Five charts to watch in global commodity markets this week

(Bloomberg) - Gold's continued surge to record highs has many market observers sleepy. The rise in oil is making it more expensive for some traders to protect themselves from soaring crude prices in what's fast becoming a very bullish market. While crop traders await a major report from the U.S. Department of Agriculture on global demand, U.S. farmers are enjoying some of the best conditions for wheat planting in years.

More reads from Bloomberg.

• Royal Bank of Canada fires premier financial officer Ahn Jae-mong after investigation into personal ties.

• Trumpism is hollowing out the church

• Saudi Arabia scales back $1.5 trillion desert project Neom's ambitions

• Turkey joins NATO allies in suspending European arms treaty

• Kroner -紥尅伯格's wealth surpasses Elon Masker's for the first time since 2020

Here are five charts to watch in global commodity markets this week.

bullion

As Treasury yields rose - usually a negative factor for bullion - gold's frenzied rally last week surprised many onlookers, with the precious metal topping $2,300 an ounce. This difficulty suggests that there are stronger factors at play, with strong central bank buying and growing Chinese consumer demand adding to gold's upward momentum. The outlook is mostly bullish, although there may be a short-term correction at current overbought levels. Weak futures positions suggest there's more room for speculation, which could push gold further up, while the much-anticipated Fed rate cut pivot - once it occurs - is likely to see investors flocking to gold-backed exchange-traded funds again after months of capital outflows.

petrochemical

For the first time since November, oil options traders are paying more to hedge the rising cost of crude oil. A so-called skew indicator showed that calls were in higher demand than puts. The shift in the skew toward calls underscores the severity of the bullish sentiment for crude amid heightened geopolitical tensions. Global benchmark Brent crude rose above $90 a barrel last week for the first time since October, while West Texas Kerosene Intermediate soared to levels not seen in nearly six months.

Wheat

Wheat production in the United States has rebounded at a time when health-conscious consumers are buying fewer foods made from this staple grain. The easing of the drought in the U.S. grain bins has resulted in the best wheat harvest conditions in four years. At the same time, flour production in flour mills has declined. On the whole, this means that domestic demand for wheat is down, and U.S. farmers have been beaten in the export market by cheaper supplies from top shipper Russia. The U.S. Department of Agriculture will release its World Crops and Demand Forecast on Thursday, revealing demand for harvested wheat and other crops.

caffeine

Coffee prices are soaring, with both lower-priced Robusta beans and premium Arabica beans moving higher. Robusta futures are near record highs as a heat wave has affected production in Vietnam, a major exporter, fueling fears of a tight global supply of instant coffee beans. Arabica beans, favored by Starbucks Corp, hit a 17-month high as roasters turned to the bean as an alternative to robusta in blends. Later this week, the market may see if Brazil, the top supplier of Arabica beans, shows any signs of easing when industry group Cecafé releases monthly export data.

Electric Vehicles

According to BloombergNEF's latest industry report, sales of passenger electric vehicles are facing a number of hurdles that could slow global annual growth rates. Regulatory adjustments in Europe, market saturation in China, and uncertainty ahead of the U.S. presidential election could dampen consumer confidence. Despite this, BNEF expects annual global EV sales to grow by 22% to 16.7 million units this year, a slowdown from last year's growth of 30%.

-Doug Alexander and Michael Hirtzer helped write it.

Most Read by Bloomberg Businessweek

• Everyone is rich, but no one is happy. Professional Golf is back!

• How Hertz's bet on Tesla is going to go 耑?

• How Brouillette Became a $2 Billion Dollar Hottest Hit with an Undiscovered Future

• Repairing Boeing's broken corporate culture begins with a new airplane.

• Elon Masse resonance X has a porn problem.

©2024 Bloomberg L.P.