COMMODITIES-Up on China growth pledge, Dow rally; Brent spikes

Tue Mar 5, 2013 9:34pm GMT

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* China vow for 7.5 pct growth a year boosts prices
    * Dow Jones record high fuels broad gains
    * Brent crude gains most since Dec as outages help
    * Copper, soy rise but arabica coffee slumps

    By Barani Krishnan
    NEW YORK, March 5 (Reuters) - Commodities closed up broadly
for a second straight day on Tuesday, with oil posting its
biggest gains since December on supply outages and a U.S. stock
market rally, and metals rising on China's bullish growth
outlook.
    Soybeans hit a near four-month high on strong
overseas demand for U.S. soy, before paring gains as the dollar
soared against the euro. 
    The surge in the U.S. currency following record highs
in Wall Street's Dow Jones Industrial Average index 
and solid U.S. services sector growth in February
 limited gains in other commodities as well. 
    The Thomson Reuters-Jefferies CRB index, a
commodities bellwether, rose by just 0.3 percent despite gains
in 12 of the 19 markets it tracks.
    Gasoline and heating oil led gains on the
CRB by rising about 2 percent each. Nickel, corn 
and cotton climbed about 1 percent.
    However, Arabica coffee bucked the trend, falling
about 4 percent to become the CRB's biggest loser, after
breaking below technical support levels. 
    
    BRENT CRUDE UP AFTER 5-DAY FALL
    In oil, concerns over supply disruptions and optimism about
China's oil demand helped the benchmark Brent crude buck a
five-day losing streak. The rally in U.S. equities also
underpinned gains in oil.
    Brent rose $1.52, or 1.4 percent, to settle at
$111.61 per barrel. It was the largest one-day rise since
December 26 for Brent, but the gain did not show up on the CRB
as the U.S.-based index does not track the London-based market.
    U.S. crude, quoted on the CRB, finished up 70 cents,
or 0.8 percent, at $90.82 per barrel.
    Brent's 80,000 barrel-per-day (bpd) system was shut for a
second time in seven weeks after oil and associated gas was
found to have leaked into a leg of the 10,000 bpd Cormorant
Alpha platform that had been offline since January.
 
    In Nigeria, Royal Dutch Shell (RDSa.L> declared force
majeure on its Bonny Light crude deliveries following a leak on
a pipeline that was discovered on Sunday. It was not immediately
clear how long it would take to repair the line. 
    Oil also gained as commodity investors cheered China's vow
on Tuesday to deliver economic growth at 7.5 percent and
concentrate on boosting domestic consumption.
    The pledge by outgoing Premier Wen Jiabao countered concerns
about demand in the world's No. 2 oil market. Purchasing manager
surveys over the weekend had suggested growth in China's key
manufacturing and service sectors may be slowing. 
    
    
    
    Copper rose as China's vow to maintain strong economic
growth boosted the demand outlook for base metals from the
world's largest consumer of the commodity.
    Demand from China, which accounts for 40 percent of global
copper consumption, slowed last month ahead of the week-long
Lunar New Year holiday, but expectations of a rebound have
gathered pace ahead of the seasonally stronger second quarter.
    "Over the short term we're likely to see prices at around
current levels for the next few months. You do have some
continuation in the Chinese recovery story and that will help to
support prices," said Ross Strachan, an economist at Capital
Economics in London.
    But demand could slow again later in the year, she said.
    "In the second half, we think that the recovery (in Chinese
demand) will be more disappointing than some have anticipated.
We're expecting prices of around $7,000 for copper by the end of
the year."
    Three-month copper on the London Metal Exchange CMCU3 closed
at $7,772 a tonne, up from Monday's close of $7,725. Last week,
copper hit its lowest level in more than three months at $7,652.
 
     
 Prices at 3:40 p.m. EST (2040 GMT)      
                             LAST/      NET    PCT     YTD
                             CLOSE      CHG    CHG     CHG
 US crude                    90.87     0.75   0.8%   -1.0%
 Brent crude                111.68     1.59   1.4%    0.5%
 Natural gas                 3.529    0.000   0.0%    5.3%
 
 US gold                   1574.90     2.50   0.2%   -6.0%
 Gold                      1576.81     3.47   0.2%   -5.8%
 US Copper                  349.65     1.35   0.4%   -4.3%
 LME Copper                7772.00    47.00   0.6%   -2.0%
 Dollar                     82.095   -0.100  -0.1%    6.9%
                              
 
 US corn                    732.00     9.00   1.2%    4.8%
 US soybeans               1496.50     6.25   0.4%    5.5%
 US wheat                   696.25     0.25   0.0%  -10.5%
 
 US Coffee                  141.15    -5.50  -3.8%   -1.8%
 US Cocoa                  2059.00     3.00   0.1%   -7.9%
 US Sugar                    18.19     0.11   0.6%   -6.8%
 
 US silver                  28.604    0.108   0.4%   -5.4%
 US platinum               1585.70    19.50   1.2%    3.1%
 US palladium               734.60    20.15   2.8%    4.4%
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