Gold prices have broken out of a six year trading range. Gold is up over 11% YTD, and more than 21% since its August low. The chart below compares the performance of gold from its August 2018 low to the S&P 500. … [Read more...]

Bloomberg has reported that China is threatening to restrict the supplies of rare earth metals as part of its ongoing trade war with the United States. This isn't the first time China has used rare earths as a tool in its diplomacy. People who know the history of China's rare earths dominance should understand instantly why such a threat is indicative of why America must get tough on Chinese trade policies in the first place. China didn't come to dominate rare earth metals because of its natural endowment, but instead because the country subsidized production in order to eliminate … [Read more...]

As Occidental Petroleum attempts to purchase Anadarko Petroleum, it is raising funds for the deal by selling Anadarko's African natural gas assets to French oil major, Total SA. Neanda Salvaterra reports for The Wall Street Journal: Total SA’s TOT +0.88% deal to buy Anadarko Petroleum Corp.’s APC +0.26% assets in Africa cements the French oil major’s position as the world’s second-largest provider of liquefied natural gas while pushing its business deeper into dangerous parts of the world. Total said earlier this week that it agreed to buy Anadarko’s African assets for $8.8 billion in a … [Read more...]

Bad weather in some key housing markets had tempered demand for lumber, as builders are slowed down. Some big mill owners have even trimmed their output in the face of lower product prices. Ryan Dezember reports for The Wall Street Journal: Lumber prices typically rise in the spring as builders stock up for construction season. But this year, they are being hit hard by bad weather and a decline in home building. The slump comes a year after lumber prices reached record levels and were climbing higher amid a resurgent U.S. housing market, a boom in spending on home renovations and … [Read more...]

According to the White House, despite sanctions on Iranian oil, the market is well supplied. Saudi Arabia and the UAE, along with the U.S. have stepped in to fill the gaps left by the now-sanctioned Iranian crude. Reporting for Reuters, John Kemp writes that oil traders think differently: The decision to eliminate all remaining sanctions waivers for Iran’s oil buyers follows a round of top-level diplomatic contacts between the White House and leaders of Saudi Arabia and the United Arab Emirates. Tougher sanctions are likely contingent on a U.S. understanding that Saudi Arabia and the … [Read more...]

After the Trump administration announced an end to Iranian sanction waivers, the country's Revolutionary Guard force threatened to close the Strait of Hormuz, a strategic choke point at the mouth of the Persian Gulf. The EIA estimates that in 2016 around 18.5 million barrels of oil traveled through the Strait of Hormuz each day. Stopping up the strait would lead to a major economic shock. Reuters reports on the threat: Tehran is prepared for a U.S. decision to end waivers granted to buyers of Iranian crude, an Iranian oil ministry source said on Monday, as the Revolutionary Guards repeated … [Read more...]

If you guessed Apple, you'd be wrong. The iPhone maker came in second with a profit of $59.53 billion. The most profitable company was Saudi Aramco, the national petrochemical company of Saudi Arabia. Rory Jones and Summer Said report for The Wall Street Journal:  The oil firm’s 2018 net income shot up from 284 billion riyals, or the equivalent of $75.9 billion, in 2017. By comparison, Apple Inc.’s equivalent profit was roughly $60 billion in its last full year; Amazon.com Inc. was $10 billion and Exxon MobilCorp. was $21 billion. The three years of financial information contained in the … [Read more...]

For decades chicken growers have been working to speed up the rate at which a chicken grows from chick to roaster size. To reach the target weight of 6.3 pounds today takes 47 days, as opposed to double that 50 years ago. But the acceleration in chicken growth hasn't come without its own problems. The Wall Street Journal's Jacob Bunge reports on what has become known as "spaghetti meat." He writes: Chicken companies spent decades breeding birds to grow rapidly and develop large breast muscles. Now the industry is spending hundreds of millions of dollars to deal with the consequences ranging … [Read more...]

Big oil companies like Exxon and Chevron came late to the party in the Permian basin, but are now heavily invested in the oil play. Faced with certain difficulties ahead, they are looking to "change the game." Ed Crooks reports for The Financial Times: The Permian’s oil output has already shown prodigious growth in recent years: it has doubled since the summer of 2016, to 4m barrels a day, or roughly a third of total US daily production. The announcements from Exxon and Chevron were a signal that the boom would continue. “It is quite a stunning development, in terms of the scale and the … [Read more...]