SM Commodities Index - August 2020

22 September 2020

The latest prices and key trends from the SM Commodities Index.

Natural gas

Natural gas prices in the US jumped from $1.76 per 1m British thermal units (MMBtu) in July to $2.30/MMBtu in August, according to IHS Markit. Prices at the beginning of July were near historic lows, but above average temperatures across the country in the second half of July and into August caused a spike in demand from the power sector, as more electricity production was required to meet consumer demand. This July to August period is regularly the warmest weather of the year in the US, but a heatwave lifted the use of air conditioning above expected levels.

Wheat

Kansas City (KC) wheat flour prices came under pressure in August as fresh supplies moved into the market following the summer harvest. Prices had witnessed strong support from increased at-home demand following national lockdowns. KC wheat futures have turned lower for the first part of September as crop sizes have been revised higher in Australia and Russia. However US wheat exports have been supportive as the US dollar weakened.  

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