(Bloomberg) — Commodities are gaining ground as the second half gets under way, with Brent in the $40s a barrel and copper posting a seventh weekly rise. Next week brings valuable insights into energy, metals and crop markets before the earnings season hits high gear later in July. The overarching themes remain the pandemic, state of lockdowns, and prospects for demand.
The International Energy Agency leads the line-up with its monthly overview of the worldwide oil market as OPEC and allies ratchet back supplies. Crop traders will dissect the latest WASDE snapshot, with corn a particular focus. And metals markets are primed for more virus-related disruptions in Chile, which may aid copper, as well as signals of booming iron ore flows, which may hurt prices.
A brace of companies report, with numbers from Suedzucker AG, Europe’s top sugar producer, and major cocoa processor Barry Callebaut AG. And last but not least, San Francisco Federal Reserve President Mary Daly and Richmond Fed President Thomas Barkin take part on Tuesday in a discussion on the U.S. economy hosted by the National Association for Business Economics.
By the Numbers
Oil-market watchers will keep a keen eye on the International Energy Agency’s monthly report on the global crude market next week for signals on how consumption is recovering from the virus-induced slump. The market will also examine key compliance data, which the IEA releases every month, indicating to what extent the Organization of Petroleum Exporting Countries and its allies are making the cutbacks they’ve pledged to clear a glut and shore up prices.
Last month, OPEC’s output fell to the lowest since 1991, while Russia reached near-total compliance with its quota. Meanwhile, tanker-tracking data compiled by Bloomberg show crude supplies from OPEC’s Middle East exporters, excluding Iran, fell for a second month in June as Saudi Arabia and key Persian Gulf allies made further voluntary production cuts on top of the unprecedented 9.7 million barrels a day agreed by the OPEC+ group of countries in April. OPEC will release its own monthly oil market report on July 14.
The global copper market will be on alert next week for any further signs that supplies from key producer Chile are being disrupted by the coronavirus pandemic as mine workers fall ill. With prices capping a seventh weekly advance in London following BHP Group’s move to curtail operations at one site, investors and traders will also track the metal’s technical backdrop.
Driven by the powerful recovery in prices since March, copper’s 50-day moving average is fast closing in on its 200-day counterpart and may move above it next week. That pattern, a so-called golden cross, can portend further gains. Still, the last time chart watchers saw it for copper was right at the start of 2020, just before the metal swooned as the pandemic erupted.
The Big Question
The U.S. Department of Agriculture just rocked the corn market when it said American farmers planted a lot fewer acres than analysts had expected. Traders will be anxious to see how…