Electric Cars market boosting the demand for base metals

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Logical level up, but also very important fact to be aware of: Electric vehicles market is boosting growth, the new technologies are entering the big door everywhere.

Firstly, the use of batteries is pushing base metals demand from across the sea. South32, australian-based miner buoyed by an 8-fold leap in annual profit. 

Secondly, mining and metal producing companies are very inspired with current situation. Their profits are doubtlessly rising.


South 32’s position

Following, South 32 is a base metal and coal mining company. It has wide exposure to aluminium and nickel. Now, their Cannington mine in Australia enters the list of world’s largest sources of nickel, silver and lead.

“If you look at the metals we produce, they are either used in renewables or battery technology.” (South32 CEO)

“We are looking to add more base metals exposure to the group… We do see battery technology having an impact over time.”

Company’s profit

“South32 posted fiscal 2017 underlying profit of $1.15 billion, up from $138 million the previous year.” (Source – Reuters)


Glencore’s position 

Thirdly, Glencore CEO Ivan Glasenberg also frequently said that the coming large-scale usage of electric vehicles and energy storage systems will definitely unlock consequential new sources of demand for copper, cobalt, zinc and nickel.

This electric vehicles phenomena is influencing the world’s largest miner BHP to invest heavily in its nickel business.

“While South32 was prepared to supply a host of metals used in making batteries for electric vehicles and other systems, it sees overcapacity in lithium, the driving component of the burgeoning lithium-ion battery technology.” (Reuters)

By Morgan Stanley’s forecast the use of electric cars is going to rise to the immense number of 99 million new vehicles in 2020! 


Consequences and market Influence

Having in mind that the electric vehicles are our close future.. and that the environmental development depends on this… We should be aware that the consequences of these changes will push the demand for the base metals up, and in case nothing serious changes in world’s macroeconomic movements in recent months/years; the nickel, zinc and lead traders will witness very bright outcomes.

In conclusion, as South32’s promise explains:

“Our purpose is to make a difference by developing natural resources. Improving people’s lives now and for generations to come. Owners trust us and partners realise the potential of their resources.”

For further info on this subject visit:

Base Metal Market News, August the 21st

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Top 5 things to know today – global markets:

  1. War games start on Korean peninsula
  2. Renewed U.S.-North Korea tensions causing global stocks slide
  3. Dollar still remains defensive on U.S. political tensions
  4. Oil started the week a few percents lower
  5. Maersk sells oil unit to Total for $7.5B as M&A heats up

For detailed info on these subjects visit:

Some useful analysis:


Last Three months – overview:

Lately, there has been some really crazy movement happening in the base metal markets. Observing the All-along summer period, we see few metals hitting their highest level in a decade.

Firstly we must pay our attention to the period of may/juni/july/august 2017. During the whole  summer period, base metal markets trade showed some astonishing positive trends.

Secondly, along with the huge volatility which took place in july, the base metal prices now are hitting the great record levels.

Current prices :

Today, the Zinc price is peaking to the level of 3180.50 ! These levels were not seen since the far 2007.

Furthermore, observing the copper and aluminium prices.. Due to cutted supply in energy markets, their prices are hitting the highest prices since 2014 and 2015. This is definitely a very positive incline in all the base metal prices. Which also makes investors confident about further buying\selling steps.

All of this rallies are happening due to tightened supply. And certainly growing demand in the markets. Global demand is supporting the price rallies and this is spreading fast.


China’s demand:

Despite China’s industry showing a slight fade in the metal demand in July, the IMF made average growth forecast for period regarding 2018-2020. As China’s zinc production fell in July, lead output rose by couple percent in this period. Currently Chinese infrastructure now is developing and is kept at solid activity showing strength. 

Aluminium output in China fell 8.2 percent in July as capacity cuts started to take their actions. China makes more than half the world’s aluminium, and it is obviously putting China in the most important world’s suppliers.


Copper price movements:

Observing the copper prices and their movement, we also notice the important inclines. From may’s high of about 5786, to august’s high of 6596. Freeport power plant in Indonesia was currently hardly affected by floods taking place there. Due to these floods, one of the workers is missing.

Benchmark copper finished 2.4 percent higher in Friday the 18th of august, at $6,532 having touched $6,576.50, the highest since November 2014.


Nickel & lead:

Nickel is currently trading at $11,305,  which is the record level regarding the whole summer period, which is then the highest ever since 2014!

Observing the current lead prices, it is trading at $2376.

In all, having observed the summer 2017 period, we can bring the fine conclusion that base metal markets are quiet recovering.

“Momentum funds are buying the strength, piling in as the price rises.” (Reuters)

“The rallies had been supported by expectations of strong global demand and tight supplies.” (Reuters)


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 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)

  • 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.