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Tuesday, March 15, 2011

Japan earthquake and tsunami - commodities market prices of crude oil, gold, silver, copper and coffee crashing on march 15, 2011

Japan earthquake and tsunami - commodities market prices of crude oil, gold, silver, copper and coffee crashing on march 15, 2011 : Japan's deepening nuclear crisis, triggered by the March 11 earthquake and tsunami, sent shock waves across the commodities market on Tuesday with prices of crude oil, gold, silver, copper and coffee crashing. Other commodities such as rubber, crude palm oil also dropped, though some recouped their losses towards the end of the day.

A broad sell-off was seen across all commodities as investors and funds chose to cash in or book profits. A rising dollar contributed to the chaos in the market as commodities that are traded in the greenback began to lose value.

Gold savings

“Japanese need cash to rebuild. Most of their savings are significantly in gold. As they cashed for their needs, others too began to sell,” said an analyst. That dragged gold down $44 to $1,388.68 an ounce, while silver slid to $33.85 an ounce. Crude oil declined to $97.87 a barrel from $101.19 on Monday.

Copper led base metals lower, slipping to $9,016 a tonne, with aluminium, tin, lead and zinc in tow. The selloff was triggered by fears that Japan's worst earthquake and nuclear crisis could curb demand for raw materials.

The devastation caused by the earthquake and tsunami has forced Japan to shut refineries and smelters. With the country facing power shortage, car manufacturers such as Nissan, Honda and Toyota shut their plants in the northern part.

A third blast that occurred on Tuesday at the Fukushima Dai-Ichi nuclear plant and the Japanese Prime Minister, Mr Naoto Kan's statement that the risk of further radiation leaks was rising aided the bearish trend further.

Agri-commodities

Agriculture commodities, too, dropped. As regards India, events in Japan have brought down natural rubber prices to Rs 187 a kg in Kottayam from around Rs 220 last week. Soyameal prices have dropped to Rs 18,000-18,100 a tonne from Rs 18,500-18,600.

Robusta coffee prices in London slipped to $2,380 a tonne from $2,528 before the earthquake. source thehindubusinessline.com... For the latest updates PRESS CTR + D or visit Stock Market news Today

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