News

October 06, 2008

Biofuel Feedstock Prices Hit By General Uncertainty

By Sally White

The biggest weekly decline in fifty years hit commodity markets as funds and investors fled to safer havens on dollar strength, record borrowing rates, risk reduction and fear of a collapse in the global economy. Ahead of Washington’s approval on Friday evening of the US$700 billion bail-out plan, and amidst uncertainty of the fate of banks worldwide, widespread selling brought highly volatile conditions to all markets.

Prices across the commodity board were down 9.9 per cent on the Reuters/Jefferies CRB Index. There was a whole host of bad news adding to the panic. Crude oil prices fell 12 per cent, there was a fall of over five per cent in the US trade gap, US manufacturing declined to a seven year low, the highest US jobless numbers were announced since 2001 and the largest drop in US house prices on record, with the S&P/Case-Shiller home price index down 16.3 percent from July 2007.

Fresh...