Daily FNArena News - Commodities

Supply side issues have pushed up the aluminium price but JP Morgan suggests such stronger prices will not be sustainable, the broker retaining its negative view on Alumina Ltd as a result.

Industry consultant TradeTech has left its weekly spot price indicator unchanged for the second week in a row.

While a number of LNG projects have now been proposed in Queensland Credit Suisse doesn’t think the market will tighten enough to lift prices to levels allowing all the proposals to proceed.

Barclays Capital has been bullish on aluminium for some time and with indications a potentially significant tightening in the market is possible the group reaffirms its view.

With China again leading the way steel industry consultant MEPS expects global steel output to rise by 5.7% in 2008.

Merrill Lynch has revised its gold price forecasts significantly higher and the broker is not alone in suggesting US$950 per ounce or higher is possible in 2008.

If history repeats itself spot uranium should soon be rising again.

With solid demand growth and supply concerns to keep the market tight NAB has revised up its forecast for average oil prices in 2008 to US85 per barrel from US$65 previously.

Sugar prices have rallied since the September quarter but analysts continue to have diverse views on the price outlook.

The oil market looks tight at present but as CBA notes this may reflect stronger seasonal demand that traditionally eases as the northern hemisphere moves from winter to spring.