Eric Bolling’s “Commodity Corner”
Eric Bolling is a about a month into his stint at FBN, and we are glad to see him focusing on his strengths, namely commodities. Bolling spent most of 2007 correctly predicting “beans in the teens”, and with any luck he will run down the commodity markets every day at Fox Business Network. Where else are you going to get a run down of the Malaysian Palm Oil market?
Bolling’s Commodity Corner
Soybeans are up 1.5% in Asia this morning. China’s come out and says they want to increase the reserves in front of the Beijing Olympics. They have about 700 million tons of soy beans, somewhere between 1.5 and 2 million tons they would like to have in reserve for the games and going forward. Now obviously we use soybeans, they’re crushed into oil and meal. The oil is used for vegetables and edible food and the meal is used to feed animals, just like corn.
For jet fuel, everyone knows the gasoline story – hitting all time highs at the pump. Jet fuel is also hitting all-time highs and that will hurt the airlines. Diesel fuel is hitting all time highs that will hurt the trucking industry. But Barron’s made a good point and that is that the high cost of crude oil going into the refineries hurts refiners. Keep your eyes on the refiners.
Watch Chevron, watch Tesoro and watch Valero because those prices, with the coming summer driving season and the high jet fuel, that’ll eventually trickle into their profits. To be honest with you, they haven’t made that much money on gasoline because the crack spread as they call it has been so low, it’s starting to move up so keep your eye on that.
Malaysian palm oil, from the fruit of the palm tree, it competes with soy bean oil as the most edible oil in the world. It’s got money. Malaysian palm oil is in Newman’s Own salad dressing, some of the cosmetics you’re wearing. And then, motor oil and axel grease. Lot of uses for Malaysian palm oil.
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