Commodities Post Third Monthly Gain, Paced by Coffee, Nickel

Apr 30, 2014 7:02 pm ET

April 30 (Bloomberg) -- Commodities posted the third straight monthly gain as supply shortfalls boosted coffee and nickel prices.

In April, the Standard & Poor’s GSCI Total Return Index of 24 raw materials climbed 0.7 percent to 5,008.4, the longest rally since August. Arabica coffee in New York 16 percent after a drought in Brazil, the world’s top grower, cut estimates for output. Nickel in London advanced 15 percent, the most since September 2012, on concerns supplies from Russia may drop amid escalating tensions with Ukraine, following an export ban on ore from Indonesia.

“It was the supply side, and not the demand side, that drove commodities higher,” said Bjarne Schieldrop, the chief commodity analyst in Oslo at SEB AB. “The Russia-Ukraine crisis is bullish for nickel, palladium and agriculture.”

Nickel for delivery in three months reached $18,715 a metric ton on April 28, the highest since February 2013. This month, Goldman Sachs Group Inc. boosted its six-month price forecast to $20,000 from an estimate of $15,000. Supplies will lag behind demand by 100,000 tons in 2015, the first shortfall since 2010, BNP Paribas SA said April 24.

Coffee jumped to a 26-month high on April 23 as the worst Brazilian drought in decades ravaged the crop and Volcafe Ltd. predicted global bean harvests will fall short of demand. By the end of December, prices may be at $2.54 a pound, a Bloomberg survey of 19 analysts showed this month.

Feeder cattle in Chicago surged to a record in April for the biggest monthly gain since December 2012. The U.S. feedlot herd at the start of April unexpectedly fell 0.6% to 10.86 million head from a year earlier, U.S. Department of Agriculture data showed on April 25.

On the Chicago Board of Trade, corn gained 3.4 percent as rain delayed planting. Wheat advanced 3.5 percent on dry weather and possible supply disruptions from Ukraine.

--With assistance from Elizabeth Campbell in Chicago.