Citigroup Inc. joined Goldman Sachs Inc. believing in better second quarter of 2017

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“It’s time to have faith in raw materials, and oil will probably recover to the mid-$60s by the end of the year.” Citigroup Inc. who joined Goldman Sachs Group Inc. said.

Even if U.S. shale output may come “booming back” midst of higher crude prices, production control by OPEC and its leaguers should help neutralize that increase over the next six to nine months.

The producers need to widen their deal to cut supplies by the end of the year.

Goldman Sachs has also made similar comments, saying extensive inventories that have undermined the output cuts are set to shrink and calling for more patience from the market.

 

Bank sees commodity investment flows rising in second quarter

 

“With a continuation of the OPEC and non-OPEC producer deal in the second half of 2017 and the expected combined inventory draw-down, we expect oil prices to move above $60 a barrel by the second half of the year.” (Market analysts wrote.)

Still, bigger supplies from producers in the fourth quarter of 2016 at this moment seem “a dark cloud hanging over the market.” And also a failure to extend the output agreement which would send prices “precipitously lower.”

 

The bank expects U.S. West Texas Intermediate oil to average $62 a barrel. Global benchmark Brent crude is expected to average $65 a barrel in the fourth quarter. WTI was trading 30 cents lower at $52.35 a barrel on the New York Mercantile Exchange at 10:34 a.m. London time on Tuesday. Brent on the ICE Futures Europe exchange was down 35 cents at $55.01 a barrel. (Bloomberg)

The production-cut agreement urged a change in market structure. That change meant traders had less incentive to store oil at sea prompting the flow of supplies floating on ships to onshore sites. That set the stage for boosting U.S. inventories to a record in the first quarter of 2017.

This gain and agitated output by the OPEC in the fourth quarter had an effect that would “ultimately hinder and reverse the very rebalancing they were trying to accelerate,” the analysts said. The bank expects U.S. liquids output to grow y-o-y at 1 million barrels per day or more by December.

U.S. Crude Oil Inventory, Source: Bloomberg

Factors that lead to Declines across commodities

The drop in oil prices during March led declines across commodities, according to Citigroup. It estimates commodity assets under management grew about $45 billion in the first two months of the year but gave up $35 billion during the selloff in raw materials in March. Investment inflows should increase in the second quarter.” (The Citi bank predicted.)

“Do commodities need a bit of a prayer to bounce again in ‘17? Not necessary. Commodities stumbled through the first quarter following what was clearly the healthiest year for the sector since the decade began. There was too much froth in critical sub sectors like oil, copper and iron ore. In conclusion, signs of better performance are increasingly clear, despite major risks.”

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Base metals subdued; Aluminium went slightly up

 

Essentially lower levels

Base metals prices started a holiday-shortened week mostly on the defensive. With LME premarket trading on Tuesday April 18 seeing lower levels. – Potentially supportive macroeconomic developments were shrugged off.

The exception was aluminium. It pushed higher on weekend news that planned Chinese capacity extensions were being put on ice.

On the other hand, copper and zinc were wafting. Near last week’s three-month lows, nickel touched its softest for two-and-a-half months. Lead hit its weakest for two months.

“Sentiment was a bit sloppy last week, and that has carried over today it seems. There is a run of short weeks now so business looks like being a bit patchy at times.”

Consequently, there was a muted reaction to Monday’s upbeat Chinese data! First quarter GDP grew 6.9% year-on-year, marking the fastest growth rate in 18 months. And most noteworthy beating forecasts of 6.8%

 

Metals session except Al

 

The rest of the session may see the lackluster trend being maintained ahead of a string of metals.

“The base metals have been showing weakness in recent weeks and have so far not seen any pick-up even amid the shift into the seasonally strong second quarter. The lack of upside momentum in most of the metals since mid-February has increased the chance of stale long liquidation,” William Adams of Metal Bulletin said.

 

 

Aluminium

Aluminium goes it alone; China supply clenching?

The three-month aluminium price forged higher, recently trading at $1,928 per tonne, up $18 from the Thursday close. The local government in Xinjiang, western China, halted three new aluminium projects with combined capacity of 2 million tons per year for violating rules aimed at curbing output.

 

 

Other near multi-month lows

 

The three-month copper price slid to $5,663 per tonne, a $29 decline, and looks vulnerable to a test of last week’s $5,615 low. While three-month zinc price was at $2,593 per tonne, a $31 loss, with a test of $2,558 – last week’s low-point – possible. Also, three-month lead price skidded as low as $2,200 per tonne, a $39 loss, while nickel fell to $9,560, down $190. Most noteworthy, three-month tin price stood at $19,795 per tonne, however, a $190 advance.

 

Currency moves and data releases

 

The dollar index was recently down 0.29 at 100.29.

Brent crude oil fell $0.61 to $55.00 per barrel.

In equities, the UK FTSE 100 index fell nearly 70 points to around 7,258.

In data today, US building permits, housing starts, the capacity utilisation rate and industrial production are due.

 

Crude Oil Update

Venezuela’s crude-stained oil tankers banned at sea (*check the link below)

http://www.reuters.com/article/us-venezuela-oil-tankers-insight-idUSKBN17K0CE

  • June West Texas Intermediate crude oil futures are trading lower shortly before the regular session opening as investors react to a bearish government report.

Government data released on Monday showed that May output is expected to rise by 123,000 barrels per day to 5.19 million bpd.

If this information is right, May production will post its biggest monthly increase since February 2015 and the highest monthly production level since November 2015.

Overcoming the angle at $53.08 will indicate the return of buyers. This could create a labored rally into angles at $53.39, $53.77 and $53.95. Other is the last potential resistance angle before the $54.14 main top.

OPEC commented on its plans about extending to cut productio . But it may not be strong enough to turn this market around.

 

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COPPER Export Volumes and Prices After Break

Brazil copper ore export volumes

 

Brazil’s ore export volumes fell 4.7% year-on-year in March. Exports totalled 95,829 tonnes. Down from 100,528 tonnes in March 2016. The main destination for the Brazilian copper ore was India. With an intake of 31,583 tonnes last month. About 70% of the shipments came from the northern state of Pará, where Vale has its copper operations.

In the first quarter of 2017, Brazilian copper ore shipments declined to 284,350 tonnes. Opposite of 320,518 tonnes in the same quarter of 2Co016.

 

Cathode

 

Brazilian cathode exports posted a significant year-on-year drop in March. As Paranapanema, the country’s only producer, shifted its focus back to the domestic market. Cathode exports reached 1,766 tonnes last month, down from 16,138 tonnes in March 2016.

In the first quarter of 2017, Brazilian cathode exports totaled 5,779 tonnes, down from 39,984 tonnes in the corresponding period of 2016.

 

 

 

Copper wire

 

Brazil exported 2,022 tonnes of copper wire in March, down from 3,515 tonnes a year earlier, according to MDIC.

http://www.mdic.gov.br/

However, shipments inched up to 7,072 tonnes in the first three months of 2017. Compared with 6,660 tonnes in the same months of 2016.

 

Chicago Mercantile Exchange copper volumes jump 8.2% y-o-y in March

Comex copper futures saw volumes grow 8.2% year-on-year in March. Its volatility coming from uncertainty over the US infrastructure plan and anticipated resolutions to supply disruptions in Chile and Indonesia. (CME group info)

Throughout the month, c. futures saw monthly average daily volumes (ADV) hit 79,265. Bringing the year-to-date ADV to 94,653 – up 10.8% compared with the same period a year ago.

It has been a chaotic year for the red metal, with strikes in South America and export issues in Indonesia tightening supply and flipping the market to a humble deficit. Since the beginning of the year, Comex c. open interest has set multiple records and hit an all-time volume high of 300,996 lots on February 13. The same day, the contract reached its 14th open-interest record this year.

Overall, CME average daily volumes reached 16.9 million contracts in March. (Up 18% year-on-year).

The CME’s copper product was launched 30 years ago, but it struggled to compete against the London Metal Exchange’s well-established contract and focused mainly on the North American market.

That changed in 2014, when the CME decided to push more aggressively into the copper market with a focus on Asia. In 2016, ADVs traded on CME Group’s Comex copper contract rose by 26.5%. By contrast, LME copper volumes fell 5.6% in 2016. While total copper trading volumes on the Shanghai Futures Exchange dropped by 18%.

 

Other metals

In other metals, gold grew at a rate of 7% in the first quarter, supported by a positive macroeconomic backdrop and doubts of US monetary hawkishness, the report said. Overall, precious metals futures ADV increased by 5% last month compared with March 2016.

Additionally, aluminium premium aggregate open interest reached an all-time high on March 1, at 66,384 contracts. The CME Group is the world’s largest derivatives marketplace, with trading facilities in New York and Chicago, where it is headquartered.

 

Shanghai FE copper dips as supply concerns wane; Al inches higher amid news of capacity cuts

Prices on the Shanghai Futures Exchange dipped slightly during

Asian morning trading on Tuesday April 18, as concerns over supply tightness continued to wane.

The SHFE June copp. contract was recently at 46,350 yuan ($6,734) per tonne as of 03:00 BST, 30 yuan or 0.06% lower than Monday’s close.

Kazakhstan’s refined copp. production in March rose 12.7% year-on-year to 36,000 tonnes and the production in the first quarter of this year rose 1.8% on a yearly basis to 102,000 tonnes, China’s Galaxy Futures said on Tuesday.

 

“Overall, worries of a supply shortage have gradually scattered.” (CGF)

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Financiers heap billions into US shale, fearless of oil bust

Cost reduction

 

The shale sector has become seriously attractive to investors. Not because of rising oil prices, but rather because producers have achieved startling cost reductions. Slashing up to half the cost of pumping a barrel. (In past 2 years). Investors also believe that oil sector is a good investment. They claim the glut will scatter as demand for oil constantly rises.

This fact gives financiers confidence that they can clench increasing returns from shale fields. Without any price gains, just as technology continues to cut costs.

Following, financiers who took a hit last year when dozens of shale producers filed for bankruptcy, are now making some big new bets on industry’s resurgence.

Private equity funds raised $19.8 billion for energy ventures in the first quartier. It is nearly three times the total in the same period last year. (Preqin)

Therefore the accelerating tempo of investments from private equity comes even as the recovery in oil prices. Much as with hedge funds and investment banks. Also CLc1 from an 8-year low has stalled at just over $50 per barrel amid a stubborn global supply glut.

 

 

Facts

 

Most noteworthy, data on investments by hedge funds and other nonpublic investment firms is deficient. Yet the rush of new private equity money shows broader enthusiasm in shale plays.

“Shale funders look at the economics today and see a lot of projects that work in the $40 to $55 range per barrel of oil.” (Howard Newman, head of private equity fund Pine Brook Road Partners.) He himself last month committed to invest $300 million in startup Admiral Permian Resources LLC to drill in West Texas. (Reuters)

“Demand for oil has been more robust than anyone imagined three years ago.” (According to Mark Papa, chief executive of Centennial Resource Development). Papa referred to the beginning of an international oil price crash in 2014, and reminded it took many firms to the edge of bankruptcy.

 

Private Capital

 

Centennial is a Permian oil producer backed by private equity fund Riverstone. Mark Papa built EOG Resources Inc (EOG.N) into one of the most profitable U.S. shale producers. This year Riverstone copied the Centennial model, putting experienced managers atop a startup charged with acquiring operations or assets. The equity fund hired Jim Hackett to run the newly created Silver Run Acquisition Corp II (SRUNU.O). (Reuters)

Private equity fund NGP Natural Resources XI LP invested $524 million last fall in Luxe Energy LLC, a shale producer formed in 2015 by former Statoil (STL.OL) executives.

Another NGP’s investment was effectively a bet that Luxe could repeat its success of early 2016.

Then, NGP contributed about $250 million to Luxe, which used the money to acquire land in the Permian – and sold it seven months later for a double-digit profit.

In conclusion, this year’s drilling rush could be tested if global supplies grow too fast or if demand cools. Finally, the U.S. drilling rig count is rising at its fastest pace in six years and U.S. crude stockpile are close to 533 million barrels – near an all-time high and enough to supply the United States for 25 days.

“There is a ton of private capital to invest in the U.S. oil industry,” said Gerrit Nicholas, co-founder of private equity fund Orion Energy Partners.

 

 

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China’s strongest economic growth since 2015 – Steel output climbs to highest on record

 

Steel Output Growth in March

 

Growth of 6.9 percent was the fastest in six quarters! Forecasts beating March investment, retail sales and exports all suggesting the economy may carry solid momentum into spring.

China’s economy rose faster than expected. In the first quarter as higher government infrastructure spending. Also a gravity-defying property boom helped boost industrial output. To the biggest in over two years. Industrial percentage growth is a serious number, showing that China’s economy is based on real astonishing momentum.

China’s steel output rose to a monthly record of 72 million tonnes in March. 1.8 % up! March’s monthly total easily beat the previous record of 70.65 million tons hit in March 2016! In the first quarter, steel production totaled 201.1 million tons, up 4.6 percent from the same period a year earlier.

The growing production as Chinese scrounges bid to profit from prices that soared in 2016 and into this year are undermining the government’s years-long push to cut capacity to make the steel industry more efficient.

 

The Chinese Government

“The Chinese government has a tendency to rely on infrastructure development. In order to sustain growth in the long term. The question we need to ask is whether this investment-led model is sustainable? As the authorities have trouble taming credit. We need to watch closely whether China’s top leadership will send a stronger signal to tighten monetary policy shortly.” (ANZ info)

 

China’s total social financing, a extensive measure of credit and liquidity in the economy, reached a record 6.93 trillion yuan ($1 trillion) in the first quarter! Approximately equivalent to the size of Mexico’s economy.

At the same time, spending by the central and local governments rose 21 percent from a year earlier.

“Faster growth in industrial output is the primary factor in the first quarter surprise, and due mostly to higher value-added growth related to supply-side consolidation in heavy industry.” (Brian Jackson, IHS Global Insight)

 

Real Estate and new construction tempo

 

Following, Real estate investment also remained robust in the first quarter. Expanding by 9.1 percent on-year. Also the tempo of new construction quickened despite amplifying government measures to cool soaring prices.

Most analysts agree the heated property market poses the single biggest risk to China’s economic growth. But predict the cumulative weight of property curbs will eventually temper activity, not produce an outright crash.

“Sales have started falling, which means tightening measures are starting to take effect,” said Shen Ji anguang, an analyst at Mizuho Securities in Hong Kong, noting that will start to drag on both the services and construction sectors.(Reuters)

More than two dozen cities announced new or additional property cooling measures in March and early April, after curbs late last year appeared to have little lasting effect.

Buoyed by a near 12 percent increase in housing starts, China produced a record amount of steel in March! Though, analysts say warning signs are flashing and they should be concerned.

 

Rising inventory levels and recent falls in steel prices suggest output has been growing faster than China’s actual demand, raising worries of a glut later in the year, which could heighten trade tensions with the U.S. and its other major trading partners.

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North Korean missile test failed. Oil falls after

14 Apr 2017 LME/COMEX/NYMEX Closed for Good Friday LME/COMEX/NYMEX
17 Apr 2017 LME Closed for Easter Monday LME

 

Friday, as well as Monday are holidays for LME. Friday was holiday for all the stock exchanges, while LME is not open yet. Tomorrow is the first Post-holiday working day.

Post Easter Holiday News

 

Monday. After the three-day Easter break, crude oil felt in trading. The United States is continuing to add output. As well as that, they are undermining OPEC effort to support prices. Also, as the market digested North Korea’s failed missile launch on Sunday.

In the beginning, benchmark “Brent crude futures were down 49 cents at $55.40 at 0310 GMT. On Thursday, before the break closed most major markets, they settled up 3 cents at $55.89 a barrel.”

Reuters: “West Texas Intermediate crude futures were also down 47 cents at $52.71 a barrel. They rose 7 cents to $53.18 on Thursday. Both benchmarks last week rose for a third consecutive week. With Brent adding 1.2 percent over the four days before the Good Friday holiday and WTI up 1.8 percent.”

 

Markets

 

Markets were subdued to start this trading week. The major trading center in London is closed for holiday even on Monday (today). Following, markets feel pressure and more geopolitical tensions over North Korea. Sunday they launched a ballistic missile, which has failed because it blew up immediately.

“The United States is working with allies and China on responses to the failed test! ” (D.T.’s security adviser said on Sunday.)

As a sign that output gains, crammers in the U.S. added rigs last week for a 13th consecutive week.

 

“They added 11 oil rigs in the week to April 13, bringing the total count up to 683.” (Baker Hughes, Energy services firm said.) That is the highest in about two years. <RIG/U>

 

US act

 

United States is constantly irritating OPEC with its increasing outputs. In the meantime, they are also irritating other major oil producers who made a deal to cut outputs. Curbing output sustains a rally in prices in a market that has been oversupplied since 2014.

“U.S. crude oil production has climbed to 9.24 million barrels per day. (EIA data). That makes the U.S. the world’s third-largest producer after Russia and Saudi Arabia.”

“Non-OPEC compliance will improve over the next two months with Russia driving the largest reductions in volume terms.”( BMI info)

“Kazakhstan is likely to continue to exceed its quota given strong output from the Kashagan field.”

 

 

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Wall Street losses after US drops mega-bomb on Afganistan

 

Global

Geopolitical risks remain front and center, following the bombing of Afghanistan.

Most noteworthy, markets in Japan, South Korea and China closed lower on Friday. As geopolitical tensions in the region heightened, while other major bourses in Asia remained closed for a public holiday.

In Japan, the benchmark Nikkei 225 closed down 91.21 points, or 0.49 percent, at 18,335.63, while the Topix slid 9.24 points, or 0.63 percent, to 1,459.07. Across the Korean Strait, the Kospi closed down 13.73 points, or 0.64 percent, at 2,134.88. Chinese mainland markets were also down — the Shanghai composite finished down 31.47 points, or 0.96 percent, at 3,244.48 and the Shenzhen composite fell 28.01 points, or 1.39 percent, to 1,986.64. Taiwan’s Taiex fell 103.75 points, or 1.05 percent, to 9,732.93. (CNBC info)

Asias sessions

The Asia’s sessions followed a lower finish on Wall Street. It happened after US has dropped its biggest non-nuclear bomb on Afganistan. There are many consequences of this move, especially on the stock-exchange markets.

This is the first time the GBU-43 bomb, known as the “mother of all bombs,” has ever been used in combatThe bomb contains 11 tons of explosives and is also known as the Massive Ordnance Air Blast bomb.

In the meantime, the geopolitical tensions are just taking an upwards trend. US and North Korea are problematic. After official for the reclusive regime on Friday blamed President Donald Trump for escalating tensions on the Korean Peninsula.

Vice Minister Han Song Ryol warnes the U.S. against provoking North Korea military with words: “We will go to war if they choose.”

Dollar Index

The dollar index, which measures the U.S. dollar against a basket of currencies, traded at 100.59 at 2:17 p.m. HK/SIN, climbing from levels near 100.01 in previous sessions.

 

“The U.S. dollar took its cue from yields, weaving in and out of negative territory.” (Kathy Lein, managing director of foreign exchange strategy at BK Asset Management. )

 

 

Yen Indexes

Among other currency majors, the yen strengthened to 108.92 against the greenback Friday afternoon local time, after weakening to an earlier high of 109.22. The Japanese currency remained stronger than levels above 110.7 reached against the dollar earlier in the week.

 

Australian Dollar

Following, the Australian dollar fetched $0.7562 and the euro traded at $1.0613.

 

Oil summary

Oil prices finished modestly in the Thursday session even as U.S. oil rig count rose to its highest level in two years and threatened the re-balancing of markets, according to Reuters. Energy services firm Baker Hughes said drillers added 11 oil rigs in the week to April 13, bringing the total count up to 683.

Global benchmark Brent settled up 3 cents at $55.89 a barrel in the previous session, while U.S. crude was up 7 cents at $53.18.

 

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Guinea Iron Project & BSGR Accusations

Lawsuit

Mining company BSG Resources yesterday filled a lawsuit in federal court in NY .

Beginning accusing a billionaire George Soros for this projects losses. While accusing him as a financier of this project, they said he was scuttling an iron ore deal in Guinea. They were claiming the damage was worth 10 billion dollars !
Secondly, Businessman Beny Steinmetz is BSGR’s leader in a way that he controls the company.

  • Steinmetzz accused Soros and his controlled entities of manipulating the government of Guinea.

 

In addition to, stating he also manipulated elected officials and other misconduct. All with a goal to strip BSGR of mining contracts in Guinea in 2014.
“Israeli authorities put Steinmetz under house arrest on Dec. 19 after accusations that he paid tens of millions of dollars to senior public officials in Guinea to advance his businesses. He was released in January without being charged.”

 

https://www.bloomberg.com/news/articles/2017-04-14/george-soros-sued-by-fellow-billionaire-in-10-billion-mine-row

George Soros

Speaking about the “deals” of George Soros. George Soros is a Hungarian-American investor, business magnate, and philanthropist. Relying to that, Soros is considered by some to be one of the most successful investors in the world.

As of February 2017, Soros has a net worth of $25.2 billion making him one of the 30 richest people in the world.

He escaped Nazi Germany-occupied Hungary and emigrated to England in 1947. He attended the London School of Economics graduating with a bachelor’s. Following eventually a master’s in philosophy. Therefore, he began his business career by taking various jobs at merchant banks before starting his first hedge fund, Double Eagle, in 1969.

Due to this specific BSGR case, Soros was doing some “anti branding” campaign for the company. He fabricated defamatory statements about BSGR’s involvement in corruption. And he claimed that someone should check the real BSGR’s financial reports. Probabily after they check the BSGR’s way of doing business.
“Soros was motivated solely by malice, as there was no economic interest he had in Guinea,” BSGR added.
BSGR thinks Soros was motivated by vileness, but there is one question. Why would a billionaire want to loose his precious time on sabotaging someone else’s businesses? It is only possible if he has some “profits” to gain out of that.
In conclusion, Michael Vachon, a spokesman for Soros, did not respond to requests for comment, made outside of regular business hours.

Finally, the case is 1:17-cv-02726 in U.S. District Court in the Southern District of New York. (Paragraf Info inspired by Reuters)

 

 

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COPPER forecasts in 2017

Cochilco, Chile’s copper commission, has raised its forecast for the price of the copper in 2017. Wanting to reflect the impact of global supply breaks. The commission anticipates copper price to average $2.60 per lb this year. Which is up from its previous estimate of $2.40 per lb.

 

A worker monitors a process inside the plant at the copper refinery of Codelco Ventanas in Ventanas city, northwest of Santiago, Chile

Meanwhile, according to Cochilco’s vp, Sergio Hernández, the move reflects the decline in global production. Mostly due to issues at Grasberg, Cerro Verde and Escondida mines. Amid such disruptions, Cochilco reduced its forecast for global copper production increase to 0.7% in 2017.

In the same time, Chile’s production should come in slightly below the 5.6 million tonnes of copper, which would represent a 0.8% year-on-year growth from 2016.

Earlier in January, the commission expected the global output to grow 2.9% this year.

Cochilco also said that it expects the copper price to remain at the average of $2.60 per lb in 2018.

“We believe that the construction market and the infrastructure and power projects in China will be reactivated until the third quarter of this year [2017].” Said Hernández, which should sustain the country’s demand for copper.

Cesco Copper week

There was a defnite improvement in sentiment at this year’s Cesco copper week in Chile. With more market participants seeing upside price potential amid tightening supply but many still erred on the side of caution.

Cesco Week 2017, the picture is bright if not overly bullish. The three-month price was above $5,900 per tonne last week. It was driven by a host of supply disruptions in Indonesia, Chile and Peru, which have removed some 200,000 tonnes of anticipated production from the market this year. The price has since eased back to $5,780 per tonne. It happened mainly due to rising inventories and the resolution of the strikes at Escondida and Cerro Verde and the temporary export agreement for Freeport’s Indonesian subsidiary. The next World Copper Conference will be in Santiago, Chile. It will happen 9-11 April 2018.

Shanghai Future Exchange copper inventories drop 14%

Deliverable copper stocks at Shanghai Futures Exchange-approved warehouses declined by 43,543 tonnes. In percentage: 13.8% – to 271,267 tonnes as of Friday April 14 from a week earlier.

This week, R&S Logistics MHC in Shanghai saw the biggest decrease in stocks. Exactly 26,073 tonnes of the red metal exited its sheds.

Market stockpiles dropped due to active spot trading this week. With spot premiums staying in positive territory.

Copper in the physical market was traded with a premium of 25-40 yuan per tonne. As a result of which producers intend to achieve sales in the spot market rather than deliver to SHFE sheds.The Shanghai-London arbitrage window was closed today. The SHFE copper price dropped since the start of this week, although with a brief pause on Thursday, influenced by the LME complex amid concerns over geopolitical tensions.

“The decline of SHFE copper inventory indicated that consumers are dip-buying,” noted Guotai Junan. China imported 430,000 tonnes of unwrought copper and copper-fabricated products in March, 25% lower compared with 570,000 tonnes in March 2016. Info according to preliminary Chinese customs data released on April 13.

 

Zinc and nickel stocks down

 

  • Shangai Futures Exchange zinc stocks declined 16,846 tonnes to 165,398 tonnes. Furthermore, SHFE nickel stocks was slightly down 146 tonnes to 84,043 tonnes.

 

All other base metals stocks increase

  • In conclusion, Aluminium stocks climbed 5,981 tonnes over the past week to 345,942 tonnes. Lead stocks in SHFE was up 212 tonnes to 72,662 tonnes. As a result, tin stocks rose from 100 tonnes to 2,119 tonnes.
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Imports from Argentina and Indonesia hurting U.S. biodiesel producers ?

A research

 

Firstly, some very interesting news are happening. Following, U.S. said it would start an investigation into its import of biodiesel. As mentioned, this biodiesel is coming from Argentina & Indonesia. It is possible that there are some signs of dumping and subsidization in the importing process.

In addition, the United States International Trade Comision is doing a research on this subject. It is scheduled to make a preliminary decision on May the 8th. The decision will be about whether such imports from Argentina and Indosnesia hurt U.S. economy and its diesel producers.

U.S. biodiesel producers asked their government last month to impose anti-dumping duties on imports of biodiesel. They said it has flooded the U.S. market. While it also violated the trade agreements. As that is happening, there are few more days left ahead Mike Pence’s visit to Indonesia. Mike Pence, U.S. Vice President is visiting Indonesia to check some real issues about anti-dumping prices of biodiesel.

Indonesian government stating the opposite

 

-“The Indonesian government, especially the trade ministry, will be cooperative in the investigation by providing arguments and supportive data. We can also give the documents which show that there was actually no dumping or subsidies.” (Indonesia’s director for international trade, Oke Nurwan.)

Following, the biodiesel group from Indonesia is saying that it had asked its government to bring up the issue. To bring it during Pence’s visit to Jakarta next week. Previously, Argentina’s biodiesel association called CARBIO rebuffed dumping accusations.

Indonesia is a world’s top producer of PALM OIL. As a very competitive resource it can be used to ruffle the biodiesel. Indonesia relies heavily on exports. Yet their economy highly depends on palm oil. Being able to export tons of palm oil to the world’s market, Indonesia puts itself to a very high place in trading with this resource.

Charts show amount of CPO to be used in biodiesel production in Indonesia. Those are the forecasts based on Indonesias Estate Corp Fund for Palm oil. Information From 2016, predictions are till the year 2020.

 

U.S. Imports

 

 

Charts: Showing 2016 & 2017 statistic data. U.S. production and import. (Millions of gallons, in January & February)

Total U.S. imports rose to 3.5 billion liters (916 million gallons). It was a record in 2016 according to the U.S. government data published in March. Argentina represents about two-thirds of United States foreign imports. It is followed by Indonesia and Canada.

In the meantime, Indonesia is facing a pressure in Europe too. It is happening because of its government filling a WTO complains against European Union’s anti-dumping duties on Indonesian biodiesel.

Finally, the European parliament voted last week to call on the EU to easily phase out the use of Palm Oil in biodiesel by 2020. Indonesia, along with Malaysia is planning to send a joint mission to Europe next month. They want to prevent the adoption of this resolution.

 

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