The commodities sector has rallied in September, with natural gas, sugar, coffee, and silver among the biggest gainers.
A boost in the economic outlook following the U.S. Federal Reserve’s decision to cut interest rates and China’s stimulus plans helped to feed broad gains in the sector, with the Bloomberg Commodity Index trading 4.4% higher month to date in Monday dealings.
Signs of tightness in supplies of natural gas, as well as growing power needs tied to the rise in artificial intelligence have contributed to gains for the fuel. The front-month November natural-gas futures contract was trading Monday nearly 38% higher for the month on the New York Mercantile Exchange.
Silver, meanwhile, rose to a 12-year high on Thursday, and was up 7.6% for the month on Comex as of Monday, lifted in part by China’s plans to boost its economy.
Sugar and coffee prices also traded sharply higher on the ICE Futures U.S. exchange, with sugar on track for a monthly rise of 15% and coffee up 9.3%. The rally for both commodities is tied to weather in Brazil, which is undergoing what has been called one of its worst droughts in decades, said Darin Newsom, senior market analyst at Barchart.