It has been a patchy month for energy prices and precious metals, while agricultural prices have been sharply weaker. Business Advantage PNG’s monthly review of Papua New Guinea commodities and financial markets.
Qatar’s share of the global gas market (l) and oil market (r). Source: Bloomberg
According to Kina Securities, the LNG price has been stable. But tensions between Qatar—the world’s biggest exporter of LNG and the lowest cost producer—and its neighbouring Gulf states is creating uncertainty. Reuters reports that the global gas market is currently ‘on edge.’
‘Precious metals have weakened.’
Meanwhile, oil prices have tumbled. West Texas Intermediate fell by 13.2 per cent over the month and the price is down by 19.2 per cent over the year.
Since the Federal Reserve began its current cycle of US rate increases, gold has outperformed commodities, stocks and bonds. Source: Zero Hedge
Precious metals
Precious metals have weakened. Gold is US$1246.40 an ounce, which is down 2 per cent per cent for the month and 8.2 per cent over the year, according to Kina.
‘Agriculture prices were weak across the board.’
The silver price was also weak. It was down 4.4 per cent over the month, although it is up 4 per cent for the year.
Copper was strong. It was up 2.7 per cent over the month and has risen 5.3 per cent over the year.
Agriculture
Agriculture prices were weak across the board, suggesting a general weakness in commodities markets. The palm oil price fell 7.1 per cent for the month, according to Kina. It has fallen 19.5 per cent over the year.
‘Coffee prices were also weak.’
The cocoa price also lost ground, falling 4.7 per cent over the month. The price is 14.9 per cent lower than the same time last year.
Coffee prices were also weak. They were down by 7.1 per cent over the month and are 11 per cent lower over the year.
Equities
The stock market did little. The KSI Home Index (PNG-listed stocks only) fell by 0.1 per cent over the month but it is up 4.1 per cent for the year, reports Kina.
‘The Kina was steady against the US dollar but fell 2 per cent in a month against the Australian dollar.’
The KSI Index (which includes dual-listed stocks as well) was 1.1 per cent down for the month but has moved sideways over the last year.
The Australian All Ordinaries Index performed similarly. It was up by 0.2 per cent over the month and has risen just 0.7 per cent over the year. America’s S&P 500 has risen 8.9 per cent over the year.
The Kina was steady against the US dollar but fell 2 per cent in a month against the Australian dollar. It has fallen 4.8 per cent against the A$ over the last year. The kina has also fallen by 4.3 per cent against the yen over the last year.
Half-year Treasury Bills are 4.74 per cent, while full-year Bills are 7.93 per cent. Inscribed stock for 2020-2018 has an interest yield of 9.41 per cent.
