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Miners Follow Precious Metals and Trend Lower

Posted on 26 May 2016 by VRS  |  Email |Print

Precious metal miners gain: Since the beginning of 2016, precious metal mining shares have followed precious metal prices. Miners shed their 2015 losses and realized substantial gains during the gold and silver rally. The correlation between mining stocks and gold remains high.
However, gold has been falling during the past week. The marginal decline in precious metals could also amplify the losses in mining stocks. Miners took a comparative fall relative to gold. Gold’s overall performance in the first quarter was remarkably positive………………………………………..Full Article: Source

Copper hangs near three-month lows as dollar holds strong

Posted on 25 May 2016 by VRS  |  Email |Print

London copper held near its lowest in three months on Tuesday, pressured by a firmer U.S. dollar following comments by Federal Reserve officials that have bolstered expectations of a June rate hike. The Fed is on track to raise rates in June or July, and will continue with even more hikes next year given U.S. economic strength, a top Fed official said on Monday.
“In addition to a less accommodative rate environment that should continue to pressure base metals over the short-term, we also suspect that technicals are turning against the group,” Ed Meir of INTL FC Stone said in a research note………………………………………..Full Article: Source

Platinum and Palladium (PGMs) forecast and analysis for Q2 2016

Posted on 25 May 2016 by VRS  |  Email |Print

The PGMs were highly volatile in the first quarter, with platinum closing 9.5 percent higher after falling 26 percent last year and palladium ending flat after dropping 29 percent in 2015. Platinum should continue to perform relatively better than palladium although upward pressure should be limited amid poor investment demand.
Overall trend – Platinum and palladium sold off sharply in January before recovering in February and March. We expect modest upward pressure on PGMs in the second quarter, with platinum ranging between $920 and $1,040 and palladium between $550 and $650………………………………………..Full Article: Source

Industrial metals poised to suffer worst month in 4 years

Posted on 25 May 2016 by VRS  |  Email |Print

Industrial metals are set to suffer their worst monthly performance since 2012, according to S&P Dow Jones Indices. The S&P GSCI Industrial Metals Total Return Index has lost 8.7% month-to-date, as of Monday — on track for its worst month since May 2012, when it lost 9.7%. It’s also having its seventh-worst May performance since 1978, when the index history began.
Jodie Gunzberg, global head of commodities and real assets at S&P Dow Jones Indices, attributed the weak performance in industrial metals, which include copper and lead, to the rising U.S. dollar as well as rising inventories of industrial metals………………………………………..Full Article: Source

Japan’s spot aluminum premiums continue to fall amid thin trade

Posted on 25 May 2016 by VRS  |  Email |Print

Japan’s spot aluminum import premium was assessed at $90-$92/mt plus London Metal Exchange cash, CIF Japan, Tuesday, down from $90-$100/mt plus LME cash CIF as low buying interest put pressure on sellers.
A deal at $85/mt plus LME cash CIF Japan was reported closing this week between an international trader and a Japanese trader for 500 mt of primary aluminum for loading in Australia in June. The deal, however, was not taken into account as it was an extremely prompt cargo………………………………………..Full Article: Source

Asia alumina: Buyers dragged down by Chinese output, LME aluminum

Posted on 24 May 2016 by VRS  |  Email |Print

The Platts Australian alumina daily assessment fell 50 cents/mt Monday from last Friday to be assessed at $258.50/mt FOB, netting a $2.50/mt decline in the last week. India’s Nalco awarded a sell tender at $258.50-$258.75/mt FOB Visakhapatnam to Vitol for a 30,000 mt alumina parcel scheduled to load between June 3 and 7, sources close to the trade said. The deadline for bids was May 18 with bids required to be valid until May 20.
In the last two days, consumer and trader sources said they would value at close to parity the price of Indian alumina from Nalco and Australian material. The alumina market has been under pressure from increased Chinese alumina output and a steep plunge in LME aluminum prices in the last three weeks………………………………………..Full Article: Source

Zinc on a strong footing

Posted on 23 May 2016 by VRS  |  Email |Print

Zinc has outperformed other base metals with a strong 17 per cent rally so far this year. The metal’s spot price on the London Metal Exchange (LME) has now surged to $1,861 from $1,593 per tonne in December. On the domestic front, the zinc futures contract traded on the Multi Commodity Exchange (MCX) has risen 18 per cent this year.
A sharp drawdown in inventory levels has been a major trigger for this price rally. The warehouse stock in the LME has come down 23 per cent, from 0.504 million tonnes in February, to 0.387 million tonnes. Surging supply and sluggish demand were the major causes for zinc to slump 26 per cent last year. Additionally, signs of a pick-up in Chinese demand are also supporting the base metal price, as evident from the fall in China’s stock levels……………………………………….Full Article: Source

Sluggish Chinese demand, new battery tax weighs on lead

Posted on 23 May 2016 by VRS  |  Email |Print

Lead, the worst performing industrial metal on the London Metal Exchange this year, is set to stay under pressure due to weak demand in China, where a new tax has been slapped on lead-acid batteries and authorities are cracking down on electric-bikes. Lead depends on lead-acid batteries for about 80 percent of demand in top consumer China.
The global lead market saw its surplus more than double in the first quarter to 29,000 tonnes from 13,000 tonnes in the same period last year, data showed this week. “This year demand looks more worrying. And that’s the key reason we remain relatively bearish towards lead’s price outlook,” said analyst Wenyu Yao at consultancy Thomson Reuters GFMS………………………………………..Full Article: Source

Goldman Singles Out Zinc as ‘Bullish Exception’ Among Metals

Posted on 20 May 2016 by VRS  |  Email |Print

Zinc stands alone, according to Goldman Sachs Group Inc. The New York-based bank has raised its forecasts for the next year on tightening supply and robust demand in China, highlighting its positive prospects in contrast to the “very bearish” outlook seen for all other base metals.
The six and 12-month forecasts were boosted to $2,100 a metric ton from $1,700, while the three-month call rose to $2,000 from $1,800, analysts including Max Layton said in a May 19 report. Zinc for three-month delivery was at $1,868 a ton on the London Metal Exchange on Thursday………………………………………..Full Article: Source

Lesser-known metals poised for price increases: zinc, niobium, uranium

Posted on 20 May 2016 by VRS  |  Email |Print

Much like the perennial predictions of an imminent price breakout of gold, zinc, uranium, and niobium have been the subjects of similar predictions that have thus far been uniformly wrong. Despite the fact that each of these three lesser-followed metals have good fundamental reasons to be heading higher, they have clung stubbornly to the status quo. That is, until recently.
The onset of 2016 has inflicted some new realities on the global marketplace, and within this subset of profound but still unheralded shifts, there are opportunities for investors visionary and bold enough to seize them………………………………………..Full Article: Source

Iron Ore Faces Second-Half Slump as Frenzy Cools, Supply Builds

Posted on 19 May 2016 by VRS  |  Email |Print

After last month’s speculative rally, iron ore is likely to extend declines because of rising supply from the major producers and faltering demand in China, the biggest buyer. “Supply is likely to increase in the second half, so market conditions may ease further,” Rajiv Mukerji, group director of strategic procurement at Tata Steel Ltd., said.
He’ll be speaking at a conference in Singapore on Thursday that’s being attended by producers including BHP Billiton Ltd. and Vale SA. Iron ore has retreated from a 15-month high after widespread predictions the frenzy in China that propelled prices upward in April wouldn’t endure as regulators clamped down and the rallies induced higher production………………………………………..Full Article: Source

Copper touches three-month low, hit by stronger dollar

Posted on 19 May 2016 by VRS  |  Email |Print

Copper slid to its lowest in three months on Wednesday, pressured by the dollar which rose on renewed expectations of further U.S. interest rate hikes. Other industrial metals also joined the downdraft as copper reversed lower after three days of gains.
The dollar climbed to a three-week peak against a basket of currencies, which makes paying for dollar-denominated metals with other currencies more expensive, after comments from Federal Reserve officials left open the potential for several rate increases this year………………………………………..Full Article: Source

The Commodity That No One Knows About But Everybody Wants to Buy

Posted on 18 May 2016 by VRS  |  Email |Print

The world’s mines and steel plants got so devalued during the commodity slump that some were just given away by owners struggling to cut losses or debt. But there’s at least one metal that’s been attracting a lot of attention.
Niobium — named for a Greek goddess who became a symbol of the tragic mourning mother — is used to produce stronger, lighter steel for industrial pipes and aircraft parts. It is mined in only three places on Earth, and the price of every kilogram is seven times higher than copper………………………………………..Full Article: Source

Palladium left out of precious metals rally; investors shy away

Posted on 18 May 2016 by VRS  |  Email |Print

Investor appetite for palladium-backed exchange-traded funds is failing to pick up after a dismal 2015, pointing to another difficult year for the metal despite the prospect of a deepening supply deficit.
Market watchers are predicting the market shortfall for palladium will grow this year as mine output abates and demand from carmakers picks up. However, its prices have lagged the rest of the precious metals complex this year, rising 5 percent versus a 20 percent jump in gold and 17 percent climb in platinum………………………………………..Full Article: Source

Palladium and platinum to fall short of highs this year

Posted on 17 May 2016 by VRS  |  Email |Print

Prices of precious metals platinum and palladium are likely to peak this year, as the market lacks the support that gold draws from investors, a survey said on Monday at the start of London’s annual platinum week.
Both metals, which are used in auto catalysts as well as in jewellery, are likely to fall short of their 2014 highs, according to Metals Focus, a leading metals consultancy. “Ultimately, neither the fundamental market conditions nor the investor activity that would be needed to drive a more decisive bull market seem likely to emerge over the next few months,” Metals Focus said………………………………………..Full Article: Source

Fall in iron ore prices is a pointer to commodities market fragility

Posted on 17 May 2016 by VRS  |  Email |Print

What goes up on unrestrained speculation will inevitably be back on earth at some stage. We saw it when iron ore speculation defying fundamentals took the mineral’s price to a peak of $70.46 a tonne in the third week of April this year - a rise of 80 per cent since December 2015.
Buoyed by weather-related iron ore supply disruptions in Australia, fresh stimulus measures by Beijing and routine moves by China to start rebuilding inventories in the year’s beginning, speculators went on marking up prices. Ore stocks at Chinese ports at close to 100 million tonnes (mt), the highest since March 2015, signals the end of inventory build up linked imports for some time………………………………………..Full Article: Source

There’s more to China’s tumbling metals prices than spooked speculators

Posted on 17 May 2016 by VRS  |  Email |Print

A price retreat in Chinese markets for rough metals, including iron ore, steel, and reinforcing steel, or rebar, likely reflects deeper growth concerns for the world’s second-largest economy, not just short-term market machinations, said analysts. Similar indications emerged in a weekend release of Chinese economic data.
“China released a raft of data that reignites doubts about the nation’s economic stabilization. Fixed asset investment, retail sales and industrial production all missed expectations and slowed in April, suggesting that the upbeat March prints were not descriptive of the underlying trend in economic activity,” said Charalambos Pissouros, senior analyst at IronFX global………………………………………..Full Article: Source

Platinum and palladium markets to go into deficit in 2016: GFMS

Posted on 16 May 2016 by VRS  |  Email |Print

There is good news on the horizon for investors of platinum group metals (PGMs), though a reader has to scrutinize the fine print in the latest report from GFMS to find it. The GFMS team at Thompson Reuters released their annual GFMS Platinum Group Survey 2016 (registration required) last week.
In it, GFMS forecasts the platinum market will return to a small deficit in 2016 and the deficit in palladium will deepen, with the chief determinant of lowered supply for platinum being a reduction in mined metal. “There will be little addition from new projects in the development pipeline while the headwinds of mines’ reduced capital spending is expected to start to weigh,” say the report’s authors………………………………………..Full Article: Source

Iron ore price slumps below $US54 a tonne

Posted on 16 May 2016 by VRS  |  Email |Print

The iron ore price has slumped to a one-month low as investors fret over the strength of Chinese demand. The commodity weakened 1.7 per cent to $US53.50 a tonne at the end of last week, it’s lowest price since April 11. It’s the commodity’s seventh red session in the past eight and the price has now dropped to below the government’s recent budget forecast of $US55 a tonne.
News of infrastructure stimulus out of Beijing gave iron ore miners some brief respite near the end of last week, but investors are sceptical it will have much impact on demand in the coming months………………………………………..Full Article: Source

Mining deals hit new low, but signs of rebound emerge

Posted on 16 May 2016 by VRS  |  Email |Print

The latest fall in acquisition activity in the mining sector may well be the last, with increasing signs that deal flow might be about to rebound. A quarterly mining and metals update from Ernst & Young, to be released today, reveals yet another fall in both the value and volume of mergers and acquisitions in the mining industry, continuing a five-year downward trend.
But the combination of recent commodity price stability, the first long-awaited M&A moves from private equity players and the ­increased willingness of larger companies to part with better quality assets is feeding expectations that a turnaround is getting closer………………………………………..Full Article: Source

Private equity faces China challenge in key mining assets

Posted on 16 May 2016 by VRS  |  Email |Print

Private equity will find it increasingly difficult to compete with Chinese companies in bidding for strategic mining assets, according to $8.4bn private equity firm Denham Capital.
Firms in the sector have raised an estimated $7bn-$10bn to invest in metals and mining amid a commodity downturn that has pushed companies to shore up their balance sheets. But there has been little involvement so far in large deals………………………………………..Full Article: Source

After Five Years, Gold Miners Start to Bet on Growth Again

Posted on 13 May 2016 by VRS  |  Email |Print

Gold mining companies are getting ready to do something they haven’t done in half a decade. As precious metal prices have fallen steadily over the past few years, miners have been forced to cut back on costs and abandon new development projects. Now some analysts say mining companies are ready to pour money back into growth.
“This is something we haven’t seen in five years,” said Jessica Fung, a metals analyst at BMO Capital Markets. “It’s starting to look interesting again.”……………………………………….Full Article: Source

Lithium - the commodity winner you can’t buy: Russell

Posted on 13 May 2016 by VRS  |  Email |Print

Lithium is the hottest commodity around these days, enjoying spectacular price gains and a blue-sky outlook that’s the envy of the natural resource sector. There’s just one problem though. It’s extremely difficult, and somewhat risky, to gain exposure to the sector.
Lithium isn’t traded on any major exchange, and doesn’t have futures contracts or swaps, thereby cutting out one of the main ways investors gain exposure to a commodity. This means the best way to access lithium’s story is through equities, but this isn’t as straightforward as it may seem………………………………………..Full Article: Source

Copper slides to 2-1/2 month low after weak U.S., Europe data

Posted on 13 May 2016 by VRS  |  Email |Print

Copper slid to the weakest levels in 2-1/2 months on Thursday on worries about global demand for industrial metals after worse-than-expected data on U.S. jobs and European industrial output.
Other base metals also turned lower after data showed the number of Americans filing for unemployment benefits unexpectedly rose last week to the highest level in more than a year, raising further concerns about the health of the labour market………………………………………..Full Article: Source

Bulk shipping falters as commodities stumble

Posted on 13 May 2016 by VRS  |  Email |Print

Higher iron ore inventories at Chinese ports could well weigh on demand in the coming days and reflect in the index performance. The Baltic Dry Index (BDI) has been notoriously volatile this year. After touching an all-time low of 290 points on 10 February, the index shot up to 715 on 27 April. But, since then, it has declined 17% till 10 May.
What gives? For one, the drop to the lowest level in the index, which tracks transport costs on international trade routes for dry bulk commodities such as coal and iron ore, was overdone. Two, the Chinese stimulus held out hopes of higher demand for commodities, especially steel and iron ore………………………………………..Full Article: Source

Eastern China’s steel mills cut ferrous scrap buying prices again

Posted on 12 May 2016 by VRS  |  Email |Print

Large and medium-sized steel mills in eastern China on Wednesday cut their ferrous scrap buying prices by a large margin once again as Chinese domestic steel prices continued to fall. Jiangsu Shagang Group, the largest scrap user in China, Wednesday said it would lower its buying price of heavy melting scrap of 6mm thickness and above by Yuan 100/mt ($15/mt) after a cut of Yuan 50/mt on Tuesday, a company source said.
Shagang will now pay Yuan 1,400/mt ($215/mt), including 17% VAT, delivered to Zhangjiagang, Jiangsu province, for heavy melting scrap of 6mm thickness and above………………………………………..Full Article: Source

Iron plunges below $US55 a tonne as commodity trading boom turns to bust

Posted on 11 May 2016 by VRS  |  Email |Print

The world’s annual supply of iron ore changed hands four times in April pushing prices above $US70 a tonne, as Chinese speculators discovered commodities and began furiously trading them.
The boom, built on easy credit and Beijing’s stimulus measures, lasted just long enough for the Australian Treasury to upgrade its 2016 iron ore forecast to $US55 a tonne. That forecast is now under threat as Beijing cracks down on speculative activity in the commodity futures market, which has seen a rally in everything from cotton to eggs, iron ore and steel………………………………………..Full Article: Source

Iron ore market in downswing amid speculation-fueled volatility

Posted on 11 May 2016 by VRS  |  Email |Print

Heavy Chinese speculation is roiling the iron ore market, with the upturn in futures trading leading to volatile spot rates. The spot price of Australian ore headed to China surged above $70 per ton at the end of April, up more than 60% from the end of 2015.
Plans revealed at China’s National People’s Congress in March for transport infrastructure investment of more than 2 trillion yuan ($306 billion) per year caused prices of rebar and other steel materials to skyrocket. Ripples then spread through the Asian market overall, raising prices of products such as hot-coil steel………………………………………..Full Article: Source

Copper teeters on edge of downtrend, iron ore at key support level

Posted on 11 May 2016 by VRS  |  Email |Print

A decent rally in prices of industrial metals like iron ore and copper is unwinding on fears China will slow its rate of economic stimulus. Technical charts show both metals now stand at key points that could signal future price direction.
The impressive rally seen in the industrial metals space looks to be unwinding as early indications appear to show China will not continue its rate of stimulus into the second quarter. Both copper and iron ore prices are at key points in the charts, with further downside on the cards if support levels are broken………………………………………..Full Article: Source

China’s iron ore price to soften, stabilize in May: CISA

Posted on 10 May 2016 by VRS  |  Email |Print

The China Iron & Steel Association expects China’s iron ore prices for both domestically produced and imported cargoes to likely soften and stabilize in May, it said in its April report released Monday.
“Oversupply in the iron ore market will persist, and China’s exchanges have been cooling down the speculative trading on steel and iron ore futures, and iron ore price [in the physical market], thus, will probably stabilize,” the report stated………………………………………..Full Article: Source

Goldman: Steel, Iron Ore Rally May Last Through Q2

Posted on 10 May 2016 by VRS  |  Email |Print

Goldman Sachs raised its second-quarter iron ore price forecast by 47% to $55 per tonne last Friday, saying that the current rally may last through the rest of the quarter. Iron ore prices fell 2% to trade at $60.1 per tonne last week. This morning, Dalian iron ore futures tumbled 5.9%.
This is Goldman’s justification: The sequential improvement in demand surprised Chinese steel mills at the start of the year. A significant contraction in steel demand last year had conditioned the sector to expect further weakness in 2016 and to set inventories accordingly, leaving the sector unprepared for the subsequent rebound of the old economy………………………………………..Full Article: Source

Nickel rebounds as $US slides

Posted on 09 May 2016 by VRS  |  Email |Print

Nickel prices have bounced as the US dollar slid, but the market is braced for another sell-off by funds reversing bets on higher prices, with expectations of an oversupplied market adding to the pressure. Prices of industrial metals overall were boosted as the US currency slid after a weak US April jobs report, making US dollar-denominated metals cheaper for non US-firms.
Traders said some long nickel positions held by funds had been unwound on Thursday and earlier on Friday. On the London Metal Exchange funds’ long positions amounted to 40,055 lots (240,330 tonnes) on April 29 from about 21,000 lots earlier in the month………………………………………..Full Article: Source

Rio Tinto CEO a non-believer in commodities rebound

Posted on 06 May 2016 by VRS  |  Email |Print

Mining giant Rio Tinto is not counting on an upturn in commodities markets anytime soon despite recent gains in prices of iron ore, its main source of revenue, as much of the world’s economies continue to underperform.
Chief Executive Sam Walsh said factors such as the looming U.S. election, a softer outlook in China and immigration woes facing Europe were suppressing a recovery in commodities. His view, however, is a departure from others calling for an end soon to the commodities rout that has sent just about every major mining company into the red………………………………………..Full Article: Source

Doctor Copper Still Holds Sway as Fed Barometer

Posted on 06 May 2016 by VRS  |  Email |Print

As copper goes, so goes the Federal Reserve. At least, that’s what the market thinks. Copper’s ebb and flow are thought to lend insight into global momentum (or a lack thereof) because it’s used in everything from household appliances to the wiring that powers them.
The highly conductive metal is seen as reliable gauge of economic health: Hence, its oft-used honorific, “doctor.” The transformation of the commodity into a form of collateral, however, (China has stockpiled enough copper to build 30,000 Statues of Liberty) has somewhat diminished the extent to which it still serves as the planet’s financial pulse……………………………………….Full Article: Source

Iron ore sinks below $60 as Chinese frenzy cools

Posted on 06 May 2016 by VRS  |  Email |Print

Iron ore suffered another day of losses with the steelmaking commodity sinking below $60 a tonne as a speculative frenzy in China cooled following pressure from local exchanges and regulators.
Chinese iron ore futures experienced a surge in trading volumes last month as speculators piled into the market, looking for quick and easy ways to bet on a pick-up in construction activity and rising steel production………………………………………..Full Article: Source

China statistics probe shrouds base-metal markets in darkness

Posted on 05 May 2016 by VRS  |  Email |Print

In November, 2013, bosses from nine of China’s largest copper smelters sat down over a weekend to discuss the state of the local market. They did so because they had lost faith in the official copper production figures released by the National Bureau of Statistics (NBS). The NBS had just reported record output in the month of October, equivalent to an annualized run rate of 6.8 million tonnes.
The smelters weren’t convinced, suspecting the statistical agency was double-counting production at parent and subsidiary companies and incorrectly labelling some intermediate products such as copper blister as refined metal………………………………………..Full Article: Source

Lithium: The lucky commodity?

Posted on 04 May 2016 by VRS  |  Email |Print

Lithium seems to be lucky: it has roared into prominence just when most other things are doing badly, which has given it more pronounced (or at least more noticeable) thrust than probably may have been the case if all boats were rising. Call it the after-burner effect. It is the space capsule that keeps on going when the booster rockets fall away after take-off.
In the past, whatever was the latest fashion in commodity investing had surged in unison with the market in general. So when uranium went crazy in 2007, and hit $136/lb, or when phosphate and potash had their moments in the sun, or nickel went to $50,000/tonne, or gold threatened to get to $2,000/oz, they were not the only shows on the road………………………………………..Full Article: Source

Brazilian flat steel producers start new round of price hike

Posted on 04 May 2016 by VRS  |  Email |Print

Brazilian steelmakers have started a new round of higher prices for its flat steel products, although it is still uncertain how much of the desired hike would be absorbed by a depressed consuming market, sources said Tuesday.
An executive affirmed that “ArcelorMittal implemented the new prices on May 1, followed by CSN on Monday.” Usiminas’ higher values will be in effect on May 5, as previously announced by its commercial vice president Sergio Leite last week………………………………………..Full Article: Source

Gold vs. gold miners

Posted on 03 May 2016 by VRS  |  Email |Print

For thousands of years, gold has been used as money, a store of wealth, fought over and sought after. Over the last 45 years, Western populations have had a mixed impression of gold. A minority of the population understands that gold is a monetary asset that should be held as wealth insurance.
A larger percentage of the population is confused about gold because of mainstream sources of information. Many people consider gold a risky investment when in fact gold bullion is not an investment at all, but rather money itself………………………………………..Full Article: Source

Why gold is still the pick of the precious metals

Posted on 03 May 2016 by VRS  |  Email |Print

One of the strongest arguments against investing in gold was that the metal yielded no interest while you were holding it so it stands to reason that the environment of low interest rates should be friendly for investors in precious metals.
That argument, while valid, has lost significant merit, because investors don’t get much of an interest rate holding government bonds or bank deposits. Indeed in several countries interest rates have gone negative, which means that investors are paying governments for the privilege of holding their bonds. ……………………………………….Full Article: Source

Iron ore is China’s new casino

Posted on 02 May 2016 by VRS  |  Email |Print

The price of iron ore for decades was hammered out in secret talks between the world’s biggest miners and steelmakers. Now, the dominant force is an obscure commodities market in northeastern China, a stark example of how pricing power for everything from steel to copper is shifting east.
The change has been driven by Chinese investors who have poured billions of dollars into iron-ore futures traded on the Dalian Commodity Exchange. Their bets, reminiscent of last year’s frenzy in Chinese stocks, have generated as much dollar volume as gold futures in New York, according to data from Citigroup Inc………………………………………..Full Article: Source

Metal prices

Posted on 29 April 2016 by VRS  |  Email |Print

The Economist’s metals index has fallen by 46% from its peak in 2011, largely because of slowing demand in China. Supply disruptions caused occasional spikes: nickel prices rose in the first half of 2014 after Indonesia banned metal-ore exports and zinc prices jumped in 2015 after mine closures.
Metals prices have rallied in the past few months, however, thanks to a weaker dollar and a credit surge in China. The price of iron ore, a steel-making ingredient, has jumped by 70% since December. The value of tin has increased because Indonesia, the world’s second-biggest producer, introduced regulations to halt illegal trade that also curbed exports; recent flooding has also restricted access to mining areas………………………………………..Full Article: Source

Iron Ore Bear Holds Fast Even After `the Market Got It So Wrong’

Posted on 29 April 2016 by VRS  |  Email |Print

Iron ore’s surprise rally may be a thing of the past in just three months. Rising supply will top demand once more and the sudden jump in speculative trading in China that’s helped support gains is set to fizzle out, according to Brazil’s Itau Unibanco Holding SA.
The commodity will probably soon be back below $50 a metric ton, and may end the year at about $42, Artur Manoel Passos, an economist in Sao Paulo at Latin America’s largest bank by market value, said in an interview. Last week, iron ore traded as high as $70.46………………………………………..Full Article: Source

How Shanghai trading is changing the physical nickel market

Posted on 29 April 2016 by VRS  |  Email |Print

Everyone’s talking about Chinese speculators. This year has seen an unprecedented surge of trading volumes and open interest in Chinese markets as institutional and retail investors pour money into commodities.
Both the Shanghai Futures Exchange (ShFE) and the Dalian Exchange are upping margin requirements and transaction fees to try and calm overheating contracts such as steel rebar and iron ore. The stampede appears to have been halted with both prices and trading activity losing some of their recent froth. But the current trading frenzy shouldn’t distract from the growing global influence of China’s domestic commodity exchanges………………………………………..Full Article: Source

Copper hits lowest in a week on China speculator crackdown

Posted on 28 April 2016 by VRS  |  Email |Print

Copper dipped to the lowest in a week on its third straight day of losses as a crackdown on speculators in China dampened sentiment, though metals markets were supported by a weaker dollar and strong oil prices.
Iron ore and steel futures in China led a retreat as the authorities raised trading costs to deter speculative investors believed to be behind last week’s big spike in prices and volumes that raised fears of a destabilising crash………………………………………..Full Article: Source

Aluminium looks vulnerable to pullback, iron ore less so: Russell

Posted on 28 April 2016 by VRS  |  Email |Print

If there is a common theme emerging from the recent strong gains in commodity prices, it’s that the extent of the rally isn’t justified by fundamentals and is therefore largely speculative.
Assuming this market consensus is correct, it’s logical to assume that at some point the heat will go out of the market and prices will stabilise or retreat. It would also be logical to assume that the gains in some commodities have been more justifiable than those for others, given the differences in supply and demand dynamics………………………………………..Full Article: Source

Chinese commodity curbs hit iron and steel futures

Posted on 27 April 2016 by VRS  |  Email |Print

China’s heavily traded iron ore and steel futures slid Tuesday after curbs aimed to cut speculation came into effect. The most active iron ore contract on the Dalian Commodity Exchange closed down 6 per cent at 450.5 yuan a tonne, while steel rebar futures dropped 3.8 per cent to close at 2,554 yuan a tonne.
A wave of money has entered China’s commodities markets this month, on improved demand in the steel industry and expectations that China’s government would boost property and infrastructure construction………………………………………..Full Article: Source

Iron ore price rally will run out of puff

Posted on 26 April 2016 by VRS  |  Email |Print

Rampant speculation in China’s iron ore and steel rebar futures markets that helped fuel a surprisingly strong rally in Australian iron ore miners in recent weeks may be starting to cool.
While China’s rebar inventories data yesterday showed supplies of the steel rod used in concrete fell for a seventh-straight week, prices of iron ore and rebar futures faltered after regulators acted to stop excessive speculation and analysts warned the price surge was unsustainable………………………………………..Full Article: Source

April Zinc Price Forecast: Surplus Becomes Deficit in 2015

Posted on 26 April 2016 by VRS  |  Email |Print

The International Lead and Zinc Study Group recently released new data that found the global market for refined zinc recorded a surplus during the first half of 2015, but was in deficit during the second half of the same year.
The London Metal Exchange, Shanghai Futures Exchange and Chinese State Reserve Bureau warehouse inventories — along with those reported by consumers, producers and merchants — decreased in 2015 with 79% of the refined zinc stored in LME warehouses in New Orleans. Want a short- and medium-term buying outlook for aluminum, copper, tin, lead, zinc, nickel and several forms of steel? Sign up for your free trial to our monthly buying outlook reports!……………………………………….Full Article: Source

Expect 10-15% growth in metal prices by FY17: StanChart Bank

Posted on 26 April 2016 by VRS  |  Email |Print

The Chinese property sector has recovered dramatically since the beginning of the year with an upswing in construction activity. This has had a positive impact on steel prices, says Nicholas Snowdon, metals analyst - global research at Standard Chartered Bank.
Nicholas Snowdon, metals analyst - global research at Standard Chartered Bank, expects 10-15 percent rise in metal prices by the end of the current fiscal. The dollar is going to weaken and oil prices will continue to rebound, he says………………………………………..Full Article: Source

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