LONDON: Commodity prices mainly fell this week in low-volume trade on the back of weak Chinese economic data, while many participants were away for an extended Christmas and New Year break.
Beijing released figures on Friday showing that growth in China’s services sector slowed sharply in December.
The data followed news on Wednesday and Thursday that manufacturing in the country had also suffered a slowdown in growth last month.
On the upside, precious metals eked out slender gains following heavy losses during 2013.
Base metals: Base or industrial metals prices mostly slid as the poor Chinese data cast a shadow over markets.
“The lower than expected China non-manufacturing PMI figure in December has got metals lower,” said Richard Fu, director of Asian commodities trading at Newedge.
“The metals market is still a bit jittery as most people are still not sure of the macroeconomic trend for 2014.”
Asian powerhouse China is the world’s second biggest economy after the United States and is a leading consumer of many raw materials.
“Softer-than-expected manufacturing data from China is still weighing on confidence,” added analyst David Madden at trading firm IG.
By Friday on the London Metal Exchange, copper for delivery in three months fell to $7,341 a ton from $7,385 a week earlier.
Three-month aluminum increased to $1,798 a ton from $1,784
Three-month lead dropped to $2,204 a ton from $2,265.
Three-month tin gained to $21,550 a ton from $22,949.
Three-month nickel fell to $13,846 a ton from $14,344.
Three-month zinc declined to $2,051.75 a ton from $2,096.75.
Precious metals: Gold rebounded slightly, having suffered a 28-percent slump in 2013 on the back of weaker demand and easing inflation.
“Gold continues to shine in these early days of 2014,” said Forex.com analyst Fawad Razaqzada.
“However, given the low liquidity I am skeptical about this rally, which I think is fuelled by position squaring from the sellers who will likely reemerge at higher prices.”
In 2013, gold suffered its first annual loss for 12 years, while sister metal silver shed a third in value.
“It is difficult to see why gold would fall significantly further, given, for example, its price is close to the cost of production for many precious metals miners,” added Razaqzada.
“On top of this, demand from China remains very strong in the physical market.”
By late Friday on the London Bullion Market, the price of gold rose to $1,234.50 an ounce from $1,214.50 a week earlier.
Silver climbed to $20.18 an ounce from $19.92.
On the London Platinum and Palladium Market, platinum increased to $1,388 an ounce from $1,374.
Palladium advanced to $723 an ounce from $711.
OIL: Prices fell heavily, hit hard by news that a major Libyan field could come back on line later this week, while the Chinese data also weighed.
The market slumped by about three dollars on Thursday, following the Libya news that could spark an increase in global supplies.
“Oil prices dropped sharply by over three dollars yesterday, as supply concerns in Libya eased off with news that protestors would stop striking at one of the major oilfields, El Sharara, which has been shut down by protests since October,” said Inenco analyst Lucy Sidebotham.
She added: “Weaker stock markets have also weighed on prices, and poor economic data from China.”
A spokesman for the Libyan National Oil Corp. (NOC) told Agence France-Presse on Thursday that the 330,000 barrels a day El Sharara field is expected to resume normal output within two or three days, once protesters who have blocked production pull out.
Oil production in Libya has plunged to about 250,000 barrels a day from nearly 1.5 million in the face of demands from armed protesters for more regional autonomy and greater say over the distribution of oil revenues.
Key export terminals in eastern Libya remain blockaded. However, NOC announced earlier this week that two oilfields in southern Libya had resumed on Sunday.
Over the course of 2013, Brent crude prices were virtually unchanged, while New York futures have risen more than 12 percent, amid tight supply concerns earlier in the year caused by the threat of US military action on Syria.
By Friday on London’s Intercontinental Exchange, Brent North Sea crude for delivery in February dropped to $108.25 a barrel from $111.83 a week earlier.
On the New York Mercantile Exchange, West Texas Intermediate or light sweet crude for February fell to $95.45 a barrel from $99.62.
Coffee: Prices touched multi-week lows this week on the back of heavy speculative selling, dealers said.
“Speculators were the big sellers in New York, with little interest noted by producers or roasters in any trading,” said Price Futures Group analyst Jack Scoville.
Prices sank in 2013 by 24 percent in New York and 12 percent in London, hit by plentiful supplies.
By Friday on the ICE Futures US exchange, Arabica for delivery in March dipped to 111.65 US cents a pound from 117 cents a week earlier.
On LIFFE, Robusta for March fell to $1,596 a tonne from $1,699.
Cocoa: Futures sank on profit-taking after striking the highest points since September 2011 in the prior week.
Cocoa dived as low as £1,676 per ton in London and $2,629 per ton in New York.
“Cocoa futures finished significantly weaker on Thursday, falling to a near seven-week low as fresh supplies reach the global market,” said analysts at industry publication The Public Ledger.
Prices had rebounded sharply last week on undersupply concerns. Cocoa prices rose by a quarter during 2013.
By Friday on LIFFE, London’s futures exchange, cocoa for delivery in March dipped to £1,677 a ton from £1,788 a week earlier.
On ICE Futures US, cocoa for March decreased to $2,636 a ton from $2,815.
Sugar: Prices fell over the week, and slid by about 15 percent during 2013, as the market was hit once again by abundant supplies.
“The primary focus of the market remains big supplies. Strong offers from India and Thailand keep overall [price]trends down,” added Scoville.