Cotton Leads Gains on Higher Global Demand: Commodities at Close

The Standard & Poor’s GSCI Spot Index of 24 raw materials rose a second day, by 0.3 percent to 712.31, at 4:37 p.m. in New York. Cotton and cocoa lead the gain.

The UBS Bloomberg CMCI index of 26 prices rose for the third day, by 0.3 percent to 1646.93 at 4:38 p.m. in New York.

SOFT COMMODITIES

Cotton rose the most in two weeks on signs that demand is increasing for supplies from the U.S., the world’s biggest exporter. Sugar and cocoa also rose.

U.S. net sales of upland cotton more than doubled in the week ended March 8 from a week earlier, led by purchases from China, the top user, the government said. While India ended a ban on authorized exports on March 12, the government said it won’t permit registrations for new shipments until further notice, Commerce Secretary Rahul Khullar said.

Cotton for May delivery advanced 1.8 percent to settle at 89.08 cents a pound at 2:30 p.m. on ICE Futures U.S. in New York, the biggest increase for a most-active contract since March 5. The price has tumbled 55 percent in the past 12 months.

Sugar futures climbed to a three-week high on speculation that output will trail forecasts in Brazil, the world’s top producer. Coffee and cocoa advanced.

Copersucar SA, Brazil’s biggest sugar-trading and producers’ cooperative, said last week that production in the Center South, the main growing region, may be 32 million metric tons in the season that starts in April, down from a forecast of as much as 34 million tons in February, after drought damaged crops.

Raw sugar for May delivery advanced 1 percent to close at 25.66 cents a pound at 1:44 p.m. on ICE Futures U.S. in New York. Earlier, the price reached 25.71 cents, the highest for a most-active contract since Feb. 27.

Cocoa futures for May delivery rose 1.5 percent to $2,289 a ton in New York. Arabica-coffee futures for May delivery increased 0.6 percent to $1.835 a pound on ICE.

In London futures trading, refined sugar and cocoa gained on NYSE Liffe, and robusta coffee slid.

BASE METALS

Copper rose to the highest closing price in two weeks as signs of economic gains bolstered prospects for metal demand in the U.S., the world’s second-biggest consumer.

Government and industry reports this week may show U.S. home purchases climbed in February to the highest in almost two years, according to economists surveyed by Bloomberg News. Separate data from the Commerce Department may signal homebuilding increased. The Copper Development Association says that construction accounts for 40 percent of demand.

Copper futures for May delivery advanced 0.8 percent to settle at $3.909 a pound at 1:15 p.m. on the Comex in New York, the highest settlement since March 1. The metal has gained 14 percent this year.

On the LME, copper for delivery in three months rose 0.7 percent to $8,570 a metric ton ($3.89 a pound).

Aluminum nickel and zinc gained in London. Lead declined, and zinc was unchanged.

OIL PRODUCTS

Gasoline rose to a 10-month high on speculation that refinery closures because of low margins and seasonal maintenance will reduce supply as peak driving season approaches.

Futures advanced as Valero Energy Corp. said today that it will idle its Aruba refinery because it’s losing money. The 235,000-barrel-a-day plant supplies feedstocks to U.S. Gulf Coast refiners for further upgrading into gasoline and diesel.

Gasoline for April delivery rose 1.09 cents, or 0.3 percent, to settle at $3.3678 a gallon on the New York Mercantile Exchange, the highest settlement for the front-month contract since May 10.

Futures have surged 25 percent this year, becoming the best performer in the Standard & Poor’s GSCI index of 24 commodities. Prices are approaching 2011’s high of $3.4648 reached April 29.

Heating oil for April delivery fell 2.06 cents, or 0.6 percent, to settle at $3.2613 a gallon. Prices have gained 11 percent this year.

PRECIOUS METALS

Gold futures rose for the second time in three sessions as a drop in the dollar boosted the appeal of the metal as an alternative asset.

The dollar fell as much as 0.5 percent against a basket of six currencies, reaching the lowest level since March 9. Gold prices have climbed 6.4 percent this year as the dollar slumped on record low U.S. borrowing costs and as Europe’s leaders worked to tame the region’s debt crisis.

Gold futures for April delivery advanced 0.7 percent to settle at $1,667.30 an ounce at 1:40 p.m. on the Comex in New York. The metal is heading for a 12th straight annual gain.

Holdings in bullion-backed exchange-traded products touched a record 2,410.2 metric tons on March 13, data compiled by Bloomberg show.

Silver futures for May delivery gained 1.1 percent to $32.955 an ounce, after plunging 4.7 percent last week, the biggest weekly drop this year.

On the New York Mercantile Exchange, palladium futures for June delivery increased 0.8 percent to $707.60 an ounce. Platinum futures for April delivery climbed 0.5 percent to $1,684.70 an ounce. The metal, up 20 percent this year, is the best performer among the precious metals in 2012.

CRUDE OIL

Oil rose in New York on speculation that U.S. economic growth will accelerate, bolstering fuel demand in the world’s biggest crude-consuming country.

Futures gained 1 percent as confidence among U.S. homebuilders held in March at the highest level since June 2007 and sales expectations climbed. Bank of America Corp. raised 2012 price forecasts, projecting an economic recovery as geopolitical events constrain supplies. West Texas Intermediate oil, the U.S. benchmark, has advanced 9.4 percent this year.

Crude for April delivery rose $1.03 to $108.09 a barrel on the New York Mercantile Exchange, the highest settlement since March 1. The contract expires tomorrow. The more actively traded May futures gained 98 cents, or 0.9 percent, to $108.56.

Brent oil for May settlement dropped 10 cents to $125.71 a barrel on the London-based ICE Futures Europe exchange.

GRAINS, OILSEEDS

Wheat fell the most in two months on speculation that rain will boost production from North America to China. Corn and soybeans also declined as U.S. planting prospects improved.

Parts of the southern U.S. Great Plains will receive as much as 1.5 inches (3.8 centimeters) of rain in the next 24 hours from a storm that began yesterday in west Texas, World Weather Inc. said in a note today. Showers also will boost yields in southwestern Europe, China and Canada, the forecaster said. World inventories before the harvest in the Northern Hemisphere this year will rise 5.1 percent to a 12-year high, U.S. Department of Agriculture data show.

Wheat futures for May delivery tumbled 2.9 percent to close at $6.5225 a bushel at 1:15 p.m. on the Chicago Board of Trade, the largest drop since Jan. 12. The grain has declined 9.8 percent in the past 12 months on rising world production and slowing demand for U.S. supplies.

Soybean futures for May delivery fell 0.5 percent to $13.665 a bushel on the CBOT, the first drop in five sessions. Still, the oilseed has advanced 13 percent this year as hot, dry weather damaged crops in Brazil and Argentina, the biggest growers after the U.S.

Corn futures for May delivery dropped 1.4 percent to $6.635 a bushel in Chicago, the biggest decline since March 7.

LIVESTOCK

Hog futures fell for a fourth straight session, the longest slump this year, on signs that rising U.S. pork supplies are outpacing demand. Cattle prices also dropped.

Wholesale pork dropped to 82.7 cents a pound on March 16, the lowest since Jan. 12, 2011, and down from a record $1.1019 in August, U.S. Department of Agriculture data show. Hog processors slaughtered 414,000 hogs today, up 1.7 percent from a year earlier, USDA data show. In the week ended March 10, average hog weights rose 0.7 percent from a year earlier, the government said.

Hog futures for June settlement retreated 0.2 percent to close at 93.40 cents a pound at 1:15 p.m. on the Chicago Mercantile Exchange. The last time prices fell four straight sessions was Dec. 16. The most-active contract earlier touched 93.15 cents, the lowest for the June futures since Dec. 19.

Cattle futures for June delivery declined 0.4 percent to $1.2215 a pound in Chicago, capping a four-day drop of 2.1 percent. On March 16, the price touched $1.2165, the lowest since Jan. 10.

Feeder-cattle futures for May settlement slid 0.7 percent to $1.54775 a pound on the CME.

NATURAL GAS

Natural gas advanced for a second day in New York as higher prices in spot markets signaled increased demand for the power- plant fuel.

The futures gained 1.1 percent after prices at the Henry Hub in Erath, Louisiana, the delivery point for New York contracts, rose more than 6 percent. U.S. nuclear power production is at the lowest level since May, according to government data.

Natural gas for April delivery increased 2.5 cents to settle at $2.351 per million British thermal units on the New York Mercantile Exchange. The futures, down 21 percent this year, fell to $2.204 on March 13, the lowest intraday price since Feb. 15, 2002.

To contact the reporter on this story: Naureen S. Malik in New York at nmalik28@bloomberg.net.

To contact the editor responsible for this story: Dan Stets at dstets@bloomberg.net

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