Commodities in the New Great Depression: how low or high can they go

So the Airlines can stock up on Fuel Contracts, and get rid of their Fuel Surcharges, reduce what we pay for tickets.

Fat chance on that. Not that we can buy many tickets at present in any case.

And you can rock up to your local gas station and ‘fill er up’ and they will pay you. Oh sure, the companies will play that game (not).

Growth will come from small and mid caps.

I will take it as such! lol

Did day trading before so I know it’s money to be made right now. But I have no idea where the virus, people, gov+++ is going at the moment and guess nobody really know and that’s why most markets are volatile. I will hopefully be on a long ride up.

That’s why a bit safer to take 2-4 year view.
You make a $10,000 bet on commodities options and if it doesn’t go up, well that in all likelihood means it’s been game over for everyone, but if it turns around a killing can be made.
This is all about supply/demand disruptions on a mega-scale.

It’s called fuel hedging. Some airlines have lost money on that lately. But hopefully some will make money.

Barrons says oil will be $20 on Tuesday.

And that is why I do not touch commodities!

because June contract is the new front contract

image

Read :point_up_2:. Explains a lot and how June contract might be kamikaze’ing soon enough.

Why wouldn’t it be?

yes, survival of the fitness.

Back to the topic at hand,
June WTI contract long holders must find storage somewhere (good luck) to hold onto their “demand” over next few weeks.

A simple explanation of what happened.

https://seekingalpha.com/article/4338551-why-wti-crude-is-crashing-much-today?ifp=0&utm_medium=email&utm_source=seeking_alpha&mail_subject=why-wti-crude-is-crashing-so-much-today&utm_campaign=nl-macro-view&utm_content=link-0

new June WTI contract down 45% to below $12, after closing above $20 yesterday.
Shorts in control as there’s no places to store the oil upon delivery.

https://www.bloomberg.com/news/articles/2020-04-21/oil-tankers-are-surrounding-california-with-nowhere-to-unload

Almost three dozen ships – scattered in waters from Long Beach to the San Francisco Bay – are mostly acting as floating storage for oil that’s going unused as the coronavirus pandemic shutters businesses and takes drivers off the road. Marathon Petroleum Corp.’s refinery in Martinez, California, has been idled and others, including Chevron Corp.’s El Segundo refinery, have curtailed crude processing as the state orders residents to stay at home.

The more than 20 million barrels of crude is the highest volume of crude to ever float off the West Coast at one time, according to Paris-based Kpler SAS, which tracks tanker traffic. About three quarters of those tankers are holding oil in storage, meaning they have been floating steadily for seven days, also a record.

As pork, beef and chicken plants are being forced to close, even for short periods of time, millions of pounds of meat will disappear from the supply chain. As a result, there will be limited supply of our products available in grocery stores until we are able to reopen our facilities that are currently closed.”

“Farmers across the nation simply will not have anywhere to sell their livestock to be processed, when they could have fed the nation. Millions of animals — chickens, pigs and cattle — will be depopulated because of the closure of our processing facilities. The food supply chain is breaking.”

All those buying meat at CostCo in Taiwan, better go soon. Meat exports likely first impacted.

EVERYONE GO VEGAN! THERE WILL BE NO MORE ANIMAL PRODUCTS!! :runaway:

But you’re probably right. They’ve been saying for a few days now that meat supplies in the US will be disrupted by the COVID cases at the packing plants. We can expect a price rise at least.

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Parents already saying their major supermarket chain is limiting/restricting meat purchases.

I’m not surprised. Unlike TP, meat isn’t something that you can just ramp up to 24/7 production. It requires humans which require PPE. Maybe we really will need to move towards more plant based diets…better get them greens growing in the window.

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Less pork and beef in our diet. No big deal and great for the environment too.

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yeah, might as well fuq the feed farmers, too