“We forecast commodity prices to rise by an average of 2% in 2024 and fall by 4% in 2025,” HSBC wrote in a note.

HSBC expects China’s growth recovery and ongoing supply constraints will keep commodity prices supported this year.

It said geopolitical risks and expectations of looser monetary policy in the second half of 2024 will add to the upside, while downside risks include the ongoing slowdown in global growth.

Cocoa and iron ore prices surged in 2023, while natural gas and coal prices tumbled, with most agricultural products expected to outperform energy and industrial metals in the New Year amid supply constraints and dry weather.

HSBC projected Brent to average $82.5 per barrel and U.S. Henry Hub natural gas prices to average $3.75 per million British thermal units.

Crude futures lost more than 10 per cent in 2023 during a tumultuous year of trading marked by geopolitical turmoil and concerns about oil output levels of major global producers.

U.S. natural gas futures recorded their biggest percentage fall for the year since 2006, under pressure from record production, ample inventories in storage and relatively mild weather conditions.

HSBC also predicts gold prices will average $1,825 an ounce in 2024, predicting the first rate cut from the Federal Reserve in June 2024.

Gold investors anticipate record high prices this year, when the fundamentals of a dovish pivot in U.S. interest rates, continued geopolitical risk, and central bank buying are expected to support the market.

–Reporting for Reuters by Ashitha Shivaprasad, additional reporting by Deep Vakil in Bengaluru.

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Soybean and wheat futures also rose, with the agricultural markets posting weekly gains following recent declines to multi-month lows.

Traders added a weather risk premium to the markets ahead of the three-day holiday weekend, with conditions looking “quite dry” in the Corn Belt, said Arlan Suderman, chief commodities economist for broker StoneX. CBOT will be closed on Monday for Memorial Day in the U.S.

On Tuesday, the U.S. Department of Agriculture is expected to issue a weekly update on corn and soybean planting progress and its first condition ratings of the season for the corn crop. The government has projected supplies of both crops will rise sharply in the coming year due to forecasts for record harvests.

However, below-normal rainfall is expected to continue across the Midwest, eastern Plains and Delta over the next 15 days, forecaster Maxar said. The conditions will allow dryness to worsen and expand further, increasing stress on corn and soybeans, the firm said.

Stress from dryness will affect about 40 per cent of the corn crop come early June, according to Commodity Weather Group.

The most-active corn contract ended 13-1/4 cents higher at $6.04 a bushel and touched its highest price since April 26 at $6.06-3/4. Soybeans rose 3-1/4 cents to settle at $13.37-1/4 a bushel, while wheat jumped 11-3/4 cents to end at $6.16 a bushel.

Hopes that the Biden administration and Republicans in Congress will reach an agreement to raise the government’s debt ceiling helped support gains in commodity and equity markets, traders said.

The U.S. dollar was set for a third straight weekly gain amid the closely watched talks on the debt ceiling. A strong U.S. dollar is generally seen as bearish for U.S. grain futures.

— Reporting for Reuters by Tom Polansek in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.

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Financial details were not disclosed.

Agribriefing’s businesses include protein price-reporting agency Urner Barry and crop consultancy Strategie Grains, the latter acquired by Agribriefing in 2021.

New Jersey-based Urner Barry provides market intelligence for the poultry, egg, meat, seafood and plant protein segments, while France’s Strategie focuses on European and world grain and oilseed markets.

The Agribriefing takeover follows Mintec’s acquisition in December of commodity price reporting firm CommoPrices.

Mintec, based west of London, publishes prices and analysis on food ingredients.

Five Arrows Principal Investments, an investment arm of financial advisory group Rothschild and Co., acquired a majority stake in Mintec last year.

— Reporting for Reuters by Gus Trompiz in Paris.

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Ken Ball, of PI Financial in Winnipeg, said there’s heavy spreading, as well as the maneuvering of year-end positions and plenty of liquidation going on at the moment, “all trapped in a sideways affair.

“None of these markets have a situation beyond that says they’re going anywhere right now,” he said, adding activity was way down in several commodities.

Ball said this has very little to do with canola itself, but much more to do with the large amounts of spreading the markets have been witnessing.

He noted speculative money believes many of the grains and oilseeds are too high, including canola, without any reason to completely justify those prices.

“They will tend to avoid them,” Ball said, but suggested a situation could create “dominant direction” for canola and other commodities.

“Barring something unusual, the odds are something is going to fade.”

In the meantime, Ball pointed to increases canola made during most of its trading on Wednesday. With ICE canola futures taking two days off for the holidays, it had to catch up to the gains made at the Chicago Board of Trade (CBOT) the day before.

“It’s just the usual stuff, year-end crapola. None of these markets are going anywhere. They’re just waffling back and forth,” the trader said.

— Glen Hallick reports for MarketsFarm from Winnipeg.

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Corn and soybeans followed wheat lower, weighed down by lacklustre demand and pressured by lower energy and equities markets.

On Thursday, wheat surged after Russia’s Geneva U.N. ambassador told Reuters Moscow could reject a renewal of the corridor deal that has allowed wartime exports from Ukraine’s Black Sea ports.

However, there were hopes of progress in negotiations after a meeting between Russian President Vladimir Putin and Turkish counterpart Tayyip Erdogan.

“All the reasons that wheat rallied yesterday were taken away today,” said Ted Seifried, chief agriculture strategist for the Zaner Group.

“Putin said he’s not happy with the deal and he may end it. Well, he hasn’t, so maybe it’s just talk… Then you have the dollar turning around, taking back the majority of yesterday’s weakness,” he said.

Chicago Board of Trade December wheat dropped 32-1/2 cents, to $8.59-3/4 a bushel, ending the week down 2.3 per cent in a second straight weekly decline (all figures US$).

CBOT December corn fell eight cents, to $6.89-3/4 a bushel while November soybeans shed 12 cents to $13.83-3/4 a bushel. But both benchmark contracts finished higher on the week, with corn up one per cent and soy 1.2 per cent higher.

Poor export demand pressured corn as the U.S. Department of Agriculture on Friday reported net sales last week of just 260,700 tonnes, below trade expectations.

Tepid sales also weighed on soybeans, although weekly sales of 724,400 tonnes were in line with estimates.

Several large daily soybean export sales announcements by USDA this week totalling 1.622 million tonnes — mostly to top importer China — offered little support to futures as the deals are considered routine sales, traders said.

— Reporting for Reuters by Karl Plume in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.

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Poor export demand also weighed on the corn and wheat markets as investors remained wary of an economic downturn.

“The grain and oilseed markets were weaker … reflecting heightened fear that global recessionary problems may erode demand for food- and energy-based commodities in the months ahead,” Arlan Suderman, chief commodities economist at brokerage StoneX, said in a research note.

CBOT November soybeans ended down 11-3/4 cents at $13.58 a bushel (all figures US$). On a continuous basis, the most-active contract hit its lowest since July 25.

“It is hard for the bean market to rally much in the middle of harvest and there is still the concern about Chinese demand,” said Tomm Pfitzenmaier, analyst for Summit Commodity Brokerage.

CBOT December corn futures were off 8-1/2 cents at $6.75-1/2 a bushel.

Soybean export sales totaled 777,100 tonnes in the week ended Sept. 29, down 23 per cent from a week earlier, the U.S. Agriculture Department said on Thursday morning.

Corn export sales of 227,000 tonnes were down 56 per cent from a week earlier and below the low end of market expectations.

Overseas demand for U.S. corn and soybeans typically surges during harvest but low water on southern sections of the Mississippi River halted most shipping traffic, sending prices for barges soaring.

CBOT December soft red winter wheat dropped 23 cents to $8.79 a bushel.

Weekly wheat export sales totaled 229,400 tonnes, near the low end of trade expectations.

Attention is turning to next week’s U.S. Department of Agriculture (USDA) October crop forecasts for a gauge of harvest yields after a dry summer.

— Reporting for Reuters by Mark Weinraub in Chicago; additional reporting by Gus Trompiz in Paris and Naveen Thukral in Singapore.

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The dollar index retreated from two-decade highs set last week, softening after Australia’s central bank surprised investors with a smaller-than-expected interest rate hike. The move calmed fears that higher rates globally would trigger a recession that could dent demand for commodities.

“If you look at the outside markets, you’d say it should be a ‘risk-on’ environment,” said Don Roose, president of Iowa-based U.S. Commodities.

Chicago Board of Trade December corn settled up 2-1/4 cents at $6.83 per bushel and November soybeans ended up 9-1/2 cents at $13.83-1/2 a bushel (all figures US$).

Strength in crude oil helped lift grain futures, given corn’s role as the main U.S. feedstock for ethanol fuel and soyoil’s use in biodiesel, Roose said.

But seasonal pressure from the expanding U.S. harvest hung over the market, capping rallies, while traders awaited more information about the size of U.S. crops.

After the CBOT close, commodity brokerage StoneX raised its estimate of the average U.S. corn yield to 173.9 bushels per acre, from 173.2 previously, but lowered its corn production estimate to 14.056 billion bushels, from 14.168 billion last month.

For soybeans, StoneX cut its forecast of the U.S. yield to 51.3 bu./ac., from 51.8 previously, and lowered its soy production estimate to 4.442 billion bushels, from 4.515 billion.

The U.S. corn harvest was 20 per cent complete as of Sunday, the U.S. Department of Agriculture (USDA) said in a weekly progress report, trailing the five-year average of 22 per cent. The soybean harvest was farther ahead at 22 per cent complete, but still behind its five-year average of 25 per cent.

CBOT soft red winter wheat futures bucked the firm trend and closed lower on technical selling and profit-taking after last week’s two-month highs. Benchmark CBOT December wheat fell nine cents to finish at $9.03 a bushel, but K.C. December hard red winter wheat ended flat at $9.88-3/4, underpinned by worries about dry conditions in the Plains hard wheat belt.

Traders continue to monitor tensions between Russia and Ukraine, which are among the world’s leading grain exporters.

Ukraine’s winter wheat sowing for the 2023 harvest has covered only a third of the area completed at the same time last year, data from the European country’s agriculture ministry showed on Tuesday.

— Reporting for Reuters by Julie Ingwersen in Chicago; additional reporting by Naveen Thukral in Singapore and Sybille de La Hamaide in Paris.

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“This market is looking for positive news, and not finding a lot. And with all the turbulence out there, and the Dow continuing to go down every single day, there seems to be significant long liquidation,” said Altin Kalo, economist at Steiner Consulting Group.

Traders fear that a recession will reduce demand for goods including beef and pork. Commodity funds hold a net long position in live cattle and lean hog futures, leaving both markets prone to long liquidation.

CME October live cattle settled down 0.775 cent at 143.475 cents/lb. and the most-active December contract fell 1.2 cents to finish at 147.35 cents/lb. after dipping to 146.575 cents, the contract’s lowest since July 22 (all figures US$).

CME November feeder cattle settled down 1.2 cents at 177.05 cents/lb. after touching 176.025, its lowest since June 13.

A brisk cattle slaughter pace in recent weeks has added to the negative tone, pressuring wholesale beef prices. Choice cuts of beef were priced at $247.84 per hundredweight (cwt) on Monday afternoon, according to the U.S. Department of Agriculture (USDA), the lowest since March 2021.

“The last four weeks, we’ve been running the fed cattle slaughter almost 4% higher than a year ago. So that is bringing a fair amount of product to the market at a time when demand is not that great. You’ve just come out of grilling season,” Kalo said.

For hogs, CME October lean hogs ended down 2.25 cents at 90.375 cents/lb. and benchmark December hogs tumbled 3.4 cents to finish at 79.4 cents/lb. after hitting 78.4 cents, the contract’s lowest since Jan. 27.

Traders await the U.S. Department of Agriculture’s Sept. 29 quarterly hogs and pigs report.

After Friday’s close, USDA reported the number of U.S. cattle on feed as of Sept. 1 at 11.279 million head, about 100 per cent of the year-ago total and in line with analyst expectations.

Cattle marketings during August were 106 per cent of a year ago, in line with trade estimates, while August placements were 100 per cent of a year ago, above the average analyst estimate of 97.3 per cent.

— Julie Ingwersen is a Reuters commodities correspondent in Chicago.

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Corn and soybean futures joined the weaker trend, pressured by recession fears and favorable weather for the expanding U.S. harvest.

Chicago Board of Trade December wheat settled down 30-1/4 cents at $8.80-1/2 per bushel, retreating from a two-month high set a day earlier (all figures US$).

CBOT December corn ended down 11-1/2 cents at $6.76-3/4 a bushel and November soybeans fell 31-1/4 cents to finish at $14.25-3/4 a bushel.

Wall Street equity markets plunged, U.S. crude oil futures dropped nearly six per cent and the dollar touched a two-decade high, making U.S. grains less competitive globally, as worries mounted about the health of the world economy.

“Everything is interpreted through the lens of global recession that negatively impacts demand for commodities, leading to the selling as we head into the weekend,” StoneX chief commodities economist Arlan Suderman wrote in a client note.

Outlooks for clear Midwest weather added to bearish sentiment, even though the U.S. Department of Agriculture has projected smaller U.S. corn and soy crops compared to a year ago. The harvest is just beginning in the heart of the Corn Belt, with seven per cent of the U.S. corn crop and three per cent of the U.S. soybean crop cut as of Sept. 18.

“Below-normal rainfall is expected across the central U.S. over the next 15 days, which will favor dry-down and early harvesting of corn and soybeans,” space technology company Maxar said in a daily weather note.

Traders continue to monitor the conflict in Ukraine. U.S. and European wheat futures markets on Thursday reached their highest levels since July 11, after Moscow’s moves to mobilise more troops and back referendums on joining Russia in occupied regions of Ukraine fuelled concern about further disruption to vital Black Sea grain trade.

However, rising estimates of what is expected to be a record Russian wheat harvest and ongoing grain shipments from Ukraine through a Black Sea corridor were tempering supply worries.

“Trade flows are not without disruption risk, but so long as ports and transit lanes are open for grains, then prices should generally stay contained,” Citi analysts said in a note.

— Reporting for Reuters by Julie Ingwersen in Chicago; additional reporting by Gus Trompiz in Paris and Enrico Dela Cruz in Manila.

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Corn and soybean futures turned lower and the U.S. dollar set a fresh 20-year high as the Federal Reserve raised interest rates by another 75 basis points, as expected, and signalled more large increases in its battle to contain inflation. A stronger dollar tends to make U.S. grains less competitive globally.

Chicago Board of Trade December wheat settled up 10 cents at $9.03-3/4 per bushel after reaching $9.19-1/2, its highest since July 11 (all figures US$).

Grain futures rose in early moves after Russia’s President Vladimir Putin ordered a mobilization to fight in Ukraine and backed a plan to annex parts of the country, hinting he was prepared to use nuclear weapons.

“Geopolitical tensions are back in the Black Sea basin, with Putin’s comments leading to fears of a new escalation in the conflict, resulting in risk premiums,” consultancy Agritel said.

But corn and soy faded, and equity markets churned as traders weighed how a recession might hurt demand for goods. Wall Street’s main indexes slumped in late trade after the Fed’s rate hike, and crude oil futures ended lower following a volatile session.

CBOT December corn ended down 6-1/2 cents at $6.85-1/2 a bushel and November soybeans fell 17-1/2 cents to settle at $14.61-1/4 a bushel.

“Most of the ags are in negative territory on the recession trade, while wheat is again posting gains following its early-morning dip as traders worry about Ukraine risks,” StoneX chief commodities economist Arlan Suderman wrote in a client note.

At the end of a two-day meeting, the Fed raised its target interest rate to a range of three to 3.25 per cent — the highest level since 2008 — and new projections showed the policy rate rising by the end of this year before topping out at 4.5 to 4.75 per cent in 2023.

Meanwhile, the start of the U.S. corn and soybean harvest added seasonal pressure in those markets. The U.S. Department of Agriculture this week said farmers had cut seven per cent of the U.S. corn crop and three per cent of the soybean crop.

— Reporting for Reuters by Julie Ingwersen in Chicago; additional reporting by Gus Trompiz in Paris and Enrico Dela Cruz in Manila.

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