CommodityHQ.com provides weekly information about any material impact of a major economic, corporate and/or geopolitical event on the global commodities market. The report also analyzes the weekly change in prices of the major commodity futures and commodity-focused ETFs as a result of market changing events and trends. This report covers events and analysis for the week ranging March 27 to April 3.
- A deal between OPEC and non-OPEC countries to cut oil production by 32.5 million barrels for the first 6 months of the year helped lift crude oil above $50 this week.
- Aluminum prices jumped this week after China announced a production cut in order to curb pollution.
- Agricultural commodities fell as investors took a break to analyze the inflation trade more closely.
- Be sure to read our previous edition to follow up with the commodity market trends.
Weekly Market Wrap-up
Energy – OPEC and non-OPEC countries agreed to cut a total of 32.5 million barrels of oil for the first 6 months of 2017 in an effort to reduce inventories while warmer weather expectations dragged natural gas prices lower.
- Oil – Crude oil prices climbed to a 4-week high of $50.44 per barrel last week before rising US shale production caused oil to pull back slightly. Read here to know more about how to invest in crude oil.
- Natural Gas – Natural gas prices softened somewhat to $3.239 per million British thermal units this week after several weeks of bullish behavior. More mild weather reports reduced demand and hurt prices.
- Coal – The coal industry continues to face challenges with the latest report that the entire industry now employs just 76,000 – fewer people than the Arby’s restaurant franchise.
Metals – Copper prices ticked up to $2.62 per ounce ahead of the global copper industry meet in Chile, although gains are likely to be limited by U.S. interest rates and the U.S. dollar’s performance.
- Precious Metals – April delivery for gold touched $1,250.95 a troy ounce last week as investors took the time to gauge political and market conditions before making any decisions.
- Other – China cut aluminum production in an effort to curb pollution, sending aluminum higher for the week and providing a strong tailwind for aluminum equities.
- Corn and Soybeans – A boost in soybean production is expected for 2017, adding to a global supply glut and depressing prices even further as corn becomes less economically viable for farmers.
Softs – A tropical cyclone that hit Australia didn’t do much to lift sugar prices, with May futures last trading at $17.02 cents a pound.
If you want to know what commodity is right for you, check out our Commodity Investing Database here.
Weekly Movement Across Commodity Futures
For this week, we analyzed all commodities by weekly performance and listed the top three performers by weekly percentage gain. All commodities were taken into account and analyzed from a performance perspective only to find the top three.
You can use ETFdb.com’s Screener to see a complete list of commodity ETFs.
| Commodity | Weekly Gain (%) | Contract Expiration | Contract Price (as of Apr 3) | 52-Week Price Change |
|---|---|---|---|---|
| Crude Oil | 3.51% | 05/17/17 | $50.04 | $35.24 - $55.24 |
| US Corn | 2.73% | 05/17/17 | $367.50 | $301 - $439.25 |
| Heating Oil | 2.70% | 05/17/17 | $1.56 | $1.07 - $1.76 |
Oil prices gained traction this week as investors began to see promise in the OPEC production cuts from earlier in the year, while heating oil prices continued to gain on colder weather from the past few weeks. U.S. corn outperformed for the week, and farmers shifted to greater soybean production.
Weekly Commodity ETF Movers
For ETF investors, we tracked the top three biggest gainers and top three biggest losers for the past week. Not included are ETN’s, which behave differently than ETF’s, as well as leveraged ETF’s which may not be suitable for some investors. Considering the limited data for the year, all ETF’s were taken into consideration regardless of YTD gains.
Top Three ETF Winners This Week:
| ETF Ticker | ETF Name | Commodity Category | Assets ($ million) | NAV (as of Apr 3rd) | Return (Weekly %) | Return (YTD %) | Expense Ratio |
|---|---|---|---|---|---|---|---|
| OILK | ProShares K1 Free Crude Oil Strategy ETF | Oil | 3.03 | $20.09 | 5.51% | -10.31% | 0.65% |
| USO | United States Oil Fund | Oil | 2,688.14 | $10.55 | 5.08% | -9.98% | 0.45% |
| USL | United States 12 Month Oil ETF | Oil | 108.34 | $18.44 | 4.65% | -9.61% | 0.93% |
All three of the best-performing commodity-based ETFs this week are based on oil, unsurprisingly. Oil was the clear commodity winner as investors began to see hopes in the OPEC production cut, helping lift prices and downplaying some of the production growth in the US.
Learn how commodity ETFs performed this week on ETFdb.com here. If you are specifically looking for crude oil ETFs, click here.
Top Three ETF Losers This Week:
| ETF Ticker | ETF Name | Commodity Category | Assets ($ million) | NAV (as of Apr 3) | Return (Weekly %) | Return (YTD %) | Expense Ratio |
|---|---|---|---|---|---|---|---|
| CANE | The Teucrium Sugar Fund | Sugar | 4.42 | $11.67 | -5.20% | -10.23% | 1.76% |
| USAG | United States Agriculture Index Fund | Broad agriculture | 1.88 | $17.96 | -4.21% | -0.61% | 0.65% |
| SOYB | The Teucrium Soybean Fund | Soybeans | 10.87 | $18.03 | -2.28% | -5.60% | 3.49% |
Agricultural ETFs were the worst performers this week as investors began to question the strength of the inflation trade with multiple rate hikes scheduled for 2017. Institutional buying, which had been propping up values, dried up and caused prices to languish for the week.
Check out here how agriculture ETFs performed this week on ETFdb.com.
We provide this report on a weekly basis. Be sure to check our News section to remain updated on the latest happenings in the commodity space.
