In this week's Market Movers Asia with Barbara Lorenzo Caluag:
- Brent-Dubai price spread narrows
- China’s H1 international trade data in focus
- El Nino returns after seven years
Asian traders and refiners are looking to take full advantage of the sharp decline in the Brent-Dubai crude price spread, with a slew of low sulfur grades from North America, Africa and the North Sea linked to the European crude benchmark expected to reach Asia in the near term. Brent-Dubai price spread narrows
The prompt Brent-Dubai Exchange of Futures for swaps, a key indicator of Brent's premium to the Middle Eastern benchmark, flipped into the negative territory at minus 14 cents June 28, the lowest since Oct. 30, 2020.
China is set to release its preliminary international trade data for the first half of the year on July 13. The country’s slowing exports are weighing on demand recovery prospects. The data is expected to provide a hint on trade activity for the rest of the year and the possibility of government measures to drive trade.
El Nino continues to be in focus for the agriculture sector after the UN’s World Meteorological Organization officially declared the return of the weather phenomenon after seven years. This roughly implies extreme heat and dry weather may be expected in Southeast Asia and Australia, and could impact the supply of grains and vegetable oil crops.
The weather is also affecting coal markets, with rains in Indonesia keeping overall seaborne coal demand subdued. In this low-price environment, Australia’s high calorific value coal has become more attractive to buyers. Australian coal prices.
And finally, market participants will be closely tracking the listing of lithium carbonate contracts on the Guangzhou Futures Exchange in late-July.
I’m Barbara Lorenzo Caluag thank you for kicking off your Monday with S&P Global Commodity Insights!