TORONTO, Sept. 26, 2018 /CNW/ - The Scotiabank Commodity Price Index retreated by 5.3% m/m in August, with all major sub-indices falling back on a combination of demand concerns stemming from the US-China trade dispute and shortcomings in North American crude oil transportation infrastructure.
Additional tariffs in the escalating US-China trade dispute have dampened the demand outlook for base metals like copper, detailed Scotiabank Commodity Economist Rory Johnston in his latest Commodity Price Index published by Scotiabank today.
"Base metals felt the brunt of US-China trade war headwinds but Chinese copper premiums have reached 3-year highs despite weaker global copper contracts, indicating that global bearishness concerning Chinese demand has likely run ahead of any actual slowdown in physical Chinese purchases", wrote Rory Johnston, Commodity Economist.
Other highlights of the September 26 2018 Report include:
- The US continues to ramp up trade pressure on China with tariffs on an additional $200B in Chinese exports.
- In an unlikely reversal, base metals are waning just as bulk commodities are picking up steam.
- Canadian crude discounts swell on the back of maxed out pipelines and oil-by-rail services that are failing to keep pace with voracious demand for alternative egress out of Western Canada.
Scotiabank Economics provides in-depth commentary on economic, financial market, and policy developments, both domestically and internationally.
Read the full September 26 2018 Scotiabank Commodity Price Index online here.
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