Some commodities are starting to break down but the indexes are still very strong. GSCI
Metals are coming off sharply and have just about erased the Ukraine jump:
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But softs are still firm:
So is energy:
Frustratingly, none of these indexes includes Australia’s key bulk commodities of iron ore and coal.
Iron ore is falling out of bed and should continue to do so. This is Dalian futures:
The same can be said of coking coal in China:
But longer-dated seaborne coking coal prices are still rising in Singapore:
Thermal coal is similar
Which is pretty weird because JKM with which it competes has come off a lot and still is:
There are huge arbitrages all over the place here. Chinese coals are much lower than seaborne. Gas is much lower than coal. China is digging up more coal at an astonishing speed. Iron ore is still in a glut.
The market looks pretty stretched and irrational, doubtless pushed out of shape by real supply constraints and imagined ones.
I still think that a big global recession will rebase the lot. The commodity market needs it.