Commodity

U.S. wheat futures rose across the board on Friday, with Chicago SRW, KC HRW and Minneapolis spring wheat contracts posting solid gains. The market continued to price in a risk premium tied to potential Black Sea export disruptions, even as U.S. export sales activity remained weak. Export sales for the current marketing year totaled 8.342 MMT, down 31% from the same week last year, according to Export Sales data. Ukraine’s agriculture minister also said the 2027 winter wheat crop is expected to be down from 4.7 million hectares 11.61 million acres, supporting tighter-supply expectations.

Gold prices fell more than 1% on August 28 after U.S. Federal Reserve Chair Kevin Warsh suggested the central bank could raise interest rates to curb inflation. Spot gold was down 0.8% at $4,563.05 an ounce, according to Reuters. In India, gold slipped to ₹1,56,780 per 10 grams, down 1.77%. The decline followed a three-month high earlier in the week that was driven by optimism after the U.S. Treasury’s support for long-term bonds.

Qatar has extended force majeure on its LNG deliveries into November as transits through the Strait of Hormuz remain blocked, lifting gas prices in both Asia and Europe. Asia’s spot LNG price rose to $23.388 per million British thermal units (MMBtu), while Europe’s Dutch TTF benchmark moved above $80 per megawatthour. Europe is approaching winter with gas storage only 63% full, well below the five-year average of about 80%, adding to supply concerns.

NY raw sugar and London white sugar futures fell sharply, giving back earlier gains. Selling pressure intensified as the Brazilian real weakened, triggering long liquidation. On fundamentals, the European Union expects 2026/27 sugar output to fall 19% and India’s monsoon rainfall remains below normal. Global 2026/27 sugar consumption is projected to rise to a record high.

South Korea’s DRAM export unit price surged to $92,183 per kilogram for Aug. 1–20, up 401% year on year and 12.5 times higher than in January 2023. At that level, 1 kg of DRAM is valued at roughly the same as 620 grams of 24K gold. Servers using Nvidia’s Rubin GPUs could see prices rise 15% to 17% because memory makes up a large share of the bill.

India’s opening sugar stocks for the 2026-27 season are projected to fall to 3.5 million tonnes, the lowest level in a decade. Sugar output in 2025-26 is estimated to drop 27% year on year to about 28.1 million tonnes, while the average retail price is up 39% year on year and 31% month on month. Even after the government introduced a fortnightly allocation system and factory-gate prices fell 20%, the supply squeeze has persisted as the share diverted to ethanol has eased to about 9%, according to the Department of Consumer Affairs’ price monitoring cell.

Cotton futures were down 10 to 33 points in early Friday trading, giving back part of Thursday’s gains. For the week ending 8/20, 2026/27 export sales totaled 95,726 RB, down 46.62% from the same week last year. The Cotlook A Index fell 60 points on August 26 to 97.60 cents.

ICE data show arabica coffee inventories fell to 224,011 60kg bags on Aug 28, the lowest since May 2000, as dealers competed for scarce spot supply. The drawdown has helped keep benchmark arabica futures above US$3 per lb for the past couple of months. The market expects a global surplus of 8.2 million bags in the 2026/27 season, largely on hopes of a record Brazilian crop, but tight physical availability persists.

India is tightening controls on sugar stockpiling and will switch to a new quota system from September, requiring mills to sell at least 40% of their allocation in the first week and the balance in the second. With the new crushing season approaching, output is expected to exceed 10 lakh tonnes in October and reach around 45 LMT in November. Ex-mill prices have already fallen by about 20%, while retail price declines are only starting to show.

Gold prices extended their decline as investors grappled with uncertainty over the Federal Reserve’s policy path. Spot gold slid to around $4,576 per ounce, while India’s domestic gold price has fallen by nearly Rs 5,000 per 10 grams over four sessions. The US PCE inflation rate for July held at 3.7%, slightly above forecasts, prompting markets to scale back September hike expectations while still pricing a high probability of a December move. Investors are awaiting remarks from Fed Chair Kevin Warsh for clues on the rate outlook.