Investment Research — General Market Conditions

02 August 2010

Commodities Daily
Commodities news
Today’s key points
 Overview – Commodities in positive mode this morning despite the Chinese PMI and
US Q2 GDP pointing to further slowdown in global growth. Asian stock markets also  Euroland manufacturing PMIs
generally higher on strong earnings. Markets looking ahead to US ISM today and the
 US ISM manufacturing
US employment report this Friday.
 US – Q2 GDP growth was on the whole somewhat disappointing. While headline Q1
figures were revised higher, Q2 came in below expectations at 2.4% q/q AR. Private
consumption was the big disappointment, adding to the view that employment and
Commodities overview
private consumption are the main weaknesses in the US recovery.
Contract Last price %, d/d
 China – The July PMI report showed that the economy weakened further in July as
WTI, NYMEX 1. pos 79.3 1.2
the HSBC PMI fell to 49.4 in July from 50.4 in June; this is the weakest level since
March 2009. A separate PMI index released by the National Bureau of Statistics on Brent, ICE 1. pos 78.4 1.0
Sunday showed a decline to 51.2 in July from 52.1 in June. Both indices indicate that Heating Oil, NYMEX 1. pos 209.3 2.7
tightening measures from the government are working to cool the Chinese economy. Gasoline, NYMEX 1. pos 213.1 1.6
China’s appetite for commodities remains key to the sector but official data may
Aluminium, LME 3M 2196 4.9
understate demand, see WSJ: China's Ore Demand Flies Under the Radar.
Copper, LME 3M 7410 2.5
 Investor flows - The weekly positioning data from US exchanges showed that
Lead, LME 3M 2108 2.8
investors built up long positions in copper and wheat alike last week; notably, the
Nickel, LME 3M 21650 4.7
recent weather-related surge in wheat prices has led speculators to reverse their net
Zinc, LME 3M 2038 2.4
stake in the market to now be on average net long the grain.
Steel, LME 3M 500 6.8
 Cross commodities - During most of July, commodities have in general seen Hot Rol Coil, NYMEX 1. pos 580 0.9
consistent price increases, not least over the past two weeks. Corporate earnings have
in general surprised on the upside, and Euroland data have in fact turned out on Gold, spot 1182 1.5
average slightly better than analysts’ forecasts. As a result, risk markets have taken Silver, spot 18 3.2
comfort from the fact that if Europe was supposed to be the weakest link in the global
Wheat, CBOT 1. pos 675.8 7.7
recovery, then things may not look too bad. However, as highlighted by Friday’s US
GDP report, US growth may already have peaked and thus we cannot rule out that a Corn, CBOT 1. pos 397.0 4.7
disappointing US ISM number could spark a sell-off in commodities this afternoon. Source: Bloomberg, Danske Markets.

Manufacturing sentiment and metal prices

Commodities Research:

Chief Analyst
Arne Lohmann Rasmussen
+45 4521 8532
arr@danskebank.dk

Senior Analyst
Christin Tuxen
+45 45137867
tux@danskebank.dk

Commodities Sales:

Senior Dealer
Martin Vorgod
+45 4514 3286
mavo@danskebank.dk

Vice President
Source: EcoWin, Danske Markets. Fredrik Åberg
+45 4514 3285
fredrik.aberg@danskebank.dk

Bloomberg: DRFX <GO>

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Commodities Daily

Commodity-price movements

02.08.2010 Yesterday Month ago Year ago This year

Last price %, today Close %, d/d Price %, m/m Price %, y/y %, YTD
Energy (1. pos):
NYMEX WTI ($/bbl) 79.3 0.4 79.0 0.8 72.1 9.9 69.4 14.2 -0.1
ICE Brent ($/bbl) 78.4 0.3 78.2 0.8 71.7 9.4 71.7 9.3 0.6
NYMEX Heating Oil ($/gallon) 209.3 0.2 208.8 2.5 191.5 9.3 179.4 16.7 -1.2
NYMEX RBOB Gasoline ($/gallon) 213.1 0.4 212.2 1.2 197.8 7.8 204.5 4.2 3.8
ICE Gasoil ($/ton) 658.3 1.5 648.3 -0.3 613.8 7.3 570.5 15.4 3.6
ICE NWE Jet Fuel, CIF ($/ton) 719.9 1.0 712.7 0.9 666.9 8.0 629.5 14.4 2.8
TTF NL Natural Gas (€/mwh) 18.0 1.1 17.8 3.1 20.2 -10.7 9.7 86.8 40.2
Henry Hub Natural Gas ($/MMBtu) 5.0 1.1 4.9 2.0 4.7 6.2 3.7 36.3 -10.7
Nordpool electricity (€/mwh) 43.0 -1.1 43.4 0.0 46.8 -8.1 - - -
Fuel oil, 1%, FOB NWE ($/ton) 459.0 -0.8 462.5 - 446.5 3.8 301.3 53.8 81.3
Fuel oil, 3.5%, FOB ARA ($/ton) 433.0 -0.5 435.0 - 433.0 3.7 227.0 97.8 98.2
API2 steam coal, CIF ARA ($/ton) 93.9 0.2 93.7 1.6 96.5 -2.8 68.0 38.0 12.8
ICE ECX Carbon Emission (€/tn) 14.1 -0.3 14.2 0.9 15.4 -8.1 14.1 -0.1 12.6

Base metals:
Aluminium, LME 3M, $/ton 2196 1.0 2175 3.9 1937 13.4 1890 16.2 -1.5
Copper, LME 3M, $/ton 7410 1.6 7297 0.9 6410 15.6 5719 29.6 0.5
Lead, LME 3M, $/ton 2108 1.5 2078 1.3 1753 20.2 1879 12.2 -13.3
Nickel, LME 3M, $/ton 21650 2.4 21150 2.3 18800 15.2 17950 20.6 16.9
Zinc, LME 3M, $/ton 2038 0.6 2025 1.8 1780 14.5 1750 16.5 -20.4
Steel, LME 3M, $/ton 500 4.6 478 2.1 430 16.2 390 28.1 22.0
Hot Rolled Coil, NYMEX, 1. pos, $/ton 580 -0.9 585 1.7 615 -5.7 480 20.8 5.5

Precious Metals (spot, $/t oz.):

Gold 1182 0.1 1180 1.3 1209.4 -2.3 951.7 24.2 7.6
Silver 18 0.1 18 3.2 17.7 2.1 14.0 29.8 7.0

Agriculturals (1. pos):

CBOT Wheat ($/bu.) 675.8 2.2 661.5 5.4 487.8 38.5 528.3 27.9 24.8
Matif Mill Wheat (€/ton) 186.0 4.1 178.8 -0.8 136.5 36.3 127.0 46.5 41.7
CBOT Corn ($/bu.) 397.0 1.1 392.8 3.6 364.0 9.1 339.5 16.9 -4.2
CBOT Soybeans ($/bu.) 1063.3 1.0 1052.5 2.5 962.8 10.4 1134.0 -6.2 2.3
NYBOT Sugar ($/lb.) 19.6 0.4 19.5 3.3 18.0 8.5 18.8 4.4 -27.4

Commodity indices (total return):

DJ-UBS 270 1.8 265 1.5 249 8.3 254 6.3 -3.5
S&P GSCI 4253 1.2 4201 1.7 3905 8.9 4276 -0.5 -6.2
Reuters CRB 274 1.5 270 1.5 254 7.8 257 6.7 -3.1
Rogers commodity index 3207 0.7 3184 1.7 2898 10.7 2976 7.8 -2.0
DJ-AIG 134 1.8 132 1.5 124 8.3 126 6.1 -3.5
S&P GSCI Energy 932 0.8 925 1.9 901 3.5 952 -2.1 -8.3
S&P GSCI Industrial Metals 1627 2.1 1594 1.1 1463 11.2 1373 18.5 -4.7
S&P GSCI Precious Metals 1527 1.2 1508 0.8 1609 -5.1 1211 26.1 7.2
S&P GSCI Agriculture 593 3.1 575 1.7 504 17.7 556 6.7 -3.7
Source: Bloomberg, Danske Markets.

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Commodities Daily

Energy
Oil prices US crude oil stocks, EIA

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

WTI (NYMEX) forward curve Brent (ICE) curve

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

Jet fuel and gasoil crack spreads Gasoline crack spread, RBOB, NYMEX 1. Pos

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

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Heating oil crack spread, NYMEX 1. pos Fuel oil, NWE, crack spreads

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

CO2 emission rights, ICE 1. pos Electricity, Nordpool quarterly, 1. Pos

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

Natural gas, 1. pos API2 coal, 1. Pos

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

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Metals
Aluminium Aluminium forward curve

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

Copper Copper forward curve

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

Nickel Nickel forward curve

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

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Zinc Zinc forward curve

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

Copper SHFE-LME spread Steel

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

Gold and silver Gold forward curve

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

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Commodities Daily

Grains
Wheat Milling wheat forward curve, NYSE LIffe

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

Corn, CBOT 1. pos Corn forward curve, CBOT

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

Soybeans, CBOT 1. pos Soybeans forward curve, CBOT

Source: EcoWin, Danske Markets. Source: EcoWin, Danske Markets.

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