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Commodities tipped to collapse

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TheRage said:
Forgive my commodity ignorance but could someone explain what Paladium is used for and why it hit such highs a few years ago but has dropped back significantly compared against other commodities which are roaring ahead.
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http://en.wikipedia.org/wiki/Palladium

As far as the price movements noticed :dunno:

It's a pretty thinly traded contract and not one speculators usually dabble in.
 
It looks like a lot of our metals producers are being re-rated.
So the likes of BHP appear destined to hover at or over present prices.
This is supported by base metal inventories, coal, oil, uranium, iron ore, etc,., etc..
I anticipate nickel to be the weakest of the metals near term.
But recent history tells us that restocking occurs as soon as metals go off the boil.
Anyone tipping commodities to "collapse" any time soon?

Wayne, you must be able to find someone!
 
rederob said:
Wayne, you must be able to find someone!
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It was tough, but you knew I'd find someone...:D

http://virgoans.wordpress.com/2007/05/07/a-dozen-reasons-to-worry/
SNIP

– Commodity prices will nosedive. Commodity prices showed unusual strength in recent years and not just in the energy sector. Industrial metals prices have skyrocketed. So have livestock and grains of late. Even precious metals have reached prices not seen since inflation was raging in the late 1970s.

In the long run, we don’t see any constraints that will prevent the normal reaction to high commodity prices–increased supply that will depress prices. In energy, Hubbert’s Peak devotees believe the world is running out of crude oil so prices will skyrocket in the years ahead. But we’re convinced that human ingenuity will, as in the past, prevent a Malthusian outcome. The ongoing fall in U.S. home sales and likely collapse in prices will have very negative effects on building materials prices. Lumber and copper prices have already nosedived.
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Copper now up 2.9% today.............................................................
 

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I have a question about commodity prices.

How much has the increase of commodity prices been due to supply/demand, and how much is due to the deflation of the US dollar?
 
0951 [Dow Jones] Renewed surge in resources likely to get underway today, says Southern Cross Equities director Charlie Aitken. "BHP (BHP.AU) are going to A$40, Rio (RIO.AU) to A$120, Fortescue (FMG.AU) to A$50 and Oxiana (OXR.AU) to A$5.00. If you are short resources you are dead. It starts today." Another trader says recent BHP price action demonstrates that it is very well supported. BHP last A$32.79, RIO last A$92.01, FMG A$34.10, OXR A$3.37. (DWR)
 
kennas said:
0951 [Dow Jones] Renewed surge in resources likely to get underway today, says Southern Cross Equities director Charlie Aitken. "BHP (BHP.AU) are going to A$40, Rio (RIO.AU) to A$120, Fortescue (FMG.AU) to A$50 and Oxiana (OXR.AU) to A$5.00. If you are short resources you are dead. It starts today." Another trader says recent BHP price action demonstrates that it is very well supported. BHP last A$32.79, RIO last A$92.01, FMG A$34.10, OXR A$3.37. (DWR)
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Kennas can you give me a link to that please??
 
Maybe we're underestimating the effect of China's industrialisation?

1455 [Dow Jones] China's apparent copper consumption may rise much more than anticipated in 2007, possibly 18%-26%, says commodity analyst at large Chinese trading house; estimates China may import 1.2 million-1.5 million tons of refined copper and domestic output to increase to 3.3 million tons, projects apparent consumption in 2007 at 4.5-4.8 million tons vs 3.8 million in 2006. Apparent consumption includes consumption plus stock rebuilding while real consumption reflects just consumption. Tips China imports to rebound in 3Q, which, coupled with possible recovery in U.S. demand, could spur LME 3-month copper to retest $8,000/ton in 3Q or 4Q. LME 3-month copper last at $7,400/ton, down $55 vs London PM kerb. (MWL)
 
kennas said:
0951 [Dow Jones] Renewed surge in resources likely to get underway today, says Southern Cross Equities director Charlie Aitken. "BHP (BHP.AU) are going to A$40, Rio (RIO.AU) to A$120, Fortescue (FMG.AU) to A$50 and Oxiana (OXR.AU) to A$5.00. If you are short resources you are dead. It starts today." Another trader says recent BHP price action demonstrates that it is very well supported. BHP last A$32.79, RIO last A$92.01, FMG A$34.10, OXR A$3.37. (DWR)
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LOL now thats what i call a RAMP!!! :eek: :eek: :D :D
 
I have concerns upcoming quarterly reports may reflect some bad news due to the appreciating dollar. It has been widely covered in the press that profits may be hit hard in some mining stocks. It may start a correction and many foreign investors may withdraw their funds from our market dropping the Aussie value. I think that would be a good outcome in the long term. However I never even did economics 101 so welcome anyone to prove me wrong. My imagination gets a bit carried away at times.
 
Spaghetti said:
I have concerns upcoming quarterly reports may reflect some bad news due to the appreciating dollar. It has been widely covered in the press that profits may be hit hard in some mining stocks. It may start a correction and many foreign investors may withdraw their funds from our market dropping the Aussie value. I think that would be a good outcome in the long term. However I never even did economics 101 so welcome anyone to prove me wrong. My imagination gets a bit carried away at times.
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Yes, it's a subject not much is said about, but as I have posted on the ILU thread, ILU have indicated that their bottom line is affected by $8m per every 1 cent rise in the $A. Their guidance was based on exchange rate of 75c - now 85. A sign of things to come with this qtrs reporting?
CDI shares of US listed co's are taking a battering too eg NEM etc
 
Uncle Festivus

I have read that about Iluka and also others. I can recall some press article suggesting Zinifex will be affected also. I am more familiar with purchasing in FX rather than selling, and know that many importers use forward exchange contracts to soften the immediate effect of currency fluctuations. If similiar practise are used by many miners the affect may be more gradual but should be apparent as the year progresses. From my reading on this though some miners do not hedge so effects, I would imagine, will be severe and soon.

Increase in metal prices may offset, hopefully to some degree. It depends what the market has factored into current s/p. It doesn't appear it has been though with prices rollicking along.

Events I cannot fully understand always make me nervous but also make me go back to the learning process.

I would imagine /hope also the big end of town has this covered in thier expectations of earnings so perhaps I am being a little ott. We will soon find out I guess.
 
Interesting when you look back and read the first post on this thread from May 2006 - when exactly were they tipping commodities to collapse? Obviously not anytime near when it was posted cos it didnt do it.

2 Years ago the "experts" also tipped the NZ dollar at about 67 cents to fall against the Greenback. What did it do? Go up - now its at 78 cents.

How much more completely wrong can experts be?
 

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