US stocks climbed to a record high today, the dollar was unchanged and commodities continued to march ahead, with the DJ-UBS index rising to a 10-month high. This renewed interest for commodities so far this year can also be seen in the latest Commitment of Traders report, with hedge funds being net buyers of 23 out of 24 US traded commodity futures during the week ending February 18.
Once again, the hot and dry conditions in Brazil continue to support coffee and sugar, with the price of Arabica coffee reaching a new four-month high after worries that the global market could be heading for its first shortage in four years. As a result, we have seen Arabica coffee's premium over Robusta coffee (supplies of which are not under threat) rise to its highest since 2012.
Silver rose to USD 22.21, its highest level since October 31. Gold reached its highest level in 16 weeks, thereby putting resistance at 1,337.8 USD/oz under some pressure. Current momentum remains positive and with political turmoil in Ukraine raising some concerns, the metals continue to find the upside path of least resistance.
Both crude oils stayed in the black for most of the day, with continual strong demand for refined products in the US. Speculative traders still favour WTI over Brent crude, with the net-long WTI crude position almost back to its record of last summer. The Brent crude net-long is still only half of its recent peak.
Copper has dropped the most in a month after signs that demand from China, the world's largest consumer, may be faltering. Price momentum is also on the wane, which my colleague Kim Cramer highlighted in his blog earlier today.
