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Base Metal Markets – August the 23rd

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Wednesday, the 23rd of august – Top 5 things to be aware of:

  1. Trump’s policy focusing on different fronts
  2. Worldwide manufacturing data shows resilience; U.S. in focus
  3. Mario Draghi avoids policy indication ahead of Jackson Hole
  4. Risk interested wavers standing in front of Central Bankers
  5. Oil prices trading lower

 

Volatility of Metals

Metal prices are following some very inspiring movement these days. The early morning trade on LME today went this way:  

We are speaking about morning trade:

This comes after yesterday’s split performance.

When lead led the gains with a 3.2% rally, nickel prices closed up 1% and copper closed up 0.2%. The rest were led lower by a 0.8% decline in tin prices. (Fast Markets data in numbers)

Speaking about precious metals, the prices are up across the board this morning by an average of 0.3%. Inspired by a 0.4% rise in silver prices, spot gold prices are up 0.2% at $1,285.86 per oz. This follows a down day on Tuesday when the complex closed off 0.6% on average, led by a 1% fall in palladium prices. (FM)

 

SHFE today 

Observing the morning trade on the SHFE, the base metals complex is for the most part weaker with prices off an average of 0.4%. Led by a 1.7% drop in tin prices, aluminium and zinc prices are off 1.1% and copper prices are off by 0.1%. 

 

Pointing at 51,570 yuan ($7,739) per tonne. 

Bucking the trend are lead and nickel prices, up by 1.5% and 0.1%, respectively.

Other metals in China are showing some down movement. SHFE rebar prices are down 4.9% and iron ore prices on the Dalian Commodity exchange are down 3.7% at 580 yuan per tonne on the January 2018 contract. The gold and silver prices on SHFE are both down 0.4%.

 

International Markets

In international markets, spot Brent crude oil prices are up by 0.2% at $51.71 per barrel. The income on US ten-year treasuries is firmer at 2.21%, and the German ten-year bund yield is at 0.40%

 

Indexes 

In the end, observing the Indexes and their market movement:

Firstly, the Hang Seng Index is up (+0.9%), the Nikkei (+0.2%), the CSI 300 (0.1%). All of these are higher, while the ASX 200 is off 0.3% and the Kospi is off 0.1%. In the USA, the Dow Jones closed up 0.9% at 21,799.89 and in Europe, the Euro Stoxx 50 closed up 0.94% at 3,455.59.

(Exact Numbers in the Article coming from the Fast Markets.)

 

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SHFE & Market today (May 22nd)

As a weaker dollar pushed investor appetite for commodities,  base metals prices on the SHFE went up during Asia morning trading today.


Firstly, the most-traded July copper contract on the Shanghai Futures Exchange rose 580 yuan ($84.30) or 1.3% to 45,880 yuan per tonne as of 03:30 BST. Secondly, over 250,000 lots of the contract have changed hands so far.

In the meantime, the three-month copper contract on the LME rose $29 to $5,676.50 per tonne.

“Commodity markets rallied across the board as the political turmoil in the USA reignited, sparking a weaker US dollar, which helped increase investor appetite in commodities.” (ANZ Research)

The dollar index fell as low as 97.08 last Friday. Which makes it the lowest since November 2016. The political uncertainties in the USA are questioning the US president Donald Trump’s planned infrastructure spending and tax cut plans.

Crude oil prices are also rising supported by the news that members of the Organisation of the Petroleum Exporting Countries will extend their supply cut into next year while also deepening the cuts.

 

Copper stocks in SHFE 

Observing the  deliverable copper stocks at Shanghai Futures Exchange: Approved warehouses rose 1,365 tonnes or 0.7% over last week to 196,358 tonnes as of Friday May 19. Meanwhile the SHFE-LME copper arbitrage remains at a loss – it was at close to $90 per tonne on Friday. Later, on Friday, total copper stocks at LME warehouses fell 3,700 tonnes, to 336,650 tonnes.

Other base metals higher 

When speaking about the SHFE contract, July aluminium contract rose 45 yuan or 0.3% to 14,075 yuan per tonne. Following, the SHFE July zinc price went up 905 yuan or 4.2% to 22,335 yuan per tonne.  Also, the SHFE June lead price climbed 400 yuan or 2.6% to 15,785 yuan per tonne. 

Paying attention to nickel prices, the SHFE September nickel contract gained 2,290 yuan to 78,310 yuan per tonne. Finishing with  the SHFE September tin price which moved up 3,140 yuan. In percentage that is 4.1%, to 147,190 yuan per tonne.

Currencies & data

The Brent crude oil spot price rose 0.6% to $54.11 per barrel as of 03:21 BST on Monday.
Currently, the dollar index rose 0.2% to 97.31 as of 03:20 BST. Observing the Shanghai Composite index, it stood at 3,100.59 recently. Which makes it about 0.32% up.

As of today’s data, those are mainly the European events in slight focus. First of all Europe’s Buba monthly report and then China’s CB leading index due later today. The Euro group meeting will also take place in Brussels later today.
The UK prime minister Theresa May is speaking.

The beginning of the weekly trading seems to have picked up a positive expectations and the upward trends. As for the base metals, for Oil also. Speaking about Important Economic Events today, it is pretty calm day. Nothing bombastic is not currently happening. Later during the day FOMC Members are speaking. Also the RBA Assist Gov Debelle speaks. Some data about RUB Retail Sales are already out. It reached the actual level of -0.4%, while the expected was -1.2%.

Japan Trade Balance fell to actual 482B, while the forecast was 521B.

 

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SHFE Friday’s morning trade: Copper prices

Economic Events:

  • Canada Core Consumer Price Index (CPI) MoM at actual 0.3%
  • Canada Core Retail Sales MoM came to actual -0.1% while forecast was -0.3%

 

SHFE Today

Observing the copper prices this morning, they were pretty stronger on SHFE. Asia morning trading on Friday May 19 was following positive Chinese economic data and a bounce in crude oil prices.

In the meantime, the three-month copper contract on the LME reached levels of $5 higher to $5,588 per tonne.

It is the strong sales data from China’s air conditioning sector, who has supported red metal prices this morning.

The bounce in crude oil prices has also raised sense across the commodities market, as OPEC members continued to re-affirm their commitment to a rollover in their production cut agreement.

But looking the copper price in forthcoming future; the Slowdown in Chinese housing market and political shakes in USA will definitely rise the curb in prices.

USA political crisis & China home prices

Threats from political crisis in the USA are real. It is probably going to delay US president DonaldTrump’s proposed infrastructure spending and tax cut plans. Which affects the base metals markets.

China’s growth of home prices cooled again in April. Followed by a brief up rise in March, as tougher market restrictions introduced by local governments took effect.

According to data released by China’s National Bureau of Statistics, prices climbed in 58 of the 70 mainland cities tracked by the bureau, down from 62 in March. (Metal Bulletin)

“The net long position of non-commercial traders on both the LME and Comex have been falling over the past few weeks and are now at levels last seen before the Trump trade rally started.” (ANZ Research)

 

 

Copper output in China: April data

Firstly, latest NBS data shows that China produced 724,000 tonnes of refined copper in April, which makes it up 5.5% year-on-year. Year-to-April production rose 7% year-on-year to 2.86 million tonnes.


Secondly, losses in the SHFE-LME copper arbitrage remained at over $100 per tonne on Thursday. Thirdly, copper stocks at LME warehouses rose 750 tonnes to 340,350 tonnes on Thursday. While deliverable copper stocks at SHFE warehouses slipped 874 tonnes to 71,420 tonnes.

 

Other Base Metals

Observing the SHFE July aluminium contract, it climbed 0.79% or 110 yuan to 14,040 yuan per tonne. While the July zinc price rose 0.35% or 75 yuan per tonne to 21,405 yuan per tonne. Continuing with june lead price which dipped 0.51% or 80 yuan per tonne to 15,455 yuan per tonne. Later, the SHFE September nickel contract was 530 yuan or 0.7% higher at 76,040 yuan per tonne.
September tin price moved up 590 yuan or 0.41% to 144,550 yuan per tonne.


Currencies & data  

The Brent crude oil spot price rose $0.38 to $52.90 per barrel. The Texas light sweet crude oil spot price gained $0.39 to $49.77 per barrel.
Shanghai Composite index stood at 3,090.59 recently, up 0.01. The dollar index edged 0.04% lower to 97.81 as of 04:53 BST on Friday.

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Metals trade today: LME & International Economic Events

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LME Today:

Metals prices on the LME slightly declined during morning trade today. Prices were down for an average of 0.6%.

Recollecting the positive Monday, that had closing prices up for about 0.3%. Nickel had a fall of 1.7%, but the average gain would have been 0.6% led by a 1.2% rise in aluminium price.

Firstly, spot precious metals were up for about 0.4% this morning. Gold prices are up 0.2% at $1,233.50 per oz, the rest are all up 0.5%. This comes after a mixed day’s performance on Monday when palladium prices dropped 1.1%, silver and platinum prices were up around 1.1%, and gold prices were up just 0.2%.

Secondly, observing morning trade in SHFE, copper and aluminium prices were a bit up, with copper prices at 45,220 yuan ($6,555) per tonne.  Other base metals complex are down an average of 0.8%. Spot copper prices in Changjiang are up 0.1% at 45,120-45320 yuan per tonne, while the LME/Shanghai copper arb ratio is weaker again at 8.10.

International Markets & Main Economic Events

Thirdly, Brent crude oil prices are up 0.3% at $51.92 per barrel. The market oscillates on a likely OPEC deal extension. The yield on the US ten-year treasuries is little changed at around 2.33%.

Equities on Monday were firmer, the Euro Stoxx 50 closed up 0.1% and the Dow closed up 0.4% at 20,982. Asia has generally seen follow through buying interest this morning with the Nikkei and ASX 200 up 0.2%, the CSI 300 is up 0.1%, the Kospi is up marginally, while the Hang Seng is bucking the trend with a 0.3% decline.

If we have a closer look, the dollar index is showing weakness again.  It is now leveled at 98.75, having seen a recent high of 99.89. For now the 2017 trend is to the downside, with recent lows at 98.54.

Following, the euro is now stronger at 1.0994, it looks well placed to push higher. Also the Australian dollar at 0.7425, seems to push higher. While the sterling and the yen are flat. Sterling at 1.2912 and yen at 113.49.

Economic data

Japan’s tertiary industry activity slipped 0.2% after a 0.2% climb previously.

later there is data on French and UK CPI and a host of other UK price data and leading indicators, Italian and EU GDP, German and EU ZEW economic sentiment and data on the EU trade balance. US data includes: building permits, housing starts, industrial production, capacity utilization rate and mortgage delinquencies – see table below for more details.

Chinese infrastructure projects

President Xi Jinping’s oath of $78 billion worth of financing for infrastructure projects, indicates the One Belt One Road plan is continuing.  It should be long-term backup for metals’ demand. This affected positively almost all the metals on Monday. But if that will be further trend, we will see soon.

 

Other Base Metals

Nickel started to fall yesterday, while copper and aluminium were showing some weakness this morning. Zinc and lead prices are looking more fragile. Today’s lead prices setting a fresh low at $2,092 per tonne. Unless buying emerges soon, the path of least resistance looks set to remain to the downside.

 

Precious Metals

Most of the precious metals are more solid, their recent price weakness appears to have induced agreement hunting.

Except palladium, where resistance above $820 per oz. It seems to be acting as a cap and lack of upside progress is encouraging profit-taking.  Seems like silver and platinum have currently looked oversold.

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SHFE morning trade: Copper up due to Lower production in Chile

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Main Economic Events Today:

  • China Industrial Production y-o-y fell to actual 6.5%, while expected was 7.1%
  • United Kingdom Prime Minister Theresa May Speaks

This Week:

  • Empire State, Philly Fed Manufacturing for May
  • April China Industrial Production
  • Euro Zone Q1 GDP – Revised Reading
  • K. April CPI, Employment & Retail Sales
  • Japan Preliminary First Quarter GDP

 

Shanghai Futures Exchange

Firstly, copper prices on the SHFE recovered during morning trading on May 15. Due to the news that China had announced more funding for its One Belt One Road initiative. Copper price was as well impacted by reports of lower production in Chile.

The most-traded July copper contract on the SHFE rose 210 yuan per tonne to 45,240 yuan per tonne as of 10:59am Shanghai time.

Secondly, Chinese president Xi Jinping said One Belt One Road plan aims to connect China with Europe, Asia and Africa through various infrastructure projects.

 “The Belt and Road initiative, which was first proposed in 2013, offers the world’s second largest economy a chance to consolidate its political presence in the region. Additionally, the initiative provides China’s battered commodity intensive sectors, many of which are struggling to contain overcapacity, a lifeline to remain relevant for years to come.” (CBA Commodities)

“China has already committed $50 billion to date and that could grow exponentially in the next 5 years. The initiative, which could cost over $1 trillion, is clearly positive for commodity consumption. We note that construction will take place over decades. Realistically gather momentum in the 2020s and will inevitably face roadblocks from political interests of the 60 countries involved.”  (Metal Bulletin)

Thirdly, Cochico announced that copper production in Chile in 1H17 was down 14.6% year-on-year to 1.19 million tonnes, due to the strikes occurring during the period.

LME’s three-month copper contract was up $13 per tonne to $5,581 per tonne as of 03:55am London time.

SHFE, LME copper stocks fall 

Observing the open interest of the July copper contract, it was at around 219,134 position on Monday morning. Following, losses in the SHFE-LME arbitrage held at around $80 per tonne last week. Demand is keeping healthy levels due to the peak season. 
Also, deliverable copper stocks at SHFE-approved warehouses fell 20,238 tonnes or 9.4% week-on-week to 194,993 tonnes as of Friday May 12.
In the meantime, LME copper stocks fell by 7,350 tonnes to 329,375 tonnes on May 12.

Base metals broadly lower; Aluminium bit higher 

Fourthly, the SHFE July aluminium price rose 1.05% or 145 yuan to 13,975 yuan per tonne. Following, SHFE July zinc price dipped 0.09% or 25 yuan to 21,590 yuan per tonne.
Observing the July lead price, it slipped 1.05% or 170 to 15,965 yuan per tonne.
In conclusion, the SHFE September nickel price was 180 yuan or 0.23% lower at 76,830 yuan per tonne. And finishing with the SHFE September tin price who fell 1,240 yuan or 0.87% to 140,990 yuan per tonne. 


Currencies & data

 
The Brent crude oil spot price up 0.85 to $51.62 per barrel. Texas light sweet crude oil spot price also gained 0.79 to $48.59 per barrel.
Observing the Shanghai Composite, it was up 0.36% to 3.094.53. Most noteworthy, US Empire State Manufacturing Index and NAHB Housing Market Index will be released later today. The dollar index decreased 0.01% on Monday morning to 99.19.

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SHFE on May 11th; Copper up due to supply concerns; Better market movement

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Shanghai Futures Exchange continued with positive pushes, and copper price went up despite the short pull down at opening time.

Possible supply  restriction gives backup to prices. Also the news about China’s central bank. They will insert some amounts of capital into the open market. These news also renewed confidence and removed fear of the ”market ground”.
Firstly, price of the greatly active SHFE July copper contract rose 130 yuan ($18.82) to 44,920 yuan per tonne. Coming as of 03:17 BST with around 7,690 lots shifting hands. Open interest of the contract was at around 21,530 positions.

 

Over the last 6 days, today will be the first time that China’s central bank will inject a net 20 billion yuan. This amount of capital will go straight into the open market today.

“China’s central bank has resumed capital injections, relieving some recent monetary constraints and boosting financial liquidity. As a result, market sentiment has improved to some extent”  (Fast Markets)

Supply-side disruptions are the ones giving the backup to copper prices these days..

Copper prices increase

 

Secondly, LME copper stocks fell a net 3,625 tonnes to 339,200 tonnes on Wednesday. It is a third successive day of decline within LME-sheds. Thirdly, SHFE copper stocks also fell. While inventories were just down from 1,281 tonnes to 72,930 tonnes on Wednesday.


Copper project in Chile, which was put on hold in March, is cancelled. The company announced these news on Monday. Polish miner KGHM’s Sierra Gorda started this project in the first place.
Following, supply of copper scrap has tightened recently after growing in the first quarter. Meanwhile the breaks at major mines earlier in 2017 are hitting availability of metal. (Based on comments of David Lilley, co-founder of Red Kite Capital Management.)

Other base metals mainly flat; zinc, lead a bit higher

 

Speaking about the SHFE September nickel price, it was flat at 74,700 yuan per tonne. Following,  SHFE July aluminium price was also flat at 13,725 yuan per tonne.
Furthermore, the SHFE June lead price was up 85 yuan to 16,165 yuan per tonne. Finishing, September tin price wasn’t  changed at 139,000 yuan per tonne.

Currencies & data

Observing the dollar index, it was recently at 99.62 on Thursday. Makes it down for 0.03% as of 03:17 BST. Prices of the Brent crude oil spot, rose 0.27% to 50.38 per barrel. The Texas light sweet crude oil spot price was up 0.15% to $47.50.

“Crude oil was buoyed by a fall in US inventories of 5.25 million barrels and front month WTi rallied towards 48.” (Sucden Financial research data)

Looking at the Indices, Shanghai Composite dipped 0.24% to 3,045.3. US import prices for April rose 0.5%. Better than a forecast of 0.2%

 

 

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SHFE & Market today: May the 8th

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Important facts about today’s Market:

 

  • China Trade Balance (USD) rose to actual 38.05B while forecast was 35.50B
  • China Imports y-o-y fell to actual 11.9% while expected was 18.0%

 

 

Shangai Futures Exchange:

Copper price slided during Asian morning trading hours on Monday May 8. The performance of red metal was weaker, as well as the contracts on the London Metal Exchange.

“The pull-back of SHFE copper prices this morning was mostly impacted by the weakness in LME copper prices. This was a result of a build-up in LME copper inventory last week.” (Metal Bulletin)

The three-month copper contract on the LME was 0.98% or $55 per tonne lower as of 03:19 BST.

LME copper inventories were the highest since October 2016. They rose a net 36,800 tonnes to 354,650 tonnes on Friday May 5. This followed rises of 32,925 tonnes and 31,250 tonnes on May 4 and 3, respectively.

SHFE Copper tracks LME prices lower:

Firstly, LME copper inventories rose a net 36,800 tonnes to 354,650 tonnes on May 5. Secondly, deliverable copper stocks at SHFE-approved warehouses dropped 14,130 tonnes or 6% over the past week to 215,231 tonnes on May 5.
 “The fall down in SHFE copper stocks was happening due to the dip-buying from consumers. Anyway, as the copper price continued to hover at a low level. This made market participants show doubts as to whether the real demand could support the expanding inventories within consumers.” ( analyst from Guotai Jun’an)

 

Secondly, In supply news, Glencore reported lower copper production during the first quarter of the year due to its Antamina operation. The miner’s copper output reached 324,100 tonnes during the first three months of the year. It is a decline of 3% compared with the corresponding period of 2016.


Nickel prices jump off on immerse-buying: 

Thirdly, SHFE September nickel price soared 920 yuan to 73,920 yuan per tonne.
“The rally in nickel prices this morning was mainly a result of dip-buying following the falls seen last week.”

Following, last week saw nickel prices come under pressure amid the expectation of increased supply after the Philippines’ Commission on Appointments rejected Regina Lopez’ appointment. As the country’s environmental secretary. Lopez and her strict crackdowns on the Philippine mining industry were loosely regarded as important factors in keeping laterite ore export volumes from the Philippines low. Once the rainy season in the country had finally ended.

Aluminium prices slide down on rising stocks:

Speaking about Aluminium prices, the SHFE June price slipped to 13,755 yuan per tonne as of 03:18 BST. It is down 125 yuan from the previous session’s close. In addition,  aluminium stocks rose 12,327 tonnes to 403,905 tonnes on May 5.

“Aluminium is still consolidating after recent price jumps. Moreover, the market might be waiting in anticipation [of better prices] following aluminium supply-side reforms [in China. However, chances are that the actual deficit might not be as large as people expect.”

 

 

Currencies & Data:

 

The Brent crude oil spot price rose 0.67% to $49.73 per barrel while the Texas light sweet crude oil spot price was up 0.69% to $46.78. Following, the dollar index was up 0.16% at 98.74 on Monday as of 03:18 BST.

In equities, the Shanghai Composite dipped 0.61% to 3,083.99. 

  • US unemployment claims for April came in at 238,000, below the forecast of 246,000. Preliminary non-farm productivity and unit labour costs during the first quarter came in at -0.6% and 3%, respectively.
    • China’s April yuan-denominated trade balance stood at 262 billion yuan, beating both the forecast and the previous month’s balance of 197 billion yuan and 164 billion yuan, respectively.
    • While the country’s dollar-denominated trade balance for April stood at $38.1 billion, exceeding expectations of $35.3 billion and March’s balance of $23.9 billion.
    • UK Halifax house price index and BRC retail sales, EU Sentix investor confidence and US labour market conditions are due.

The EURO hit a seven-month high against the dollar after Emmanuel Macron won yesterday’s elections. This is a victory that should further boost the currency, as political concerns fade, and investors focus on the eurozone’s economic recovery.

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Bar nickel inch higher; beside multi-week lows, and oil price collapse

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SHFE

 

Marginally higher trade among base metals traded on the SHFE. Due to weaker dollar during Asian morning trade on Friday May 5. But there remained near multi-week lows following an overnight collapse in the oil price. Nickel took the uptrend, as expectations of increased supply continued to push prices down.

“European markets are buoyed by the prospects of centrist Emmanuel Macron winning the second round in the French presidential election on Sunday. [May 7]”

The strength in the European markets had pushed the dollar down yesterday’s night. Reaching a November 2016 low of 98.695. Dollar index had recently rebounded to 98.78 as of 04:32 BST. But it was still much lower compared with 99.38 at approximately the same time on Thursday.

Overnight Oil Collapse

Following, an overnight collapse in the price of oil continues to keep SHFE base metals prices under pressure this morning.

The oil price is now back to its lowest point since mid-November with WTI oil sitting at $45.51 a barrel and below the level that prevailed before the OPEC’s oil production ceiling. (According to NAB.)

Despite the pressure, SHFE bases metals prices are inching higher. The exception is nickel, which is bucking the uptrend based on fears over increased supply following the rejection of Regina Lopez as the Philippines Environment Minister on Wednesday May 3.


Nickel below 76,000 yuan per tonne

September nickel contract on SHFE stood at 75,340 yuan per tonne as of 03:54 BST. Down 930 yuan compared with the previous session’s close.

“Nickel led the sector lower as the market reacted to the failure of the Philippines Environment Minister to be confirmed by lawmakers. Ms Lopez had been spearheading the closure of the nickel mining industry due to new environmental laws.”
Appointment of  Lopez as DENR secretary came as a glimmer of hope for nickel prices amid a weakened Chinese stainless steel sector. Also a number of China-backed nickel pig iron projects coming on stream in Indonesia.

Since the country relaxed its ban on the export of unprocessed ores in January, Indonesia’s first nickel ore shipment arrived in China on Monday May 1.

A possibility that Indonesia may expand its export quota, is adding to fears of increased supply in the market.
Union workers at Glencore plc’s Raglan nickel mine

have voted 99.6% in favour of a strike mandate. Means that the USW’s negotiation committee for the mine has the authority to initiate a strike if they consider it suitable. The Raglan mine, located in the Nunavik region of northern Quebec, produces more than 37,000 tonnes of nickel-in-concentrate annually.

Copper up marginally, but the pressure is present

June copper contract on SHFE stood at 45,200 yuan per tonne as of 03:54 BST. Up 20 yuan compared with the previous session’s close.


In the mean time, the LME’s three-month copper price stood at $5,530 per tonne as of 04:48 BST. Down 0.19% from last close.  LME copper inventories rose a net 32,925 tonnes to 317,850 tonnes, with 29,275 tonnes going into Busan, after a rise of 31,250 tonnes on Thursday.
Observing the supply side, Southern Copper said a strike at its Peruvian operations in April caused a production loss of

“only 1,418 tonnes of copper”.

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SHFE : Trump’s infrastructure spending plan rises expectations on base metals market

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SHFE 

Base metals prices on the Shanghai Futures Exchange were all UP during Asian morning trading today. Inspired by news that US president Donald Trump will announce his plans for infrastructure spending very recently.
“Base metals prices were higher amid reports that President Trump will announce his infrastructure spending plan within the next two to three weeks.” An analyst based in Shenzhen, China, said.

If Trump’s $1 trillion spending plan to upgrade US infrastructure becomes a reality –  the demand for skilled workers to improve roads, highways, bridges, air traffic infrastructure, waterways and the electrical grid will skyrocket in the coming years. Potentially creating four million jobs in the process.

“It is said that Trump’s infrastructure plan could create four million skilled trades jobs. Trump’s border wall alone is expected to create 21,000 jobs. While the plan will also drive demand for the metals.”
The expectations of increased demand for the metals have seen prices well support this morning.

Copper prices rise on tightness fears, strike in Indonesia

 “Workers at PT Freeport Indonesia had started a month-long strike at Grasberg. Now the market is focusing on the risk of tight supply again, pushing up copper prices.”

The SHFE June copper contract stood at 46,820 yuan per ton. As of 04:00 London time, up 490 yuan compared with last trading session’s close.

Meanwhile, Galaxy Futures also warned that the Chinese government will strictly limit credit flowing into speculative buying in the country’s property market, which will put some pressure on copper prices. SHFE copper stocks fell 10,830 tons or 4.5% to 229,361 tons last week.

 

Other metals higher

 

June lead price on the SHFE was 240 yuan higher at 16,595 yuan per ton. Lead stocks dipped 218 to 72,070 tons as of Friday.

September tin contract climbed 2,230 yuan to 144,750 yuan per ton. SHFE tin stocks fell 19 tons to 2206 tons last week.

The September nickel contract rose 1,010 yuan to 80,310 yuan per ton. Nickel stocks at SHFE-bonded warehouses rose 439 tons to 84,334 tons as of Friday.

The SHFE June aluminium contract inched 60 yuan higher to 14,075 yuan per ton. Aluminium stocks rose 12,544 ton to 391,578 tons in the week ended April 28. The SHFE June zinc contract rose 385 yuan to 22,285 yuan per ton. Zinc inventories at Shanghai Futures Exchange-approved warehouses fell 40,312 tons – or 25.9% – last week to 115,040 tons as of Friday April 28.


Currency moves and data releases 

  • The dollar index was recently 0.12% lower at 99.025.


• In other commodities, the Brent crude oil spot price was down 0.72% to $51.45 per barrel.
• In data, China’s official NBS Manufacturing PMI fell to 51.2 in April from 51.8 in March and below market expectations of 51.6. It was the ninth straight month of expansion but the weakest since October 2016.
• The official Non-Manufacturing PMI also dropped to 54.0 in April of 2017 from 55.1 in March. It was the lowest reading since October 2016.
• Earlier this morning, China’s Caixin Manufacturing PMI fell to 50.3 in April from 51.2 in March and below market consensus of 51.2. It was the lowest reading since September 2016.

• Later today, UK and EU manufacturing PMI, EU unemployment rate and US total vehicle sales are expected.

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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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