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Copper rebounds as Chile closes mines

Posted on 27 March 2015 by VRS  |  Email |Print

Copper rebounded as torrential rain in Chile closed some of the biggest mines in the world’s largest producer of the metal. Copper rose as much as 0.5 percent after snapping the longest rally in six weeks on Wednesday. Some of the world’s largest copper mines were forced to shut down as torrential rain in the Atacama Desert of northern Chile closed roads and flooded towns.
Codelco, the world’s biggest copper producer, shut all of its Atacama mines including Chuquicamata and Radomiro Tomic, according to the state-owned company. “Copper supply expectations have been revised again after news that rains in Chile forced mines shut,” said Fang Junfeng, an analyst at Shanghai Cifco Futures Company. “The market is entering a peak consumption season in the northern hemisphere.”……………………………………….Full Article: Source

Morgan Stanley Copper Price Outlook

Posted on 27 March 2015 by VRS  |  Email |Print

The copper price has started to bounce back from its drastic fall at the start of the year, climbing more than 6 percent over the past month. However, Morgan Stanley (NYSE:MS) has cut its 2015 price forecast for the metal by roughly 16 percent, to $5,945 per tonne, on the back of lackluster demand from China.
The firm remains convinced that base metals will outperform bulk commodities such as coal, but in a report it expresses concern that seasonal demand from China has failed to pick up as expected. In the report, analysts Tom Price and Joel Crane state that far from expanding trade in response to “a growing list of government approved property and infrastructure projects,” the metals processing industry in China “remains dormant” and is “actually sidelining capacity.”……………………………………….Full Article: Source

Shanghai to Match London Metals as China Seeks Commodities Sway

Posted on 27 March 2015 by VRS  |  Email |Print

The Shanghai Futures Exchange will start trading nickel and tin on Friday, offering the same main contracts as the world’s biggest metals bourse in London, as China seeks to extend its influence over commodities prices.
They join Shanghai’s existing futures for aluminum, copper, lead and zinc. Nickel and tin are the worst performers on the London Metal Exchange this year, partly on concern that demand in China may weaken. Mainland traders can use both LME and SHFE contracts to hedge or profit from the difference in prices………………………………………..Full Article: Source

China’s top copper producer continues alarming slump

Posted on 26 March 2015 by VRS  |  Email |Print

Jiangxi Copper, China’s top producer of the metal, posted a 20% drop in net profit for 2014, a third consecutive annual decline due to weak metal prices, and forecast a tough outlook for base metals due to overcapacity.
The company expects copper prices to stay weak, pressured by a buoyant US dollar as the Federal Reserve moves towards tightening monetary policy. Net profit fell to 2.8 billion yuan (RM1.6 billion) last year from 3.6 billion yuan in 2013, the company said in a filing to the Shanghai stock exchange on Wednesday. ……………………………………….Full Article: Source

Iron ore price jumps past $US55

Posted on 25 March 2015 by VRS  |  Email |Print

The price of iron ore has again surged past $US55 a tonne, after it had held below that mark for three out of the prior four trading sessions. At the end of the latest offshore session, benchmark iron ore for immediate delivery to the port of Tianjin in China was trading at $US55.60 a tonne, up 2.6 per cent from its prior close of $US54.20 a tonne.
The positive showing was its second best gain for the year to date, but the commodity remains nearly 60 per cent off where it was at the start of 2014 and over 20 per cent below where it started this year………………………………………..Full Article: Source

Is nickel finally back on track?

Posted on 25 March 2015 by VRS  |  Email |Print

At the outset of 2015, the once-stable base metal segment suddenly became a precarious one, recording a bear market rally that sent an alarming signal to investors. Even nickel, whose early January trading was considered exemplary, eventually succumbed to a series of weak prices.
Nickel was 2014’s best performing industrial metal, and experts believe that it will remain a strong contender for the same accolade this year until 2016. However, several unanticipated events pulled the base metal down, including the Greece bailout crisis, the Chinese market’s absence on Lunar Eclipse holiday, and the shaky supply and demand segment dictated by China………………………………………..Full Article: Source

Is the tide turning for Precious Metals?

Posted on 23 March 2015 by VRS  |  Email |Print

Has the tide begun to turn for the precious metals, notably silver and gold? In our view the turn began last year and if pressed to pinpoint one event, it would be following the failure of the Swiss referendum when the SNB de-pegged the franc from the euro. The Swiss National Bank was frustrated with the continued depreciation of the Euro. This had as much to do with sentiment as it did with the SNB clearing seeing the Euro might be going the way of the Rentenmark.
Around this timeframe, investors received a flurry of news regarding worldwide demand for both silver and gold. This news continues to pore in, that multiple factions that are unsure of the longevity of the U.S. dollar continue to buy precious metals. For example, net silver imports into India in November, set an all-time monthly record. This would be followed by a record setting year of net silver imports, amounting to 7,063 tons………………………………………..Full Article: Source

Iron ore price bounces to $US55

Posted on 23 March 2015 by VRS  |  Email |Print

Iron ore has enjoyed a rare positive session after a tumultuous week that saw the commodity sink below $US55 a tonne for the first time since 2009. At the end of the latest offshore session, benchmark iron ore for immediate delivery to the port of Tianjin in China was trading at $US55.00 a tonne, up 0.9 per cent from a six-year low of $US54.50 a tonne.
However, the metals bulletin price for iron ore delivered to the port of Qingdao, another closely-watched spot market, was 0.6 per cent weaker at $54.66. Over the last month the commodity has given up about 15 per cent of its value, the latest sign of turbulence after a horror 2014 that saw its price cut in half………………………………………..Full Article: Source

New Hong Kong brokers focus on metals trading

Posted on 23 March 2015 by VRS  |  Email |Print

A new breed of broker, focused purely on trading commodities, is applying for licences from Hong Kong’s securities watchdog. Listed metal trading firm Lee Kee will start offering commodities broking in the city during the second quarter, after the Securities and Futures Commission granted it a futures broker licence last month.
Lee Kee, a Hong Kong firm established in 1947, has no history in any brokering business but it trades zinc, nickel, aluminium and a host of other metals for more than 1,000 customers, mostly manufacturers in toys, fashion, cars and other industries on the mainland and in Southeast Asia………………………………………..Full Article: Source

Copper drops on China weakness

Posted on 19 March 2015 by VRS  |  Email |Print

Copper has taken its biggest fall since late January, weighed down by economic weakness in top consumer China and expectations the Federal Reserve will prepare the ground for an increase in US interest rates. Other metals slid to fresh lows as investors stepped up selling during the day, sending tin and lead to their weakest levels in 57 months and nickel to a 14-month nadir.
The Fed was expected to remove the word “patient” from its statement on the timing of its first rate rise since 2006, possibly paving the way for policy tightening as early as June. The US dollar was steady near its recent 12-year peak against a basket of currencies. A strong dollar makes dollar-priced metals more costly for non-US investors………………………………………..Full Article: Source

Platinum price drops under $1,100 per oz to fresh 2009 lows

Posted on 18 March 2015 by VRS  |  Email |Print

Platinum dropped below a price of $1,100 on early on Tuesday afternoon to a fresh July 2009 low, coming under renewed pressure from the strength of the US dollar. The metal traded as low $1,096 per ounce, down $10 on Monday’s close and a drop of 9.1 percent since the start of the year. It was last at a price of $1,095/1,100.
“The decline in PGM prices this year may be viewed as encouraging for industrial buyers [but] we believe above ground stocks may have to be depleted further before platinum can make significant upside advances,” James Steel at HSBC said………………………………………..Full Article: Source

Hedge Fund Seeks Zinc, Copper Assets After Finnish Mine Deal

Posted on 17 March 2015 by VRS  |  Email |Print

Audley Capital Advisors is seeking to add to its metals resources after buying Talvivaara Mining Co.’s nickel operation in Finland, according to the former Anglo American Plc executive heading the hedge fund’s mining business.
“I came to Audley with a view to be able to go in and operate some assets,” John MacKenzie, who led copper and zinc operations at Anglo before joining the fund in 2013 as chief executive officer of mining, said in an interview. “Audley Capital is constantly on the lookout for mining opportunities,” including nickel, zinc, copper and metallurgical coal, he said………………………………………..Full Article: Source

Copper, Industrial Metals Climb as China Credit Tops Estimates

Posted on 13 March 2015 by VRS  |  Email |Print

Copper rose to a one-week high and aluminum rebounded from an 11-month low as credit growth expanded more than forecast in China, the world’s largest user of industrial metal.
Aggregate financing was 1.35 trillion yuan ($216 billion) in February, China’s central bank said Thursday. That topped the median estimate of 1 trillion yuan by analysts surveyed by Bloomberg. Nickel, zinc and lead also rose in London………………………………………..Full Article: Source

More Coal Cuts Seen Ahead as Demand for Steel Slows: Commodities

Posted on 13 March 2015 by VRS  |  Email |Print

In the last year, mining companies eliminated about 15 million tons of production capacity for the coal used to make steel, while outlining plans to double those cuts in the near future. It won’t be near enough.
That’s the determination of Chief Executive Officer Don Lindsay at Teck Resources Ltd., the world’s second-biggest exporter of metallurgical coal. For supply to match flagging demand, the industry must cut a total of as much as 45 million tons, he says, raising the ante as prices sit at a six-year low………………………………………..Full Article: Source

How to read the changing signals from China’s metals trade: Andy Home

Posted on 12 March 2015 by VRS  |  Email |Print

China will be the key determinant of industrial metal prices this year. Nothing new there then. The country has played the starring role in the sector for many years, thanks to its stellar contribution to global demand growth for everything from aluminium to zinc.
What has changed over the last couple of years, though, is the country’s own surging output of refined metals following years of production capacity growth. In the aluminium market, for instance, what China imports from the rest of the world is far less significant for prices than what it exports………………………………………..Full Article: Source

Aluminium costs sink globally

Posted on 12 March 2015 by VRS  |  Email |Print

The surcharge that consumers pay to obtain the metal started falling in Europe in November, spurring US declines in February. The global domino-effect was completed last week, when people involved in the negotiations told Bloomberg News that Japanese buyers will pay less amid a regional oversupply.
The rates are falling from an all-time high as demand for aluminium can’t keep up with record exports from China, the biggest producer of the metal. Aluminium for delivery in three months on the London Metal Exchange dropped 4.8 percent this year as some traders unwound financing deals and warehouse backlogs eased………………………………………..Full Article: Source

China ferrochrome: Domestic price supported by tight spot supply

Posted on 12 March 2015 by VRS  |  Email |Print

The domestic spot price of 50% Cr Chinese high-carbon ferrochrome was assessed flat on the week at Yuan 6,400-6,600/mt (equivalent to 78-80 cents/lb) — including 17% value-added tax and delivery — on Wednesday on support from spot supply tightness and word that Shanxi Taigang Stainless Steel had lifted its March purchase price.
Spot market supply — while not as tight as earlier this year before Chinese New Year holidays in mid-February because more Chinese ferrochrome producers have restarted production after the holidays — is still seeing some tightness as producers are prioritizing production for term contracts, sources said………………………………………..Full Article: Source

Global nickel prices set to pick-up in H2 2015: Citi Research

Posted on 12 March 2015 by VRS  |  Email |Print

Nickel prices are expected to recover globally in the second half of the year on declining nickel pig iron production, stronger demand from the European stainless steel market and reduced nickel ore availability, Citi Research said in a report Tuesday, March 10.
China’s NPI production is expected to fall to 377,000 mt this year, from 471,000 mt in 2014, with output already contracting by almost 33% year on year to a little over 30,000 mt (contained nickel) in January, Citi said. This follows a 29% year-on-year decline in Q4 last year. Cost pressures and environmental issues will likely constrain production, explained Citi………………………………………..Full Article: Source

All is not well on the metals commodities front

Posted on 11 March 2015 by VRS  |  Email |Print

The world of metalliferous mining – for the most part at least – is suffering, and suffering badly. No more China-driven supercycle (at least for the short to medium term). More of a China-driven downcycle seems to be in place as Asia’s biggest economy ceases to grow at its recent pace, and there are suggestions too that the Chinese, who look at these things with a rather longer-term viewpoint than most Western governments and businessmen, may even be actively driving down some commodity prices through destocking and reducing imports.
No matter that this impacts on the country’s own mining operations – there has been something of an ongoing programme anyway to rein in some of that nation’s more inefficient and most-polluting mining operations………………………………………..Full Article: Source

Rio Tinto sees iron ore mines closing at slower pace in 2015

Posted on 11 March 2015 by VRS  |  Email |Print

Global miner Rio Tinto expects some 85 million tonnes of iron ore capacity to be taken out of the world market in 2015 because a price slump has made it too costly to produce, on top of an estimated 125 million tonnes last year.
Chinese mines - among the least efficient globally - will absorb most of the losses, according to Rio Tinto iron ore chief Andrew Harding. However, some of that will be offset by the likely start-up this year of the Roy Hill mine in Australia. “We estimate that around 85 million tonnes of existing production will exit the market in 2015,” Harding said on the sidelines of a conference in Perth on Tuesday. “This will come from China as well as seaborne suppliers.”……………………………………….Full Article: Source

London copper turns lower as dollar firms up

Posted on 11 March 2015 by VRS  |  Email |Print

London copper sagged on Tuesday as a stronger dollar clipped the gains from short-covering in the previous session, while traders waited for signs of demand from China, the world’s top copper user, after last month’s long holiday.
The dollar scaled a near 12-year peak against the euro on Tuesday, as the underlying theme of monetary policy divergence held sway, making commodities more expensive for the holders of other currencies and exacerbating price pressure after soft trade data this week cast a shadow over metals demand………………………………………..Full Article: Source

Iron ore majors raise supply

Posted on 10 March 2015 by VRS  |  Email |Print

Global iron ore supplies are set to expand further as the world’s biggest producers press on with capacity expansions, raising shipments of the steel-making raw material into a market facing a record surplus and sinking prices.
Net supplies will increase about 60 million to 75 million metric tons in 2015, in line with a 75 million ton rise in 2014, as mine expansions in Australia and Brazil more than offset closures in China, according to Sanford C. Bernstein & Company. Morgan Stanley predicts a net rise of 63 million tons this year, with production expected to peak in September to October………………………………………..Full Article: Source

Miners pray the commodities collapse has hit rock-bottom

Posted on 09 March 2015 by VRS  |  Email |Print

Life in Australia’s gold pits are not what it once was, but dealmakers in the ailing sector are ready to strike after betting on a turnaround. At the height of the mining boom, lorry drivers working in Western Australia’s Pilbara iron ore belt would have expected to take home something in the region of £100,000 a year in basic salary as China’s demand for commodities countinued unabated.
Nowadays, mining companies Down Under have even cut steak sauce off the menu and cancelled the free staff barbecues to cut costs. The days of mineworkers earning salaries and bonuses comparable to a fully qualified doctor are long gone………………………………………..Full Article: Source

China’s Copper Imports Tumble as Lunar New Year Crimps Demand

Posted on 09 March 2015 by VRS  |  Email |Print

China’s copper imports fell for a second month to the lowest in more than three years as the week-long national Lunar New Year holiday sapped demand for the metal. Inbound shipments in February of unwrought copper and products fell 32 percent from the previous month to 280,000 metric tons, the lowest since May 2011, according to data released by the General Administration of Customs on Sunday. Imports during the first two months of the year are down 24 percent from the same period in 2014.
Demand for the metal slowed as businesses and factories shut before and during the holiday, which ran from Feb. 18-24 this year. Copper rebounded 7.3 percent in London last month after a 13 percent tumble in January as investors weighed slowing economic growth in China against supply disruptions at mines globally………………………………………..Full Article: Source

Nickel Prices Look Poised to Rebound

Posted on 09 March 2015 by VRS  |  Email |Print

Prices of nickel hit their lowest levels in more than a year last week, suggesting it is just another metal suffering from weaker Chinese demand growth and a strong dollar. But many traders and analysts think the long decline in nickel’s price is reaching an end, as China’s drive to produce more of a substitute product—nickel pig iron—shows signs of cracking. NPI is commonly used in China as a cheaper alternative to pure nickel for producing stainless steel.
China’s burgeoning output and usage of NPI has meant that the world has had plenty of spare pure nickel. That has put pressure on prices for the commodity: The benchmark three-month nickel futures contract on the London Metal Exchange is down around 30% in the past year………………………………………..Full Article: Source

Iron Ore Majors Raising Supply as Surplus, China Sink Prices

Posted on 09 March 2015 by VRS  |  Email |Print

Global iron ore supplies are set to expand further as the world’s biggest producers press on with capacity expansions, raising shipments of the steel-making raw material into a market facing a record surplus and sinking prices.
Net supplies will increase about 60 million to 75 million metric tons in 2015, in line with a 75 million ton rise in 2014, as mine expansions in Australia and Brazil more than offset closures in China, according to Sanford C. Bernstein & Co. Morgan Stanley predicts a net rise of 63 million tons this year, with production expected to peak in September to October………………………………………..Full Article: Source

Iron ore falls below $60 on China cuts vow

Posted on 06 March 2015 by VRS  |  Email |Print

The price of iron ore, a key steelmaking ingredient, dropped below $60 a tonne for the first time since 2009 as China vowed to cut overcapacity in the steel industry and close mills that violate pollution standards. Benchmark Australian iron ore for delivery to China fell $2.80, or 4.5 per cent, to $59.30 a tonne on Thursday, according to The Steel Index, a price reporting agency.
Iron ore futures on China’s Dalian exchange fell 3.1 per cent to a three-month low. Iron ore is a key profit generator for several large mining companies, including Rio Tinto, BHP Billiton, and Vale of Brazil………………………………………..Full Article: Source

Aluminium trading profits under threat

Posted on 05 March 2015 by VRS  |  Email |Print

The days of easy profits for aluminium traders benefiting from warehouse queues may finally be over as prices fall and new rules seek to change behaviour. When demand for aluminium cratered during the financial crisis, supplies swamped warehouses, where banks and commodity trading houses could borrow at low interest rates, store the metal and sell a futures contract for delivery at higher prices.
It was a trade that took significant amounts of metal off the market. Rather than suffering, producers from Alcoa to Rusal earned handsome profits by satisfying demand from industry as long queues built up at warehouses for metal that subsequently needed to be withdrawn………………………………………..Full Article: Source

Platinum buyers seek to limit SA output risk

Posted on 04 March 2015 by VRS  |  Email |Print

Additional platinum metal sourced from recycling is one of the major reasons why the platinum market remains weak and this source of metal is being actively promoted by customers as an alternative to primary supply from South Africa.
That’s according to Royal Bafokeng Platinum (RBPlat) CEO, Steve Phiri, who told financial media and analysts during a presentation of the company’s financial results for 2014 in Sandton today that “… this is a worrying development”. Phiri added: “Secondary platinum from recycling is being viewed as a substitute for primary supply from South Africa because we are no longer seen as a reliable and sustainable supplier of the metal for various reasons including labour issues and regulatory issues……………………………………….Full Article: Source

Iron ore price nears 5.5-year low

Posted on 04 March 2015 by VRS  |  Email |Print

The price of iron ore has extended its recent losses in overnight trade, yielding ground for the sixth session out of the last seven. At the end of the latest offshore session, benchmark iron ore for immediate delivery to the port of Tianjin in China was trading at $US62.30 a tonne, down 0.8 per cent from its previous close of $US62.80 a tonne.
The commodity is now less than 2 per cent above the five-and-a-half-year low of $US61.10 a tonne set in February and in danger of an imminent move below $US60. Should it breach that barrier it will be the first time since 2009. Investors are still coming to grips with the likely impact of the latest rate cut from the People’s Bank of China, but the longer traders think about the move, the more sceptical they seem to become……………………………………….Full Article: Source

Global Iron Ore Surplus Seen by World Bank Lasting Two Years

Posted on 04 March 2015 by VRS  |  Email |Print

If history is any guide the global glut in iron ore may persist for as long as two years, according to the World Bank, which forecasts that the steel-making raw material will average $75 a metric ton this year.
“From experience from earlier iron ore episodes as well as other metal markets, it takes about one to two years for either excess supplies to get back to normal levels or excess demand to be met by larger supplies,” John Baffes, a senior economist at the lender, said in an e-mail response to questions……………………………………….Full Article: Source

Oil gloom won’t hit aluminium industry: Expert

Posted on 04 March 2015 by VRS  |  Email |Print

Qatar’s aluminium industry remained resilient to the global economic downturn and dwindling oil prices. The total annual production of aluminium in Qatar is continuously growing and expected to touch 640,000 tonnes in 2015, which is 9.4 percent higher than the installed capacity of Qatalum plant (585,000 tonnes), a senior official of Qatalum said.
“We were not affected by oil crisis, and our production level is still increasing. The annual production in 2014 reached 612,000 tonnes, about five percent higher than the full capacity,” said Tom Petter Johansen (pictured), CEO of Qatalum……………………………………….Full Article: Source

Copper: A Rebound - Don’t Get Too Bullish

Posted on 03 March 2015 by VRS  |  Email |Print

I have been writing a lot about copper lately because I think it is one of the most important commodity prices to monitor. Copper is a building block staple - growing economies require copper to build infrastructure. When it comes to economic growth, copper is a barometer. Doctor copper is a misnomer - copper is really the patient.
It does not provide a diagnosis of global economic condition; rather it reacts to the strength or weakness of the landscape. Therefore, copper is a symptom and symptoms occur not in the doctor but in the patient. Since copper traded to all-time highs of $4.6495 per pound in February 2011, the price of the red metal has made lower highs and lower lows. In January 2015, it broke below the $2.72 level, which was the June 2010 lows and key support………………………………………..Full Article: Source

Australia’s gold output at decade high as miners cash in on currency drop

Posted on 02 March 2015 by VRS  |  Email |Print

Australia recorded its highest annual rate of gold production in a decade in 2014, accelerating the depletion of high-grade mine reserves, a survey released on Sunday said. Gold output in Australia, the second highest producing nation after China, rose to 284 tonnes in 2014, up 11 tonnes or four percent on 2013, mining consultants Surbiton Associates Pty said in its latest survey of Australian gold mining.
This is the highest annual figure tallied by Surbiton since 2003. Output for the fourth quarter 2014 reached 73 tonnes, up three tonnes on the previous quarter, according to Surbiton………………………………………..Full Article: Source

Investors hard to come by in mining industry downfall

Posted on 02 March 2015 by VRS  |  Email |Print

As the beleaguered mining sector suffers through another year of its deepening slump, the industry’s boom days are but a distant memory. It’s an ugly time for the junior mining industry, as companies descend on Toronto for the annual Prospectors and Developers Association of Canada conference. Already starved for cash, small mining companies are facing their fourth consecutive year of declining commodity prices.
Since 2011, gold is down 30 per cent. Iron ore and metallurgical coal, both used to make steel, are about 70 per cent lower. Copper is down 40 per cent and nickel is off by 50 per cent. Shares of a slew of junior mining companies have crumbled to just a few pennies apiece………………………………………..Full Article: Source

US ‘Probes Banks’ Precious Metals Rigging’

Posted on 27 February 2015 by VRS  |  Email |Print

The United States is reportedly probing major banks over possible manipulation of precious metals markets. The investigation centres on prices for gold, silver, platinum and palladium, the Wall Street Journal says.
It is being carried out by the Justice Department with help from Commodity Futures Trading Commission, which regulates raw materials and derivatives, the newspaper said, quoting sources close to the case. The banks targeted are HSBC, Bank of Nova Scotia, Barclays, Credit Suisse, Deutsche Bank, Goldman Sachs, JP Morgan, Societe Generale, Standard Bank and UBS………………………………………..Full Article: Source

Platinum Dives to 5-Year Low

Posted on 27 February 2015 by VRS  |  Email |Print

For more than a year, you must have heard hundreds of analysts arguing that investors were moving money into precious metals and that global economic uncertainty would push these metals higher. Well, that hasn’t happened.
If we look back in time, periods of economic concern do not always translate into higher rising precious metals price. Furthermore, the market is just fine in spite of all the economic news that keep coming up talking about global economic concerns………………………………………..Full Article: Source

Can platinum regain its premium over gold in Q2-Q3?

Posted on 26 February 2015 by VRS  |  Email |Print

On the positive side, precious metals consultancy, Metals Focus, in its latest Precious Metals Weekly, reckons that there’s a good chance that platinum will regain its premium over gold, perhaps as soon as in Q2 this year and possibly get back to a premium level during the year averaging as much as $100 over the gold price (which is pretty much the normal situation).
However there’s little in their opinion on the fundamentals side to support this argument, the key factor, being in their view, that when the U.S. Fed eventually ceases shilly-shallying and starts to raise interest rates, it will be the gold price which bears the bulk of any adverse reaction in the markets and platinum less affected………………………………………..Full Article: Source

Will a dry spell in Chile curb a global oversupply of copper?

Posted on 26 February 2015 by VRS  |  Email |Print

A raging seven-year drought affecting copper-rich Chile is making miners grow anxious as the dry spell is now affecting the supply of power necessary to sustain their operations, responsible for around a third of global copper output. Companies such as BHP Billiton and Anglo American have recently highlighted the impact of the country’s extreme conditions in their latest financial reports.
Output at BHP’s Escondida, the world’s largest copper mine, dropped 2% percent in the second half of 2014. Water scarcity at Anglos’ Los Bronces — the world’s sixth-largest copper operation— may cost the company as much as 30,000 tonnes of lost production, equivalent to 4% of Anglo’s overall copper output this year, Reuters reports………………………………………..Full Article: Source

Copper Signal May Be Flashing Green

Posted on 26 February 2015 by VRS  |  Email |Print

Copper has been down for so long that some are saying the only way is up. A key signal in the market is starting to flash green, with bets that copper prices will continue to fall recently hitting a record high on the London Metal Exchange, though they’ve since started to fall back. For some, that suggests the red metal’s fortunes may be about to turn. At these levels, there’s simply no more stomach to bet against copper, they say.
“People have kind of run out of ammunition,” said Guy Wolf, global head of market analytics at Marex Spectron, a broker “There’s no more new money to come in.” According to Marex Spectron, there were 130,000 lots that were bets that copper would fall on Jan. 29. That was equivalent to 76% of all copper contracts registered with the London Metal Exchange, a record high, above even the bets made against copper during the global financial crisis of 2008, according Mr. Wolf………………………………………..Full Article: Source

Market not paying enough attention to copper supply situation: Citi

Posted on 25 February 2015 by VRS  |  Email |Print

The current bearish sentiment toward copper is being driven by concerns about China’s economy slowing with the market ignoring the fact that mine supply is looking increasingly constrained, Citibank’s research department said Tuesday.
Over the last decade, average global copper consumption growth has been in the region of 2.5% a year, “a remarkably low average given the strong growth in China consumption rates. This average annual rate is less than half that for aluminium.” Analyst at the bank David Wilson said that two factors have been at work to limit the rate of global copper demand growth………………………………………..Full Article: Source

Aluminium restarts not just a matter of price: Andy Home

Posted on 25 February 2015 by VRS  |  Email |Print

Non-Chinese aluminium production was unchanged in January, according to the latest figures from the International Aluminium Institute (IAI). Producers, it might be inferred, are still holding the line in terms of keeping capacity off-line in the face of low prices and historical stocks overhang.
Their continued discipline is a subject of much market conjecture, although the fear of restarts waxes and wanes with the price. A combination of lower London Metal Exchange (LME) basis price and softer physical premiums, particularly in Europe, has seen the all-in price slide back to just above $2,100 per tonne from over $2,450 as recently as November………………………………………..Full Article: Source

PwC Metals Deals Outlook: buyers and sellers to play a waiting game

Posted on 25 February 2015 by VRS  |  Email |Print

There will be weak momentum in the metals deals market in 2015 according to a new report from PwC. The report, Metals Deals: Forging ahead, predicts that, as in 2014, the lack of convincing, strong and sustainable growth in the global economy will keep metals deals in a low gear, or even stalling in some parts of the world.
Jim Forbes, global metals leader at PwC, said: “With the current level of commodity prices and the downward pressure on economic forecasts, we don’t expect dealmakers to be rushing to the table in 2015. The deal making that will take place is likely to be driven primarily by specific country, industry or company considerations, rather than the global cycle, the direction of which remains uncertain.”……………………………………….Full Article: Source

Copper Tells Two Stories on Global Economy

Posted on 24 February 2015 by VRS  |  Email |Print

It is often claimed that copper prices are a reliable barometer of the global economy’s health. Those who monitor the metal closely are sharply divided over its condition. As of Monday, copper’s spot price on the London Metal Exchange had fallen nearly 10% since the start of the year. Even so, the metal has staged a partial recovery from a five-year low reached on Jan. 29, rising 5.1% from that low to $5,672 a ton on Monday.
The whipsawing in prices has been mirrored in the shares of major copper producers. Chile-based Antofagasta PLC’s stock fell 13% in January but has since recovered the lost ground………………………………………..Full Article: Source

Copper Is Shining Bright After Dull Start to the Year

Posted on 20 February 2015 by VRS  |  Email |Print

Copper prices rose to a one-month high on Wednesday, as the possibility of a deal between Greece and its European creditors sparked optimism in metals markets. Copper for March delivery, the most actively traded contract, closed up 1.3% at $2.6145 a pound on the Comex division of the New York Mercantile Exchange. It was the highest settlement since Jan. 13.
Greece will seek an extension to its rescue deal from the rest of the eurozone, officials said, signaling a shift in the standoff between Athens and its creditors. The possibility of an agreement that would keep the EU whole sparked optimism in copper markets, which saw a sharp drop Tuesday………………………………………..Full Article: Source

Nickel Falls to 12-Month Low as Greece Impasse Fuels Demand Woes

Posted on 20 February 2015 by VRS  |  Email |Print

Nickel prices dropped to a 12-month low on concern that European demand for industrial metals will falter amid signs of snags in Greece’s debt talks. Germany rebuffed Greece’s request for an extension of its aid program as euro-area finance ministers prepare to meet to avert a cash crunch for the region’s most-indebted nation. A gauge of the six main prices on the London Metal Exchange has declined 6.6 percent this year.
“There are lots of concerns in Europe whether a deal will be done, and that’s still very much hanging in the balance,” Nic Brown, the head of commodity research at Natixis SA in London, said in a telephone interview. “Issues in Greece epitomize the wider problems for Europe.”……………………………………….Full Article: Source

Base metals slip on EU wrangling, nickel and zinc price hit fresh lows

Posted on 20 February 2015 by VRS  |  Email |Print

Base metals moved to lower prices in Thursday’s LME morning session in thin and volatile conditions in the absence of Asian market participants over Chinese New Year - nickel hit a one-year low and zinc its softest for three weeks.
“For now, we would expect the metals to take their lead from the dollar/euro and from developments over Greece. Should a loan extension be agreed, there may be room for a relief rally,” FastMarkets analyst William Adams said. Greece has applied for a six-month extension on the loan agreement, Eurogroup president Jeroen Dijsselbloem suggested on social media platform twitter………………………………………..Full Article: Source

Indonesia says may delay 2017 ban on copper concentrate exports

Posted on 19 February 2015 by VRS  |  Email |Print

Indonesia could push back a ban on exports of copper and other mineral concentrates due to come into effect in January 2017 if miners have not built new domestic smelters in time, a mining ministry official said on Wednesday.
Early last year Southeast Asia’s largest economy put in place export restrictions aimed at forcing mining firms to develop smelting and processing facilities so that Indonesia could refine all of its own raw ores and concentrates………………………………………..Full Article: Source

Copper Futures Decline Most in a Week on Chinese Housing Data

Posted on 18 February 2015 by VRS  |  Email |Print

Copper futures fell the most in a week after a report showed declining property prices in China, the world’s largest metal user. New-home prices fell in 64 out of 70 cities in January, Chinese government data showed on Tuesday. That signaled an interest-rate cut in November, the first since 2012, hasn’t revived construction yet. Property accounts for about half of China’s copper demand, according to Goldman Sachs Group Inc.
“More and more reports are indicating that the slowdown is not getting any better,” Mike Dragosits, a senior commodity strategist at TD Securities in Toronto, said in a telephone interview. “Prices will probably remain under pressure until we see China taking some aggressive steps to boost growth.”……………………………………….Full Article: Source

Fundamentals look good for mining companies

Posted on 17 February 2015 by VRS  |  Email |Print

For the most part, positive fundamentals (for gold mining companies) refers to rising gold prices. However, this neglects things under the surface that can affect margins as much as or more than headline prices. In the chart below, we plot gold priced in canadian dollars; gold against oil; and gold against Industrial Metals. Before we get to the chart, let me explain why these ratios are important.
First, the vast majority of gold mining firms are headquartered in Canada, with the loonie is their local currency. The Canadian gold price for firms that operate mines or explore in Canada can be more important than the USD Gold price because their costs are in Canadian Dollars and not US$’s. Thus, a weak loonie rather than a weak dollar is a benefit………………………………………..Full Article: Source

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