Powerful 7.5 magnitude earthquake strikes Mexico, buildings shaken in capital

A magnitude 7.5 earthquake hit Mexico on Friday in the western state of Guerrero, north of the resort of Acapulco. The quake shook the capital Mexico City for at least 30 seconds, with building swaying as people fled on to the streets.

The city was reportedly more crowded than usual because of the Easter holiday. Despite the relative severity of the quake there are no immediate reports of any major damage.

7.5-magnitude quake strikes off Papua New Guinea

An earthquake struck late Saturday off Papua New Guinea's eastern coast with a preliminary magnitude of 7.5, the U.S. Geological Survey said.

The quake struck at 11:27 p.m. (9:27 a.m. ET) and occurred at a depth of 19 miles (32 km), the USGS said.

It was centered 47 miles (75 km) southwest of Panguna, Papua New Guinea.

After the quake, the Pacific Tsunami Warning Center issued a tsunami warning for Papua New Guinea and the Solomon Islands, but then canceled it. Saturday's incident is the latest in a series of seismic events in the region over the week. They began with magnitude-7.1 and magnitude-6.5 earthquakes on April 11, just to the northeast and southeast, respectively.

Since then, 45 earthquakes of magnitude-4.5 or greater have occurred nearby. Earthquakes with magnitudes between 7.0 and 7.9 are classified by USGS as "major," second only to "great," which are 8.0 and up.

Soybeans Rise to 10-Month High After Record Crush in U.S.

Soybeans extended their climb to the highest level in more than 10 months after a report showed record demand from U.S. mills, boosting concern that supplies from the world’s second-biggest exporter would be reduced.

Soybeans for July delivery rose as much as 0.8 percent to $15.2025 a bushel on the Chicago Board of Trade, the highest price for a most-active contract since June 6. Futures were at $15.155 by 6:53 a.m. local time, rising for a fourth day and taking this year’s increase to 17 percent.

Processors crushed 153.84 million bushels in March, up 12 percent from a year earlier and the most for the month since at least 1998, the National Oilseed Processors Association reported April 15. Domestic stockpiles at the end of August will be 135 million bushels, less than the 145 million bushels forecast in March and below 141 million last year, the U.S. Department of Agriculture said last week.

Soybean prices are “supported by worsening tightness in U.S. soybean supplies,” Luke Mathews, a commodity Strategist at Commonwealth Bank of Australia, wrote in a note today. Slightly better-than-expected Chinese economic data has also supported “improved sentiment within the oilseed market and helped traders turn a blind eye to recent reports of Chinese soybean cancellations” and defaults, he said.

Importers in China, the biggest buyer, may default on as much as 2 million metric tons of shipments, according to the U.S. Soybean Export Council’s Beijing office. The country’s gross domestic product rose 7.4 percent in the first quarter, government data showed yesterday. The median estimate of analysts in a Bloomberg survey was 7.3 percent.

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Teck's Red Dog zinc mine 'operating as normal' after earthquakes

Two earthquakes, a magnitude 5.5 and a magnitude 5.4, struck near the Red Dog Operations zinc-lead mine in remote northwest Alaska, the U.S. Geological Survey said.

It said the quakes, which struck minutes apart, were centered just a few miles (km) southeast of Red Dog Mine, the world's largest producer of zinc, which is operated by Canadian mining company Teck Resources.

Teck Resources said on Friday its Red Dog zinc mine, the world's largest, in Alaska is operating as usual after two earthquakes struck a few miles from the site.

"Mild tremors were felt at Red Dog operations. There were no safety concerns and the mine is currently operating as normal," a spokesman said in an email. 

Russia Confirms Troop Build-Up Near Ukraine; Warns West, More Sanctions "Absolutely Unacceptable"

For the first time, Russia has confirmed that it has built up its military presence on the Ukrainian border (according to Agence France Presse). On the heels of the de-escalation and the West's threat of tougher sanctions (if Russia failed to abide by the new 'deal'), Kremlin spokesman Dmirty Peskov told Rossiya TV that "we have troops in different regions, and there are troops close to the Ukrainian border. Some are based there, others have been sent as reinforcements due to the situation in Ukraine." Reuters also reports that Washington statements "are unlikely to help dialogue," and further sanctions would be "absolutely unacceptable." It seems the 'deal' has done little to calm anything but the US equity market as Peskov blasted "You can't treat Russia like a guilty schoolboy."

The Daily Mail's latest update on suspected (now confirmed) Russian troop build-up

Reuters adds that President Vladimir Putin's spokesman, Dmitry Peskov, said, "Statements like those made at a high level in Washington that the United States will follow in detail how Russia fulfils its obligations ... are unlikely to help dialogue,"

"You can't treat Russia like a guilty schoolboy who has to put a cross on a piece of paper to show he has done his homework," Peskov said in an interview with Russia's First Channel. "That kind of language is unacceptable."

Russia's Foreign Ministry accused U.S. officials of seeking to whitewash what it said was the use of force by the Ukrainian government against protesters in the country's mainly Russian-speaking eastern provinces.

"The blame for the Ukrainian crisis and its current aggravation is unreasonably being placed on Russia," the ministry said in a statement.

"The American side is once again stubbornly trying to whitewash the current actions of Kiev's authorities, who have embarked on a course for the violent suppression of protesters in the southeast who are expressing their legitimate indignation over the infringements of their rights."

Sliding Chinese currency takes blame for gold price weakness

The price of gold ended the holiday-shortened week below the psychologically and technically important $1,300 level, losing almost 2% since Monday.

The sell-off was blamed on an easing of tensions between Russia and the West over Ukraine after marathon diplomatic talks on Thursday.

The gold price was also hurt by renewed profit-taking ahead of the Good Friday long weekend when many markets in the West are closed for trading.

Investors continued to pull money out of the SPDR Gold Trust (NYSEARCA:GLD), the world's largest physically-backed gold ETF accounting for some 40% of total holdings in the industry.

A new report suggests there may be other reasons for the recent weakness in the yellow metal: The slide in the value of the Chinese currency, the yuan, to levels against the US dollar last seen in February.

Copper being used in China as collateral for loans and to bypass the country's capital control regulations has long been a staple of the industry.

With the tight credit conditions inside the country, the practice has spread to iron ore and gold. Some estimates put the the portion of copper stockpiles used in finance deals as high as 80%, while 40% of iron ore inventories could be tied up for trade credit.

This week a report by the World Gold Council said Chinese firms could have locked up as much as 1,000 tonnes of gold in financing deals.

DailyFX explains the dynamic of how this could push down the gold price:

Gold has been used for some even more complex and lucrative structures surrounding the skirting of capital controls

"The highest USD/CNY fixing rates in months may have forced the unwinding of some extremely overleveraged positions. Although the systems of financing are often complex as we saw with copper, gold has been used for some even more complex and lucrative structures surrounding the skirting of capital controls.

"In regards to the depreciating Yuan, political pressure continues to build with Treasury officials warning the Chinese not to weaken the Yuan for their economic benefit. Meanwhile, the daily reference rates out of the PBoC continue to move higher toward the ominous 6.25 mark. That is said to be the level where a large concentration of leveraged financial vehicles may experience some serious stresses."

Another indication that there may be lots of gold on offer in China is the disappearance of premiums paid on the Shanghai Gold Exchange.

From premiums that topped out at $37 when gold was trading around $1,200 last year, traders are now offering gold at a discount or a couple of dollars above to the quoted London spot price.

Driven in part by a weakening yuan discounts on gold in China widened to as much as $9 an ounce below when the price were headed towards $1,400 in March.

Chalco to Halt 600,000-tpy Aluminum Capacity, 800,000-tpy Alumina Capacity

Aluminum Corporation of China Limited (02600) (Chalco) announces that, given the massive over-capacity of electrolytic aluminium, the depressed market price of products and higher cost of electricity of enterprises at present, it has determined to implement flexible production arrangements for certain electrolytic aluminum and alumina production lines, which involve temporary shutdown of production capacity of 600,000 tonnes of electrolytic aluminum and 800,000 tonnes of alumina, respectively.