LONDON - COPPER hit a 33-month low, gold tumbled and oil slid further on Thursday as prices of industrial materials and other commodities were undermined by growing fears of global recession.
Oil slumped to a 13-month low and is now trading at less than half its Jul record high of US$147 (S$217.64 ) a barrel. Gold slipped more than 2 per cent, copper crashed 33 per cent, US corn dropped to a 10-month low and coffee and cocoa fell further.
'Markets generally are just selling off. It is that, as much as anything else, that gold is being caught up in,' said Mr Stephen Briggs, an analyst at RBS Global Banking & Markets.
'People need to liquidate assets to cover losses elsewhere.'
Spot gold was quoted at US$835.55/838.05 an ounce at 5.55pm down from US$848.00 in late New York trade on Wednesday. Earlier it touched a session low of US$827.85.
Oil's decline echoed global stock markets with Japan's Nikkei suffering its worst one-day loss since the stock marketcrash of 1987.
European shares tumbled at the open, shedding more than 6 per cent at one point. Although they later came off lows, the fall sparked a sell-off of commodities as investors fretted over the prospect of recession.
'Economic weakness is hitting the stock and oil markets, but the oil price fall is also reflecting a lack of demand,' said Mr Francisco Blanch, head of commodity research at Merrill Lynch.
Oil fell for a third straight session, hitting a 13-month low near US$71 a barrel.
US crude for Nov delivery was down US$1.83, or 2.5 per cent, down at US$72.71 a barrel at 6.38pm.
The front-month contract has lost nearly a third in value in three weeks, the steepest such decline since it began trading in 1983.
Copper, used in the construction and power industries, dropped to a 33-month low and other industrial metals also fell, on demand concerns amid mounting fears of a global economic slowdown.
Copper for delivery in three months on the London Metal Exchange fell to US$4,545 a tonne, a drop of 7.6 per cent, to the lowest price since Jan 2006.
Grains futures around the globe hit new lows on fears that a recession could weaken demand.
Corn futures dropped to a 10-month low in electronic trade, soybean futures fell to a 13-month low while wheat hit a level not seen for 16 months.
By 6.25pm, Dec corn futures had dropped 1.6 per cent to US$3.81-3/4 a bushel after settling in US trade below US$4 for the first time in 10 months, while Nov soybean futures declined 1.4 per cent to US$8.46-1/4 a bushel.
In soft commodities, Jan robustas were down US$17 or 0.97 per cent to US$1,744 per tonne at 1029 GMT while Dec cocoa was down US$49 at US $1,260 a tonne. -- THOMSON REUTERS
