SOURCE: Scotiabank


October 30, 2015 08:00 ET

Commodity Prices Rally in October: Scotiabank

TORONTO, ON--(Marketwired - October 30, 2015) - Amid concern over the outlook for China's economy -- Scotiabank's Commodity Price Index lost further ground in September easing by -2.6% month-over-month (m/m) and -33.4% year-over-year (y/y); however, commodity prices have improved in October.

"Though commodity prices remain near a decade low, they have rallied in October, rebounding with some easing in negative sentiment over China's growth outlook," said Patricia Mohr, Vice President of Economics and Commodity Market Specialist at Scotiabank.

China's third-quarter GDP growth at 6.9% was slightly better than expected.

"Another factor assisting the rebound has been central bank attempts to bolster global growth through easing monetary policy, lifting global equity markets last week, boosting risk appetite across financial markets and supporting base metal prices."

"The Trans-Pacific Partnership (TPP) will deepen Canada's trade ties in the Asia/Pacific region, cement the value of our NAFTA trade agreement and open up valuable new export markets for Canadian forest products. The best prospects for expanded trade in lumber and panel boards appear to be in Japan, Malaysia and Vietnam. The Agreement will give Canadian exporters an important advantage in TPP markets over strong competitors from Russia, China, Indonesia and the European Union."

Other highlights from the report include :

  • The Oil & Gas Index led commodity prices lower again in September (-5.2% m/m, -58.4% yr/yr). While light, sweet crude oil edged up in Edmonton, Western Canadian Select heavy oil dropped from US$29.33 to US$26.32 per barrel -- close to the 2008-recessionary low of US$22.91. While WCS heavy oil prices have rallied moderately in October, WTI oil (the key reference price for North America) is range bound at about US$46. The market is still waiting for a significant international supply-side adjustment to low oil prices.
  • Glencore cuts zinc production, tightening supply and demand conditions and boosting the outlook for zinc prices in 2016-17. Prices could jump to US$1.25-1.35 per pound in 2016 and even higher in 2017.
  • China's Central Committee met this week to set out the 13th Five-Year Plan, a blueprint for economic and social development between 2016 and 2020. Likely to loom large in the plan is the development of a 21st-century version of the 'Silk Road,' President Xi Jinping's signature foreign policy initiative.

Read the full Scotiabank Commodity Price Index online at:,,3112,00.html.

Scotiabank provides clients with in-depth research into the factors shaping the outlook for Canada and the global economy, including macroeconomic developments, currency and capital market trends, commodity and industry performance, as well as monetary, fiscal and public policy issues.

About Scotiabank

Scotiabank is Canada's international bank and a leading financial services provider in North America, Latin America, the Caribbean and Central America, and parts of Asia. We are dedicated to helping our 21 million customers become better off through a broad range of advice, products and services, including personal and commercial banking, wealth management and private banking, corporate and investment banking, and capital markets. With a team of more than 87,000 employees and assets of $863 billion (as at July 31, 2015), Scotiabank trades on the Toronto (TSX: BNS) and New York Exchanges (NYSE: BNS). Scotiabank distributes the Bank's media releases using Marketwired. For more information, please visit and follow us on Twitter @ScotiabankNews.

Contact Information