News

September 28, 2008

That Was The Week That Was … In Grains And Alternative Fuels

By Sally White

Commodity traders took their cues this week from the reports coming out of Washington about the negotiations for the emergency US financial bail-out. Trading was tumultuous as a number of major firms with large speculative grain positions went to the wall, while concern rose about the strategies of major index funds. And in alternative energy markets commercial lobbying for a reduction in emission restrictions met with some success, despite a report from the International Council for Science which showed a sharp rise in carbon emissions during 2007.

Some reassurance about commodity prices came from Australian broker Goldman Sach JM Were. Commodities, said the Melbourne-based broker, would stay “stronger for longer'', as financing issues will become a serious hindrance to growth on the supply side. “Junior companies wishing to finance greenfield projects that would have had little difficulty in raising either debt or equity 18 months ago, would likely struggle today.'' However the broker continued that, “Longer term, we believe the...