Reasons for gold’s climb to record prices haven’t changed: a weaker dollar, inflation worries and mixed investor sentiment seem to rule the markets lately. But as gold marches forward, other metals have hitched a ride on its coattails. Platinum and palladium have hit 12-month highs, and analysts think it could continue if gold remains strong. (Copper should also enjoy higher prices despite the overstock supply).

Devon Maylie for The Wall Street Journal reports that platinum and palladium are both industrial and precious metals. As a result, they’re benefiting from hedging as well as hopes that industrial activity will take off in 2010. (Learn about the “other” metals). Silver, another precious metal with industrial applications, has also been gaining strength, handily outperforming gold year-to-date. (Six benefits of silver investing).

Copper prices have also rallied to a 13-month high on a sliding dollar and Japan’s economic expansion. Copper made up 54% of the total value of Chile’s exports last month, up from 42% the same time last year, reports Drew Benson for Bloomberg.

Spot gold hit a record high of $1,134.55 a troy ounce Monday, building on the gains it has posted over the past weeks.

For more stories about commodity ETFs, visit our commodity ETFs category.

If you don’t want gold, where can you look? Among the growing number of options include:

• iShares Silver Trust (NYSEArca: SLV): up 53.1% year-to-date

• E-TRACS UBS Long Platinum ETN (NYSEArca: PTM): up 47.6% year-to-date

http://online.wsj.com/article/SB10001424052748704431804574539160726487446.html

• ETFS Physical Silver Shares (NYSEArca: SIVR): up 15.9% in the last three months

• iPath DJ AIG Copper TR Sub-Index ETN (NYSEArca: JJC): up 109.3% year-to-date

China’s buying spree has been seen as a major driver of commodity prices in recent months. But did they get a little too carried away? David Taggart for iStockAnalyst reports that this was more bargain shopping than an actual demand-driven rally. As a result, demand for copper has not yet picked up, leaving China done with buying and considering selling. (Can the recent commodity hot streak continue?)

Analysts say that any big upward moves in copper prices aren’t expected. Large stockpiles of copper sit in warehouses and as much as 350,000 tons could be re-exported. According to Bloomberg, there are not many buyers for refined copper and the price of copper has more than doubled this year already. Finding a buyer might be tough. (Will a global recovery help spur demand for copper?)

Is copper’s run on hold for now? Some feel it may be. If it cools have, have your exit strategy at the ready to put a cap on your losses. Read about trend following in The ETF Trend Following Playbook.

For more stories about copper, visit our copper category.

• iPath Dow Jones AIG Copper TR Sub-Index ETN (NYSEArca: JJC): up 110.1% year-to-date

Copper started the week with a new year high and brokers are uncertain as to the cause, reports Andrea Hotter for The Wall Street Journal. Market fundamentals aren’t supporting any strong price gains at the moment. Copper did receive a boost yesterday after the factory orders report. (Where’s copper going?)

• iPath DJ AIG Copper TR Sub-Idx ETN (NYSEArca: JJC): up 107.8% year-to-date

The U.S. Commodity Futures Trading Commission Commitments of Traders report revealed that speculative long positions have hit a high last seen in the beginning of 2006, which means downside risk is accumulating, and the current commodities market is still bullish. Experts and analysts are divided as to how prices will pan out.

• iShares S&P GSCI Commodity-Indexed Trust (NYSEArca: GSG): up 10% year-to-date

China is the largest holder of U.S. debt, with around $1 trillion, and experts are urging China to diversify its currency holdings unless the country enjoys watching its dollar holdings depreciate in value, remarks Andrew Snyder for Today’s Finance News. Another option for China is to exchange some dollars for commodity holdings as a better way to hold value – also, better for commodities investors gazing at those price upticks.

• PowerShares DB U.S. Dollar Index Bearish (NYSEArca: UDN): up 7.4% year-to-date

Natural gas inventories are almost topped off  with a little more than 3.7 trillion cubic feet – the total country storage space is 3.9 trillion cubic feet. Snyder believes the natural gas market has ridden the commodities bubble and a correction may soon take place as the spot market corrects for the excess inventory. (How to avoid a bubble).

• United States Natural Gas (NYSEArca: UNG): down 57% year-to-date

Keep in mind that these are just predictions. Watch the markets for what really happens, and act accordingly. When investing in commodities, it’s wise to have an exit strategy that involves a stop-loss points that you can execute when the time comes. (How to protect yourself with a trend-following plan).

For more information on commodities, visit our commodity category.

Max Chen contributed to this article.

Jefferies

The latest funds from Jefferies are based upon the Thompson Reuters/Jefferies CRB-EQ series of indexes. The equity-based funds track the industrial metals and agriculture indexes, explains Ron Rowland for Seeking Alpha.

The ETFs are:

• Jefferies/TR/J  CRB Global Agriculture Index (NYSEArca: CRBA)
• Jefferies/TR/J  CRB Global Industrial Metals Equity Index Fund (NYSEArca: CRBI)
  

CRBA holds equity securities from global universe of listed companies engaged in the production and distribution of agricultural products, including grains, livestock, fertilizers, chemicals, seeds, traits (seed characteristics attained through genetic modification) and equipment. (Another Jefferies Commmodity ETF launched earlier this month).

CRBI offers investors access to shares of companies across the globe engaged in the production and distribution of base/industrial metals and base/industrial metal products, including copper, aluminum, iron ore, steel, nickel and others. (Where copper and steel prices are going).

Both funds come with a 0.65% expense ratio.

These funds will not be affected by regulations expected from the Commodity Futures Trading Commission (CFTC), because they hold equities and not futures. (How regulations could change commodity ETFs).

For more stories about new ETFs, visit our new ETF category.

Coal. China has reduced its supply of coal by clamping down on pollution while demand remains unchanged, which could result in higher prices for the commodity. Now, China will need to import coal to maintain its production and power plants. Coal is the world’s fastest-growing fuel based on consumption. Coal is also a major component in producing steel. (More on coal here).

• Market Vectors Coal ETF (NYSEArca: KOL): up 184.3% since low; up 121.7% year-to-date

Steel. Steel has experienced rising popularity as the global infrastructure sector recovers and automakers increase demand. The Chinese markets and the U.S. dollar weakness has helped prop up the base metals market. (Four ways to play base metals).

• Market Vectors Steel Index ETF Fund (NYSEArca: SLX): up 147.7% since low; up 95.4% year-to-date

Metals & Mining. These funds track indexes made up of the stock of commodity producers. One argument in favor of investing in hard asset equity ETFs is that you may know a little about a particular commodity, but the person running a company involved in mining or producing that commodity is duty-bound to know a whole lot more. Commodity producers can make brilliant business decisions, and they can also benefit when new mines are discovered. They can also cut costs and boost profits. (The benefits of hard assets).

• SPDR S&P Metals & Mining (NYSEArca: XME): up 123.1% since low; up 74.3% year-to-date

Basic Materials. Base metal prices have jumped as demand for the metals increase, more notably from China as the country recovers and hoards metals. Base metals should continue their upward journey as fundamentals in a global recovery strengthen. (More on China’s shopping spree).

• iShares Dow Jones U.S. Basic Materials (NYSEArca: IYM): up 100.9% since low; up 58.5% year-to-date

Copper. Copper prices are at their highest levels in 13 months, thanks to both a drooping dollar and concerns about supply of the metal. Prices have doubled this year, mostly because China stepped up its demand as its economy recovered. Analysts also predict that copper will be the top performer among base metals. (Where copper is going).

• iPath Dow Jones AIG Copper TR Sub Index ETN (NYSEArca: JJC): up 81.3% since low; up 112.7% year-to-date

Commodities have been on a hot streak, but as we’ve learned from recent bubbles, it’s wise to have an exit strategy in the event of a correction. You can read more about strategies here.

For full disclosure, Tom Lydon’s clients own shares of IYM.

Max Chen contributed to this article.

The current supply of copper looks like it may be dropping and steel producers may be flooding the market.

Copper prices jumped more than 3%, hitting a 13-month high on Wednesday, and BHP Billiton (NYSE: BHP) declared force majeure at the fourth-largest copper mine in the world, reinforcing supply concerns, writes Barani Krishnan and Rebekah Curtis for Reuters. Copper, along with other commodities, rallied as the dollar dipped.

Copper futures for the December delivery finished at $3.0360 per pound on the New York Mercantile Exchange -  the last time copper hovered around $3 dollars was in September 2008. (For more information on copper, visit our copper category.)

China Steel, Taiwan’s foremost steel producer, will reduce its domestic price by 4.5% in December, indicating that steel prices could be bottoming out. The company expects steel outlook to improve in 2010 as world economies recover, reports Ken Wills for Reuters.

Analysts are not surprised by pullbacks in the benchmark hot-rolled sheet in coil (HRC) steel price as a result of weak end-use demand, comments Tom Stundza for Purchasing. Production has increased to almost 62% of capacity despite August U.S. steel mill shipments being down 37% from last year.

In a survey of steel buyers, 77% of participants think current inventory levels are sufficient for one or two months and 76% don’t plan on increasing steel orders. Over the next month, 24% expect incoming orders to decline, and 46% expect incoming orders to decline in the next three months. (For more information on steel, visit our steel category.)

Fore more information on industrial metals, visit our industrial metals category.

• iPath DJ AIG Copper TR Sub-Idx ETN (NYSEArca: JJC): up 112.7% year-to-date

• Market Vectors Steel ETF (NYSEArca: SLX): up 96.6% year-to-date

• iShares MSCI Chile Investable Mkt Idx (NYSEArca: ECH): up 67.4% year-to-date; materials constitutes 20.7%, including mining companies

Max Chen contributed to this article.

Copper prices are at their highest levels in six weeks, thanks to both a drooping dollar and concerns about supply of the metal. Anna Stablum for Bloomberg reports that copper prices have doubled this year, mostly because China stepped up its demand as its economy recovered. Investors are now speculating that demand for copper will only increase. (Read more about how copper is used here).

Meanwhile, incidents in Chile and Australia are leading to supply worries. In Chile, the BHP mines are facing a potential walkout/strike as employees are not happy with recent contract offerings. Around 20% of copper mine output is at stake. In Australia, an investigation into an accident at a mine forced the closing of the main hauling shaft.

• iPath Dow Jones AIG Copper TR Sub Index ETN (NYSEArca: JJC): up 95.7% year-to-date

Steel also has experienced rising popularity as the global infrastructure sector recovers and automakers increase demand. Sahil Mahtini and Prasenjit Bhattacharya for The Wall Street Journal report that the Steel Authority of India Ltd., India’s largest steelmaker by local capacity, expects India’s steel consumption to rise 5%-6% in the calendar year 2009, while production is expected to rise 4%-5%.

India’s leading steel companies raised prices of flat products for the second month in a row in September because of demand from automakers and a recovery in global prices.

Meanwhile, the U.S. Commerce Department launched an investigation Wednesday into whether to impose anti-dumping and duties on imports of certain steel pipes from China. Tom Barkley for The Wall Street Journal reports that trade disputes are rising as the global economy moves into recovery mode. Producers are searching for different markets to unload excess inventory.

• Market Vectors Steel (NYSEArca: SLX): up 81.6% year-to-date

For more stories about base metals, visit our base metals category.

China’s cabinet is no longer approving new projects for energy-intensive aluminum production for three years. Chuin-Wei Yap and Juan Chen and Yue Li for Dow Jones Newswires report that the State Council, also issued new rules to contain excessive capacity in seven other sectors, including revisiting a years-long campaign to curb steel output.

The ban on new aluminum capacity, a popular metal, is primarily meant to rein in the energy-guzzling and hard-to-control industry. The markets have so far shrugged off the news.

The Chinese markets and the U.S. dollar weakness has helped prop the base metals market up, and the underlying demand is strong indicator that emerging markets have some resilience to the economic downturn, says Dorothy Kosich for MineWeb.

One analyst notes that base metals prices have hit “mid-cycle” levels, something that normally takes years after a global downturn. The analyst also predicts that copper will be the top performer among base metals, and forecasts China’s consumption to grow 20% this year.

Some related ETFs and exchange traded notes (ETNs):

• iPath Dow Jones AIG Copper TR Sub-Index ETN (NYSEArca: JJC): up 91.2% year-to-date

• iPath Dow Jones AIG Lead TR Sub-Index ETN (NYSEArca: LD): up 119.3% year-to-date

• Market Vectors Steel ETF (SLX): up 80% year-to-date

For more stories about base metals, visit our base metals category.

Strong employment reports, renewed auto and housing demand and signs of a recovery in China have helped spur the base metals’ strong run, says Sara Jane Tasker for The Australian. The rebound has been so strong that analysts expect it to continue for the rest of 2009.

Some other points:

• According to Citigroup, copper has led the base metal recovery, up $600 in recent trading. So far this year, it has gained 100%.
• Aluminum has climbed around 30% despite its London Metal Exchange inventories remaining at record levels, says Michael Taylor for Reuters.
• Base metals should continue their upward journey as fundamentals in a global recovery strengthen and the demand from China remains healthy.
• China is expected to account for 38% of the world’s copper demand by 2014, up from 28% in 2008.

• SPDR Metals & Mining (XME): up 53.7% year-to-date; holds companies involved in the metals and mining industries

• iShares Dow Jones U.S. Basic Materials (IYM): up 40.7% year-to-date; composed of companies involved in the production of basic materials

• Market Vectors Steel (SLX): up 66.5% year-to-date; pure exposure to steel companies

• PowerShares DB Base Metals (DBB): up 55.4% year-to-date; holds futures contracts for aluminum, copper and zinc

For more stories about base metals, visit our base metals category.