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Metals Industry News

Philippine nickel output falls 6% y-o-y in 2017

Base Metals Market - Wed, 02/21/2018 - 09:53
Nickel ore production in the Philippines fell 6% year-on-year to 23.35 million dry metric tonnes (dmt) in 2017, according to the country’s Mines and Geosciences Bureau (MGB).
Categories: Metals Industry News

Metals morning view: Metals prices drift as market awaits China’s return

Base Metals News - Wed, 02/21/2018 - 08:40

The metals prices on the London Metal Exchange are mixed this morning, Wednesday February 21, with nickel and tin prices firmer by 0.4%, while the rest are lower by between 0.1% and 0.5%. Copper prices are off 0.1% at $7,068 per tonne.

Volumes remain light with 1,862 lots traded as of 07:05 am London time – we expect this to change tomorrow with China returning from the Lunar New Year holiday.

Tuesday’s trading was for the most part weaker, with copper, aluminium, lead and zinc closing down an average of 0.8%, while nickel and tin were little changed. The cash/three-month spread on aluminium has also eased to $30-32 per tonne backwardation, from $50 on Tuesday morning.

Precious metals prices are weaker this morning, with the complex down an average of 0.2%. Spot gold prices are at $1,328.05 per oz. This follows a general day of weakness on Tuesday when the complex closed down an average of 0.7%, which was partially driven by a firmer US dollar index.

In wider markets, spot Brent crude oil prices are weaker by 0.52% at $64.67 per barrel and the yield on US 10-year treasuries remains firm at 2.91% as US treasury auctions are underway. On the other hand, the German 10-year bund yield has eased to 0.72%, from 0.75% on Tuesday.

Equity markets in Asia are firmer – the Nikkei is up by 0.21%, the Kospi is up 0.60%, the ASX 200 is up 0.05% and the Hang Seng is up 1.71%. This follows a mixed performance in western markets on Monday, where in the United States the Dow Jones closed down by 1.01% at 24,964.75, and in Europe where the Euro Stoxx 50 closed up by 0.8% at 3,435.08.

The dollar index’s rebound continues, being recently quoted at 89.89 – the fourth consecutive day of gains. This is applying some downward pressure on other currencies, with the euro at 1.2317, sterling at 1.3980, yen at 107.82 and the Australian dollar at 0.7845. The emerging market currencies we follow are on a back footing, which reflects the slightly firmer dollar.

The economic calendar is busy today and includes flash PMI data and the minutes of the latest FOMC meeting. Data out already from Japan shows flash manufacturing PMI dipping to 54 from 54.8 in January and all industries activity rising 0.5% in December, from 1% in November. In addition, there is employment and borrowing data out of the UK and US, initial jobless claims and existing home sales data.

Two weeks ago metals prices were selling off, last week they were rebounding and this week they are consolidating. But, with China on holiday so far this week, we are not surprised prices are rudderless, with a slight weaker bias. Today’s manufacturing PMI data may provide some direction, but overall we would expect traders to sit on the side lines until China returns to work in force, but that may not be seen until next week. We still expect dips to be remain well supported.

Another turn-around in the dollar has weighed on gold, especially as it happened when gold prices were once again challenging recent highs. Platinum is holding up relatively well, silver less so and palladium is consolidating after its latest half-hearted rebound. With the US treasury auctions underway, for now yields are likely to remain bid and that is likely to underpin the dollar and weigh on gold, but we do expect gold prices to remain well supported as concerns over higher bond yields and the impact that may have on equity and bond prices may prompt some pick-up in safe-haven buying.

Overnight Performance GMT 07:05 +/- +/- % Lots Cu 7,068 -9.0 -0.1% 551 Al 2,177 -10.5 -0.5% 646 Ni 13,570 50.0 0.4% 180 Zn 3,547 -4.0 -0.1% 316 Pb 2,580 -8.5 -0.3% 166 Sn 21,475 85.0 0.4% 3 Average BM   0.0%        1,862 Gold  1,328.05 -1.90 -0.1%   Silver        16.43 -0.03 -0.2% Platinum      996.60 -0.40 0.0% Palladium  1,029.70 -4.30 -0.4% Average PM   -0.2%

 

Economic calendar GMT Country Data Actual Expected Previous 12:30am Japan Flash Manufacturing PMI 54 55.2 54.8 4:30am Japan All Industries Activity m/m 0.5% 0.5% 1.0%  8:00am France French Flash Manufacturing PMI 58.1 58.4  8:00am France French Flash Services PMI 59.1 59.2 8:30am Germany German Flash Manufacturing PMI 60.6 61.1 8:30am Germany German Flash Services PMI 56.9 57.3 9:00am EU Flash Manufacturing PMI 59.2 59.6 9:00am EU Flash Services PMI 57.7 58 9:30am UK Average Earnings Index 3m/y 2.5% 2.5% 9:30am UK Claimant Count Change 2.3K 8.6K 9:30am UK Public Sector Net Borrowing -11.5B 1.0B 9:30am UK Unemployment Rate 4.3% 4.3% 2:15pm UK Inflation Report Hearings 2:45pm US Flash Manufacturing PMI 55.4 55.5 2:45pm US Flash Services PMI 53.8 53.3 3:00pm US Existing Home Sales 5.61M 5.57M 7:00pm US FOMC Meeting Minutes

The post Metals morning view: Metals prices drift as market awaits China’s return appeared first on FastMarkets.

Categories: Metals Industry News

METALS MORNING VIEW 21/02: Metals prices drift as market awaits China's return

Base Metals Market - Wed, 02/21/2018 - 08:40
The metals prices on the London Metal Exchange are mixed this morning, Wednesday February 21, with nickel and tin prices firmer by 0.4%, while the rest are lower by between 0.1% and 0.5%. Copper prices are off 0.1% at $7,068 per tonne.
Categories: Metals Industry News

EUROPEAN MORNING BRIEF 21/02: US aluminium premiums rise further; Truck woes hit US copper users; Brazil crude steel output

Base Metals Market - Wed, 02/21/2018 - 05:05
Good morning from Metal Bulletin’s office in Singapore as we bring you the latest news and pricing stories on Tuesday February 21.
Categories: Metals Industry News

LIVE FUTURES REPORT 21/02: LME nickel inches up, other base metals show declines; China market back tomorrow

Base Metals Market - Wed, 02/21/2018 - 04:25
Base metals on the LME were generally lower during Asian morning trading on Wednesday February 21, amid a lack of liquidity with the Chinese markets still closed.
Categories: Metals Industry News

Southern Peru wins tender to develop Michiquillay copper project

Base Metals Market - Wed, 02/21/2018 - 03:25
Southern Peru Copper Corporation (SPCC) has won the tender to develop the $2-billion Michiquillay copper mining project in northern Peru, the country’s state-run investment agency Proinversion said on Tuesday February 20.
Categories: Metals Industry News

GLOBAL ALUMINIUM WRAP: US Midwest jumps to highest since April 2015 on 232 uncertainty; Asia and Europe steady

Base Metals Market - Wed, 02/21/2018 - 02:45
Aluminium premiums in the United States rose on the back of Section 232 uncertainty, while those in Europe and Asia remained unchanged in the past week.
Categories: Metals Industry News

WEEKLY BASE METAL PREMIUMS REPORT: 20/02

Base Metals Market - Tue, 02/20/2018 - 19:43
A summary of base metals premiums across the globe for the week to Tuesday February 20.
Categories: Metals Industry News

Tiberius, BGRIMM Lilan apply for LME category V membership

Base Metals Market - Tue, 02/20/2018 - 17:56
Two companies have filed their applications to the London Metal Exchange for category V membership, which will allow them to receive client contracts.
Categories: Metals Industry News

LIVE FUTURES REPORT 20/02: LME lead price charges up; most base metals dip lower

Base Metals Market - Tue, 02/20/2018 - 17:45
Base metals prices trading on the London Metal Exchange were largely lower at the 5pm close on Tuesday February 20, except for lead and nickel which saw upticks at the end of the day.
Categories: Metals Industry News

Brazilian aluminium premiums rise on soaring Midwest market following Section 232 recommendations

Base Metals Market - Tue, 02/20/2018 - 16:43
Brazil aluminium premiums, especially for metal sold domestically, are facing increased upward pressure in the spot market due to soaring US Midwest premiums, with the industry preparing for potential heavy sanctions on imports into the United States.
Categories: Metals Industry News

LIVE FUTURES REPORT 20/02: Comex copper price tumbles after extended weekend

Base Metals Market - Tue, 02/20/2018 - 16:30
Comex copper prices failed to hold onto previous gains on Tuesday February 20 following the Presidents Day public holiday, with the dollar pressuring metals lower.
Categories: Metals Industry News

FORECAST: US aluminium import tariffs short-term bullish, long-term bearish for Asian premiums – sources

Base Metals News - Tue, 02/20/2018 - 14:09

The imposition of import tariffs and/or quotas by the US government on aluminium and aluminium products could push Asian premiums up in the short term but drive them down in the long term, market participants said.

US Secretary of Commerce Wilbur Ross on Friday February 16 recommended a series of tariffs and/or quotas in addition to existing duties in place on aluminium and steel imports following the department’s Section 232 investigations into imports of the products.

US President Trump is required to make a decision on the recommendations by April 19.

“It is hard to quantify the impact on Asian premiums in the next one to two weeks, or at least until the market returns from [Chinese New Year] holidays. But there could be a knee-jerk response in the near term. If US premiums rise, Asia premiums will climb too,” a Singapore-based trader suggested.

Aluminium premiums in Asia are largely unchanged this week, with spot trading remaining slow due to the continued holiday-related absence of some industry participants. Metal Bulletin assessed the South Korean P1020 premium at $98-120 per tonne on February 20, unchanged from last week.

US aluminium premiums will rise should the US impose import tariffs and quotas on aluminium and aluminium products, market observers agree.

American Metal Market’s assessment of the P1020 premium has been rising since before Ross delivered his recommendations to the White House. The assessment on February 13 at 13-13.5 cents per lb marked an upswing of more than 40% since the start of the year.

Higher US aluminium premiums could see producers divert supply to the US, reducing supply to Asia and hence provide support for Asia premiums, a second Singapore-based trader said.

“If US premiums increase… swing tonnages will go to the US, which can lead to supply pressures in Asia,” he said.

Backwardation in foreground
But the near-term outlook for premiums in Asia is also complicated by the backwardation in nearby London Metal Exchange aluminium spreads, which could put downward pressure on premiums in the region if it persists, industry sources noted.

“The backwardation is a tough situation for traders. If the backwardation continues for another half month or longer, premiums will decrease. If the backwardation is sustained till mid-March, it could even affect Q2 MJP premiums,” a third Singapore-based trader said.

The backwardation in the February/March 2018 spread has sparked huge deliveries of the metal into LME-listed warehouses. On February 13, some 166,225 tonnes were delivered into LME system – the largest single delivery of aluminium into LME warehouses since March 19, 2014.

These deliveries briefly swung spreads back into contango but the cash/three-month spread then returned to a huge backwardation of $50 per tonne today, while the March/April 2018 spread is at a narrow contango of $0.25 per tonne.

Talks between global aluminium producers and Japanese buyers for second-quarter aluminium supply to main Japanese ports (MJP) are set to start soon, with one producer already offering $135 per tonne to some buyers in Japan.

Rising US and European aluminium premiums and expectations of strong demand during the second quarter are likely to raise the second-quarter premium from the first-quarter settlement of $103 per tonne cif.

But the backwardation is likely to cap the upside for the second-quarter MJP premium, traders have noted.

“Some material won’t be leaving the US now [due to expected higher US premiums from import tariffs]. Canada is already exporting less to Southeast Asia and Korea. Producers will latch on to [the reasons that US premiums are rising] to support their Q2 MJP offers,” the second Singapore trader said.

“But with the backwardation, traders won’t accept high premiums. Q2 MJP should increase but not significantly. $10 could be the maximum.”

Smelters will use the argument of good demand in Japan, the US and Europe to keep the second-quarter MJP premium elevated, a Korea-based trader said.

“But if the backwardation still exists in March, I don’t think the final premium can go up to $135,” he added.

Long-term view
In the mid-to-long term, market participants expect a more bearish impact on Asia aluminium premiums should the US impose import tariffs and/or quotas on the metal.

“If the US increases import tariffs on aluminium imports, China’s export of coils and products to the US will have to stop,” a second Korea-based trader said.

Should these products be redirected to Asia, it would put downward pressure on premiums in the region, he added – especially in Korea and Southeast Asia.

Offers in the region for Chinese aluminium products such as coil and plate – some of which are used as substitutes for P1020 ingots – have risen in recent months while the export arbitrage window in China has been open.

South Korea’s imports of aluminium plate, sheet and strip from China jumped 57.1% to 177,015 tonnes in 2017
. In December alone, imports from China grew 47.8% year on year to 13,278 tonnes.

Traders in Southeast Asia said earlier this month that they had received offers for Chinese aluminium plates that can be used as primary aluminium.

“If Chinese exports can’t go to the US, it will go somewhere else and the place with least resistance is Southeast Asia. Expectations of import tariffs in the US is also why the coil export chatter has been getting louder recently,” the second Singapore trader said.

Since Japanese buyers are unlikely to opt for Chinese coils as a replacement for P1020 ingots, local premiums are less likely to come under pressure, sources said.

Japan imported only 10,334 tonnes of aluminium plates, sheets and strips from China in 2017, Japanese customs data showed.

The spot cif MJP premium
 was unchanged week on week at $95-110 per tonne on February 20, according to Metal Bulletin’s assessment.

China’s exports of unwrought aluminium and aluminium products rose 4.5% to 4.79 million tonnes in 2017. In January this year, exports rose for a third consecutive month – they were up 14.3% year on year at 445,000 tonnes.

The post FORECAST: US aluminium import tariffs short-term bullish, long-term bearish for Asian premiums – sources appeared first on FastMarkets.

Categories: Metals Industry News

FORECAST: US aluminium import tariffs short-term bullish, long-term bearish for Asian premiums - sources

Base Metals Market - Tue, 02/20/2018 - 14:09
The imposition of import tariffs and/or quotas by the US government on aluminium and aluminium products could push Asian premiums up in the short term but drive them down in the long term, market participants said.
Categories: Metals Industry News

BHP reports higher half-year copper earnings; revises volume growth down for the year

Base Metals Market - Tue, 02/20/2018 - 11:52
BHP has revised its copper equivalent volume growth to 6% for the 2018 financial year from 7% previously, due to lower volumes now expected at Broadmeadow and Blackwater mines.
Categories: Metals Industry News

LIVE FUTURES REPORT 20/02: LME base metals under pressure awaiting China's return; Ali spreads tighten

Base Metals Market - Tue, 02/20/2018 - 10:35
Base metals prices on the London Metal Exchange were lower across the board this morning, Tuesday February 20, with a rebound in the dollar and thin market volumes putting pressure on prices.
Categories: Metals Industry News

PRICING NOTICE: Proposal to amend methodology for Aluminium P1020 cif main Japanese ports (MJP) premiums

Base Metals News - Tue, 02/20/2018 - 09:00

Metal Bulletin proposes changes to the pricing methodology for its Aluminium P1020 cif quarterly main Japanese ports (MJP) premium and Aluminium P1020 cif MJP spot premium.

Aluminium P1020 cif quarterly main Japanese ports (MJP) premium
Metal Bulletin plans to update the methodology to include confirmed deals from at least one major consumer (instead of two consumers currently) and confirmed deals with traders. This is to reflect the increasing volumes of deals taking place between traders and producers for the settling of this benchmark. The methodology will continue to be considered settled if deals with three producers are reported to us.

Metal Bulletin tries to ensure both the buy and sell side of deals are reported to us, however, the 30,000-tonne threshold is all the total deals reported to us and not unique business.

Metal Bulletin is also reclassifying certain market participants involved in the talks such as Panasonic and Sumitomo Chemicals who were considered consumers to trading houses because a large part of their trading activity is not for their own consumption but for third-party trading.

The main overseas producers involved in the quarterly negotiations are Rio Tinto, Alcoa, South32 and Rusal. Indian and Middle Eastern producers and their material are not considered during the settling of the quarterly benchmark.

Aluminium P1020 cif spot main Japanese ports (MJP) premium
Metal Bulletin plans to increase the frequency of the assessment to twice weekly to more accurately ascertain moves in the premium taking into account deals, bid, offers, deals heard and assessments during the week. This will result in a more liquid assessment, capturing moves in the premiums twice in a week.

This would also bring the spot MJP pricing frequency, in line with the proposed changes to US Midwest premium pricing frequency, to twice-weekly.

Currently, an assessment of the spot MJP aluminium premium is produced every Tuesday. Under the adjusted methodology, the premium would be assessed every Tuesday and Friday.

Metal Bulletin is also proposing to continue pricing a spot low-high range and to stop assessing a single spot MJP assessment number.

The consultation period for these proposed amendments will end one month from the date of this pricing notice on March 20, with changes taking place from March 21.

To provide feedback on this price or if you would like to provide price information by becoming a data submitter to this price, please contact Shivani Singh by email at: pricing@metalbulletin.com. Please put ‘FAO: Shivani Singh, re: Aluminium P1020 cif  main Japanese ports (MJP) premium’ in the subject line.

To see all Metal Bulletin’s pricing methodology and specification documents go to https://www.metalbulletin.com/prices/pricing-methodology.html 

The post PRICING NOTICE: Proposal to amend methodology for Aluminium P1020 cif main Japanese ports (MJP) premiums appeared first on FastMarkets.

Categories: Metals Industry News

PRICING NOTICE: Proposal to amend methodology for Aluminium P1020 cif main Japanese ports (MJP) premiums

Base Metals Market - Tue, 02/20/2018 - 08:57
Metal Bulletin proposes changes to the pricing methodology for its Aluminium P1020 cif quarterly main Japanese ports (MJP) premium and Aluminium P1020 cif MJP spot premium.
Categories: Metals Industry News

Metals morning view: Metals prices mixed as traders adjust to high prices and thin conditions

Base Metals News - Tue, 02/20/2018 - 08:08

The metals prices on the London Metal Exchange are mixed this morning, Tuesday February 20, with aluminium and tin prices firmer by 0.2% and 0.7% respectively, while the rest are lower by an average of 0.7%. Copper prices are down 0.6% at $7,094 per tonne.

Needless to say, with China still on holiday volumes have been light with 1,625 lots traded as of 06:57 am London time.

This follows a mixed performance on Monday, when aluminium, nickel and zinc prices were little changed, with copper, lead and tin prices off 0.6%, 0.7% and 1.7% respectively. The main development on Monday was the increased tightness in aluminium spreads that saw the cash/three-month spread move out to $50 per tonne backwardation, with most of the tightness concentrated in the cash to March date.

Precious metals prices are split between bullion and the platinum group metals (PGMs) with spot gold and silver prices down either side of 0.5% and the PGMs little changed. Spot gold was recently quoted at $1,339.61 per oz. This follows a quiet day for most of the precious metals on Monday, the exception being palladium were prices dropped 1%.

Exchanges remain closed in China for the Lunar New Year holiday and will not reopen until Thursday February 22.

In wider markets, spot Brent crude oil prices are little changed at $65.57 per barrel and the yield on US 10-year treasuries has climbed again to 2.91% and the German 10-year bund yield is firmer too at 0.75%.

Equity markets in Asia are for the most part weaker – the Nikkei is down by 1.01%, the Kospi is down 1.13%, the ASX 200 is off 0.1% and the Hang Seng is up 0.05%. This follows weakness in western markets on Monday, where in Europe the Euro Stoxx 50 closed down by 0.55% at 3,407.79.

The dollar index’s rebound continues, it was recently quoted at 89.44, this after a fresh low of 88.25 on February 16. This is applying some downward pressure on other currencies with the euro at 1.2377, sterling at 1.3968, yen at 106.88 and the Australian dollar at 0.7924. The emerging market currencies we follow are if anything on a slight back footing, which reflects the slightly firmer dollar.

Economic data out already today showed a pick-up in German PPI to 0.5% from 0.2%, later there is data on German and EU ZEW economic sentiment, EU consumer confidence, UK industrial order expectations and there is an EU Econfin meeting.

Last week’s rebounds in the base metals have paused for now but prices are for the most part poised under recent highs and look well placed to continue to rally. Needless to say with China on holiday until Thursday, trading activity may be subdued. We remain bullish overall and expect dips to remain well supported, but we need to be cautious given the broad based correction two weeks ago in case rising bond yields prompt another bout of jitters. The tightness in aluminium spreads, which comes ahead of tomorrow’s third Wednesday, combined with the large stock increases of late, are probably just to do with shorts rolling February positions and we would expect that to pass over the next few days, although the next three days of LME stocks data could still hold some surprises is shorts are going to deliver against their February shorts, rather than roll them..

A rebound in the dollar is creating a bit of a headwind for gold and silver prices, but gold generally seems in favor and the broad based sell-off from two weeks ago may be encouraging some rotation out of equities and bonds into gold. Platinum prices are looking well placed to challenge resistance above $1,000 per oz and palladium prices seem to be rebounding after their recent 15.8% correction. A stronger dollar may delay moves to the upside though.

Overnight Performance GMT 06:57 +/- +/- % Lots Cu 7,094 -44.0 -0.6% 517 Al 2,205 3.5 0.2% 447 Ni 13,545 -125.0 -0.9% 288 Zn 3,548 -19.5 -0.5% 175 Pb 2,569 -19.5 -0.8% 192 Sn 21,540 140.0 0.7% 6 Average BM   -0.3%        1,625 Gold  1,339.61 -5.74 -0.4%   Silver        16.54 -0.10 -0.6% Platinum  1,003.80 0.80 0.1% Palladium  1,030.80 -1.20 -0.1% Average PM   -0.3%

 

Economic calendar GMT Country Data Actual Expected Previous 7:00am Germany German PPI m/m 0.5% 0.3% 0.2% 10:00am Germany German ZEW Economic Sentiment 16 20.4 10:00am EU ZEW Economic Sentiment 28.4 31.8 All Day EU ECOFIN Meetings 11:00am UK CBI Industrial Order Expectations 12 14 3:00pm EU Consumer Confidence 1 1

The post Metals morning view: Metals prices mixed as traders adjust to high prices and thin conditions appeared first on FastMarkets.

Categories: Metals Industry News

METALS MORNING VIEW 20/02: Metals prices mixed as traders adjust to high prices and thin conditions

Base Metals Market - Tue, 02/20/2018 - 08:08
The metals prices on the London Metal Exchange are mixed this morning, Tuesday February 20, with aluminium and tin prices firmer by 0.2% and 0.7% respectively, while the rest are lower by an average of 0.7%. Copper prices are down 0.6% at $7,094 per tonne.
Categories: Metals Industry News

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