Commodity

European benchmark gas futures surged more than 10% on Monday as traders remained unconvinced that negotiations involving Iran and Oman would quickly restore global LNG flows via the Strait of Hormuz. Europe’s storage sites are just under 59% full, well below the five-year seasonal norm of 76% and at the lowest seasonal level in records dating back to 2009. Citigroup strategists including Maggie Xueting Lin expect inventories to reach about 74% by the end of October if Middle East LNG exports gradually resume from mid-August, but warned of demand-spike risks if El Niño brings extreme cold spells, according to Bloomberg. Dutch TTF front-month futures settled at €61.24 per megawatt-hour, while US gas futures also posted their biggest gain in more than two months on short-covering tied to swings in weather forecasts.

Chicago wheat futures climbed as traders positioned for the US Department of Agriculture’s monthly supply-and-demand report, which is expected to show tighter global grain supplies. The most-active contract rose as much as 2.5% intraday to its highest level since July 30 before giving back some gains. The Black Sea remains the main export gateway for Russia and Ukraine, which together account for over a quarter of global seaborne wheat shipments and a 10th of corn. Markets are focused on the prospect of a tighter supply outlook.

U.S. crude oil inventories in the Strategic Petroleum Reserve fell to their lowest level in more than four decades after dropping 6.1 million barrels last week to 298.7 million barrels. Since mid-March, SPR stocks have declined by about 116 million barrels. The drawdown follows an authorization by President Donald Trump on March 11 to release up to 172 million barrels in response to disruptions tied to the Iran war that slowed tanker traffic through the Strait of Hormuz.

Brazil Center-South June sugar output fell 26.3% y/y to 3.903 MMT, adding to supply concerns. India’s weather office cut its June-September monsoon cumulative rainfall estimate to 90% of the long-term average, and total rainfall was 12% below normal as of August 10. The USDA projects Thailand’s 2026/27 sugar production will drop 15.6% y/y to 9.5 MMT. The tighter supply outlook helped New York raw sugar and London white sugar futures edge higher on Monday.

A weaker production outlook in smaller West African countries lifted ICE cocoa futures to a higher close on Monday. Early assessments put output for the new season at just 1.8 MMT, down 18% year on year, sharpening concerns about tighter supply. Even with Ghana’s 2025/26 harvest up 25.6% to 750,000 MT, Ivory Coast port arrivals up 20% to 2.11 MMT in the current marketing year, and Nigeria’s June exports up 30%, market attention has shifted toward the expected drop in the coming season.

India is considering cutting the amount of sugarcane diverted to ethanol production as domestic sugar prices reach record highs. Mills have diverted about 3 million metric tons of sugar—around 10% of total output—to ethanol in the current year ending September. Sugar prices have climbed about 10% over the past month on tighter supplies and stronger festival-season demand, and are expected to stay elevated for at least the next three months. To keep its 20% ethanol blending programme on track, the government may raise the use of corn and rice for ethanol production.

Sugar prices are rising as supply concerns grow, after UNICA data showed Brazil Center-South June sugar production fell 26.3% year on year. In India, monsoon rainfall forecasts have been cut and actual rainfall remains below normal, adding to worries about the crop. For 2026/27, global sugar consumption is expected to rise 0.4% to 179.991 million tons. A tighter supply-demand outlook is supporting prices.

ICE cocoa futures in New York and London rebounded as assessments of the new West African crop pointed to weak pod development. The market is pricing 2026/27 output at 1.8 MMT, down 18% from the prior season. Separately, Ghana’s cocoa board said 750,000 MT has been harvested for 2025/26, up 25.6% year on year, while Ivory Coast shipments to ports totaled 2.11 MMT in the current marketing year, up 20%. Nigerian cocoa exports in June rose 30% year on year.

Global gold ETFs posted net inflows of $3.04 billion in the week ended August 7, marking a third consecutive week of net additions, according to World Gold Council data. The US, China and the UK led gross inflows totaling $4.38 billion, while the US also accounted for the largest outflows of $1.33 billion. Net ETF investment stands at $13.69 billion year-to-date, while China and India have continued to contribute positive flows totaling about $11 billion. Gold rose more than 6% over the week, and analysts cited $3,950–4,000 as a support zone.

Copper is up more than 17% this year, but the rally cooled after accelerating in early August to a record $6.90 a pound before pulling back. The Democratic Republic of Congo has disclosed a June 29 order banning exports of copper and cobalt concentrate. Markets are also weighing expectations that the U.S. could delay or only partially implement copper import tariffs, a scenario seen keeping current stockpiling flows and a tight supply-demand backdrop in place and leaving prices trading within the existing range.