Oil prices weaker but copper up sharply: a monthly review of Papua New Guinea’s commodities and financial markets

Oil prices have weakened, but copper has seen an upwards run. Business Advantage PNG’s monthly review of Papua New Guinea commodity and financial markets.

Natural gas prices. Source: Macrotrends

According to Kina Securities, the oil price has weakened over the month. After rising sharply in July, West Texas Intermediate fell by 3.3 per cent in August, a continuation of recent volatility.

The general trend is downwards, however. The light crude oil price is 11.7 per cent lower than this time last year.

The LNG price has also been weak. It was down 1.8 per cent for the month and has fallen by 20 per cent over the year.

‘Gold was up 2 per cent for the month and has risen 12.2 per cent over the year.’

There is likely to be some short-term volatility in prices because of Hurricane Harvey in Texas. The flooding has interrupted about 16 per cent of US refining capacity.

Copper prices, year to date. Source: Macrotrends

Metals

Precious metals prices have continued to move mostly sideways. Gold was up 2 per cent for the month and has risen 12.2 per cent over the year, according to Kina.

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‘Copper was a big mover, which is of significance to some of PNG’s big producers.’

The silver price was up 2.9 per cent over the month, and is up 6.6 per cent from this time last year.

Copper was a big mover, which is of significance to some of PNG’s big producers. It was up 6.2 per cent over the month, according to Kina Securities, and has risen 22 per cent over the year.

Agriculture

Agriculture prices continue to be mixed. The palm oil price rose by 2.2 per cent for the month, according to Kina Securities, but it is still down 14.5 per cent over the year.

‘Coffee prices also lost recent gains.’

The cocoa price was weak, losing some of its recent gains. It was down 4.4 per cent for the month and 9.5 per cent for the year.

Coffee prices also lost recent gains. They fell 6.8 per cent over the month and are down 7.6 per cent for the year.

Equities

The stock market did little. The KSI Home Index (PNG-listed stocks only) rose by 1.4 per cent over the month and the KSI Index (which includes dual-listed stocks as well) rose 1.2 per cent in the month. Both have risen by 3.5 per cent from the same time last year. The Australian All Ordinaries Index has risen 1.4 per cent over the year, while America’s S&P 500 is up 8.9 per cent over the year.

The kina was unchanged over the month against the US dollar but was up 1.9 per cent against the Australian dollar, according to Kina Securities.

The kina has fallen by 6.6 per cent against the yen over the last year, after weakening by 1.7 per cent over the last month.

Half-year Treasury Bills are yielding 4.74 per cent, while full-year Bills are yielding 7.97 per cent.

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