Commodity markets were relatively well behaved on the first day of the week, as investors continued to track events in Washington D.C.
Significantly, the US government is discussing a plan that would end the shutdown and increase the debt ceiling by enough to cover the nation’s borrowing needs at least through mid-February 2014, sources told Reuters.
The agreement would also see the government re-open until January and include a mechanism to force lawmakers into longer-term budget discussions, the Financial Times reported.
Oil futures finished the day down by 0.13% at $102.28 on the NYMEX despite those signs of progress.
Some observers were also referencing an estimate from Goldman Sachs – from last Friday – according to whom the current impasse in Washington, so far, may reduce US economic growth in the fourth quarter by half a percentage point to 2%.
Freight traders are hiring record numbers of iron-ore carriers in the spot market as Chinese steel production expands at the fastest pace in three years, spurring the biggest rally in shipping rates since 2009.
One-time charters to haul iron-ore on Capesizes, the largest ore carriers, rose 51% to 124 in September from the previous month, according to data compiled by Morgan Stanley, Bloomberg says. More than 90% are bound for China.
Chinese steel production is expanding at its fastest in three years.
China’s Dalian Commodity Exchange will begin trading its first iron-ore futures for physical delivery this week, challenging derivatives from CME Group and Singapore’s exchange.
Gold futures ended the day only slightly lower, by 0.92% to the $1,264.90/ounce mark.
Corn futures rose by 0.23% to the $438/bushel level.