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LIVE FUTURES REPORT 15/05: SHFE base metals prices diverge; copper down amid disappointing data, stock inflows

Base Metals News - Tue, 05/15/2018 - 03:45

Base metals prices on the Shanghai Futures Exchange were on divergent paths during Asian morning trading on Tuesday May 15, with copper down amid disappointing Chinese data and rising stock levels.

The most-active July copper contract on the SHFE traded at 51,280 yuan ($8,088) per tonne as at 10.44am Shanghai time, down 280 yuan per tonne from Monday’s close. Around 126,000 lots of the contract have changed hands so far this morning.

On Tuesday, China’s fixed asset investment growth came in at 7% for January-April, below expected growth of 7.4%, while April retail sales gained 9.4%, also below forecasts of a 10% increase. April industrial production, however, surprised on the upside with growth of 7% – 6.4% had been called for.

Sufficient supply of refined copper and rising copper stocks have capped the upside for red metal prices, China’s Minmetals Jingyi Futures said in a report on Monday.

Copper inventories are being digested at a slower rate in the second quarter of this year than last year, but there is support coming from tighter supply of copper scrap and concentrates, the broker said.

“Copper prices should continue to fluctuate in the near term, with outlook improving in the medium term,” it added.

Copper inventories in SHFE warehouses rose for a second consecutive week in the week ended May 11, reaching a total of 279,525 tonnes. Stocks in London Metal Exchange warehouses increased a net 8,900 tonnes to a total of 289,975 tonnes, with the increase concentrated in Singapore and Taiwan’s Kaohsiung.

Base metals prices

  • The SHFE July aluminium contract price increased 60 yuan per tonne to 14,695 yuan per tonne.
  • The SHFE June lead contract price fell 5 yuan per tonne to 19,380 yuan per tonne.
  • The SHFE July zinc contract price gained 160 yuan per tonne to 23,715 yuan per tonne.
  • The SHFE September tin contract price decreased 380 yuan per tonne to 145,750 yuan per tonne.
  • The SHFE July nickel contract price rose 380 yuan per tonne to 106,870 yuan per tonne.


Currency moves and data releases

  • The US dollar index was at 92.63 as at 10.50am Shanghai time, down 0.04% from its previous closing price.
  • In other commodities, the Brent crude oil spot price fell 0.27% to $78.25 per barrel as at 10.50am Shanghai.
  • In equities, the Shanghai Composite fell 0.15% to 3,169.13 as at 10.50 am Shanghai time.
  • A string of US data is due later today, including core retail sales, retail sales, Empire State manufacturing index, business inventories and NAHB housing market index.

 

SHFE snapshot at 10.44am Shanghai time Most-traded SHFE contracts   Price (yuan per tonne) Change since previous session’s close (yuan) Copper (Jul) 51,280 -280 Aluminium (Jul) 14,695 60 Zinc (Jul) 23,715 160 Lead (Jun) 19,380 -5 Tin  (Sep) 145,750 -380 Nickel  (Jul) 106,870 380

 

LME snapshot at 03.44am London time Latest three-month LME Prices   Price ($ per tonne) Change since previous session’s close ($) Copper 6,875 -10 Aluminium 2,317 -2 Lead 2,381.50 -3.5 Zinc 3,079 24 Tin 20,980 30 Nickel 14,370 -130

 

Changjiang spot snapshot on May 15   Range (yuan per tonne) Change (yuan) Copper  50,990-51,030 -190 Aluminium 14,560-14,600 100 Zinc 23,850-23,900 170 Lead 19,400-19,600 -200 Tin  144,000-145,500 0 Nickel  106,700-107,000 1,550

The post LIVE FUTURES REPORT 15/05: SHFE base metals prices diverge; copper down amid disappointing data, stock inflows appeared first on FastMarkets.

Categories: Metals Industry News

FORECAST: EV nickel demand to surge tenfold by 2025, Vale says

Base Metals News - Tue, 05/15/2018 - 01:17

Mass production of electric vehicles (EVs) will transform the nickel market, which must evolve from pricing and supply perspectives in order to meet the anticipated surge in demand, a Vale executive said ahead of Metal Bulletin’s 6th International Nickel Conference, which begins Thursday May 31 in Toronto, Canada.

“We’re already preparing [to enter the EV space] but we’re going to preserve optionality until it’s time and we can extract value,” Robert Morris, Vale’s executive vice president of sales and marketing for base metals, told Metal Bulletin.

Nickel prices are not nearly high enough to incentivize more production to come online. “If we want to supply this battery revolution with the appropriate nickel units, prices will have to be substantially higher,” he said, adding that it would likely take a couple of years for that to occur.

Morris didn’t have a specific nickel price point in mind for warranting additional production but it would “certainly” need to be above $17,000 per tonne, he said.

The London Metal Exchange’s three-month nickel contract closed the official session at $14,355 per tonne ($6.51 per lb) on Monday May 14. The contract had hit a more than three-year high of $15,790 per tonne on April 19.

Demand for nickel in the EV space is expected to total 36,000 tonnes in 2018, according to Frank Nikolic, Vale’s manager of market intelligence for base metals.

That figure is expected to surge to 350,000-500,000 tonnes by 2025, according to Morris.

Nickel demand currently stands at slightly more than 2 million tonnes and is roughly split evenly between Class 1 and Class 2 units, meaning that nickel demand in the EV space will account for 35-50% of current Class 1 nickel usage, he added.

But until prices and demand warrant a shift, the majority of Vale’s Class 1 nickel units will continue to feed demand in aerospace and plating, Morris said.

Once the EV market is ripe for additional nickel supply, Vale is ready to compete in the space. “We believe that our readiness, our capabilities and our optionality are very good,” he said. The “vast majority” of Vale’s nickel assets are Class 1, but the Class 2 assets that the company has – its refinery in Japan and its mine in New Caledonia – “are readily available to be converted to Class 1 without significant capital or other technicalities.”

As for any threat to overall EV market growth, Morris said he isn’t worried. “That train has left the station. It’s not coming back. Not a matter of if but when and how fast.”

Morris acknowledged that while there are “concerns in a number of areas that may alter the growth [of EVs], we don’t believe there’s anything that will derail EVs from being the dominant form of transportation in the future.”

Potential obstacles include required infrastructure, getting EVs to be at cost parity with internal combustion engine vehicles and continued incentives from governments and other entities to boost EV ownership.

Vale also isn’t overly concerned about potential nickel substitution, largely because “there’s no alternative technology that will come in and save the day. It’s just not there. Other batteries are years away from being commercialized,” Morris said.

Further, companies have been “spending billions” to produce lithium-ion batteries that contain nickel, he said. “By 2025, there will be massive economies of scale producing this particular chemistry. Those will make for very high barriers of entry for alternative chemistries.”

If anything, the amount of nickel used in EV batteries will increase. Most EV battery chemistries will be eight parts nickel, one part cobalt and one part manganese by 2025, Morris said. Battery chemistries currently use less nickel.

Nickel is attractive because it allows for a higher energy density, and the more nickel that is used means there will be less cobalt, which is much more expensive.

Although technically difficult and complicated to increase the amount of nickel used in EV batteries, “everyone is moving toward that … cheaper and higher performance,” Morris said.

Vale’s Morris will be a panelist at Metal Bulletin’s 6th International Nickel Conference, running from May 31-June 1 in Toronto. He will be joined by Barry Jackson, principal market analyst of nickel at Anglo American; Delphine Le Liboux, sales manager of the nickel division at Eramet; Mark Selby, president and chief executive officer of Royal Nickel Corp; and Denis Sharypin, head of market intelligence at Norilsk Nickel.

The post FORECAST: EV nickel demand to surge tenfold by 2025, Vale says appeared first on FastMarkets.

Categories: Metals Industry News

LIVE FUTURES REPORT 14/05: LME nickel climbs 3%; lead moves higher

Base Metals Market - Mon, 05/14/2018 - 18:05
Base metals on the London Metal Exchange were mostly mixed at the close of trading on Monday May 14, with nickel’s three-month price climbing 3% during the afternoon.
Categories: Metals Industry News

Commission to report back on new DRC mining code

Base Metals Market - Mon, 05/14/2018 - 17:56
The commission appointed to draft the regulations required for the Democratic Republic of Congo’s (DRC) new mining code has completed its work and will now report back to the Minister of Mines, major international mining companies active in the country said.
Categories: Metals Industry News

PEOPLE MOVES: Dessy Nascimentom joins Harthill Logistics

Base Metals Market - Mon, 05/14/2018 - 16:44
London-based Harthill Logistics has expended its consultancy services through the appointment of Dessy Nascimentom, the company said.
Categories: Metals Industry News

Marex Spectron adds satellite analysis to quantitative research in JV with Earth-i

Base Metals Market - Mon, 05/14/2018 - 16:40
Global commodities broker Marex Spectron’s new joint venture with international space company Earth-i will diversify its research arm by bringing “New Space” technologies to the forefront of the metals market.
Categories: Metals Industry News

PEOPLE MOVES: Chile’s president appoints two board members for Codelco; new chairman to be named this week

Base Metals Market - Mon, 05/14/2018 - 16:24
Chilean President Sebastián Piñera has appointed Hernán de Solminihac and Ignacio Briones as new board members of state-owned copper producer Codelco, the company said late on Friday May 11.
Categories: Metals Industry News

LIVE FUTURES REPORT 14/05: Comex copper price slides to open week

Base Metals Market - Mon, 05/14/2018 - 15:54
Comex copper prices failed to hold onto Friday's gains with the market pausing the uptick after a fresh set of material inflows across Europe and Asia.
Categories: Metals Industry News

NORTH AMERICAN MORNING BRIEF 14/05: LME base metals lower; Afarak confirms Q1 loss on low ferro-chrome prices; US slab imports likely excluded from Section 232

Base Metals Market - Mon, 05/14/2018 - 12:15
The latest metal markets news and price moves to start the North American day on Monday May 14.
Categories: Metals Industry News

LIVE FUTURES REPORT 14/05: LME base metals broadly lower; nickel up 2.2%

Base Metals Market - Mon, 05/14/2018 - 11:25
Base metals on the London Metal Exchange edged mostly lower during morning trading on Monday May 14, with nickel and lead the only metals to record gains across the complex.
Categories: Metals Industry News

ALUMINIUM FOUNDRY WRAP: Tight supply drives US premiums; Europe unchanged

Base Metals Market - Mon, 05/14/2018 - 08:15
The sanctions placed on Russian aluminium producer UC Rusal by the US Department of the Treasury continued to push up foundry alloy premiums in the United States this month, while the European market remained unchanged at record highs.
Categories: Metals Industry News

METALS MORNING VIEW 14/05: Metals start the week on firmer footing

Base Metals Market - Mon, 05/14/2018 - 08:11
Base metals prices on the London Metal Exchange were broadly positive on the morning of Monday May 14, with all of the metals, except for zinc (-0.1%), up by an average of 0.6%. Nickel and lead were the frontrunners with gains of 1.3% and 1.2% respectively.
Categories: Metals Industry News

METALS MORNING VIEW 14/05: Metals start the week on firmer footing

Base Metals News - Mon, 05/14/2018 - 07:11

Base metals prices on the London Metal Exchange were broadly positive on the morning of Monday May 14, with all of the metals, except for zinc (-0.1%), up by an average of 0.6%. Nickel and lead were the frontrunners with gains of 1.3% and 1.2% respectively.

Volume on the LME has been average, with 4,689 lots traded as at 06.42 am London time.

The precious metals were firmer across the board this morning, with the complex up by an average of 0.3% – gold prices were up by 0.1% at $1,319.87 per oz. Once again it looks as though gold prices have found support above $1,300 per oz and prices are attempting to work higher.

Lead and nickel prices on the Shanghai Futures Exchange also led the way this morning, with prices up by 2.4% and 2.2% respectively. Copper prices were up by 0.2% at 51,580 yuan ($8,140) per tonne, tin prices were up by 0.3%, while aluminium and zinc prices were down by 0.3% and 0.2% respectively.

Spot copper prices in Changjiang were up by 0.2% at 51,140-51,240 yuan per tonne and the LME/Shanghai copper arbitrage ratio has dropped to 7.42 from 7.51 for most of last week.

In other metals in China, iron ore prices were up by 1.6% at 485 yuan per tonne on the Dalian Commodity Exchange. On the SHFE, steel rebar prices were up by 0.7%, while gold and silver prices were little changed.

In wider markets, spot Brent crude oil prices were down by 0.33% at $76.70 per barrel. The yield on US 10-year treasuries has eased back from the 3% level and was recently quoted at 2.96%, while the German 10-year bund yield has firmed to 0.56%.

Equity markets in Asia were for the most part up on Monday: Nikkei (+0.51%), Hang Seng (+1.12%), CSI 300 (+0.92%) and the ASX 200 (+0.27%), but the Kospi was struggling with a 0.04% decline. This follows a mixed performance in western markets on Friday, where in the US the Dow Jones closed up by 0.37% at 24,831.17, and in Europe where the Euro Stoxx 50 closed down by 0.12% at 3,565.52.

The dollar index is weaker this morning at 92.39 – this is the third down day after a strong rally that peaked at 93.42 on May 9. Having travelled 4.7% in an all but straight line since April 17 – some consolidation is not surprising. With the dollar edging lower, most of the other major currencies are getting some lift: euro (1.1970), sterling (1.3567), and the Australian dollar (0.7552), but the yen remains flat at 109.32. The yuan has strengthened, it was recently quoted at 6.3364 and most of the emerging market (EM) currencies have halted their slide – the exception being the Brazilian real and the ringgit, which has reversed an early spike lower.

The economic agenda is light today with Japan’s producer price index (PPI) rising 2%, which was down slightly from 2.1% previously, and the country’s machine tool orders were up 22%, after a previous reading of 28.1%. Later, US Federal Open Market Committee member Loretta Mester is speaking.

The base metals are quite diverse: In recent weeks it was aluminium that was leading the pack, now it is lead, nickel and copper, while aluminium and tin have been consolidating after recent weakness and zinc has been moving sideways. The easier dollar should provide some support for base metals’ prices, but the fact each metal is moving to its own tune, suggests underlying sentiment is neither bullish, nor bearish. We have said in recent weeks that if metals prices do not sell off given the raised geopolitical tensions, then it will be a sign that demand is not weak, but we still fell that in the current climate consumers may feel little need to chase prices higher.

Gold prices have once again found support above $1,300 per oz and prices are trading either side of $1,320 per oz. The pull-back in the dollar is no doubt helping support prices and the underlying geopolitical tensions are likely to providing support too. Silver has rebounded strongly, as have platinum and palladium. While prices may have found underlying support, there does not seem to be too much bullishness around. As such, we expect more rangebound trading.

The post METALS MORNING VIEW 14/05: Metals start the week on firmer footing appeared first on FastMarkets.

Categories: Metals Industry News

EUROPEAN MORNING BRIEF 14/05: Most SHFE base metals prices up; LME Asia Week gets underway; US Midwest Ali premium strong

Base Metals Market - Mon, 05/14/2018 - 05:45
Good morning from Metal Bulletin’s offices in Asia as we bring you the latest news and pricing stories on Monday May 14.
Categories: Metals Industry News

LIVE FUTURES REPORT 14/05: Easing trade tensions, weaker dollar support most SHFE base metals prices

Base Metals Market - Mon, 05/14/2018 - 04:39
Base metals prices on the Shanghai Futures Exchange were broadly higher during Asian morning trading on Monday May 14, with the exception of aluminium and zinc, amid easing trade tensions between the United States and China, and a weaker dollar.
Categories: Metals Industry News

LIVE FUTURES REPORT 14/05: Easing trade tensions, weaker dollar support most SHFE base metals prices

Base Metals News - Mon, 05/14/2018 - 03:39

Base metals prices on the Shanghai Futures Exchange were broadly higher during Asian morning trading on Monday May 14, with the exception of aluminium and zinc, amid easing trade tensions between the United States and China, and a weaker dollar.

Leading the pack was lead, with the most-traded July contract on the SHFE traded at 19,105 yuan ($3,015) per tonne as at 11.10am Shanghai time, climbing 310 yuan per tonne from last Friday’s close. Around 25,000 lots of the contract have changed hands so far this morning.

“Domestic lead stocks remain tight, and with the peak operating period of battery factories in June, supply could tighten further,” China’s Ruida Futures said late last Friday. The broker suggested clients consider buying in at around 19,100 yuan per tonne.

On the trade front, US President Donald Trump tweeted on Sunday that he was working with Chinese President Xi Jinping to help Chinese telecom company ZTE Corp, which had suspended its main operations earlier this month, “get back into business fast”. The US had imposed a ban on American companies supplying ZTE after the Chinese firm was found to have violated US export restrictions by illegally shipping US goods to Iran.

Trump’s remark was seen as a thawing in trade relations between the two countries, ahead of a second round of discussion between the two countries’ top officials over trade disputes in the US capital of Washington DC this week.

The dollar index has eased after hitting as high as 93.42 on May 9, the highest since December 25, 2017. It was at 92.42 as at 11.03am Shanghai time, down 0.15% from its previous closing price.

Base metals prices

  • The SHFE July copper contract price increased 90 yuan per tonne to 51,530 yuan per tonne.
  • The SHFE July aluminium contract price fell 20 yuan per tonne to 14,650 yuan per tonne.
  • The SHFE July zinc contract price dipped 120 yuan per tonne to 23,575 yuan per tonne.
  • The SHFE Sept tin contract price increased 170 yuan per tonne to 145,760 yuan per tonne.
  • The SHFE July nickel contract price gained 1,500 yuan per tonne to 105,420 yuan per tonne.

Currency moves and data releases

  • The dollar index has eased after hitting as high as 93.42 on May 9, the highest since December 25, 2017. It was at 92.42 at 11.03am Shanghai time, down 0.15% from its previous closing price.
  • In other commodities, the Brent crude oil spot price fell 0.29% to $76.73 per barrel as at 11.04 am Shanghai.
  • In equities, the Shanghai Composite rose 0.55% to 3,180.59 as at 11.04 am Shanghai time.
  • In data on Friday, China’s M2 money supply rose 8.3% in April, which was close to expectations, while April new loans in the country bested forecasts at 1.18 trillion yuan. In US data, preliminary University of Michigan (UoM) consumer sentiment for May was close to forecast at 98.8, while preliminary UoM inflation expectations came in at 2.9% during the same month.
  • It is a quiet day for economic data today but a slew of Chinese data including fixed asset investment and industrial production is due on Tuesday.

 

SHFE snapshot at 11.10 am Shanghai time Most-traded SHFE contracts   Price (yuan per tonne) Change since previous session’s close (yuan) Copper (Jul) 51,530 90 Aluminium (Jul) 14,650 -20 Zinc (Jul) 23,575 -120 Lead (Jul) 19,105 310 Tin  (Sep) 145,760 170 Nickel  (Jul) 105,420 1,500

 

LME snapshot at 04:11am London time Latest three-month LME Prices   Price ($ per tonne) Change since previous session’s close ($) Copper 6,929 -13 Aluminium 2,283.50 -4.5 Lead 2,379.50 34.5 Zinc 3,079.50 -4.5 Tin 21,000 25 Nickel 14,090 35

 

Changjiang spot snapshot on May 14   Range (yuan per tonne) Change (yuan) Copper  51,180-51,220 60 Aluminium 14,460-14,500 -120 Zinc 23,680-23,730 -140 Lead 19,600-19,800 500 Tin  144,000-145,500 0 Nickel  105,150-105,450 700

The post LIVE FUTURES REPORT 14/05: Easing trade tensions, weaker dollar support most SHFE base metals prices appeared first on FastMarkets.

Categories: Metals Industry News

LME ASIA WEEK 2018: TMT Metals hires senior officials, plans to grow base metals footprint

Base Metals Market - Mon, 05/14/2018 - 03:35
TMT Metals Holdings Ltd (TMT Metals) aims to grow its trading book to $4-5 billion within the next three years by expanding into markets like zinc, copper, nickel and concentrates and has recently made three new hires as part of this diversification plan, a company official told Metal Bulletin during LME Asia Week.
Categories: Metals Industry News

NON-FERROUS WEEK IN BRIEF: LME ali stocks drop; Largo reports record net income; Gecamines’ case delayed

Base Metals Market - Fri, 05/11/2018 - 21:59
Metal Bulletin rounds up some of the key news and price moves across the global metal markets this week.
Categories: Metals Industry News

LIVE FUTURES REPORT 11/05: LME base metals find strength at end of week; aluminium price down 2.2%

Base Metals Market - Fri, 05/11/2018 - 18:09
Base metals on the London Metal Exchange ended the week predominantly higher at the close of trading on Friday May 11, although aluminium fell 2% and edged below its $2,300 per tonne support level.
Categories: Metals Industry News

BATTERY RAW MATERIALS MARKET REPORT 11/05: Cobalt sulfate discount widens while nervous buyers step back

Base Metals Market - Fri, 05/11/2018 - 17:48
An overview of the battery raw materials markets and their price moves from the past week.
Categories: Metals Industry News

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