Commodity Monthly Monitor

Transcription

1 Commodity Monthly Monitor Fed normalisation to cap any potential upside Jun/Jul 217 Summary Over the past month, the market has endured a plethora of potential risk events, such as the French and UK elections, the ongoing political gyrations in the US and the Greek debt decision. As we expected, most outcomes have been followed by a strong reaction from the markets. Adding to this is the increasingly hawkish undertones from central bankers in the developed world. The European Central Bank (ECB) subtly hinted at policy normalisation while the US Federal Reserve (Fed) has published a more positive economic outlook for the US while giving details on its policy normalisation procedure, likely to begin in December this year. We believe that the ECB will begin to discuss policy normalisation while the Fed plans to increase interest rates more aggressively, and see the beginning of policy normalisation as a form of rate hike akin to 25 basis points. The US dollar is likely to trade close to its floor, after considerable weakness this year. Positive sentiment has cooled while sentiment towards the Euro looks close to a peak. Disappointing economic data from the US suggest the upside potential for the US dollar is limited. This suggests that gold has reached its near-term peak as it moves inversely with the US dollar. Although US Treasury yields are likely to rise as the US Federal Reserve normalises rates, the pace of normalisation will be slow and thus inflation will not decline rapidly. The very gradual increase in real interest rates will mean that there will be limited downside to gold prices. More broadly across commodities we continue to see improving leading economic data from emerging markets, including China where our growth proxy measure suggests growth has continued to improve over the last few months with encouraging freight volumes and retail sales figures. We continue to see recent commodities falls as an opportunity, particularly in industrial metals. Warm and dry weather degrades production of grains. Within the agricultural complex there were sharp price movements in lean hogs, wheat, cotton and sugar. There appears to be seasonal factors behind the strong demand for lean hogs and live cattle. The depreciation in the Brazilian Real pushed sugar and coffee prices lower. Copper bucked the trend of declining prices in the industrial metal space. With speculative positioning recovering from a shake-out earlier this year, it appears that investors are focusing once again on the likely supply deficit for this year. Excess supply to continue to weigh on prices. How to absorb the excess supply in each individual market is the key question. Tension in the Middle-East countries may provide a boost to US natural gas exports. Meanwhile uncertainty about the real impact of the OPEC/non-OPEC production cut, growing US oil production and inventories continue to weigh on oil prices. Speculators in charge as palladium leads precious metals sector higher. The precious metals sector was the only one in the commodity market to experience gains across the board over the past month. Palladium remains the leader in the sector despite some softness in the auto sector, while lingering uncertainty has kept the price of gold supported despite the US Federal Reserve hiking rates last week. James Butterfill, Executive Director - Head of Research & Investment Strategy Martin Arnold, Director - FX & Macro Strategist Edith Southammakosane, Director - Multi- Asset Strategist Nitesh Shah, Director - Commodities Strategist Morgane Delledonne, Associate Director - Fixed Income Strategist Contents Commodities market overview 1 Summary tables 4 CFTC net positioning 5 Inventories 9 Moving average and volumes 13 Futures curves 17 Roll yields 21 Recent publications 27 Commodity Monthly Matrix 1 Performance 2-1 Mth - 6 Mth - 12 Mth Current Returns Price vs 2 Inventories 3 Positioning 4 14 Jun 15 May All Commodities -2.5% -5.8% -6.% Price 2 Roll Yield 5 (-1 Mth) days MA (- 3 Mths) (- 1 Mth) Score Score Energy -1.% -19.5% -16.7% WTI Oil % -1.1% -3.1% 7% -.4% (4) Industrial Metals -.2% -4.4% 18.% Brent Oil % -9.8%.% -5% -.6% (2) (4) Precious Metals 3.9% 6.2% -2.3% Natural Gas % -6.1% 17.4% -114% -.7% (4) 2 Agriculture -2.2% -7.% -19.1% Gasoline % -7.1% -1.6% 71%.1% 2 1 MSCI World 2.1% 11.4% 21.6% Heating Oil % -9.5% -16.2% -34% -.6% (2) (2) US Aggregate Bond 1.2% 3.5%.9% Carbon % -3.6% % (2) (2) Wheat % 6.1% 4.5% -2% -3.1% (2) (1) Corn % 5.6% -11.9% 4% -2.1% 2 (1) Soybeans 9-2.3% -5.8% 11.3% -292% -.4% (4) (3) Sugar % -28.7% -1.5% -79% -1.7% (2) (2) Cotton.7-1.6% -.4% -3.1% -14%.8% 4 Coffee % -12.9% - -65% -1.7% (4) (4) Soybean Oil.3-1.7% -4.7% -6.6% -917% -.4% (2) 1 Cocoa 2,4 -.2% -9.2% - 41% -1.7% (1) CFTC Net Speculative Positioning Aluminium 1,87 -.8% 4.% -18.7% 3% -.3% 1 2 (in ' contracts) Copper (COMEX) % 2.7% -21.2% 56% -.5% 2 (3) Copper (LME) 5, % 2.8% -17.9% 47% -.1% 2 (3) Zinc 2, % -4.7% -33.% -4% -.3% (2) (2) Nickel 8, % -12.6% -2.1% 13% -.2% (2) Lead 2,59-2.9% -5.2% -2.5% -2% -.5% (2) (4) Tin 19, % -4.4% -58.1% -2%.2% 3 Gold 1, % 2.8% - 51% - 4 (4) Silver % -1.9% - 21% - 2 (4) Platinum % -1.3% - 115% - 2 (4) Palladium % 16.1% - 3% - 4 Live Cattle % 7.8% - 4% 5.6% 3 3 Lean Hogs % 32.2% - 113%.5% 4 1 Feeder Cattle % 1.6% - -3%.3% 1 (1) The score matrix is designed to highlight significant changes in key variables but should not be viewed as predictor of performance. Source: ETF Securities, Bloomberg Bloomberg TR Indexes for basket returns, data to Wednesday 14 June 217. Source: ETF Securities, Bloomberg Precious Metals Livestock Industrial Metals Energy Agriculture 3, 2,5 2, 1,5 1, Source: ETF Securities, CFTC, Bloomberg " - " Information not available. Green = returns positive, inventories falling, positioning rising, roll yield positive. Red = the opposite. Black = neutral. 1 Detailed explanation of the matrix calculations can be found at the end of this report. 2 All prices are futures prices to Jun 14, 217. Broad sector returns based on Bloomberg Commodity Index family. 3 % change in inventory over the past 3 months except for sugar and coffee which are based on past 6 months as data is updated bi-annually by USDA. 4 CFTC futures and LME COTR net positioning as at Jun 6, 217, and Jun 9, 217 respectively, % change from previous month. 5 Calculated as % difference between front month and second month futures prices on report date. 1

2 Gold Platinum Silver Palladium Natural Gas Gasoline Brent Oil WTI Oil Heating Oil Carbon Nickel Tin Lead Zinc Aluminum Copper (COMEX) Copper (LME) Sugar Cotton Coffee Soybeans Soybean Oil Live Cattle Cocoa Feeder Cattle Corn Wheat Lean Hogs Sector Overview Agriculture Lean hog prices rose 15.4% on the month after 23.7% in May as the demand for bacon in summer months intensifies and the so-called BLT season continues. In April, the Brazilian Sugarcane Industry Association (Unica) had predicted that sugar production would decline slightly from past years high level, but the weaker Brazilian real might create production incentives, as sugar exports look more attractive. The marginal expected decline of production in Brazil will not be enough to avoid a supply surplus in the 217/218 crop according to the International Sugar Organization (ISO). Sugar prices remain under pressures, falling 12.2% on the month. The warm and dry temperatures in Western Europe and in the US are degrading the conditions of wheat and corn crops. Lower-than-expected French wheat crop volumes reduced exports to non-eu countries and drove wheat prices up by 4.2% on the month. Corn price is also up by 4.2% in June amid a higher-than-expected supply deficit in 2 according to the US Department of Agriculture (USDA). Agriculture - June Returns* 2% 15% 1% 5% % -5% -1% -15% Source: Bloomberg Industrial Metals Most industrial metal prices fell last month as Chinese manufacturing PMIs slipped into contractionary territory and total social financing fell, indicating tightness in credit and liquidity. Meanwhile, the market remains doubtful that Trump s pro-growth policies advocated in his campaign trail will see the light of day this year. Copper prices bucked the trend of declining industrial metal prices. Freeport-McMoRan Inc. fired 3, workers at it Grasberg pit in Indonesia amid a strike that has lasted for longer than five weeks. While that hasn t shut the mine (an estimated 3, people work at the mine), production is not at an optimum level. Freeport only just received the go-ahead to export concentrate in April, after wrangling with the government when its licence expired in February. Nickel prices fell the most among industrial metals. Supplies from Indonesia and Philippines, the top two producers, is expected to rise. Indonesia lifted a ban on ore exports in January, and last month a large producer, PT Aneka Tambang, started shipments to China after obtaining a licence to export 2.7mn tonnes of nickel ore. The removal of Philippines environment minister Regina Lopez, who ordered an audit of nickel mines and shut several mines for environmental violations, is seen as a sign the country won t continue with the tough stance against violations. Mine supply from the country could thus increase. Industrial Metals - June Returns* 3% 2% 1% % -1% -2% -3% -4% -5% Source: Bloomberg Energy Energy prices fell by 8.6% on average over the past month with natural gas being the worst performer at -14.3%. US natural gas production is about to outpace domestic consumption this year according to data from the US Energy Information Agency (EIA) with the country potentially ending the year as net exporter for the first time. Energy - June Returns* 15% 1% 5% % Market participants are questioning the efficiency of the OPEC/non-OPEC agreement as global oil production continues to increase with US shale oil near its level prior to the sharp drop in oil prices in 214. The extension of the agreement for another 6 months and tensions between Qatar and four other middle-east countries including Saudi Arabia put little pressure on oil prices. We believe oil prices will continue to trade range between US$4/bbl. and US$55/bbl. -5% -1% -15% -2% The summer driving season in the US may help absorb some of the excess in the gasoline market with inventories near record high. The EIA however estimates close to average temperatures for the season. As a result, no particular upside in US demand for natural gas is to be expected. An escalation of the tension in the Middle East may provide a boost to US natural gas exports. Source: Bloomberg Precious Metals The spread between the prices of platinum and palladium is at the narrowest level in 15 years. There appears to be little fundamental reason to justify the relative surge of palladium over platinum. Palladium is mostly used in catalytic converters for gasoline cars and although European auto registrations jumped 7.7% in May, it follows on the back of a 6.8% plunge in April. Meanwhile other regions are coming off the boil: US car sales were.5% softer in May, and Chinese vehicle sales are slowing. While passenger car sales in China rose 1.1% in May, sales for the first five months of 217 is.9% weaker than in 216. Lingering uncertainty has kept the price of gold supported. Expectation for continued rate increases and central bank balance sheet normalisation in the US after a surprisingly hawkish statement from the Federal Reserve last week saw the gold prices pare recent gains. However, as we observed in the previous week, geopolitical events can be supportive for the gold price. In the absence of shocks, however, we expect gold prices to grind lower, but the downside risk will be contained by the gradual nature of rate increases. Silver remains an investor favourite in the sector, with the metal experiencing solid gains despite continued rise in inventory levels. While higher stocks reflects weakening industrial demand, investor positioning is nearly double the 5-year average and the highest in five week. Nonetheless, we believe silver remains cheap compared to gold, with the gold:silver ratio at the highest levels in nearly 12 months and again approaching the multi-year peak seen in Q Precious Metals - June Returns* 8.% 7.% 6.% 5.% 4.% 3.% 2.% 1.%.% Source: Bloomberg *Note: all returns are based on front month futures prices in the month to Wednesday 14 June

3 Technical Overview Positioning Top 5/Bottom 5 Change in CFTC Net Positions 1 Shorts in soybean oil extended close to a multi-year high, leaving net positioning at almost one standard deviation below average. COMEX and LME copper net speculative positioning rose 56% and 47% respectively, indicating that investor doubts around copper are fading. With COMEX copper positioning having been net short on average over the past five years, with the market close to 13, contracts net long, positioning is close to 1 standard deviation above average. Net speculative positions in natural gas futures have turned positive for the first time ever for one month before ending the period at -2,931, which is still a bullish level compared to historical data. Short positions have been declining since June 215 while long positions have been increasing from January 216. Market sentiment has been switching on global concerns over climate change. Palladium positioning is becoming stretched, with net long positions at the highest level since September 214, and are nearly two standard deviations above the 5-year average. Source: Bloomberg Inventories Top 5/Bottom 5 Change in Inventories 2 Soybean inventory increased 11.3% in June. In its monthly report in June, the USDA raised its 217/218 projections for soybean inventory by 3.4 million metric tons to 92.2 million metric tons. LME inventories have declined across the industrial metals spectrum. However, aluminium and tin inventories in SHFE have increased. Heating oil inventory reached another record low this year as structural demand for the fuel for heating during the winter is falling in favour of natural gas and alternative clean sources of electricity. Lower structural demand has led to lower production and inventories. The US and Europe oil inventories, on the other hand, are at record highs as global oil production continues to increase due to production cost efficiency. Natural gas inventories have normalised below the 216 highs, a potential support to prices. Source: Bloomberg Platinum Lean Hogs Gasoline Copper (COMEX) Natural Gas Soybeans Wheat Brent Oil Sugar Copper - LME Aluminium Copper Zinc Tin Gold Sugar Natural Gas Soybeans Coffee Soybean Oil -1% -8% -6% -4% -2% % 2% -8% -6% -4% -2% % 2% 4% Curve Dynamics Top 5/Bottom 5 Roll Yields 3 There is steep backwardation in live cattle futures. The roll yield in live cattle increased to 5.6% last month. Industrial metal futures curves remain very flat with front month roll yields ranging from -.3% (copper and lead) and +.2% (tin). Flat yield curves allow investors to focus investment decisions on the spot price rather that the drag or enhancement from the rolling of futures contracts. Energy prices have been falling over the past month sending Brent, WTI and heating oil futures curves in contango. Gasoline tends to be in backwardation at this time of the year ahead of the US driving season while natural gas is on the flattest part of its futures curve with the EIA expecting average seasonal demand for air conditioning this summer. Live Cattle Palladium Cotton Lean Hogs Feeder Cattle Sugar Cocoa Coffee Corn Wheat Source: Bloomberg -4% -2% % 2% 4% 6% 8% Contango Backwardation Technicals Top 5/Bottom 5 Price Diff to 2 day moving av. (dma) 4 Sugar is trading 28.7% below its 2dma. Sugar has declined 12.2% last month amid supply surplus prospects this year and a weaker Brazilian Real. Nickel is trading 12.6% below its 2dma. After having started the year on a strong note following the closure of Philippine mines that were being investigated for environmental law violations, nickel prices have fallen hard in recent month, making the metal the worst performer in the industrial metal space. As opposed to other energy commodities, natural gas price has been trading above both its 5 and 2dmas until recently, supported by strong demand during the previous winter season to March/April 217. Other energy prices have been bouncing around their moving averages for the past three months, reflecting the elevated uncertainty on the oil market. Palladium is over 7% above its 2dma, the highest premium since the price decline in February this year. Meanwhile, the price of platinum has just recovered above its 2dma, but price action looks subdued. Lean Hogs Palladium Feeder Cattle Live Cattle Wheat Brent Oil WTI Oil Nickel Coffee Sugar Source: Bloomberg -4% -2% % 2% 4% % < 2 dma % > 2 dma 1 CFTC futures net positioning as at report date, percent change from previous month. 2 Percent change in inventory based on 3 month change (in %). 3 Roll yields calculated as percent change between front month futures price and next month futures price on Jun 14, Percent difference between the front month futures price and its 2 day moving average on Jun 14,

4 Summary Tables PRICES 1 Current 1 Month 3 Month 6 Month 1 Year ROLL YIELDS 2 Unit Exchange 14-Jun 1 Week 1 Month 3 Month Energy Energy WTI Oil % -6.3% -12.4% -7.8% WTI Oil USD/bbl. NYMEX -.4% -.6% -.6% -1.3% Brent Oil % -7.7% -12.8% -5.7% Brent Oil USD/bbl. ICE -.6% -.8% -.4% -.4% Natural Gas % -.2% -17.1% 12.6% Natural Gas USD/MMBtu NYMEX -.7% -1.1% -2.3% -1.8% Gasoline % -9.5% -6.5% -5.8% 7 Gasoline USd/gal. NYMEX.1%.4%.1% -1.1% Heating Oil % -5.5% -14.2% -6.1% Heating Oil USd/gal. NYMEX -.6% -.6% -.4% -.5% Carbon % -3.3% -1.6% -15.6% 9 Carbon EUR/MT ICE -.2%.%.%.% Agriculture Agriculture Wheat % 7.5% 13.2% -8.7% Wheat USd/bu. CBOT -3.1% -3.2% -3.4% -4.3% Corn % 6.6% 7.2% -13.6% Corn USd/bu. CBOT -2.1% -1.9% -2.1% -2.3% Soybeans % -5.6% -9.% -2.3% Soybeans USd/bu. CBOT -.4% -.4% -.1% -1.2% Sugar % -25.% -24.5% -29.6% Sugar USd/lb. NYBOT -1.7% -1.3% -1.8%.4% Cotton.7-1.6% -4.7% 2.8% 16.6% 3 Cotton USd/lb. NYBOT.8% 1.7% 8.3% -1.3% Coffee % -1.1% -1.5% -7.1% Coffee USd/lb. NYBOT -1.7% -1.8% -1.6% -1.2% Soybean Oil.3-1.7%.8% -12.6% -1.3% Soybean Oil USd/lb. CBOT -.4% -.4% -.3% -1.4% Cocoa 2,4 -.2% -2.4% -11.6% -35.1% Cocoa USD/MT NYBOT -1.7% -1.% 1.4% 1.6% Industrial Metals Industrial Metals Aluminum 1,87 -.8%.9% 6.6% 16.5% Aluminum USD/MT LME -.3% -.1%.2% -.2% Copper % -1.9% -1.% 26.1% Copper USd/lb. COMEX -.5% -.5% -.2% -.4% Copper (LME) 5, % -2.4% -.8% 25.9% Copper (LME) USD/MT LME -.1% -.1% -.1% -.1% Zinc 2, % -9.7% -11.3% 23.1% Zinc USD/MT LME -.3% -.3% -.1% -.1% Nickel 8, % -12.8% -21.8%.4% Nickel USD/MT LME -.2% -.2% -.2% -.2% Lead 2,59-2.9% -7.2% -1.6% 22.6% Lead USD/MT LME -.5% -.3% -.1% -.2% Tin 19, % -3.3% -8.9% 13.7% 6 Tin USD/MT LME.2%.2%.4%.1% Precious Metals Precious Metals Gold 1, % 5.8% 9.6% -1.% Gold USD/t oz. COMEX -.2% -.2% -.3% -.3% Silver % 1.5% -.1% -1.7% Silver USD/t oz. COMEX -.4% -.4% -.3% -.2% Platinum % 1.4% 1.2% -2.1% Platinum USD/t oz. NYMEX -.3% -.3% -.4% -.3% Palladium % 16.2% 18.% 6.9% 2 Palladium USD/t oz. NYMEX 1.1%.7%.1%.1% Livestock Livestock Live Cattle % 7.% 12.1% 4.6% 1 Live Cattle USd/lb. CME 5.6% 5.7% 3.1% 8.8% Lean Hogs % 17.2% 43.5% 1.6% 4 Lean Hogs USd/lb. CME.5%.7% -1.4% -6.% Feeder Cattle % 14.3% 14.4% 2.8% 5 Feeder Cattle USd/lb. CME.3%.4% -4.5%.3% CFTC NET 5 Yr Current POSITIONING 3 Average 1 Month 6 Month 1 Year INVENTORY LEVELS 4 Current 1 Month 3 Month 6 Month Energy Energy WTI Oil 416, , ,66 48, ,451 Oil - US 511,546 27% -2% -3% 6% Brent Oil** 16,892 14, , ,384 2,995 Oil - OECD Europe** 355 7% - % 2% Natural Gas -2, ,35 2,325-15,51-152,18 Natural Gas - DOE 2,631 12% 11% 17% -31% Gasoline 5,389 61,83 29,519 62,273 5,426 Gasoline - DOE 242,444 1% 1% -2% 5% Heating Oil 6,85 2,89 1,352 5,694 18,584 Heating Oil - DOE 9,716-36% 1% -16% -36% Agriculture Industrial Metals Wheat -91,816-38,491-89,812-76,942-43,216 Aluminum 1,87,428-56% -5% -19% -14% Corn -83,71 18,55-139,57 58, ,443 Aluminum - LME 1,438,25-64% -8% -29% -31% Soybeans -89,789 95,833-22,93 171,791 25,956 Aluminium - SHFE 432,43 46% 5% 61% 399% Sugar 8,562 13,37 4, , ,554 Copper 624,916 17% -8% -21% 27% Cotton 96,378 5, , ,826 59,626 Copper - LME 272,625-11% -17% -18% -2% Coffee -18,63 7,767-2,639 25,971 26,258 Copper - SHFE 19,262 1% -2% -42% 44% Soybean Oil -19,36 22,684-1,93 13,36 66,635 Copper - COMEX 162,29 196% 5% 21% 1% Cocoa -2,33 39,789-34,176-1,275 35,168 Nickel - LME 376,452 19% -1% -2% 2% Industrial Metals 5 Zinc 386,384-58% -13% -33% -34% Copper (COMEX) 12,848-8,22 8,257 61,21-44,71 Zinc - LME 317,975-55% -8% -17% -27% Copper (LME) 57,143 4,294 38,994 75,959 16,2 Zinc - SHFE 68,49-68% -33% -65% -55% Aluminum 21,98 178,838 24,29 22, ,361 Lead 256,548-6% -3% -3% 24% Nickel 25,6 18,794 22,126 35,392 13,35 Lead - LME 176,375-18% -4% -8% -6% Zinc 67,9 69,761 7,77 62,2 78,743 Lead - SHFE 8,173 4% -2% 11% 297% Lead 27,365 25,19 34,281 27,272 19,822 Tin 6 6,148-43% 1% -9% 21% Tin 1,466 2,259 1,825 1,96 2,782 Tin - LME 1,92-79% -17% -58% -43% Precious Metals Tin - SHFE 4, % 13% 92% 148% Gold 214,11 134, ,386 12,176 36,4 Agriculture Silver 65,31 36,16 54,61 67,14 71,128 Wheat - USDA 261, % 1.1% 4.5% 3.6% Platinum 19,781 31,763 9,212 24,964 29,677 Corn - USDA 194,33 39% -.5% -11.9% -12.6% Palladium 21,136 16,24 2,54 15,241 3,93 Soybeans - USDA 92,22 53% 3.8% 11.3% 11% Livestock Sugar - USDA 38,245 6% % -2% Live Cattle 161,318 73, ,19 98,241 42,299 Cotton - USDA 87,71 19%.7% -3.1% -1.6% Lean Hogs 7,649 51,949 33,26 45,558 81,526 Coffee - USDA 33,37-7% Feeder Cattle 19,162 6,178 19,852 1, Soybean Oil - USDA 3,55-13% -3.% -7% 3% 1Performance of front month futures from 14 (1 Year), 14 (6 Month), 14 (3 Month) and 14 (1 Month) to 14. 2Roll return non-annualised from front month futures into second " month on 14 (3 Month), 15 (1 Month), 7 (1 Week), Net positions in number of contracts. 4 Current inventories relative to 1, 3, 6 months ago. Under the column "5 yr average" is the current inventory level relative to 5 year average inventory. For energy, 5 yr average is the average of the same month as report month over the past 5 years. **Brent 5 Yr average of net positions from January 211 as positions were not reported by CFTC before then and inventory data (OECD) reported with 2 month lag with current = Mar All Industrial metals positioning data (excluding copper) is sourced from LME COTR data in Bloomberg from 28th July 14 (first available date). 6 SHFE started reporting inventory data from April

5 CFTC Speculative Net Long Futures Positions Agriculture Cocoa ,6 3,4 3,2 3, 2,8 2,6 2,4 2,2 2, 1,8 Coffee Price (RHS, USD/MT) Price (RHS, USd/lb.) Corn Cotton x stdv Price (RHS, USd/bu.) Price (RHS, USd/lb.) Soybean Oil Soybeans x stdv Price (RHS, USd/lb.) Price (RHS, USd/bu.) Sugar Wheat 1 5 1x Price (RHS, USd/lb.) Price (RHS, USd/bu.) Note: standard deviation based on 5 year average 5 All commodity futures price data is denominated in USD unless otherwise indicated.

6 Energy Brent Oil WTI Oil x stdv 1x ICE managed money net positioning Price (RHS, USD/bbl.) Price (RHS, USD/bbl.) Natural Gas Gasoline Price (RHS, USD/MMBtu) Price (RHS, USd/gal.) Heating Oil Price (RHS, USd/gal.) Note: standard deviation based on 5 year average 6 All commodity futures price data is denominated in USD unless otherwise indicated. *Brent average of net positions from January 211 as positions were not reported by CFTC before then

7 Jul-14 Nov-14 Jan-15 May-15 Jul-15 Nov-15 Jan-16 May-16 Jul-16 Nov-16 Jan-17 May-17 Jul-14 Nov-14 Jan-15 May-15 Jul-15 Nov-15 Jan-16 May-16 Jul-16 Nov-16 Jan-17 May-17 Jul-14 Nov-14 Jan-15 May-15 Jul-15 Nov-15 Jan-16 May-16 Jul-16 Nov-16 Jan-17 May-17 Jul-14 Nov-14 Jan-15 May-15 Jul-15 Nov-15 Jan-16 May-16 Jul-16 Nov-16 Jan-17 May-17 Jul-14 Nov-14 Jan-15 May-15 Jul-15 Nov-15 Jan-16 May-16 Jul-16 Nov-16 Jan-17 May-17 Jul-14 Nov-14 Jan-15 May-15 Jul-15 Nov-15 Jan-16 May-16 Jul-16 Nov-16 Jan-17 May-17 Industrial Metals Copper (COMEX) Copper (LME) Series average since Jul 214 8, 7,5 7, 6,5 6, 5,5 5, 4,5 4, Price (RHS, USd/lb.) LME non-commercial net positioning Price (RHS, USD/MT) Aluminum Series average since Jul 214 2x stdv 2,2 2,1 2, 1,9 1,8 1,7 1,6 1,5 1,4 Zinc Series average since Jul 214 3, 2,8 2,6 2,4 2,2 2, 1,8 1,6 1,4 LME non-commercial net positioning Price (RHS, USD/MT) LME non-commercial net positioning Price (RHS, USD/MT) Nickel Lead Series average since Jul 214 2, 18, 16, 14, 12, 1, 8, 6, Series average since Jul 214-2,45 2,35 2,25 2,15 2,5 1,95 1,85 1,75 1,65 1,55 LME non-commercial net positioning Price (RHS, USD/MT) LME non-commercial net positioning Price (RHS, USD/MT) Tin Series average since Jul , 22, 2, 18, 16, 14, 12, LME non-commercial net positioning Price (RHS, USD/MT) Note: standard deviation based on 5 year average. LME non-commercial net positions averaged from 28 th July 14 and respective graphs represent da 7 All commodity futures price data is denominated in USD unless otherwise indicated.

8 Precious Metals Gold ,9 1,8 1,7 1,6 1,5 1,4 1,3 1,2 1,1 1, 9 Silver Price (RHS, USD/t oz.) Price (RHS, USD/t oz.) Platinum ,95 1,75 1,55 1,35 1, Palladium Livestock Lean Hogs Price (RHS, USD/t oz.) Price (RHS, USD/t oz.) Live Cattle Price (RHS, USd/lb.) Price (RHS, USd/lb.) Feeder Cattle Price (RHS, USd/lb.) Note: standard deviation based on 5 year average 8 All commodity futures price data is denominated in USD unless otherwise indicated.

9 8/81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 8/81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 8/81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 8/81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 8/81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 8/81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 8/81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 8/81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 Inventories Agriculture Corn - Stock to Use Annual data in %, from 198 to % chg in projections vs. previous = -13.8% Corn - Ending Stocks Annual data in mln tons, from 198 to chg in projections vs. previous = Coffee - Stock to Use Annual data in %, from 198 to % chg in projections vs. previous =.% Coffee - Ending Stocks Annual data in mln bags (6 kg), from 198 to chg in projections vs. 5 previous = Cotton - Stock to Use Annual data in %, from 198 to % chg in projections vs. previous = -5.5% Cotton - Ending Stocks Annual data in mln 48 lb Bales, from 198 to chg in projections vs. 1 previous = Soybeans - Stock to Use Annual data in %, from 198 to % chg in projections vs. previous = 7.3% Soybeans - Ending Stocks Annual data in, from 198 to chg in projections vs. previous = 9.4 Note: Ending stocks, inventories and stock to use data from the USDA are annual with monthly update of 217/218 estimates 9

10 /81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 8/81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 8/81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 8/81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 8/81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 Soybean Oil - Stock to Use Annual data in %, from 198 to % chg in projections vs. previous = -1.% Soybean Oil - Ending Stocks Annual data in mln Metric Tons, from 198 to chg in projections vs. previous = Sugar - Stock to Use Annual data in %, from 1998 to % chg in projections vs. previous = -4% Sugar - Ending Stocks Annual data in mln Metric Tons, from 198 to chg in projections vs. previous = Wheat - Stock to Use Annual data in %, from 198 to % chg in projections vs. previous = 5.4% Wheat - Ending Stocks Annual data in mln tons, from 198 to chg in projections vs. previous = 11.3 Cocoa - Inventory Annual data in ' metric tons, from 1981 to 217 2, 1,8 1,6 1,4 1,2 1, Source: International Cocoa Organisation, Bloomberg, ETF Securities Note: Ending stocks, inventories and stock to use data from the USDA are annual with monthly update of 217/218 estimates 1

11 8/81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 8/81 89/9 9/91 99/ /1 1/2 2/3 3/4 4/5 5/6 6/7 7/8 8/9 9/1 1/11 Jul-16 Aug-16 Oct-16 Nov-16 Jan-17 Feb-17 Apr-17 May-17 Jul-16 Aug-16 Oct-16 Nov-16 Jan-17 Feb-17 Apr-17 May-17 Industrial Metals Aluminum Inventory Daily data, from 14 to 14 2,8 2,6 2,4 2,2 2, 1,8 1,6 1,4 Copper Inventory Daily data, from 14 to SHFE Inventory (in ' tonnes) LME Inventory (in ' tonnes) SHFE Inventory (in ' tonnes) LME Inventory (in ' tonnes) COMEX Inventory (in ' tonnes) Nickel Inventory Daily data in ' MT, from 14 to Zinc Inventory Daily data, from 14 to Source: LME, Bloomberg, ETF Securities SHFE Inventory (in ' tonnes) LME Inventory (in ' tonnes) Lead Inventory Daily data, from 14 to Tin Inventory Daily data in ' MT, from 14 to SHFE Inventory (in ' tonnes) Livestock Lean Hogs Inventory Annual data in mln Heads, from 198 to LME Inventory (in ' tonnes) LME Inventory (in ' tonnes) SHFE Inventory (in ' tonnes) Source: LME, Bloomberg, ETF Securities Live Cattle Inventory Annual data in mln Heads, from 198 to 217 1,15 1,1 1,5 1, 95 9 Note: Ending stocks, inventories and stock to use data from the USDA are annual with monthly update of 217/218 estimates 11

12 Energy US Oil Inventory Weekly data in mln barrels, from Jun 12 to Yr Average +/-1 stdev Source: DOE, Bloomberg, ETF Securities OECD Europe Oil Industry Inventory Monthly data in mln barrels, from Jun 12 to Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 5Yr Average +/-1 stdev Source: DOE, Bloomberg, ETF Securities Heating Oil Inventory Weekly data in mln barrels, from Jun 12 to Yr Average +/-1 stdev Source: DOE, Bloomberg, ETF Securities Natural Gas Inventory Weekly data in billion cubic feet, from Jun 12 to 4,5 4, 3,5 3, 2,5 2, 1,5 1, Yr Average +/-1 stdev Source: DOE, Bloomberg, ETF Securities Gasoline Inventory Weekly data in mln barrels, from Jun 12 to Yr Average +/-1 stdev Source: DOE, Bloomberg, ETF Securities Note: "Oil - OECD Inventory" represents OECD industry stocks and is reported with a 2 month lag. 12

13 Commodities Front Month Futures and Trading Volumes Agriculture Cocoa Front Month Futures Price Daily data in USD/MT, from 14 to 14 2,5 2, 1,5 1, 5 $3,4 $3,2 $3, $2,8 $2,6 $2,4 $2,2 $2, $1,8 $1,6 Coffee Front Month Futures Price Daily data in USd/lb., from 14 to 14 7, 6, 5, 4, 3, 2, 1, $1.8 $1.7 $1.6 $1.5 $1.4 $1.3 $1.2 $1.1 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Corn Front Month Futures Price Daily data in USd/bu., from 14 to 14 25, 2, 15, 1, 5, $4.4 $4.2 $4. $3.8 $3.6 $3.4 $3.2 $3. Cotton Front Month Futures Price Daily data in USd/lb., from 14 to 14 4,85 4,35 3,85 3,35 2,85 2,35 1,85 1, $.9 $.85 $.8 $.75 $.7 $.65 $.6 $.55 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Soybean Oil Front Month Futures Price Daily data in USd/lb., from 14 to 14 9, 8, 7, 6, 5, 4, 3, 2, 1, $.4 $.38 $.36 $.34 $.32 $.3 $.28 Soybeans Front Month Futures Price Daily data in USd/bu., from 14 to 14 4, 35, 3, 25, 2, 15, 1, 5, $13 $12 $11 $1 $9 $8 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Sugar Front Month Futures Price Daily data in USd/lb., from 14 to 14 9, 8, 7, 6, 5, 4, 3, 2, 1, $.26 $.24 $.22 $.2 $.18 $.16 $.14 $.12 Wheat Front Month Futures Price Daily data in USd/bu., from 14 to 14 1, 9, 8, 7, 6, 5, 4, 3, 2, 1, $5.1 $4.9 $4.7 $4.5 $4.3 $4.1 $3.9 $3.7 $3.5 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) 13

14 Energy Brent Oil Front Month Futures Price Daily data in USD/bbl., from 14 to 14 $12, $63 WTI Oil Front Month Futures Price Daily data in USD/bbl., from 14 to 14 $14, $6 $1, $8, $6, $4, $2, $58 $53 $48 $43 $12, $1, $8, $6, $4, $2, $55 $5 $45 $4 $ $38 $ $35 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Natural Gas Front Month Futures Price Daily data in USD/MMBtu, from 14 to 14 $3, $25, $2, $15, $1, $5, $4.5 $4. $3.5 $3. $2.5 $2. Gasoline Front Month Futures Price Daily data in USd/gal., from 14 to 14 $35, $3, $25, $2, $15, $1, $5, $1.8 $1.7 $1.6 $1.5 $1.4 $1.3 $ $1.5 $ $1.2 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Heating Oil Front Month Futures Price Daily data in USd/gal., from 14 to 14 $23, $18, $13, $8, $3, -$2, $1.9 $1.8 $1.7 $1.6 $1.5 $1.4 $1.3 $1.2 $1.1 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Carbon Carbon Front Month Futures Price Daily data in EUR/MT, from 14 to Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Note: all commodity futures trading volume and price data is denominated in USD unless otherwise indicated. 14

15 Industrial Metals Aluminum Front Month Futures Price Daily data in USD/MT, from 14 to 14 $2, $18, $16, $14, $12, $1, $8, $6, $4, $2, $ $2, $1,9 $1,8 $1,7 $1,6 $1,5 $1,4 Lead Front Month Futures Price Daily data in USD/MT, from 14 to 14 $6, $5, $4, $3, $2, $1, $ $2,7 $2,5 $2,3 $2,1 $1,9 $1,7 $1,5 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Copper (COMEX) Front Month Futures Price Daily data in USd/lb., from 14 to 14 $25, $2, $15, $1, $5, $ $3. $2.8 $2.6 $2.4 $2.2 $2. $1.8 Copper (LME) Front Month Futures Price Daily data in USD/MT, from 14 to 14 $3, $25, $2, $15, $1, $5, $ $6,2 $6, $5,8 $5,6 $5,4 $5,2 $5, $4,8 $4,6 $4,4 $4,2 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Volume ($mn) 2 dma (RHS) 5 dma (RHS) Prices (RHS) Nickel Front Month Futures Price Daily data in USD/MT, from 14 to 14 $9, $8, $7, $6, $5, $4, $3, $2, $1, $ $12, $11,5 $11, $1,5 $1, $9,5 $9, $8,5 $8, Tin Front Month Futures Price Daily data in USD/MT, from 14 to 14 $8 $7 $6 $5 $4 $3 $2 $1 $ $23, $22, $21, $2, $19, $18, $17, $16, $15, Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Zinc Front Month Futures Price Daily data in USD/MT, from 14 to 14 $16, $14, $12, $1, $8, $6, $4, $2, $ $3,2 $3, $2,8 $2,6 $2,4 $2,2 $2, $1,8 $1,6 $1,4 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Note: all commodity futures trading volume and price data is denominated in USD unless otherwise indicated. 15

16 Precious Metals Gold Front Month Futures Price Daily data in USD/t oz., from 14 to 14 $12, $1, $8, $6, $4, $2, $ $1,4 $1,35 $1,3 $1,25 $1,2 $1,15 $1,1 Silver Front Month Futures Price Daily data in USD/t oz., from 14 to 14 $18, $16, $14, $12, $1, $8, $6, $4, $2, $ $21 $2 $19 $18 $17 $16 $15 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Platinum Front Month Futures Price Daily data in USD/t oz., from 14 to 14 $2,5 $2, $1,5 $1, $5 $ $1,2 $1,15 $1,1 $1,5 $1, $95 $9 $85 Palladium Front Month Futures Price Daily data in USD/t oz., from 14 to 14 $1,6 $1,4 $1,2 $1, $8 $6 $4 $2 $ $9 $85 $8 $75 $7 $65 $6 $55 $5 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Livestock Lean Hogs Front Month Futures Price Daily data in USd/lb., from 14 to 14 $2,3 $1.2 $1,8 $.92 $.82 $1,3 $.72 $8 $.62 $.52 $3 $.42 -$2 $.32 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Live Cattle Front Month Futures Price Daily data in USd/lb., from 14 to 14 $12, $1.5 $1, $1.4 $8, $1.3 $6, $1.2 $4, $1.1 $2, $1. $ $.9 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Feeder Cattle Front Month Futures Price Daily data in USd/lb., from 14 to 14 $3, $2,5 $2, $1,5 $1.7 $1.6 $1.5 $1.4 $1, $1.3 $5 $1.2 $ $1.1 Volume ($mn) Prices (RHS) 5 dma (RHS) 2 dma (RHS) Note: all commodity futures trading volume and price data is denominated in USD unless otherwise indicated. 16

17 Futures Curves Agriculture Cocoa Futures USD/MT $2,25 $2,2 $2,15 $2,1 $2,5 $2, $1,95 $1, Coffee Futures USd/lb. $1.8 $1.7 $1.6 $1.5 $1.4 $1.3 $ Corn Futures USd/bu. $4.4 $4.3 $4.2 $4.1 $4. $3.9 $3.8 $3.7 $3.6 $3.5 Cotton Futures USd/lb. $.91 $.86 $.81 $.76 $.71 $ Soybean Oil Futures USd/lb. $.345 $.34 $.335 $.33 $.325 $.32 $.315 $.31 Soybeans Futures USd/bu. $1.2 $1.1 $1. $9.9 $9.8 $9.7 $9.6 $9.5 $9.4 $9.3 $ Sugar Futures USd/lb. $.19 $.18 $.17 $.16 $.15 $.14 $.13 Wheat Futures USd/bu. $5.8 $5.6 $5.4 $5.2 $5. $4.8 $4.6 $4.4 $4.2 $4. $ Note: all commodity futures price data is denominated in USD unless otherwise indicated. 17

18 Energy Brent Oil Futures USD/bbl. $53 $52 $51 $5 $49 $48 $47 $46 $45 $44 WTI Oil Futures USD/bbl. $53 $52 $51 $5 $49 $48 $47 $46 $45 $ Gasoline Futures USd/gal. $1.65 $1.6 $1.55 $1.5 $1.45 $1.4 $1.35 $1.3 $1.25 $1.2 Natural Gas Futures USD/MMBtu $3.8 $3.6 $3.4 $3.2 $3. $2.8 $ Heating Oil Futures USd/gal. $1.7 $1.65 $1.6 $1.55 $1.5 $1.45 $1.4 $ Carbon Carbon Futures EUR/MT Note: all commodity futures price data is denominated in USD unless otherwise indicated. 18

19 Industrial Metals Aluminum Futures USD/MT $1,99 $1,97 $1,95 $1,93 $1,91 $1,89 $1,87 $1,85 Lead Futures USD/MT $2,25 $2,2 $2,15 $2,1 $2,5 $2, Copper (COMEX) Futures USd/lb. $2.75 $2.7 $2.65 $2.6 $2.55 $2.5 Copper (LME) Futures USD/MT $5,9 $5,85 $5,8 $5,75 $5,7 $5,65 $5,6 $5,55 $5, Nickel Futures USD/MT $11, $1,5 $1, $9,5 $9, $8,5 Tin Futures USD/MT $2,2 $2, $19,8 $19,6 $19,4 $19,2 $19, $18, Zinc Futures USD/MT $2,8 $2,7 $2,6 $2,5 $2,4 $2,3 $2, Note: all commodity futures price data is denominated in USD unless otherwise indicated. 19

20 Precious Metals Gold Futures USD/t oz. $1,45 $1,4 $1,35 $1,3 $1,25 $1,2 $1,15 Silver Futures USD/t oz. $19.5 $19. $18.5 $18. $17.5 $17. $16.5 $ Platinum Futures USD/t oz. $98 $97 $96 $95 $94 $93 $ Livestock Lean Hogs Futures USd/lb. $.85 $.8 $.75 $.7 $.65 $ Palladium Futures USD/t oz. $88 $86 $84 $82 $8 $78 $76 $74 $ Live Cattle Futures USd/lb. $1.35 $1.3 $1.25 $1.2 $1.15 $1.1 $1.5 $1. $.95 $ Feeder Cattle Futures USd/lb. $1.6 $1.55 $1.5 $1.45 $1.4 $1.35 $1.3 $1.25 $ Note: all commodity futures price data is denominated in USD unless otherwise indicated. 2

21 C Commodity Monthly Matrix Explained Score based on unweighted sum of four fundamental/technical measures detailed below with each measure awarded a possible score of -1,, or 1 depending on whether variable is viewed as fundamentally negative, neutral or positive. Score ranging from -4 to +4. For commodities where data is not available or not relevant, scores are calculated on remaining variables and adjusted to the -4 to +4 scale. The score matrix is designed to highlight significant changes in key variables but should not be viewed as predictor of performance. The four fundamental/technical measures are as follow: - price vs. 2 days moving average: 1 when price is above 2dma and return is positive, -1 when price is below 2dma and return is negative, otherwise - % change in net positioning over the past month: 1 when % change is positive, -1 when % change is negative, when no change - % change in inventory level over the past 3 months: 1 when % is negative, -1 when % is positive, when no change - roll yield between the front and second month futures contracts: 1 when in backwardation, -1 when in contango, when no change CALENDAR ETF Securities - Recent Research Notes 14- Maxwell Gold Solar remains a bright spot for silver demand 4-Apr-17 Morgane Delledonne Is China s credit boom dangerous for foreign investors? 11-Apr-17 Edith Southammakosane How to mitigate the cost of contango 19-Apr-17 Michael Wang Energy equities starting to look interesting 3-May-17 Nitesh Shah US natural gas - international demand unlikely to absorb domestic glut 9-May-17 Morgane Delledonne France and Europe narrowly survived populism 16-May-17 Martin Arnold Commodity currencies in the doldrums 23-May-17 Michael Wang China A-shares - Short-term headwinds but positives in the medium-term 31-May-17 Martin Arnold Upside potential for GBP after UK election 6- Edith Southammakosane Momentum for short-term tactical play, CAPE for the longer run 7- James Butterfill An update on our commodities contrarian model 13- Nitesh Shah Energy Wars: OPEC fighting a losing battle ETF Securities - Past Issues of Commodity Monthly Monitor Jan - Feb 217 Research Team Can government spending 'Trump' rising production? Feb - Mar 217 Research Team Investors remain bullish on commodities Mar - Apr 217 Research Team Dovish tightening to support precious metals Apr-May 217 Research Team Defensives gain as "Trumpflation" fades May-Jun 217 Research Team Under pressure from a speculative unwind The research notes are for qualified investors only. Key Reports Current Next release 9-12-Jul-17 USDA World Agricultural Supply and Demand Estimates 6-11-Jul-17 EIA Short-Term Energy Outlook Jul-17 OPEC OPEC Oil Market Report Jul-17 IEA IEA Oil Market Report DISCLAIMER Important Information The analyses in the above tables are purely for information purposes. They do not reflect the performance of any ETF Securities' products. The futures and roll returns are not necessarily investable. General This communication has been provided by ETF Securities (UK) Limited ( ETFS UK ) which is authorised and regulated by the United Kingdom Financial Conduct Authority (the FCA ). This communication is only targeted at qualified or professional investors. The information contained in this communication is for your general information only and is neither an offer for sale nor a solicitation of an offer to buy securities. This communication should not be used as the basis for any investment decision. Historical performance is not an indication of future performance and any investments may go down in value. This document is not, and under no circumstances is to be construed as, an advertisement or any other step in furtherance of a public offering of shares or securities in the United States or any province or territory thereof. Neither this document nor any copy hereof should be taken, transmitted or distributed (directly or indirectly) into the United States. This communication may contain independent market commentary prepared by ETFS UK based on publicly available information. 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