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Commodities Briefing - Category | Metals and Minerals more

Copper drops as China-led commodity rout seen deepening

Posted on 16 December 2015 by VRS  |  Email |Print

Copper futures dropped the most in five weeks on concern the metals rout may deepen on slowing demand in China, the world’s biggest user. Continued concern over China’s economy, coupled with a stronger greenback as the Federal Reserve moves to raise US interest rates, will make it difficult for commodities to rebound, Stephen Roach, a senior fellow at Yale University and former non-executive chairman for Morgan Stanley in Asia, said in a Bloomberg Television interview in Hong Kong on Tuesday.
Fed policy makers start a two-day meeting on Tuesday. The Bloomberg Industrial Metals Subindex is trading near the lowest since 2004 as China’s slowest expansion in a generation cuts demand………………………………………..Full Article: Source

Industrial metals drop as commodities seen extending declines

Posted on 16 December 2015 by VRS  |  Email |Print

Industrial metals dropped with zinc and copper leading losses on concerns commodities risk extended declines on slowing demand from China, the world’s biggest user.
Zinc in London fell as much as 1.6% and traded at $1 532 a metric ton at 4:25pm in Shanghai, while copper fell as much as 1.2%. Raw materials have sunk to the lowest level since 1999 as China’s slowest expansion in a quarter of a century cuts demand. Chinese metals companies have announced reductions in supply or plans to rein in capacity growth to stem the price rout………………………………………..Full Article: Source

Private equity, pension funds eye more metal streaming deals

Posted on 15 December 2015 by VRS  |  Email |Print

Private equity and pension funds may provide the next wave of funding to the slumping mining sector through metal streaming deals as dedicated funding sources struggle to raise their own cash, industry sources said. With many miners unwilling to issue equity given their weakened shares amid falling commodity prices, streaming may help them avoid credit downgrades and fund new mines.
About $4.5 billion worth of these deals, an alternative form of financing where miners are paid cash upfront for future output, have been inked this year, making 2015 a record year for metals streaming as miners slash debt five years into a commodities downturn………………………………………..Full Article: Source

The China metal exchange at center of investment scandal

Posted on 15 December 2015 by VRS  |  Email |Print

The plain four-storey Fanya exchange building in this southern Chinese city is teeming with investigators trying to understand how an obscure metal trading business turned into one of China’s most audacious investment schemes.
Tucked behind an upmarket shopping mall, the Fanya Exchange was founded in 2011 with the aim of giving China greater global control over the supply and price of 14 strategic and rare metals. It also offered an investment product promising annual returns as high as 13.68 percent and the flexibility to deposit and withdraw money at will………………………………………..Full Article: Source

China’s Steel Output Drops Again With More Cuts on the Way

Posted on 14 December 2015 by VRS  |  Email |Print

Steelmakers in China, the world’s largest supplier, are cutting production yet again as faltering demand and a collapse in prices show no signs of abating. Crude steel output contracted 1.6 percent to 63.32 million metric tons in November from a year earlier, according to data from the statistics bureau Saturday.
Supply for the first 11 months dropped 2.2 percent to 738.38 million tons. The country makes about half the world’s steel. Demand in China is weakening as policy makers seek to steer Asia’s biggest economy away from investment-led growth to one driven by consumer demand and services………………………………………..Full Article: Source

Iron ore’s red streak hits 11 days

Posted on 14 December 2015 by VRS  |  Email |Print

The price of iron ore has struck $US37 a tonne as a floor eludes the beaten-down commodity, with industry tensions running high as a result. At the end of the latest session, benchmark iron ore for immediate delivery to the port of Tianjin in China was trading at $US37.00 a tonne, down 1.3 per cent from its prior close of $US37.50 a tonne.
The commodity’s 11th consecutive red session serves as its longest red streak through an 18-month bear market. The losing run has barely stopped for nine weeks, with just four positive trading days in the last 45………………………………………..Full Article: Source

Moody’s: Global base metals, US steel & coal industry fundamentals will remain weak

Posted on 11 December 2015 by VRS  |  Email |Print

Moody’s Investors Service maintains its negative outlook on the global base metals, US steel and US coal industries as persistently low prices and continued volatility in the commodities markets will weaken the operating metrics for issuers in all three sectors in 2016. Slowing Chinese growth will continue to be the main source of volatility for the global base metals market, although weak or contracting growth in Europe and Brazil will also reduce demand and further weigh on prices in 2016, according to “Base Metals - Global, Steel, Coal — US: 2016 Outlook — Gauges Remain in the Red as Price Slide Continues.”
“Single commodity producers, particularly of copper and aluminum, will be more vulnerable than those that are more diversified,” said Carol Cowan, a Moody’s Senior Vice President. “But producers’ costs, liquidity and debt maturity profiles are key considerations that would also affect their credit profiles and ability to weather persistently low prices.” (Press Release)

Copper, aluminum and steel collapse to crisis levels

Posted on 10 December 2015 by VRS  |  Email |Print

The last time raw materials like copper and oil were this cheap, an economic depression loomed just around the corner. It’s no secret that commodities in general have had a horrendous 2015. A nasty combination of overflowing supply and soft demand has wreaked havoc on the industry.
But prices for everything from crude oil to industrial metals like aluminum, steel, copper, platinum, and palladium have collapsed even further in recent days. Crude oil crumbled below $37 a barrel on Tuesday for the first time since February 2009………………………………………..Full Article: Source

Copper Prices Buoyed by Miner Cutbacks

Posted on 10 December 2015 by VRS  |  Email |Print

Copper prices edged up Wednesday as the drumbeat of cutbacks by base-metal producers continued. Copper prices rose 0.6% to $2.066 a pound on the Comex division of the New York Mercantile Exchange, building on Tuesday’s marginal gain. Copper prices have sunk nearly 27% this year as economic growth has dimmed in China, the world’s largest buyer of the metal, which is often looked to as a barometer of global economic health.
Base-metal producers have begun taking steps to shore up supply and demand fundamentals after a dismal year. Anglo-American PLC said Tuesday it would restructure operations, and Freeport-McMorRan Inc. on Wednesday followed suit, saying it would reduce capital spending by $1 billion in the next two years. Glencore PLC and other miners have made similar moves as prices have tumbled………………………………………..Full Article: Source

Morgan Stanley closing base metals trading: source

Posted on 10 December 2015 by VRS  |  Email |Print

U.S. investment bank Morgan Stanley will close its base metals trading desks globally as part of a plan to cut up to 25 percent of jobs in its fixed income and commodities division, a source at the company told Reuters on Tuesday.
Some jobs in precious metals and energy markets may also go, but the bank is planning to keep a market making presence in these areas because they are more likely to deliver the required profitability and returns. A spokesman at Morgan Stanley declined to comment………………………………………..Full Article: Source

Commodities: Material revolution

Posted on 09 December 2015 by VRS  |  Email |Print

As the prices for traditional commodities such as oil, steel and coal languish at multiyear lows, the raw materials used in smartphones, electric cars and 3D printers — among them lithium, graphite and cobalt for use in batteries — are set to experience increased demand. That is prompting some analysts to declare the advent of a new resource era driven by technology.
Goldman Sachs describes lithium as potentially the “new gasoline”. It forecasts that demand for its use in electric vehicles could grow 11-fold to more than 300,000 tonnes by 2025. The opportunity is clear — hybrid and electric car batteries contain between 40kg and 80kg of lithium………………………………………..Full Article: Source

Miners swept up in commodities slump as Anglo shelves dividend

Posted on 09 December 2015 by VRS  |  Email |Print

The worst slump in commodity markets for a decade engulfed the mining sector on Tuesday when Anglo American, one of the industry’s most venerable names, shelved its dividend and said it would cut two-thirds of its workforce. The moves are part of a radical restructuring that will see the company retreat from all lossmaking assets, close mines and shed some 85,000 jobs.
Shares in Anglo dropped by more than 12 per cent to a record low on the news. Other mining and natural resources stocks also fell as oil dipped below $40 a barrel for the first time since the financial crisis began and iron ore, the biggest mined commodity, hit a 10-year low………………………………………..Full Article: Source

Big miners accept reality of low commodity prices. Now what?

Posted on 08 December 2015 by VRS  |  Email |Print

It may seem like stating the obvious, but top miners BHP Billiton and Rio Tinto have said recently that they expect commodities prices to remain subdued. While it is important that two of the world’s top three mining companies acknowledge what the rest of the market has believed for some time, what’s more important is how they respond to the realities they now face.
The first reality is that growth has slowed in China by more than the resource companies, and indeed most market analysts, expected when investment decisions on expanding capacity were made about five years ago. ……………………………………….Full Article: Source

Copper shorts suggest metal oversold, says Citi

Posted on 08 December 2015 by VRS  |  Email |Print

Copper bears may have gone too far this time. Money managers are holding the biggest net-short position in two years in copper futures traded in New York, US government data show. Total bearish wagers doubled last month, approaching a record set in August even as prices have dropped more than 10 per cent since then.
Now, Citigroup says the metal may be “oversold” and that the near-record short position could exacerbate price swings in 2016. Net-short positions in copper futures and options surged in the past five weeks to 36,893 contracts, the most since April 2013, when they reached an all-time high, according to the Commodity Futures Trading Commission data Friday………………………………………..Full Article: Source

Iron ore now with $US30s handle - but for how long?

Posted on 08 December 2015 by VRS  |  Email |Print

After weeks of speculation, iron ore is now finally trading with a $US30 handle. Ore with 62 per cent iron content delivered to Qingdao fell 2.4 per cent overnight to $US39.06 a tonne, according to Metal Bulletin Ltd. The raw material is headed for a third annual decline and has lost 80 per cent since peaking in 2011 at $US191.70.
Indeed, the price is the lowest since 2005, based on annual pricing that preceded the current spot-based system. Analysts are also assessing the impact of the first shipments from Gina Rinehart’s Roy Hill mine within the coming days………………………………………..Full Article: Source

Materials makers to cut production amid demand slump

Posted on 08 December 2015 by VRS  |  Email |Print

Chinese producers of copper, nickel and other materials have agreed to reduce output, aiming to chip away at supply gluts and raise prices as low demand endangers earnings.
Jiangxi Copper and nine other industry leaders agreed in a joint statement Dec. 1 to cut combined output of the refined metal by 350,000 tons in 2016, bringing production more than 4% below the 2014 level. They pledged to close loss-making plants and retire aging facilities as well as to defer expanding capacity for several years………………………………………..Full Article: Source

Why the Chinese metal production cuts won’t work: Andy Home

Posted on 04 December 2015 by VRS  |  Email |Print

The last few days have brought a string of cutback announcements by Chinese metals producers. A grouping of 10 of the country’s top copper smelters have pledged to reduce output by 350,000 tonnes next year. Not to be outdone, 10 major zinc producers are going to cut their output by 500,000 tonnes next year, while eight of the country’s biggest nickel producers are going to cut by around 20 percent, equivalent to around 80,000 tonnes, of collective capacity.
The statements, coordinated by the China Nonferrous Metals Industry Association and Antaike, both metallic arms of the government, are proof that Chinese metals producers are feeling the same pain as their Western peers after this year’s implosion in metal prices………………………………………..Full Article: Source

Copper Prices Pull Higher as Dollar Slips

Posted on 04 December 2015 by VRS  |  Email |Print

Copper prices rose Thursday on support from a weaker dollar and as investors continued to weigh the outlook for supply following recent cuts by Chinese producers. The most actively traded contract, for March delivery, was recently trading 0.85 cents, or 0.4%, higher at $2.0410 a pound on the Comex division of the New York Mercantile Exchange.
Copper prices rebounded from one-week lows hit Wednesday as a weaker dollar reanimated some trader interest in the industrial metal. The ICE Dollar Index, which tracks the buck against a basket of other currencies, was recently at 98.32 versus 100.47 earlier………………………………………..Full Article: Source

Iron ore seen dropping below $40 as China demand wanes

Posted on 04 December 2015 by VRS  |  Email |Print

Spot iron hit a new decade low on Thursday and was seen dropping below $40 a tonne in future, with shrinking steel demand forcing Chinese producers to cut output while there are no signs that top iron ore miners will curb production.
The commodity hit hardest by a slowing Chinese economy, iron ore has lost 43 percent this year, far more than oil and copper, as growing low-cost supply has expanded a global glut. The $10 billion Roy Hill iron ore mine is set to ship its first cargo, marking the start-up of the last of the mining-boom era mega projects in Australia………………………………………..Full Article: Source

Copper declines to almost reverse gains after China supply cuts

Posted on 03 December 2015 by VRS  |  Email |Print

Copper fell after US manufacturing unexpectedly shrank at the fastest pace since 2009, retracing most of an advance on Tuesday as smelters in China, the world’s biggest producer, agreed to reduce output. Zinc retreated.
Copper slid as much as 0.9%, almost reversing a 1% gain the previous day, when Chinese companies announced cuts of 350 000 metric tons next year. The reduction would tip the market into a deficit if it’s implemented, said Helen Lau, an analyst at Argonaut Securities (Asia) in Hong Kong………………………………………..Full Article: Source

Nickel’s caught in a vicious circle but who’s to blame? Andy Home

Posted on 03 December 2015 by VRS  |  Email |Print

Even within the bombed-out landscape that is the industrial metals sector right now nickel is something of a stand-out. On the London Metal Exchange (LME) the price for three-month delivery is trading around $9,000 per tonne, a level last seen during the depths of the Global Financial Crisis (GFC) in 2008.
Last month it fell further than even that historical yardstick, hitting $8,145, the lowest price since 2003. London nickel is now down by 40 percent since the start of the year. The next worst performer, zinc, is down by “only” 30 percent. “Nickel prices have already seriously deviated from the market fundamentals and the whole industrial chain has fallen into a vicious circle.”……………………………………….Full Article: Source

Iron ore is TANKING - $40 horror line in sight

Posted on 03 December 2015 by VRS  |  Email |Print

For the third day in a row the spot iron ore price has fallen to a fresh record low. According to Metal Bulletin, the spot price for benchmark 62% fines slid a further $1.11, or 2.63%, to $41.13 a tonne.
This extends the year’s losses to 42.3%. In Australian dollar terms, the price has declined 35.7% over the same period. So while the currency has fallen, it has been nowhere near enough to offset the slide in the spot price………………………………………..Full Article: Source

Iron ore to trade with a $US30 handle: ANZ

Posted on 02 December 2015 by VRS  |  Email |Print

Iron ore could soon be trading with a $US30 ($42) handle as collapsing steel demand in China pushes the commodity to record low prices. Ore with 62 per cent iron content delivered to Qingdao dropped 3.4 per cent to $US42.97 a tonne on Monday, the lowest level in daily data dating back to May 2008.
Indeed, it was the lowest since 2005, based on annual pricing that preceded the current spot-based system, Reuters reported. A slowdown in China’s manufacturing sector has hit oversupplied commodity markets hard. On Tuesday, official data showed China’s factory activity slipped to its weakest level in more than three years………………………………………..Full Article: Source

Metals fund Orion Resources sees more pain for copper, gold

Posted on 02 December 2015 by VRS  |  Email |Print

Copper and gold are set for more price weakness as bear markets across the commodities sector are likely to last three more years, metals and mining fund Orion Resources said. “We are going to see a pretty broad cross-commodity leg down, where $900 an ounce gold is more than just a possibility,” Orion’s CIO Oskar Lewnowski said.
“$1.80 a pound ($3,968 a tonne) for copper is likely … I don’t think we are going to see much relief until 2018,” said the mining financier, who co-founded metals merchant and hedge fund Red Kite more than a decade ago before starting Orion………………………………………..Full Article: Source

US steel sheet prices expected to find floor by year-end

Posted on 02 December 2015 by VRS  |  Email |Print

Prices for hot-rolled and cold-rolled coil in the US are expected to bottom out by the end of the year, sources said Tuesday. Platts maintained its daily HRC and CRC assessments at $360-$370/st and $490-$500/st, respectively. Both prices are normalized to a Midwest (Indiana) ex-works basis.
Any further erosion from current price levels was expected to be minimal, while available prices in the market were heard to remain compressed. “You have reached that point where 1,000 st or 100 st [orders] would not see much of a difference in terms of pricing,” a buy-side source said………………………………………..Full Article: Source

Gold miners in good place: Beament

Posted on 01 December 2015 by VRS  |  Email |Print

Australia’s emerging mid-tier gold sector is well placed to compete globally as the price of the precious commodity hits five-year lows in US dollar terms, according to Northern Star Resources boss Bill Beament.
The gold price has fallen more than $US130 an ounce since mid-October and taken local gold stocks with it, with the ASX all ordinaries gold index down more than 25 per cent in the same period. It has fallen about $145 in local currency terms in the same period, to about $1470/oz………………………………………..Full Article: Source

Iron ore plunges below $US43

Posted on 01 December 2015 by VRS  |  Email |Print

Increasing fears of oversupply in the iron ore market pushed spot prices down 3.5 per cent overnight in China, while on the Singapore exchange, futures dropped below $US40 for the first time since record keeping began seven years ago. Ore with 62 per cent iron content delivered to Qingdao dropped 3.4 per cent to $US42.97 a tonne on Monday, the lowest level in daily data dating back to May 2008.
The iron ore contracts on the Singapore Exchange tumbled more than 3 per cent to below $US40 a tonne for the first time during the session. The January and February contracts traded $US39.67 a tonne and $US38.85 respectively………………………………………..Full Article: Source

Can the London Metal Exchange crack the steel market?

Posted on 01 December 2015 by VRS  |  Email |Print

The London Metal Exchange (LME) has just launched two steel contracts, one for steel scrap and one for steel rebar. It’s the second time the LME has tried to expand its dominant franchise in nonferrous metals markets into the ferrous space.
Its steel billet contract has long been moribund. Volumes so far this year have totaled a meager 28 lots and there has been no trading at all since June. Despite that, the exchange has decided to keep the contract to facilitate potential arbitrage with the two new contracts. Steel could offer a timely boost to the LME, which is seeing volumes across its core base metals contracts decline for the first time in many years………………………………………..Full Article: Source

Shanghai takes command in metals markets

Posted on 01 December 2015 by VRS  |  Email |Print

Over the summer the surge of Chinese retail investors into equities alarmed global markets. Now the same is happening in commodities, as metals become a favourite tool to bet on a slowing Chinese economy. Investment funds in China have piled into trading on the Shanghai Futures Exchange this month, sending global prices for copper down to a six-year low and nickel to a 10-year low.
The price moves highlight China’s influence on global metals prices as the boom that was spurred by the country’s demand comes to an end. Lower commodity prices have hit shares in global miners, sending Anglo-American to a record low on Friday, as well as revenue in producing countries like Chile………………………………………..Full Article: Source

Half of gold output may not be profitable: miner

Posted on 30 November 2015 by VRS  |  Email |Print

Half of the gold coming from mines may not be viable at current prices, underscoring the industry’s need for consolidation and output cuts, according to the best-performing producer of the metal in the past decade.
“The more we continue to produce unprofitable gold, the more pressure we put on the gold price,” Randgold Resources chief executive officer Mark Bristow said in an interview in Toronto on Friday. “In the medium term, it’s a very bullish outlook for the gold industry. The question is, how long are we going to supply it with unprofitable gold?”……………………………………….Full Article: Source

Relief on lead is temporary

Posted on 30 November 2015 by VRS  |  Email |Print

It was a manic Monday in the metals complex last week as most of the metals fell to multi-year lows. The London Metal Exchange’s (LME) Metal Index declined to its six-year low of 2,097.4. Aluminium and copper also tumbled to their six-year lows. The worst hit among them all was nickel, which tanked to a 12-year low of $8,154 per tonne.
Fears about a surprise Fed rate hike, due to an unscheduled meeting, added to concerns about China, and undermined all metals. However, panic prevailed only for one day and metals have managed to reverse sharply higher thereafter to recover their losses. Lead prices also followed the other metals and fell to a six-year low of $1,554 per tonne on Monday last week………………………………………..Full Article: Source

Nickel tumbles as metals, bar tin, fall

Posted on 30 November 2015 by VRS  |  Email |Print

Nickel has tumbled despite a group of Chinese producers saying they planned to cut output, on scepticism about whether the cuts would be implemented. Eight Chinese producers including state-owned Jinchuan Group Co Ltd have said they would cut output by 15,000 tonnes in December and by at least 20 per cent in 2016.
Nevertheless, three-month nickel slid 5.5 per cent to an intraday low of $US8,685 a tonne. It pared losses to close 4.5 per cent weaker at $US8,775. Nickel had slumped to $US8,145 on Tuesday, the lowest in more than a decade, and has been the worst performing LME base metal in 2015, sliding 42 per cent………………………………………..Full Article: Source

Commodities Slump Defies Miners’ Cuts

Posted on 27 November 2015 by VRS  |  Email |Print

For commodities, the first cuts weren’t the deepest. If anything, they have proved feeble. Prices for copper and zinc continued to fall after announced production cuts by miners. Glencore in September said it would close two African copper mines, removing about 400,000 metric tons of copper annually from the market.
That came after cuts from others like Freeport-McMoRan. Glencore followed that with October’s plans to cut a third of its annual zinc production, or 500,000 tons. The moves prompted short-term rallies, only for them to dissipate within days………………………………………..Full Article: Source

The year of the Chinese metal bear: Andy Home

Posted on 27 November 2015 by VRS  |  Email |Print

The collapse in metal prices this year is all about China. That much is now common knowledge. Chinese demand growth fuelled the boom years. Chinese slowdown, particularly the slowdown in construction activity, has caused the bust. But China is also the source of an entirely new driver of lower prices in the form of massive speculative short selling.
Open interest and volumes have surged across all the industrial metals contracts traded on the Shanghai Futures Exchange (SHFE). Indeed, such has been the intensity of the bear attack that the country’s own producers are now calling for the authorities to investigate what is going on………………………………………..Full Article: Source

Copper Prices Rise on Reports That China Will Start Buying Metals

Posted on 27 November 2015 by VRS  |  Email |Print

Copper prices hit an eight-day high in London on Thursday, rebounding from recent multiyear lows on reports that China will start buying industrial metals to stock up its strategic reserves. The London Metal Exchange’s three-month copper contract was up 2.3% at $4,656 a metric ton in midmorning European trade, having hit an intraday high of $4,741 a ton.
All other major base metals were also up. On Thursday, analysts highlighted that several media reports saying that the Chinese government may buy large quantities of nickel, zinc and aluminum for its own reserves and to alleviate a domestic oversupply………………………………………..Full Article: Source

Metals rally on output cut hopes

Posted on 27 November 2015 by VRS  |  Email |Print

Metal prices have rebounded from their lowest levels since the financial crisis on hopes Chinese producers will start to cut output. Copper, nickel and zinc all rose more than 2 per cent on the London Metal Exchange on Thursday.
Chinese nickel producers are expected to meet on Friday to decide on output cuts after a group of 10 zinc smelters last week announced they would cut production. As commodity prices rose over the past decade, China rapidly built out its mining and smelting capacity in metals. High-cost mines and producers are feeling the squeeze………………………………………..Full Article: Source

Precious metals funds post biggest outflow in 17 weeks -BAML

Posted on 27 November 2015 by VRS  |  Email |Print

Precious metals funds posted their biggest net outflow last week in around four months, while investors kept up the rapid pace of inflows into money market funds, Bank of America Merrill Lynch said on Thursday.
Investors pulled $1.0 billion out of precious metals funds in the four trading sessions to Tuesday, a period in which the dollar rose to its strongest level against a basket of major currencies in seven months. Gold fell to its lowest since early 2010, moving closer towards a break below $1,000 an ounce, and platinum fell to a seven-year low below $850 an ounce………………………………………..Full Article: Source

What will stop the iron ore drop?

Posted on 26 November 2015 by VRS  |  Email |Print

The iron ore price sank to its lowest level in at least six years, amid speculation mills in China are cutting back steel output, hurting demand for the raw material as supplies from the biggest miners increase.
Ore with 62 per cent iron content delivered to Qingdao fell 1.9 per cent to $US43.89 a dry tonne overnight, the lowest in daily data since May 2009, eclipsing the previous low of $US44.59 set in July, Metal Bulletin said………………………………………..Full Article: Source

Miners’ Relationship to Commodities: Hyper-Sensitive

Posted on 26 November 2015 by VRS  |  Email |Print

Life on the edge is an unpredictable business. Anglo American shares plummeted Wednesday, after an HSBC report argued that the miner would still burn cash at spot prices even if it cuts its dividend, reduced investment and chopped costs.
The prospect of a dividend cut should surprise no one: it is virtually certain that Anglo cuts its pay-out and increasingly likely it goes to nothing. Anglo’s $16 billion in liquidity means it can handle a miserable environment for some time………………………………………..Full Article: Source

In the Commodities Rubble, Citigroup Likes Look of Platinum

Posted on 25 November 2015 by VRS  |  Email |Print

In the beaten up world of commodities, platinum may prove to be a good bet. “Right now, platinum looks like an oversold metal,” Ivan Szpakowski, a commodities strategist at Citigroup Inc., told Rishaad Salamat in a Bloomberg TV interview on Tuesday when asked what’s hit rock bottom and may rebound.
The metal that’s used in jewelry and catalytic converters sank to the lowest level in seven years on Tuesday after retreating for the past five quarters. It’s lost 30 percent this year as the dollar advanced and the Volkswagen AG emissions scandal hurt prospects for demand………………………………………..Full Article: Source

Iron ore reaches record post-2008 low in steel demand slide

Posted on 25 November 2015 by VRS  |  Email |Print

The price of iron ore, a key steelmaking ingredient, fell to its lowest level in at least seven years on Tuesday, as steel demand in China continues to weaken. The price of iron ore for China delivery hit $43.4 a tonne, according to the Steel Index. That is a record low in its data going back to the end of 2008, when iron ore prices moved on to a spot market from bilateral pricing contracts.
The drop comes after steel prices in China hit record lows in recent days. Analysts at Macquarie estimate that Chinese steel demand will fall 5.7 per cent this year, and will drop again in 2016………………………………………..Full Article: Source

Base metals bounce, but downward path intact

Posted on 25 November 2015 by VRS  |  Email |Print

Copper and nickel led an industrial-metals rebound on speculation that the slump encouraged some traders to close out bearish bets. The 14-day relative-strength indexes for each of the six main contracts on the London Metal Exchange were near or below the level of 30 that indicates to some traders that prices may be poised to rebound.
Crude oil helped spark a rally in commodities as tensions in the Mideast rose after Turkey shot down a Russian warplane. The LME’s gauge of metals reached the lowest since April 2009 on Monday and has slumped 26 per cent this year as a slowdown in China, the top commodities user, cut demand and added to a glut of metal………………………………………..Full Article: Source

Industrial metals and oil most battered in commodities slump

Posted on 24 November 2015 by VRS  |  Email |Print

A slump in commodities deepened, with industrial metals and oil leading losses as the dollar extended gains. Crude extended its drop below US$42 a barrel and copper fell to levels unseen since 2009 as comments from Federal Reserve officials about the prospect of a rate increase next month bolstered the greenback.
Nickel plunged 4.1 per cent and gold declined, helping to send the Bloomberg Commodity Index to a 16-year low. “This is not a really welcoming environment for risk taking,” said Tim Condon, head of Asia research at ING Groep NV in Singapore………………………………………..Full Article: Source

Metals are getting smashed — nickel, copper and silver are all flirting with multi-year lows

Posted on 24 November 2015 by VRS  |  Email |Print

Commodity prices are getting smashed again on Monday, with several metals either reaching or flirting with their lowest prices in years. Nickel, copper and silver have all traced different paths over recent years, but they have got two things in common — they all plunged in price in 2008-09 as the financial crisis and subsequent recession ripped away demand, and they’re all sliding now.
And Rabobank’s senior FX strategist Jane Foley explained the main drivers of the slump: The strengthening USD continues to contribute to the slump in commodity prices with industrial metals and oil leading the way………………………………………….Full Article: Source

Metals prices fall to multiyear lows

Posted on 24 November 2015 by VRS  |  Email |Print

Metals prices suffered a broad sell-off on Monday that sent prices to their lowest levels in years, intensifying the pressure on miners from Chile to China to cut production. Copper fell to a new six-year low of $4,443.5 a tonne on the London Metal Exchange, while nickel dropped 5 per cent to its lowest level since 2003.
Commodities from metals to oil have fallen more than 23 per cent this year amid increasing concern about slowing growth in China, according to the Bloomberg Commodity Index, which tracks 22 raw materials………………………………………..Full Article: Source

Deepening Metals Rout Sends Copper Below $4,500 as Nickel Slumps

Posted on 24 November 2015 by VRS  |  Email |Print

Copper fell below $4,500 a metric ton for the first time in six years and nickel touched the lowest in more than a decade on concern producers aren’t doing enough to trim a glut of metal.
The retreat in commodities helped send a gauge of mining companies to near the lowest in almost seven years. The London Metal Exchange’s index of six main contracts has slumped 28 percent this year, the most since the global financial crisis in 2008, as a slowdown in top user China cut demand………………………………………..Full Article: Source

Tough road ahead for LME’s new steel, aluminium contracts

Posted on 23 November 2015 by VRS  |  Email |Print

New steel and aluminium contracts to be launched next week by the London Metal Exchange (LME) are expected to attract initial interest from customers, but building up strong liquidity in the current bear market may be challenging. The launch on Monday is a key element of a strategy by the LME’s owner, Hong Kong Exchanges and Cleaning (HKEx), to boost profitability at the 138-year-old exchange.
Three new contracts in steel rebar, steel scrap and aluminium premiums will go live nearly three years after HKEx bought the LME for $2.2 billion, pledging to widen the scope of the exchange from its core business in key industrial metals………………………………………..Full Article: Source

Zinc gains, but copper is down

Posted on 23 November 2015 by VRS  |  Email |Print

Zinc has surged nearly six per cent after top Chinese smelters agreed to cut output in 2016 by 500,000 tonnes, but gave up the bulk of gains on scepticism over whether shortages would kick in. Zinc, mainly used in galvanising steel, rebounded a day after sinking to its weakest point in six years, jumping on the back of the joint announcement by Chinese zinc producers to slash production.
“The scale of those cuts is quite significant. A surge of refined output from China has been weighing on the whole zinc market all year,” said Caroline Bain, senior commodities economist at Capital Economics in London. Three-month zinc on the London Metal Exchange shot up 5.8 per cent to an intraday peak of $US1,620.50 a tonne, the biggest one-day gain in over a month………………………………………..Full Article: Source

Copper Crisis in Commodity ETFs

Posted on 23 November 2015 by VRS  |  Email |Print

On Wednesday, 23 exchange traded products hit all-time lows and the bulk of those products were commodities funds. The iPath Dow Jones-UBS Copper Subindex Total Return ETN, an exchange traded note, is included in that group. JJC has tumbled 29.4% year-to-date as slack demand for the red metal from China has prompted an array of global banks to pare their outlooks on copper.
Goldman Sachs argues that the base metal is headed for a seven-year-long bear market cycle, reports Aza Wee Sile for CNBC. “It is, in our view, highly likely that the four-year trend decline in copper prices is set to continue through at least 2018,” Goldman Sachs said in a note………………………………………..Full Article: Source

LME base metals hit multi-year lows

Posted on 19 November 2015 by VRS  |  Email |Print

Base metals have hit multi-year lows as fears persisted over waning demand in top metals user China and investors awaited the minutes of a US Federal Reserve policy meeting, which could reinforce rate rise expectations.
THE US dollar was just off seven-month highs against a basket of currencies, weighing on metals by making dollar-priced commodities costlier for European and other non-US investors. London Metal Exchange zinc hit a fresh six-year trough of $US1,510.50 a tonne, and ended down 2.0 per cent at $US1,517………………………………………Full Article: Source

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