Morning Call: Crude 112.50 +1.04%; Cotton 96.37 +0.94%; BDI 1013 -3.8%

Crude prices rose in Asian trading on news that France was pushing for faster implementation of sanctions against Iran and comments from Saudi Arabia in support of average global crude prices at $US100 per barrel.

Sentiment towards commodities was also supported by faster than expected Chinese GDP growth in 2011Q4. Chinese GDP expanded by 8.9%, against expectations of an 8.7% rise although this is the slowest rate of increase for over 2 years.

Commodity Risk Economic Calendar 16th – 20th Jan 2012

(All times GMT):

Monday 16th January

13:00 – ECB President Draghi speaks: Following S&P’s downgrade of French and Austrian sovereign debt last week and bank deposits at the ECB reaching record levels, expect his speech to set the tone for market sentiment at the start of the week.

21:00 – China GDP estimates: Over the past year annual GDP growth has slowed from 9.8% in 2010Q4 to 9.1% in 2011Q3. Recent PMI data show manufacturing output contracted in November, the first time since 2009 so a slowdown in GDP in 2011Q4 is likely. 2011Q4 data is forecast at 8.8%. The latest data can be found here. A better than expected estimate may be bullish for commodities on improved demand in China. read more

Commodity price volatility seen as key global risk in new report

Last week saw the publication of the World Economics Forum Global Risks 2012 report, a report based on a survey of 469 experts from industry, government, academia and civil society that examines 50 global risks and the latest in a series of reports from different institutions aiming to categorise how risks are changing over time.

The 50 global risks were divided into 5 categories: economic, environmental, geopolitical, societal and technological. Although all 5 categories may present a risk to the correct functioning of a supply chain, the category ‘economic’ addresses those areas that are of greatest concern in terms of likelihood and impact in the area of macroeconomics and so has the most bearing on managing commodity risk in global supply chains. read more