Commodities Daily. Growing doubts about OPEC production cuts. Commodity Research. For important disclosure information please see page 6.

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1 Commodity Research Commodities Daily Growing doubts about OPEC production cuts Energy: Oil prices have come under selling pressure since Friday. Brent is trading at around USD 51.5 per barrel, and WTI is back below USD 5 per barrel. On Friday morning, Brent was still at a 4-month high of USD per barrel within a hair s breadth of its annual peak at the beginning of June. Doubts are obviously growing that agreement can be reached among the OPEC countries on output cuts. For some countries are meeting again this week on the fringes of an energy conference in Istanbul. Current statements from the Iraqi oil minister are evidence that further negotiations are still needed. He confirmed yesterday that Iraq plans to increase oil production further next year. The wide gulf between words and actions at OPEC therefore remains. OPEC is currently producing nearly 1 million barrels more crude oil per day than required. At current OPEC production levels, the market would not be in balance for a year. The three energy agencies are likely to confirm the current oversupply when they announce new supply and demand estimates this week. Non- OPEC supply for 217 could even be revised up further. For, according to Baker Hughes, the number of active oil rigs in the US increased for the 14th time in the last 15 weeks last week, and Russian output also reached a record level in September. The profit-taking by some speculators is therefore unsurprising. In the week to 4 October they increased their net long positions in WTI by 68, contracts, contributing significantly to the steep price rise in the reporting week. Precious metals: Gold briefly reached a 4-month low of just above USD 1,24 per troy ounce on Friday, but recovered again subsequently. As the new trading week gets under way it has moved slightly above the important technical 2-day moving average again to around USD 1,265. Support came from a weaker US dollar in late trading and ETF inflows. The US dollar depreciated in response to slightly weaker than expected labour market figures for September. Last month 156, new jobs were created in the US, in line with the moderate recovery in the US economy. We still believe the US central bank (Fed) is likely to raise interest rates further in December. On Friday the gold ETFs recorded by Bloomberg showed the largest daily inflow since mid-september of 9.1 tons. This was mainly attributable to the SPDR Gold Trust, the largest gold ETF in the world. As evident from the CFTC statistics showing the positioning of speculative market players, this investor group was mainly responsible for the sharp fall in the gold price last Tuesday. For in the week to 4 October, net long positions were scaled back by 22% to 2, contracts, their lowest level for four months, and are likely to have been reduced further since then. The central banks have already been holding back from purchases for some time. According to central bank data, China increased its gold reserves by only about 16, ounces or 5 tons in September. 1 October 216 Speculative market positioning (net) 4-Oct contracts Weekly change WTI Henry Hub Gasoline Gold Silver Platinum Palladium Copper Wheat Corn Soybeans Cotton Coffee Cocoa Sugar Source: CFTC, Bloomberg Number of active US oil and gas rigs 7-Oct Rig count weekly change USA total Oil Gas 94-2 Horizontal Vertical 61-3 Directional 5-1 Source: Baker Hughes, Bloomberg CHART OF THE DAY: Speculators switching out of gold and into oil 4 35 ' contracts Jan-12 Jul-12 Jan-13 Jul-13 Speculative net long positions in WTI Speculative net long positions in gold Source: CFTC, Bloomberg, Commerzbank Research For important disclosure information please see page 6. research.commerzbank.com / Bloomberg: CBKR / Research APP available Head of Commodity Research Eugen Weinberg eugen.weinberg@commerzbank.com Carsten Fritsch carsten.fritsch@commerzbank.com Barbara Lambrecht barbara.lambrecht@commerzbank.com Michaela Kuhl michaela.kuhl@commerzbank.com Daniel Briesemann daniel.briesemann@commerzbank.com

2 Prices Base metals: Chinese traders are resuming market activity again today after the holiday week in China. The resulting firmer Chinese stock markets are also providing impetus for metal prices. At the beginning of the new week, copper is therefore trading above USD 4,8 per ton again. Speculative financial investors have also been providing support for the red metal again for some time. In the week to 4 October they extended their net long positions on Comex in New York to a 9-week high of 7, contracts. Four weeks earlier, net short positions were still very high with almost 42, contracts. The copper price rose nearly USD 2 per ton or 4% in this period. In addition to copper, the prices of zinc, lead and nickel are also increasing at the beginning of the new trading week. The nickel price is making good Friday s losses again. According to the General Secretary of the Energy and Mineral Resources Ministry, the Indonesian government is considering relaxing the mineral ore export ban in place since the beginning of 214. A meeting of representatives of the related ministries will be held this week. The move is intended to give companies more time to build smelters. Accordingly, the government might in future allow the export of up to 15 million tons of nickel ore and bauxite respectively per year. This would ease the supply situation on the global nickel market in particular. Agriculturals: Based on likely record corn and soybean harvests in the US, there is little reason for any significant price increases. True, recent heavy rainfall in important cultivation areas has delayed harvests slightly, and the latest export figures have also been positive though corn is still trading at below 35 US cents per bushel and the soybean price has also remained below the 1, US cents per bushel threshold in recent weeks. Projected dryer weather has recently driven prices of corn and soybeans down by 1.5% and 1.9% on a weekly basis. Conversely, the prospect of dry weather in wheat growing areas is causing concern because young plants need sufficient humidity before the dormant winter period. Weather conditions in France were also too dry when rapeseed was sown for the 217 crop. The French agricultural consultancy ODA therefore expects the area of cultivation to be 8% smaller than in the previous year. According to the ODA, 1% of fields are also in a poor condition. It expects a crop volume of 4 million tons. In 216, 4.7 million tons of rapeseed were harvested in France, already a 12% decline on the year before. Similar difficulties are being reported in Germany, where the 216 rapeseed harvest has already declined by 8% on the previous year to 4.6 million tons despite a larger cultivation area. The EU Commission expects the 216 EU rapeseed harvest to have fallen for the second time in succession to 19.9 million tons, after average yields were again significantly lower than in the previous year. Energy 1) current 1 day 1 week 1 month ytd Brent Blend % 1.8% 7.9% 39% WTI % 1.6% 8.1% 34% Gasoline % 6.4% 11.7% 31% Gasoil % 3.4% 8.8% 39% Diesel % 4.6% 13.7% 46% Jet fuel % 5.% 14.4% 32% Natural gas ($/mmbtu) % 8.2% 13.% 35% Base metals 2) Aluminum %.3% 6.6% 12% Copper % -.2% 3.8% 2% Lead %.6% 1.9% 18% Nickel %.6%.4% 18% Tin 2 -.5%.7% 3.9% 38% Zinc 2324.% -2.6% 2.2% 46% Precious metals 3) Gold % -3.8% -4.9% 19% Gold ( /oz) % -3.4% -4.4% 16% Silver % -5.8% -7.% 28% Platinum % -3.4% -8.5% 9% Palladium % -5.6% -.4% 2% Agriculturals 1) Wheat (LIFFE, /t) % -2.2% 5.9% -1% Wheat CBOT %.8% -1.2% -22% Corn % -2.1% 3.3% -11% Soybeans % -1.1% -2.8% 8% Cotton % -1.6% -1.5% 1% Sugar %.3% 12.8% 63% Coffee Arabica %.4% -4.6% 12% Cocoa (LIFFE, /t) % 4.3% 2.2% 3% Currencies 3) EUR/USD % -.3% -.5% 3% Inventories Energy * current 1 day 1 week 1 month 1 year Crude oil % -5.% 8% Gasoline % -2.% 2% Distillates % 3.9% 8% Ethanol % -3.6% 7% Crude oil Cushing % -1.9% 18% Natural gas % 8.2% 1% Gasoil (ARA) % -7.1% -15% Gasoline (ARA) % -33.5% -33% Base metals ** Aluminum LME % -1.6% -3.5% -32% Shanghai % -18.7% -71% Copper LME % -5.7%.% 15% COMEX 7619.%.1% 4.2% 73% Shanghai % -35.4% -31% Lead LME %.2% 1.5% 22% Nickel LME % -.3% -1.9% -18% Tin LME % -2.6% -2.3% -26% Zinc LME % 4.2% 1.9% -22% Shanghai % -16.9% -5% Precious metals *** Gold %.7%.8% 34% Silver % -.2%.2% 1% Platinum %.3%.4% -16% Palladium % -.2% -1.4% -3% Source: DOE, PJK, LME, COMEX, SHFE, Bloomberg, Commerzbank Research Percentage change on previous period 1) 1 month forward, 2) 3 months forward, 3) spot Crude oil in USD per barrel, oil products and base metals in USD per ton, Precious metals in USD per troy ounce, grains and soybeans in US cents per bushel, Cotton, sugar and coffee Arabica in US cents per pound * US inventories of crude oil, oil products and ethanol in barrel, US natural gas inventories in billion cubic feet, ARA stocks in tons ** tons, *** ETF holdings in ounces 2 1 October 216

3 Net long positions of money managers vs. price GRAPH1: Crude oil (WTI) GRAPH 2: Natural gas (Henry Hub; futures and swaps) 35 ' contracts spec. net long positions, ls WTI ($/barrel), rs ' contracts spec. net long posit., ls HenryHub ($/MMBtu), rs GRAPH 3: Crude oil (Brent) GRAPH 4: Gold 5 in ' contracts Jan. 14 Jul. 14 Jan. 15 Jul. 15 Jan. 16 Jul. 16 Spec. Net long positions, ls Brent, $/barrel, rs Source: ICE; Bloomberg, Commerzbank Research ' contracts spec. net long posit., left Gold ($ per troy ounce), right GRAPH 5: Silver GRAPH 6: Copper ' contracts ' contracts spec. net long posit., ls Silver (USD per troy ounce), rs spec. net long positions, ls Copper (USD per ton), rs GRAPH 7: Corn 3 ' contracts spec. net long posit., ls Corn (USd per bushel), rs GRAPH 8: Wheat 6 ' contracts spec. net long posit., ls Wheat (USd per bushel), rs 1 October 216 3

4 GRAPH 9: Forward curve oil market (WTI) Source: NYMEX; Bloomberg, Commerzbank Research GRAPH 11: Forward curve gas market (Henry Hub) GRAPH 1: Forward curve oil market (Brent) M 7M 13M 19M 25M 31M 37M 43M Source: ICE; Bloomberg, Commerzbank Research GRAPH 12: Forward curve gasoil (ICE) M 3M 5M 7M 9M 11M 13M 15M Source: NYMEX; Bloomberg, Commerzbank Research GRAPH 13: Forward curve aluminium (LME) 19 Source: ICE; Bloomberg, Commerzbank Research GRAPH 14: Forward curve copper (LME) GRAPH 15: Forward curve Nickel (LME) GRAPH 16: Forward curve zinc (LME) M 5M 9M 13M 17M 21M 4 1 October 216

5 GRAPH 17: Forward curve lead (LME) 22 GRAPH 18: Forward curve tin (LME) M 8M 15M 22M 185 1M 4M 7M 1M 13M GRAPH 19: Forward curve wheat (CBOT) Source: LME, Bloomberg, Commerzbank Research GRAPH 2: Forward curve wheat (MATIF) M 8M 12M 18M 22M 13 3M 6M 8M 12M 15M 18M 2M 24M Source: CBOT; Bloomberg, Commerzbank Research GRAPH 17: Forward curve corn (CBOT) Source: MATIF; Bloomberg, Commerzbank Research GRAPH 22: Forward curve soybeans (CBOT) M 8M 12M 18M 22M 27M 92 2M 8M 12M 18M 23M Source: CBOT; Bloomberg, Commerzbank Research GRAPH 23: Forward curve cotton (NYBOT) Source: CBOT; Bloomberg, Commerzbank Research GRAPH 24: Forward curve sugar (NYBOT) M 7M 13M 18M 22M 27M 16. 5M 9M 17M 21M 3M 34M Source: NYBOT; Bloomberg, Commerzbank Research Source: NYBOT; Bloomberg, Commerzbank Research 1 October 216 5

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