London, Oct 15 - Almost all commodity prices fell on Wednesday, dragged down by fears that a global recession would depress demand for raw materials and manufactured goods.
Oil slumped to its lowest level in 13 months, copper dropped more than 3 percent and soy, sugar and coffee futures tumbled as euphoria over moves in the United States and Europe this week to invest in banks and defuse a global financial crisis evaporated.
Concerns were growing that the bank rescue, involving hundreds of billions of dollars on both sides of the Atlantic, would come at a huge economic cost and do little to repair the damage already done by a 14-month credit crunch.
Much worse-than-expected British data showing unemployment shot up by 164,000 in the three months to August -- even before the credit crunch tightened its grip -- deepened the gloom.
"Although a global bankruptcy was avoided, operators worry about the consequences of the crisis on an economic downturn and a consecutive fall in demand," French analyst Agritel said in its daily report.
Henk Potts, equity strategist at Barclays Wealth, said investors were absorbing grim forecasts for economic growth in Western countries next year.
"Investors are starting to realise that a systemic meltdown of the financial sector is less likely, but worries have shifted to macro-economic concerns," he said.
REAL ECONOMY
U.S. crude oil futures fell $3.66 to $74.97 a barrel on Wednesday, the lowest level since September 2007, dragged down by expectations economic weakness will cut further into demand for crude. Prices were trading around $76.50 by 1325 GMT.
Expectations of weaker global demand for metals were reinforced after the world's largest copper producer, Codelco, said the premium for refined copper in Europe would be lower in 2009.
"That's probably the biggest single piece of news today that would pull the copper price back," analyst John Meyer at investment bank Fairfax said on the Codelco update. "They are focusing more on the demand side things worldwide."
"It's (also) growing awareness of the impact of the credit crisis on the real economy on a wider basis."
Prices of copper used in power and construction have fallen more than 40 percent since a record high of $8,940 in July.
Copper for delivery in three months on the London Metal Exchange traded lower at $5,060 a tonne in official rings, from a closing bid of $5,298 on Tuesday. The metal hit an intra-day low of $4,965.
Rhodium shed $350 an ounce as investors sold the precious metal on fears demand from carmakers would fall, and to raise cash to cover losses on other markets. It was quoted at $2,850 an ounce against $3,200 an ounce on Tuesday.
COFFEE, SUGAR, COCOA FUTURES DOWN
Auto manufacturers' association ACEA said European new vehicle sales fell 8.2 percent in September, and U.S. car sales have also fallen, recent figures suggest.
"Car sales are looking grim from everywhere, really, and that is the major home for the majority of rhodium," said one British trader.
Chicago Board of Trade November soybeans fell 0.11 percent to $8.95 a bushel, after rising to $9.1 earlier as the market attempted to recover from 13-month lows hit on Monday.
Gold prices were among the most stable in the commodities complex, paring early gains, while silver prices fell more than 5 percent.
Spot gold was at $837.80/840.30 an ounce at 1315 GMT, down from a session high at $848.30 an ounce and compared with $835.25 in late New York trade on Tuesday. Silver was at $10.36/10.44 an ounce from $10.95.
Coffee, sugar and cocoa futures all fell on origin and investor selling. January robusta coffee was down $41 or 2.23 percent at $1,795 per tonne at 1211 GMT.
Fortis Commodity Derivatives said in a daily market report: "Whilst the panic selling might be over, we think we are now entering a period where investors will be endlessly fed a diet of recessionary data about the global economy.