(Corrects 11th paragraph to show area of earthquake damage accounts for 30 percent of feed-production capacity.)
March 18 (Bloomberg) -- Commodities gained to a one-week high as unrest in the Middle East and North Africa boosted oil prices and after the Group of Seven intervened in currency markets to help Japan after last week’s earthquake.
The Standard & Poor’s GSCI Spot Index rose as much as 1.7 percent to 712, the highest level since March 10, a day before Japan’s worst earthquake on record triggered a tsunami and a crisis at one of the country’s nuclear power plants. It was at 711.61 at 12:23 p.m. London time.
“The market switched focus from Japan’s nuclear crisis back to the escalating geopolitical tensions in Libya,” Mark Pervan, head of commodity research at Australia and New Zealand Banking Group Ltd. in Melbourne, wrote today in a report.
Crude climbed as much as 2.2 percent in New York today after the United Nations Security Council voted to ground Libya’s air force and establish a no-fly zone. Oil jumped the most in three weeks yesterday after Libyan leader Muammar Qaddafi’s jets dropped bombs around Benghazi and Bahraini security forces arrested opposition leaders. The International Energy Agency estimated the output loss in Libya at about 1.3 million barrels a day.
The S&P GSCI Index, which tracks 24 commodity futures including industrial and precious metals, grains and energy, is headed for a weekly gain of 1.5 percent, extending this year’s advance to 13 percent. The index climbed 3.4 percent yesterday, the most since Feb. 24.
“The prospect of supply tightening is keeping a floor under oil prices,” said Ben Westmore, a commodity analyst at National Australia Bank Ltd. in Melbourne.
Crude for April delivery climbed as high as $103.66 a barrel in New York and last traded at $102.95.
Gold gained for a third day as the fighting in Libya and unrest in Bahrain boosted demand for safer assets. Immediate-delivery bullion rose 1.2 percent to $1,420.60 an ounce, and silver increased 2.9 percent to $35.2438 an ounce. Copper for three-month delivery fell 0.2 percent to $9,543 a metric ton on the London Metal Exchange, heading for a weekly gain.
G-7 nations agreed to their first joint intervention in the foreign-exchange markets for more than a decade by selling yen after the currency soared to a post-World War II high, threatening Japan’s recovery from the disaster. Water cannons may have had some success in cooling one reactor at Tokyo Electric Power Co.’s damaged nuclear plant at Fukushima, even as the United Nations’ nuclear agency said the situation remains “very serious.”
Rubber traded in Tokyo surged for a third day, climbing as much as 7.2 percent to 425.5 yen a kilogram ($5,210 a ton) after Thailand, Indonesia and Malaysia, the biggest growers, said they may reduce shipments.
The earthquake and tsunami in Japan “severely damaged” importing facilities in a part of the country that accounts for about 30 percent of total compound feed-production capacity, according to an estimate by the U.S. Grains Council.
Corn for May delivery in Chicago gained as much as 5.2 percent to $6.80 a bushel before trading at $6.7925, heading for a weekly advance. May-delivery wheat added as much as 4.8 percent to $7.44 a bushel, the highest level since March 10, and last traded at $7.42.
To contact the reporter on this story: Chanyaporn Chanjaroen in Singapore at email@example.com
To contact the editor responsible for this story: James Poole at firstname.lastname@example.org