According to the Mercantile Exchange of Vietnam (MXV), the MXV-Index closed slightly lower on October 16, down 0.23% to 2,168 points, marking its third consecutive session of decline. The industrial materials sector led the market trend as prices for various commodities dipped, with raw sugar prices hitting their lowest level in nearly a month. In contrast, the metals market rebounded after two sessions of significant volatility and adjustments.

Raw Sugar Prices Hit One-Month Low Raw sugar led the decline in the industrial materials group, dropping over 3%, erasing gains from the previous four sessions and falling to its lowest level in nearly a month.

Rain has returned to most of Brazil's sugarcane-growing regions, including the key Central-South area, boosting expectations for the 2025-2026 crop. The rain not only provides moisture to the soil but also lowers temperatures, creating favorable conditions for the recovery of sugarcane fields that had endured record droughts.

Additionally, the Dollar Index rose by 0.32% yesterday, while the Brazilian Real weakened, driving the USD/BRL exchange rate to its highest level in over a month. This has encouraged Brazilian farmers to increase sugar sales, aiming to maximize foreign currency earnings.

In September, despite logistical challenges and concerns over lower-than-expected production due to drought and fires, Brazil continued to increase its sugar exports. The government reported 3.95 million tons exported in September, up 23.82% from 3.19 million tons in the same period last year.

Metals Market Recovers Amid Mixed Sentiments MXV noted that the metals sector showed a return to green, with 6 out of 10 commodities gaining in price on October 16, following two consecutive sessions of declines. In the precious metals segment, both silver and platinum increased by about 0.6%, closing at $31.97/ounce and $1,002.6/ounce, respectively.

There were no major economic data releases yesterday, leading to minimal volatility in the precious metals market. Moreover, mixed signals from fundamental factors have kept silver and platinum prices relatively flat in recent sessions.

Aside from the Federal Reserve's interest rate movements, investor focus is shifting toward the upcoming U.S. presidential election. Growing uncertainty before the announcement of the next president may drive demand for precious metals as a hedge against risk, limiting the potential for significant declines in silver and platinum prices.

Iron Ore Faces Continued Pressure In the base metals group, iron ore prices continued to slide due to bleak demand prospects, despite ample supply. The commodity ended the session down 1.14%, at $104.74/ton, marking the largest decline within the group.

The World Steel Association (WorldSteel) recently lowered its forecast for global steel demand growth to 0.9% this year, equivalent to 1.75 billion tons. This is lower than the 1.7% growth projected in April due to weaker consumption, putting significant pressure on iron ore prices, a key raw material in steel production.

Amid weak consumption outlooks, iron ore supply has remained stable, leading to increased selling pressure. Yesterday, major iron ore producers Vale and Rio Tinto both reported higher production in Q3.

Vale's iron ore production reached 91 million tons, up 5.5% year-over-year and the highest since Q4 2018, mainly due to improvements at the S11D, Itabira, and Brucutu projects. Meanwhile, Rio Tinto also raised its output to 84.1 million tons, up 1% from the same period last year and 5% from the previous quarter.

Source: MXV