Withdrawals from gold ETPs are driving record outflows of $36.3 billion from commodity investments, according to Barclays Plc. Assets under management declined $88 billion since the start of the year through last month, the bank said in a report Dec. 17. Excluding withdrawals from precious-metal ETPs, commodities had an inflow of $4 billion.
Bullish bets on crude oil climbed 0.3% to 252,910 contracts, the highest since mid-October, the CFTC data show. U.S. fuel consumption surged 13% to 21 million barrels a day as of Dec. 13, the highest since April 2008, an Energy Information Administration report on Dec. 19 showed.
Speculators are holding a net-long position in copper of 20,688 contracts. That compares with a net-short holding of 1,223 a week earlier. Stockpiles monitored by the London Metal Exchange have fallen to the lowest since February. U.S. housing starts jumped in November to the highest since February 2008, data from the Commerce Department showed Dec. 18. Builders put about 400 pounds (181 kilograms) of copper into the average home.
A measure of speculative positions across 11 agricultural products slid 8.4% to 245,071 contracts, the CFTC data show. Investors increased their bearish wheat outlook to a record as global production is estimated by the U.S. government to reach an all-time high. The funds got more bullish on soybeans.
Temperatures in Argentina will reach as high as 105 degrees Fahrenheit (41 Celsius) in the next 10 days, increasing stress on plants with immature root systems, World Weather Inc. in Overland Park, Kansas, said in a report Dec. 20. The nation is the world’s biggest exporter of oilseed-based livestock feed. Soybean futures in Chicago are heading for the biggest quarterly advance in a year.
The net-long position in cotton more than doubled to 34,293 contracts, the highest since late October. Stockpiles at warehouses monitored by ICE Futures U.S. tumbled 57% this year.
“The taper is a sign of better global economic growth, and that’s a negative for gold,” said Rob Haworth, a senior investment strategist in Seattle at U.S. Bank Wealth Management, which oversees about $112 billion of assets. “We’re a minor bull on commodities over the next 12 months. We think global demand growth is a huge help. The tough part is the supply part of the equation, which will create volatility.”