January 15, 2013 / 8:47 PM / 5 years ago

COMMODITIES-Wheat at 3-week highs, gas at 2-week peaks

* Fear of drier weather boosts U.S. wheat
    * Gas rallies on frigid U.S. forecasts
    * Platinum at 3-month high as Amplats cuts output
    * Copper at 2-week low on U.S. debt ceiling, China worries

    By Barani Krishnan
    NEW YORK, Jan 15 (Reuters) - U.S. wheat prices hit
three-week highs on Tuesday on fear that a return to dry weather
could do further damage to grain in parched U.S. fields, and
natural gas touched a two-week peak as colder weather boosted
heating demand across the nation.
    Platinum extended the three-month highs from the previous
session after a production overhaul by top global producer Anglo
American Platinum cut world output by about 1 percent.
Gold and silver also edged higher, boosting the precious metals
complex.
    Copper  hit a two-week low as worries over
the U.S. debt ceiling resurfaced and the demand outlook from
China looked cloudy. 
    Other commodities such as orange juice, sugar,
heating oil and crude oil also posted losses,
weighing on the 19-commodity Thomson Reuters-Jefferies CRB index
.  
    Currency markets held little sway over commodities after the
dollar fell against the yen and rose against the euro
. 
    
    WHEAT LEADS GRAINS RALLY
    Wheat futures jumped 2 percent on the Chicago Board of
Trade, rising for a third day, on fear that dry weather will
return to the drought-stricken southern Plains, damaging dormant
crops. 
    Benchmark CBOT wheat for March delivery settled up
15-3/4 cents at $7.82-3/4 per bushel after racing earlier to
$7.89-3/4, the highest price since Dec. 26.
    There was little rain or snow in the forecast in the Plains
and western Midwest regions that grow most of the wheat in the
United States, said Joel Widenor, an agricultural meteorologist
for Commodity Weather Group. 
    "Dry weather will prevail in core drought areas of the
western Midwest and Central Plains through the last half of
January," Widenor said. 
    A cold snap this week may have caused some minor winterkill
in areas of western Nebraska, and a blast of cold Arctic air is
expected next week centered on the Midwest, said Don Keeney, a
meteorologist for MDA EarthSat Weather. 
    Conditions are expected to remain dry for the next two weeks
in Argentina and southern Brazil, Keeney said.
    Corn and soybean futures were also higher, with
corn on track for the seventh straight session of higher prices
as conditions turned dry in Argentina, while the U.S.
Agriculture Department's forecast last week for tight stockpiles
continued to underpin prices. 

    PLATINUM EXTENDS 3-MONTH HIGHS
    Platinum rallied for a fifth straight session after Anglo
American Platinum said it would mothball two South
African mines and sell another. The overhaul by Amplats would
cut output by around 400,000 ounces annually, accounting for
nearly 1 percent of world output.
    The spot price of platinum jumped to nearly $1,700 an
ounce, a high since Oct 9, before pulling to just below $1,680,
a gain of 1.6 percent. Since the year began, the metal, used to
remove toxins from auto fumes, has risen almost 10 percent.
    Platinum miners have been under intense pressure over the
last year, hit by a wave of strikes while contending with rising
operating costs and stubbornly depressed prices. 
    Amplats' overhaul will involve cutting 14,000 jobs to
restore profits, an action that may provoke a repeat of last
year's strikes.
    "Anglo Platinum will not be the last company to cut output,"
S.P. Angel analyst John Meyer said. "We would expect platinum
miners to pull back by 25 to 30 percent, which is going to have
a severe impact on prices." 
    
    GAS SURGES ON FRIGID FORECASTS
    Natural gas futures rallied for a fourth straight day as
colder weather made its way into U.S. consuming regions. 
    "By this weekend, very cold weather is expected along major
portions of the eastern half of the U.S., the coldest spell for
this region so far this winter," said Energy Management
Institute's Dominick Chirichella.  
    Thomson Reuters Natural Gas Analytics data showed heating
demand for the next two weeks would be close to normal, while
the Northeast would see "enhanced" demand of about 57 heating
degree days above normal.
    Degree days are a measure of departure in the mean daily
temperature from 65 degrees Fahrenheit (18 degrees Celsius) and
are used to estimate demand to heat or cool homes and
businesses. 
    Last week's much larger-than-expected inventory drawdown,
the biggest in about two years, has kept gas prices to the
upside, rising more than 9 percent in four trading days. 
    New York's front-month gas futures contract settled
up 2.4 percent at $3.455 per million British thermal units.
    
 Prices at 3:27 p.m. EST (2027 GMT)      
                             LAST/      NET    PCT     YTD
                             CLOSE      CHG    CHG     CHG
 US crude                    93.44    -0.70  -0.7%    1.8%
 Brent crude                110.35    -1.53  -1.4%   -0.7%
 Natural gas                 3.455    0.082   2.4%    3.1%
 
 US gold                   1683.90    14.50   0.9%    0.5%
 Gold                      1681.20    14.40   0.9%    0.4%
 US Copper                  363.75     0.35   0.1%   -0.4%
 LME Copper                7994.00    -6.00  -0.1%    0.8%
 Dollar                     79.696    0.208   0.3%    3.8%
                             
 
 US corn                    730.50     6.50   0.9%    4.6%
 US soybeans               1413.50    -4.50  -0.3%   -0.4%
 US wheat                   782.75    15.75   2.1%    0.6%
 
 US Coffee                  152.50    -0.80  -0.5%    6.1%
 US Cocoa                  2270.00     3.00   0.1%    1.5%
 US Sugar                    18.62    -0.28  -1.5%   -4.6%
 
 US silver                  31.529    0.419   1.3%    4.3%
 US platinum               1688.00    31.70   1.9%    9.7%
 US palladium               713.35    10.05   1.4%    1.4%

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