ANZ Research

Commodity Call
1 September 2022

Not out of the woods

This is not personal advice nor
financial advice about any product or Key view
service. It does not take into account Europe has made the most of a seasonal lull in demand to fill gas storage
your financial situation or goals.
Please refer to the Important Notice facilities well ahead of schedule. However, the energy crisis is far from over.
Increased supply of LNG, in combination with strong generation from
Contents
renewable energy amid the seasonal lull in demand has enabled gas storage
Commodity views 5 levels to reach 80% of capacity. This is nearly two months ahead of schedule.
Week in review 6
Calendar 8 Nevertheless, the situation in Germany is perilous. Its gas inventories can
Previous reports 9 cover two months of peak demand. As temperatures fall through Autumn,
Commodity performance 10 demand for heating fuels will rise significantly above current supply. As it
Investor positioning 11
stands, the country could run out of gas in early 2023.
Prices 13
Inventories 15 Risks of energy shortages worsening are also high. Russian gas producer
Forward curves 16
ANZ forecasts 17
Gazprom has highlighted that several other turbines on the Nord Stream
require maintenance. Ultimately Germany would need to be successful in
cutting natural gas consumption by 15% to keep gas storage facilities from
Authors running empty.
Daniel Hynes
Senior Commodity Strategist Chart of the week
+61 2 8037 0072
Daniel.Hynes@anz.com Germany could run out of gas in early 2023

Soni Kumari, CAIA

Commodity Strategist
+91 80 67951321
Soni.Kumari2@anz.com

Contact
research@anz.com

Twitter
@ANZ_Research

What we are watching

OPEC meeting: The oil producing group meets on Monday to review its
production outlook. Saudi Arabia’s oil minister, Prince Abdulaziz bin Salman,
has warned that markets had disconnected from fundamental supply/demand
factors. He hinted a cut to output may be in order. OPEC’s Joint Technical
Committee seemingly endorsed this view, slashing this year’s estimate of a
surplus by half and flipping its projection for next year to a deficit of 300kb/d.
We don’t expect a production cut; but rhetoric will likely be bullish.

Weekly outlook
Crude LNG Copper Gold Iron ore
 Strategy
Germany still at risk of running out of gas this winter
Europe has taken advantage of the lull in demand to ramp up gas storage levels
ahead of winter. In part this is because warmer temperatures through the European
spring reduced demand for electricity. But added to this was strong output of
renewable energy, in particular wind power.
Increased supply of LNG also improved the picture. LNG deliveries to Northwest
Europe and Italy reached 248m cubic meters (cm) per day in July. This compares
with 75mcm/d in July 2021. Based on ship tracking data, this is projected to rise to
253mcm/d, or 5.7mt, in August.
This lull was disrupted as soaring temperatures hit the continent in August. This has
led to a sharp rise in power demand for cooling, particularly in the residential market.
However, high gas and electricity prices have weakened demand in other sectors,
particularly industry. Industrial demand in Germany from January through July stood
at 1.15TWh, a 13% drop compared to the three-year average.
Current storage levels have risen to 144bcm or nearly 80% of capacity, which is
within the five-year range (Figure 1). Some countries have managed to boost
inventories even higher. Storage facilities in Poland and the UK are nearly full, and
France’s are over 90% .
As part of its strategy to ensure gas supplies through the coming winter, the
European Union (EU) has mandated that storage levels should reach 80% capacity
by the end of October and 90% by the end of the year. Based on current projections,
these targets should be met nearly a month early.

Figure 1. European gas storage levels Figure 2. Gas storage levels by country

Nevertheless, the better-than-expected storage levels don’t alleviate the risk of

running out of gas during the upcoming heating season.
The northern hemisphere winter is a key period for the gas market, during
which around 40% of demand comes from the residential sector for heating.
Approximately 35% of gross heating production in Europe comes from natural gas.
Warmer than usual temperatures cause natural gas demand to fall well below supply.
Injections into storage usually commence in April and persist until October (Figure 3).

ANZ Commodity Call | 1 September 2022 2

 Strategy
Figure 3. European injections within historic range

The EU imports 90% of the gas at consumes, with Russia providing around 45% of
those imports. Germany has the biggest reliance on the energy giant, which provides
over half its gas needs.
Following closures for maintenance of turbines on the Nord Stream pipeline, gas
flows fell to about 20% of capacity. Germany has managed to partly offset this,
directly and indirectly, with gas from the LNG market. We estimate gas supply was
7.7bncm in July, only marginally lower than the 8.3bncm it received prior to Russia’s
invasion of Ukraine. However, with the seasonal fall in demand, it has been able to
add gas to storage since April. Latest data in August has storage is at 83% of
capacity. This should see it reach its target of 85% capacity well ahead of the end-of-
October deadline.
As temperatures fall through Autumn, demand for heating fuel rises rapidly.
In Europe, natural gas consumption picks up from October. Despite strong interest in
solar power in the residential market, Germany still relies on natural gas for heating,
so it will start to withdraw natural gas from its reserves. Assuming Russian gas flows
remain at current levels of 20% of capacity, we don’t see Germany’s storage levels
reaching their target of 95% by November. In fact, we estimate they will fall in
October, and that withdrawals will pick up in November.

Figure 4. Germany’s gas supply and demand Figure 5. Germany’s natural gas balance and
storage levels

ANZ Commodity Call | 1 September 2022 3

 Strategy
This leave Germany’s gas market in a perilous state. Assuming natural gas
consumption is unchanged from 2021, we expect it to start drawing on inventories to
a point where it will run out of gas in early 2023 (Figure 5).
Still, energy shortages could worsen. Gazprom has highlighted that several other
turbines on the Nord Stream pipeline are due for maintenance. With limited ability to
increase natural gas supply in the short term, how Germany gets through the winter
will depend on its ability to reduce demand.
EU members agreed in July to voluntarily reduce gas use by 15%. In a bid to reach a
compromise, the deal contains significant carve-outs for several countries, which
could make the agreement less effective. Measures to reduce demand, include:
• Speeding up the replacement of gas boilers with heat pumps
• Enacting short-term measures to protect vulnerable consumers from high
electricity prices
• Accelerating energy efficiency improvements in buildings and industry
• Forcing consumers to reduce energy consumption, using initiatives such as
turning down thermostats
It will also boost energy from alternative sources. German utility, Uniper SE, said this
week it will re-start its Heyden coal-fired power plant, as a three-day halt in Russia's
gas supplies could cause power disruptions. However, this and other reinvigorated
coal-fired plants may struggle to reach capacity, as coal deliveries have been
obstructed by low water levels in the Rhine River.
Germany has also investigated delaying the phase out of its three remaining nuclear
power stations. The plants were due to close by the end of 2022 under legislation
passed by the Merkel government after Japan’s 2011 Fukushima accident. However,
Economy Minister Robert Habeck said a delay to this phase-out would offer little help
in solving the energy shortages.
In fact, nuclear power generation was down 14% y/y in H1 2022. Across the EU bloc,
there is a bleak outlook for improvements. France’s EDF is striving to bring online
nuclear reactors that are undergoing maintenance. Their restart dates are still
uncertain, so low generation levels can be expected.
Ultimately, Germany’s reliance on gas for heating means it will have to cut natural
gas consumption by 15% to keep storage levels from falling to zero.

Figure 6. German gas storage levels if gas consumption is cut by 15%

ANZ Commodity Call | 1 September 2022 4

 In brief
Views
 bull,  bear,  neutral

Sector Views Week Month

The deteriorating oil demand outlook is weighing on market sentiment. We believe
supply disruptions will off-set some demand concerns. OPEC production is
constrained. Supplies from Libya are stabilising but under-investment in many
member countries will constrain production. Iranian nuclear deal talks have
Crude
revived, raising the possibility of more oil supply. US shale producers are likely to
oil
continue their gradual production ramp-up, but incremental supply is likely to come
from smaller producers. Capex discipline among major oil and gas companies
continues despite strong cash flows. We expect supply to tighten once Europe’s
embargo comes into effect in December.

LNG markets remain on edge, as Russian gas flows dropped to 20% of capacity
from 40% last week. Europe is on the verge of an energy crisis, as the threat of a
LNG halt to Russian gas supplies rises. A prolonged halt would jeopardise plans to fill
storage facilities in time for winter. Increasing concerns of supply shortages should
keep LNG prices supportive.

Concerns around slowing economic growth are outweighing supply disruptions and
low inventories. Weaker demand in China from lockdowns has dragged into Q3.
Increased infrastructure spending and policy measures for the housing sector
Base
should stabilise the market, although the upside looks limited. Disruptions to
metals
Russian supplies and energy shortages in Europe should keep aluminium and zinc
balances tight. Depleted inventories and supply challenges are broadly supportive
for the sector.

Aggressive Fed rate hikes and a stronger USD are holding down the gold price.
While growing recession fears, due to rising rates against sticky inflation, should
Gold &
see some haven flows. Central bank purchases are likely to be strong as currencies
silver
depreciate and geopolitical risks rise. This should help mitigate weaker physical
demand. We expect gold to find its floor near USD1,700/oz.

Easing semi-conductor supply tightness could revive auto-sector demand for

PGMs. That said, doubts around the economic outlook could cap the upside.
PGM
Russia supplies more than 35% of palladium worldwide, and disruptions so far look
limited.

We see limited upside in iron ore prices. A stabilisation in the Chinese property
market should support sentiment and prices through Q3 and into year end.
Iron
We expect prices to trend lower in Q4 and into 2023 as the impact of China’s
ore
stimulus measures peter out and iron ore demand weakens. We see prices at the
end of 2023 sitting under USD100/t as the market tightness eases.

Coal prices face upward pressure from strong European demand. An impending
energy crisis in Europe is likely to switch power utilities from gas to coal, this could
increase competition for seaborne coal. Chinese coal imports have slowed in
Coal
recent months, but a revival of industrial activity would see higher burning rates.
That said, some relief could come as China and India import more Russian coal.
Chinese power plants are well stocked, so imports are likely to be weak.

ANZ Commodity Call | 1 September 2022 5

 Looking back
Week in review
Markets remained gripped by central bank tightening policies, with most risk assets
coming under pressure. Industrial commodities came under pressure amid the risk off
tone across markets. Energy was also lower, despite fundamentals suggesting markets
remain tight. The ANZ CCI settled marginally higher by 0.4% w/w due to strong gains
in agriculture.
Crude oil markets were under pressure amid renewed growth concerns. Hawkish central
banks and China’s economic slowdown weighed on sentiment, with Brent crude recording
its third straight monthly decline in August. A wave of downgrades on China’s economic
growth has raised concerns its crude oil demand will be weaker than expected.
This comes as the country stays true to its zero-COVID strategy. China’s independent
refiners are planning to increase maintenance in September amid the weak demand
backdrop. Even data showing tighter fundamentals failed to shift the narrative. US
commercial inventories fell 3,326kbbl last week, according to EIA data. Gasoline
inventories were also lower (-1,172kbbl) while apparent demand climbed to 8.59mb/d.
The market is facing some impending supply issues. Political unrest in Iraq and Libya puts
at risk 5mb/d of crude oil.
European energy prices slumped as authorities threatened to step up efforts to curb
rising prices. The European Union warned it will intervene in power markets and is
currently studying various options to bring down the price of electricity, although it
could take weeks to hash out and implement. As a result, German and French power
prices tumbled 15% and European gas, with Dutch front month futures falling nearly
30% from recent record highs. Nevertheless, gas flows into Europe continue to fall.
Russia halted supplies to French utility Engie SA because of a disagreement over
payments and a full cut-off of gas will commence from 1 September. This comes as a
three-day maintenance shutdown of the Nord Stream pipeline cut gas flows into the
continent even further. The falls in Europe saw North Asian LNG spot prices also come
under pressure. This was exacerbated by news that Shell’s Prelude floating LNG terminal
will resume operations following strike action. Nevertheless, top LNG importers are
showing no signs of letting up on purchases of cargoes. Japan and South Korea are
currently looking to procure more LNG as they prepare for strong demand over winter.

Figure 7. ANZ CCI weekly performance Figure 8. ANZ CCI monthly performance

The fallout hit related markets. Carbon prices in Europe

declined as much as 9% to EUR58.90/t, while UK
emissions were down sharply to GBP60.50/t. European
coal futures collapsed by nearly 18% while Newcastle
ANZ Commodity Call | 1 September 2022 6
thermal coal futures fell 10% to USD242/t. The energy
crisis flowed to India, with authorities urging state-run
 Looking back
European carbon followed energy prices lower amid a bearish mood ahead of this
week’s auctions. After trading in a tight range around EUR90/t, EUAs fell below
EUR80/t as selling intensified. This was despite Gazprom closing the Nord Stream
pipeline for a scheduled three-day maintenance program. The growing number of
industrial shutdowns across Europe is raising expectations that demand for carbon
credits will be curbed. European Commission President Ursula von der Leyen
shrugged off calls by Poland to freeze carbon allowance prices at EUR30/t as a way
to help the bloc’s industry cope with soaring gas and power prices. Australian
carbon prices edged higher as supply of new Australian Carbon Credit Units (ACCUs)
came off from recent lofty levels. After falling to AUS26/t in mid-August, ACCU’s
have gained more than 10% to trade above AUD28/t. Australia’s greenhouse gas
emissions declined 0.4% q/q in Q1 and 0.3% q/q in Q2 according to the National
Greenhouse Gas Inventory. Emissions in the year to March 2022 were 21.6% below
the year to June 2005, which is the baseline year for Australia’s 2030 emissions
reduction target under the Paris Agreement.
Copper led the base metals sector higher earlier in the week as China increased its
support of the economy with a CNY1tn of measures to bolster growth. This includes a
CNY300bn investment in infrastructure projects that should support consumption of
industrial metals. Much of this could be directed into the power grid to help ease an
energy crisis in the country. Power shortages in Sichuan, where a drought has
hindered hydro generation, could see investment ploughed into improving the
connectivity. Beijing had already earmarked an increase in grid investment, but
these latest issues are likely to fast-track projects over the next year. This will see
stronger demand for metals such as copper and aluminium in China, despite
the property sector headwinds that are weighing on their use in construction.
However, the risk off tone across market following the Fed Chair Jerome Powell’s
hawkish speech at Jackson Hole saw it give up those gains. This was exacerbated by
concerns of virus lockdowns in China hurting demand. Outbreaks of COVID-19 have
emerged in every province over the past week despite strict measures to control the
virus.
Iron ore fell below USD100/t for the first time in five weeks amid a crisis in China’s
steel industry. Baoshan Iron & Steel, the world’s biggest steel producer, warned it is
facing severe challenges in the third quarter. Restrictions on output in Tangshan
could see output fall substantially. The steel industry is also battling a property crisis
that shows no signs of easing. A lack of growth in construction activity will keep steel
and iron ore demand weak in the short term.
Gold ended the week lower after Powell warned the central bank will likely keep
raising rates and leave them high to help contain inflation. This raises the prospect of
a 75bp hike at the Fed’s September meeting. Powell’s hawkish speech saw the USD
reverse course and push higher, putting pressure on investor appetite for gold.

Figure 9. ANZ China Commodity Index Figure 10. ANZ CCI sub-sectors

ANZ Commodity Call | 1 September 2022 7

 Coming up
Calendar
Monday Tuesday Wednesday Thursday Friday
5 Sep 6 Sep 7 Sep 8 Sep 9 Sep
• 32nd OPEC and • China trade • US initial jobless • China PPI and CPI
non-OPEC balance claims • China steel and
Ministerial • EIA STEO iron ore port
Meeting • US Beige Book inventories
• EIA weekly oil • SHFE weekly
inventories inventories data
(10:30am EST) • CFTC COT data
• Baker Hughes US
rig count

12 Sep 13 Sep 14 Sep 15 Sep 16 Sep

• USDA WASDE • OPEC MOR • IEA OMR • US Retail sales • China retail sales,
• US CPI • US PPI • US IP IP, FAI
• US NFIB Small • EIA weekly oil • China aggregating • China PPI and CPI
Business inventories financing • China steel and
(10:30am EST) • US initial jobless iron ore port
claims inventories
• SHFE weekly
inventories data
• CFTC COT data
• Baker Hughes US
rig count

19 Sep 20 Sep 21 Sep 22 Sep 23 Sep

• US Housing starts • US Existing Home • US initial jobless • China steel and
• Switzerland Sales claims iron ore port
precious metals • FOMC rate inventories
export decision • SHFE weekly
• ECB non- inventories data
monetary policy • CFTC COT data
meeting • Baker Hughes US
• EIA weekly oil rig count
inventories
(10:30am EST)

26 Sep 27 Sep 28 Sep 29 Sep 30 Sep

• US Dallas Fed • EIA weekly oil • Russia industrial • China steel and
manufacturing inventories production iron ore port
activity & durable (10:30am EST) • Germany CPI inventories
goods orders • US new home • US GDP • SHFE weekly
sales inventories data
• CFTC COT data
• Baker Hughes US
rig count

ANZ Commodity Call | 1 September 2022 8

 In depth
Previous reports
Title (click to download) Topic Date
Commodities in Ten Charts Supply issues back in focus 30 Aug 2022
Commodity Insight Feeding the world sustainably 30 Aug 2022
Commodity Call: sparks fly Metal demand to benefit from China’s power grid investment 25 Aug 2022
Commodity Tracker Up in the air 19 Aug 2022
Commodity Call: China effect Weak sentiment to persist despite robust demand in China 18 Aug 2022
Commodity Call: weak foundations Supply side issues the only thing supporting iron ore prices 11 Aug 2022
Commodity Update China Commodity Trade Data: July 2022 8 Aug 2022
Commodity Call: demand normalisation Oil demand continues to recover, but momentum is slowing 5 Aug 2022
Commodities in Ten Charts Supply vs demand 3 Aug 2022
Commodity Call: minerals go critical Minerals are critical to emerging technologies 29 Jul 2022
Commodity Tracker Sluggish demand 25 Jul 2022
Commodity Call: the balance of power Coal markets tighten as demand from power generators surge 22 Jul 2022
Commodity Call: running on empty Halt to Nord Stream could force gas rationing and slow Europe 14 Jul 2022
down
Commodity update China commodity trade data: June 2022 13 Jul 2022
Commodity Call: hitting the panic button Sentiment collapses in base metals markets amid recession 11 Jul 2022
risks
Commodities in Ten Charts Supply issues persist 4 Jul 2022
Commodity Call: ride out the storm Oil well positioned to withstand an economic slowdown 30 Jun 2022
Commodity Call: Australia's energy Australia’s emerging energy crisis is not a short-term issue 24 Jun 2022
crunch
Commodity Tracker No picnic 21 Jun 2022
Commodity Update China Commodity Trade Data: May 2022 10 Jun 2022
Commodity Call: tailwinds for zinc The energy crunch curtails zinc supply just as demand picks up 9 Jun 2022
Commodities in Ten Charts Supply cracks widen 3 Jun 2022
Commodity Call: sweet spot for iron ore Iron ore market tightens amid supply issues 2 Jun 2022
Commodity Call: battle for LNG cargoes LNG market to tighten further in H2 2022 26 May 2022
heats up
Commodity Tracker Demand concerns 23 May 2022
Commodity Call: pedal to the metal Outlook for base metals remains positive as China boosts 19 May 2022
stimulus
Commodities in Ten Charts Energy crunch 13 May 2022
Commodity Call: over a barrel Russian supply issues to tighten crude oil markets 12 May 2022
Commodity Update China commodity trade data, Apr 2022 9 May 2022
The Vault Stronger USD creates headwinds for gold 9 May 2022
Commodity Call: feeding the carbon Food crisis to weigh on carbon and energy markets 6 May 2022
offset market
Commodity Tracker Supply shocks 21 Apr 2022
Commodity Call: copper bottomed out Copper demand to rebound once Chinese lockdowns ease 14 Apr 2022
Commodity Update China Commodity Trade Data: March 2022 13 Apr 2022
Commodities in Ten Charts Scarce resources 8 Apr 2022
Commodity Call: oil’s relief valve Inventory releases don’t change the fundamentals for oil 7 Apr 2022
markets
Commodity Call: gold finds safe haven Gold remains an effective hedge against geopolitical uncertainty 31 Mar 2022
Commodity Call: aluminium supply woes Upheaval in trade flows to disrupt aluminium supply 25 Mar 2022
worsen
Commodity Call: coal revival China’s plans to boost coal output won’t weaken import demand 18 Mar 2022
Commodities in Ten Charts Supply shock 11 Mar 2022
Commodity Call: step on the gas Europe’s energy mix: to lean on coal and LNG in the short 10 Mar 2022
term
Commodity Update China commodity trade data: Jan-Feb 2022 7 Mar 2021
Commodity Call: oil’s changing geopolitics Russia’s dominance of commodity markets warrants a high- 24 Feb 2022
risk premium

Registered users can view our complete archive on ANZ Research

ANZ Commodity Call | 1 September 2022 9

 Charts
Commodity performance

Figure 11. One-week performance Figure 12. One-month performance

Figure 13. Change in inventory w/w – metals Figure 14. Change in inventory w/w – energy

Figure 15. ANZ CCI vs USD Figure 16. ANZ CCI sub-sector performance

ANZ Commodity Call | 1 September 2022 10

 Charts
Investor positioning
Figure 17. LME copper Figure 18. LME aluminium

Figure 19. WTI Figure 20. Brent

Figure 21. Gold Figure 22. Corn

ANZ Commodity Call | 1 September 2022 11

 Charts

Figure 23. EFT holdings by sector

Figure 24. ETF Holdings – Broad Based Figure 25. ETF Holdings – Energy

Figure 26. ETF Holdings – Industrial Metals Figure 27. ETF Holdings – Precious Metals

Figure 28. ETF Holdings – Agriculture Figure 29. ETF Holdings – Livestock

ANZ Commodity Call | 1 September 2022 12

 Charts
Prices

ANZ Commodity Call | 1 September 2022 13

 Charts

Copper Aluminium Nickel Zinc

Lead Tin Gold Silver

Platinum Palladium Iron ore China rebar

Coking coal Thermal coal Brent crude oil WTI crude oil

US natural gas Spot LNG Soybeans Corn

Wheat Cocoa Sugar Palm oil

ANZ Commodity Call | 1 September 2022 14

 Charts
Inventories
Copper (LME) Copper (SHFE) Aluminium (LME)

Aluminium (SHFE) Zinc (LME) Zinc (SHFE)

Nickel (LME) Lead (LME) Iron ore (China ports)

Steel (China) Gold ETF holdings Platinum ETF holdings

Thermal coal (China) US crude oil US gasoline

ANZ Commodity Call | 1 September 2022 15

 Charts
Forward curves

ANZ Commodity Call | 1 September 2022 16

 Tables
ANZ forecasts
COMMODITY Unit Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 Dec-23 Mar-24 2022F 2023F 2024F

BASE METALS
Aluminium USD/t 2,600 2,800 3,000 2,950 3,000 2,900 2,800 2,830 2,952 2,809
Copper USD/t 8,000 9,000 10,800 11,000 11,250 11,500 11,000 8,980 10,887 10,125
Nickel USD/t 23,000 25,500 27,000 26,000 25,000 25,000 24,000 25,350 25,800 23,700
Zinc USD/t 3,300 3,800 4,200 4,000 3,900 3,800 3,750 3,610 3,975 3,707
Lead USD/t 2,000 1,900 1,850 1,800 1,800 1,800 1,800 2,100 1,823 1,801

PRECIOUS METALS
Gold USD/oz 1,800 1,820 1,800 1,750 1,725 1,700 1,700 1,842 1,756 1,555
Platinum USD/oz 850 1,000 1,020 1,150 1,200 1,200 1,250 968 1,123 1,180
Palladium USD/oz 1,900 2,000 2,100 2,150 2,180 2,100 2,000 2,135 2,123 1,800
Silver USD/oz 19.6 20.2 20.0 19.4 19.2 18.9 19.8 21.7 19.5 18.5

ENERGY
WTI NYMEX USD/bbl 103.0 113.0 104.0 109.0 99.0 94.0 94.0 104.5 103.4 94.0
Dated Brent USD/bbl 105.0 115.0 105.0 110.0 100.0 95.0 95.0 107.0 104.5 95.0
LNG spot USD/mmBtu 50.0 55.0 35.0 35.0 30.0 25.0 20.0 40.7 36.3 20.5
LNG (Japan contract) USD/mmBtu 15.5 14.7 15.5 14.7 15.0 14.1 13.3 13.6 13.1 15.1

BULKS
Iron ore (CIF China) USD/t 110 115 110 105 100 95 95 126 105 95
Coking coal - Prem (contract) USD/t 400 425 400 350 300 250 140 379 343 151
Coking coal - Semi-soft USD/t 95 90 90 90 90 90 90 98 90 90
PCI coal USD/t 105 100 100 100 100 100 100 107 100 100
Newc Thermal (Spot) USD/t 375 400 375 350 300 250 170 353 334 135
Note 1: Base/precious metals, energy and bulk quarterly forecasts are end of period prices; agriculture forecasts are
average prices. Annual forecasts are a calculated average of the end of quarter prices.
Note 2: Historical data are actuals.
Source: ANZ Research

FX Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 Dec-23 Mar-24 Jun-24

AUD/USD 0.71 0.72 0.74 0.75 0.75 0.75 0.75 0.75
USD/JPY 134.0 132.0 130.0 128.0 127.0 126.0 125.0 122.0
EUR/USD 1.02 1.05 1.07 1.10 1.12 1.13 1.14 1.18
USD/CNY 6.70 6.65 6.60 6.55 6.50 6.45 6.43 6.40
DXY Index 106.20 104.00 102.50 100.40 99.20 98.50 97.70 96.10

Interest Rates Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 Dec-23 Mar-24 Jun-24
RBA cash rate 2.35 3.35 3.35 3.35 3.35 3.35 3.35 3.35
Fed funds rate1 3.00 4.00 4.00 4.00 4.00 4.00 3.75 3.50
US 2 year bond 3.75 4.10 4.00 3.50 3.25 3.00 2.75 2.50
US 10 year bond 3.75 3.75 3.75 3.75 3.50 3.50 3.50 3.25

WORLD ECONOMY - GDP 2008-2017 average 2018 2019 2020 2021 2022f 2023f
United States 1.5 2.9 2.3 -3.4 5.7 2.3 1.1
Euro area 0.7 1.8 1.6 -6.4 5.4 2.3 2.4
China (mainland) 8.3 6.7 6.0 2.2 8.1 3.0 4.2
India* 7.1 6.5 3.7 -6.6 8.7 6.7 6.1
World 3.4 3.6 2.9 -2.4 5.5 2.6 2.7
Note: Forecast prices are end of period. Historical data are actuals.
Source: Bloomberg, ANZ Research

ANZ Commodity Call | 1 September 2022 17

Important notice
Last updated: 1 September 2022
This document (which may be in the form of text, image, video or audio) is intended for ANZ’s Institutional, Markets and Private
Banking clients. It should not be forwarded, copied or distributed. The opinions and research contained in this document are (a)
not personal advice nor financial advice about any product or service; (b) provided for information only; and (c) intended to be
general in nature and does not take into account your financial situation or goals.
This document may be restricted by law in certain jurisdictions. Persons who receive this document must inform themselves about and observe
all relevant restrictions.

Disclaimer for all jurisdictions: This document is prepared by Australia and New Zealand Banking Group Limited (ABN11 005 357 522)
(ANZ), a company incorporated in Australia. It is distributed in your country/region by ANZ or (if stated below) its subsidiary or branch (each, an
Affiliate).
This document is distributed on the basis that it is only for the information of the specified recipient or permitted user of the relevant website
(recipients).
This document is solely for informational purposes and nothing contained within is intended to be an invitation, solicitation or offer by ANZ to sell,
or buy, receive or provide any product or service, or to participate in a particular trading strategy.
Distribution of this document to you is only as may be permissible by the laws of your jurisdiction, and is not directed to or intended for
distribution or use by recipients resident or located in jurisdictions where its use or distribution would be contrary to those laws or regulations, or
in jurisdictions where ANZ would be subject to additional licensing or registration requirements. Further, the products and services mentioned in
this document may not be available in all countries.
ANZ in no way provides any financial, legal, taxation or investment advice to you in connection with any product or service discussed in this
document. Before making any investment decision, recipients should seek independent financial, legal, tax and other relevant advice having
regard to their particular circumstances.
Whilst care has been taken in the preparation of this document and the information contained within is believed to be accurate, ANZ does not
represent or warrant the accuracy or completeness of the information, except with respect to information concerning ANZ. Further, ANZ does not
accept any responsibility to inform you of any matter that subsequently comes to its notice, which may affect the accuracy of the information in
this document.
Preparation of this document and the opinions expressed in it may involve material elements of subjective judgement and analysis. Unless
specifically stated otherwise: they are current on the date of this document and are subject to change without notice; and, all price information is
indicative only. Any opinions expressed in this document are subject to change at any time without notice.
ANZ does not guarantee the performance of any product mentioned in this document. All investments entail a risk and may result in both profits
and losses. Past performance is not necessarily an indicator of future performance. The products and services described in this document may
not be suitable for all investors, and transacting in these products or services may be considered risky.
ANZ expressly disclaims any responsibility and shall not be liable for any loss, damage, claim, liability, proceedings, cost or expense (Liability)
arising directly or indirectly and whether in tort (including negligence), contract, equity or otherwise out of or in connection with this document to
the extent permissible under relevant law. Please note, the contents of this document have not been reviewed by any regulatory body or
authority in any jurisdiction.
ANZ and its Affiliates may have an interest in the subject matter of this document. They may receive fees from customers for dealing in the
products or services described in this document, and their staff and introducers of business may share in such fees or remuneration that may be
influenced by total sales, at all times received and/or apportioned in accordance with local regulatory requirements. Further, they or their
customers may have or have had interests or long or short positions in the products or services described in this document, and may at any time
make purchases and/or sales in them as principal or agent, as well as act (or have acted) as a market maker in such products. This document is
published in accordance with ANZ’s policies on conflicts of interest and ANZ maintains appropriate information barriers to control the flow of
information between businesses within it and its Affiliates.
Your ANZ point of contact can assist with any questions about this document including for further information on these disclosures of interest.
Australia. ANZ holds an Australian Financial Services licence no. 234527. For a copy of ANZ's Financial Services Guide please click here or
request from your ANZ point of contact.
Brazil. This document is distributed on a cross border basis and only following request by the recipient. No securities are being offered or sold in
Brazil under this document, and no securities have been and will not be registered with the Securities Commission - CVM.
Brunei, Japan, Kuwait, Malaysia, Switzerland, Taiwan. This document is distributed in each of these jurisdictions by ANZ on a cross-border
basis.
Cambodia. The information contained in this document is confidential and is provided solely for your use upon your request. This does not
constitute or form part of an offer or solicitation of any offer to engage services, nor should it or any part of it form the basis of, or be relied in
any connection with, any contract or commitment whatsoever. ANZ does not have a licence to undertake banking operations or securities
business or similar business, in Cambodia. By requesting financial services from ANZ, you agree, represent and warrant that you are engaging
our services wholly outside of Cambodia and subject to the laws of the contract governing the terms of our engagement.
Canada. This document is general information only, is intended for institutional use only – not retail, and is not meant to be tailored to the
needs and circumstances of any recipient. In addition, this document is not intended to be an offer or solicitation to purchase or sell any security
or other financial instrument or to employ a specific investment strategy.
Chile. You understand and agree that ANZ Banking Group Limited is not regulated by Chilean Authorities and that the provision of this document
is not subject to any Chilean supervision and is not guaranteed by any regulatory or governmental agency in Chile.
Fiji. For Fiji regulatory purposes, this document and any views and recommendations are not to be deemed as investment advice. Fiji investors
must seek licensed professional advice should they wish to make any investment in relation to this document.
Hong Kong. This document is issued or distributed in Hong Kong by the Hong Kong branch of ANZ, which is registered at the Hong Kong
Monetary Authority to conduct Type 1 (dealing in securities), Type 4 (advising on securities) and Type 6 (advising on corporate finance)
regulated activities. The contents of this document have not been reviewed by any regulatory authority in Hong Kong. If you are in any doubt
about any of the contents of this document, you should obtain independent professional advice.
India. If this document is received in India, only you (the specified recipient) may print it provided that before doing so, you specify on it your
name and place of printing.
Israel. ANZ is not a holder of a licence granted in Israel pursuant to the Regulation of Investment Advising, Investment Marketing and Portfolio
Management Law, 1995 (“Investment Advice Law”) and does not hold the insurance coverage required of a licensee pursuant to the Investment
Advice Law. This publication has been prepared exclusively for Qualified Clients as such term is defined in the First Schedule to the Investment
Advice Law. As a prerequisite to the receipt of a copy of this publication a recipient will be required to provide confirmation and evidence that it is
a Qualified Client. Nothing in this publication should be considered Investment Advice or Investment Marketing as defined in the Investment
Advice Law. Recipients are encouraged to seek competent investment advice from a locally licensed investment adviser prior to making any
investment.
Macau. Click here to read the disclaimer for all jurisdictions in Mandarin. 澳门. 点击此处阅读所有司法管辖区的免责声明的中文版。
Myanmar. This document is intended to be general and part of ANZ’s customer service and marketing activities when implementing its functions
as a licensed bank. This document is not Securities Investment Advice (as that term is defined in the Myanmar Securities Transaction Law 2013).
Important notice
New Zealand. This material is for information purposes only and is not financial advice about any product or service. We recommend seeking
financial advice about your financial situation and goals before acquiring or disposing of (or not acquiring or disposing of) a financial product.
Oman. ANZ neither has a registered business presence nor a representative office in Oman and does not undertake banking business or provide
financial services in Oman. Consequently ANZ is not regulated by either the Central Bank of Oman (CBO) or Oman’s Capital Market Authority
(CMA). The information contained in this document is for discussion purposes only and neither constitutes an offer of securities in Oman as
contemplated by the Commercial Companies Law of Oman (Royal Decree 4/74) or the Capital Market Law of Oman (Royal Decree 80/98), nor
does it constitute an offer to sell, or the solicitation of any offer to buy non-Omani securities in Oman as contemplated by Article 139 of the
Executive Regulations to the Capital Market Law (issued vide CMA Decision 1/2009). ANZ does not solicit business in Oman and the only
circumstances in which ANZ sends information or material describing financial products or financial services to recipients in Oman, is where such
information or material has been requested from ANZ and the recipient understands, acknowledges and agrees that this document has not been
approved by the CBO, the CMA or any other regulatory body or authority in Oman. ANZ does not market, offer, sell or distribute any financial or
investment products or services in Oman and no subscription to any securities, products or financial services may or will be consummated within
Oman. Nothing contained in this document is intended to constitute Omani investment, legal, tax, accounting or other professional advice.
People’s Republic of China (PRC). This document may be distributed by either ANZ or Australia and New Zealand Bank (China) Company
Limited (ANZ China). Recipients must comply with all applicable laws and regulations of PRC, including any prohibitions on speculative
transactions and CNY/CNH arbitrage trading. If this document is distributed by ANZ or an Affiliate (other than ANZ China), the following
statement and the text below is applicable: No action has been taken by ANZ or any affiliate which would permit a public offering of any products
or services of such an entity or distribution or re-distribution of this document in the PRC. So, the products and services of such entities are not
being offered or sold within the PRC by means of this document or any other document. This document may not be distributed, re-distributed or
published in the PRC, except under circumstances that will result in compliance with any applicable laws and regulations. If and when the
material accompanying this document relates to the products and/or services of ANZ China, the following statement and the text below is
applicable: This document is distributed by ANZ China in the Mainland of the PRC.
Peru. The information contained in this document has not been, and will not be, registered with or approved by the Peruvian Superintendency of
the Securities Market (Superintendencia del Mercado de Valores, SMV) or the Lima Stock Exchange (Bolsa de Valores de Lima, BVL) or under
the Peruvian Securities Market Law (Legislative Decree 6 861), and will not be subject to Peruvian laws applicable to public offerings in Peru. To
the extent this information refers to any securities or interests, it should be noted the securities or interests may not be offered or sold in Peru,
except if (i) such securities or interests were previously registered with the Peruvian Superintendency of the Securities Market, or (ii) such
offering is considered a private offering in Peru under the securities laws and regulation of Peru.
Qatar. This document has not been, and will not be:
• lodged or registered with, or reviewed or approved by, the Qatar Central Bank (QCB), the Qatar Financial Centre (QFC) Authority, QFC
Regulatory Authority or any other authority in the State of Qatar (Qatar); or
• authorised or licensed for distribution in Qatar, and the information contained in this document does not, and is not intended to, constitute a
public offer or other invitation in respect of securities in Qatar or the QFC.
The financial products or services described in this document have not been, and will not be:
• registered with the QCB, QFC Authority, QFC Regulatory Authority or any other governmental authority in Qatar; or
• authorised or licensed for offering, marketing, issue or sale, directly or indirectly, in Qatar.
Accordingly, the financial products or services described in this document are not being, and will not be, offered, issued or sold in Qatar, and this
document is not being, and will not be, distributed in Qatar. The offering, marketing, issue and sale of the financial products or services described
in this document and distribution of this document is being made in, and is subject to the laws, regulations and rules of, jurisdictions outside of
Qatar and the QFC. Recipients of this document must abide by this restriction and not distribute this document in breach of this restriction. This
document is being sent/issued to a limited number of institutional and/or sophisticated investors (i) upon their request and confirmation that
they understand the statements above; and (ii) on the condition that it will not be provided to any person other than the original recipient, and is
not for general circulation and may not be reproduced or used for any other purpose.
Singapore. This document is distributed in Singapore by ANZ solely for the information of “accredited investors”, “expert investors” or (as the
case may be) “institutional investors” (each term as defined in the Securities and Futures Act Cap. 289 of Singapore). ANZ is licensed in
Singapore under the Banking Act Cap. 19 of Singapore and is exempted from holding a financial adviser’s licence under Section 23(1)(a) of the
Financial Advisers Act Cap. 100 of Singapore. In respect of any matters arising from, or in connection with, the distribution of this document in
Singapore, please speak to your usual ANZ contact in Singapore.
United Arab Emirates (UAE). This document is distributed in the UAE or the Dubai International Financial Centre (DIFC) (as applicable) by
ANZ. This document does not, and is not intended to constitute: (a) an offer of securities anywhere in the UAE; (b) the carrying on or
engagement in banking, financial and/or investment consultation business in the UAE under the rules and regulations made by the Central Bank
of the UAE, the Emirates Securities and Commodities Authority or the UAE Ministry of Economy; (c) an offer of securities within the meaning of
the Dubai International Financial Centre Markets Law (DIFCML) No. 12 of 2004; and (d) a financial promotion, as defined under the DIFCML No.
1 of 200. ANZ DIFC Branch is regulated by the Dubai Financial Services Authority (DFSA) ANZ DIFC Branch is regulated by the Dubai Financial
Services Authority (DFSA). The financial products or services described in this document are only available to persons who qualify as
“Professional Clients” or “Market Counterparty” in accordance with the provisions of the DFSA rules.
United Kingdom. This document is distributed in the United Kingdom by Australia and New Zealand Banking Group Limited (ANZ) solely for the
information of persons who would come within the Financial Conduct Authority (FCA) definition of “eligible counterparty” or “professional client”.
It is not intended for and must not be distributed to any person who would come within the FCA definition of “retail client”. Nothing here excludes
or restricts any duty or liability to a customer which ANZ may have under the UK Financial Services and Markets Act 2000 or under the
regulatory system as defined in the Rules of the Prudential Regulation Authority (PRA) and the FCA. ANZ considers this document to constitute
an Acceptable Minor Non-Monetary Benefits (AMNMB) under the relevant inducement rules of the FCA. ANZ is authorised in the United
Kingdom by the PRA and is subject to regulation by the FCA and limited regulation by the PRA. Details about the extent of our regulation by the
PRA are available from us on request.
United States. Except where this is a FX-related document, this document is distributed in the United States by ANZ Securities, Inc. (ANZ SI)
which is a member of the Financial Regulatory Authority (FINRA) (www.finra.org) and registered with the SEC. ANZSI’s address is 277 Park
Avenue, 31st Floor, New York, NY 10172, USA (Tel: +1 212 801 9160 Fax: +1 212 801 9163). ANZSI accepts responsibility for its content.
Information on any securities referred to in this document may be obtained from ANZSI upon request. This document or material is intended for
institutional use only – not retail. If you are an institutional customer wishing to effect transactions in any securities referred to in this document
you must contact ANZSI, not its affiliates. ANZSI is authorised as a broker-dealer only for institutional customers, not for US Persons (as “US
person” is defined in Regulation S under the US Securities Act of 1933, as amended) who are individuals. If you have registered to use our
website or have otherwise received this document and are a US Person who is an individual: to avoid loss, you should cease to use our website
by unsubscribing or should notify the sender and you should not act on the contents of this document in any way. Non-U.S. analysts may not be
associated persons of ANZSI and therefore may not be subject to FINRA Rule 2242 restrictions on communications with the subject company,
public appearances and trading securities held by the analysts. Where this is a FX-related document, it is distributed in the United States by
ANZ's New York Branch, which is also located at 277 Park Avenue, 31st Floor, New York, NY 10172, USA (Tel: +1 212 801 916 0 Fax: +1 212
801 9163).
Vietnam. This document is distributed in Vietnam by ANZ or ANZ Bank (Vietnam) Limited, a subsidiary of ANZ.