The Scotiabank Commodity Price Index started 2013 on a stronger note, rising 3.8% month-over-month in January, after losing significant ground late last year.
"Riskier assets such as commodities and equities were buoyed in January by the 2012 fourth quarter pick-up in China's economy," said Scotiabank's VP of economics and commodity market specialist, Patricia Mohr.
"However, market conditions remain skittish, with some industrial commodity prices and equity markets easing back again in late February."
China's GDP accelerated to 7.9% from 7.4% in the third quarter, accompanied by raw material re-stocking, a partial resolution of the U.S. 'fiscal cliff' and expectations of some pick-up in the U.S. economy by the second half of 2013.
But markets became concerned again as China's State Council, worried over re-escalating residential property prices, announced a five-point plan to contain prices, some of which are restrictive. The Federal Reserve's FOMC minutes of January 29-30 also unsettled commodity markets - particularly gold - with participants discussing the merits of the Fed's monetary easing policy.
However, Federal Reserve chief Ben Bernanke eased fears about the program ending sooner than expected on Tuesday, as he defended the policy in his first day of testimony on Capitol Hill, saying the benefits of the asset purchase program outweigh any costs, and will continue.
The gain in Scotiabank's Commodity Price Index in January was widespread, with all sub-Indices advancing.
After plunging in December, the Oil & Gas index posted the strongest month-over-month increase among all the sub-indices, at 9.2%, led by firmer light crude oil in Edmonton, and stronger propane prices in Edmonton and Sarnia.
While Western Canadian Select heavy oil (WCS) remained at a low ebb, the price edged up from a mere US$57.84 per barrel in December to almost US$62 in January.
Firmer international oil prices - with WTI climbing from US$88.25 to US$94.83 amid improving sentiment for a stronger global economy - offset a widening of the WCS discount off WTI to US$32.84 in January.
The Metal and Mineral Index also edged up in January by 0.3% from December, as copper prices responded favourably to the pick-up in China's growth, surging as high as US$3.71 per pound late month.
Spot iron ore prices delivered to northern China also jumped to US$150.49 per tonne - from just under US$129 in December and a low of only US$99 last September - on further re-stocking by Chinese steel mills. These gains offset softer gold prices.
Meanwhile, the Forest Product Index posted a further gain of 2.3% in January, climbing 18.9% year-over-year - the biggest increase of any sub-Index. Lumber and OSB prices continued to march higher in January amid tight supplies.
Finally, the Agricultural Index rose by 1.2% month-over-month in January and 8.1% year-over-year. Price gains in canola, cattle, hogs and Atlantic Coast lobster more than countered slight declines in wheat and barley, the report said. Reported by Proactive Investors 2 hours ago.
"Riskier assets such as commodities and equities were buoyed in January by the 2012 fourth quarter pick-up in China's economy," said Scotiabank's VP of economics and commodity market specialist, Patricia Mohr.
"However, market conditions remain skittish, with some industrial commodity prices and equity markets easing back again in late February."
China's GDP accelerated to 7.9% from 7.4% in the third quarter, accompanied by raw material re-stocking, a partial resolution of the U.S. 'fiscal cliff' and expectations of some pick-up in the U.S. economy by the second half of 2013.
But markets became concerned again as China's State Council, worried over re-escalating residential property prices, announced a five-point plan to contain prices, some of which are restrictive. The Federal Reserve's FOMC minutes of January 29-30 also unsettled commodity markets - particularly gold - with participants discussing the merits of the Fed's monetary easing policy.
However, Federal Reserve chief Ben Bernanke eased fears about the program ending sooner than expected on Tuesday, as he defended the policy in his first day of testimony on Capitol Hill, saying the benefits of the asset purchase program outweigh any costs, and will continue.
The gain in Scotiabank's Commodity Price Index in January was widespread, with all sub-Indices advancing.
After plunging in December, the Oil & Gas index posted the strongest month-over-month increase among all the sub-indices, at 9.2%, led by firmer light crude oil in Edmonton, and stronger propane prices in Edmonton and Sarnia.
While Western Canadian Select heavy oil (WCS) remained at a low ebb, the price edged up from a mere US$57.84 per barrel in December to almost US$62 in January.
Firmer international oil prices - with WTI climbing from US$88.25 to US$94.83 amid improving sentiment for a stronger global economy - offset a widening of the WCS discount off WTI to US$32.84 in January.
The Metal and Mineral Index also edged up in January by 0.3% from December, as copper prices responded favourably to the pick-up in China's growth, surging as high as US$3.71 per pound late month.
Spot iron ore prices delivered to northern China also jumped to US$150.49 per tonne - from just under US$129 in December and a low of only US$99 last September - on further re-stocking by Chinese steel mills. These gains offset softer gold prices.
Meanwhile, the Forest Product Index posted a further gain of 2.3% in January, climbing 18.9% year-over-year - the biggest increase of any sub-Index. Lumber and OSB prices continued to march higher in January amid tight supplies.
Finally, the Agricultural Index rose by 1.2% month-over-month in January and 8.1% year-over-year. Price gains in canola, cattle, hogs and Atlantic Coast lobster more than countered slight declines in wheat and barley, the report said. Reported by Proactive Investors 2 hours ago.