlying fundamentals of the US economy and signs of recovery in China have encouraged a more bullish market outlook. Commodity markets are less buoyant.