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China’s activity and investment data for March were robust and point to a strengthening of metals demand in the first quarter. However, the prospect of a steadily tightening policy environment over the course of this year implies weaker demand in the …
19th April 2017
South Africa’s overall mine production continued its recovery in February, as higher prices incentivised producers to raise output. The strength of the production data was broad-based, with gold the only significant exception. … South Africa’s Mine …
13th April 2017
There was a general drawdown of stocks over the last month, albeit on a relatively small scale. The main exception was inventories of tin, which have fallen by nearly 25% in the last four weeks, reflecting constrained supply. … Stocks edge …
11th April 2017
The latest data show only a slight increase in central banks’ holdings of gold in February. We anticipate that this weakness will persist throughout 2017. … Central banks’ gold demand …
7th April 2017
There were some signs of fading investor enthusiasm for industrial metals last month. Although January-February economic data out of China were encouraging, the shift in timing of the Lunar New Year holiday can create distortions. Moreover, stocks of many …
5th April 2017
Sentiment towards metals has soured somewhat over the past few weeks. We think that, in some cases valuations still look stretched, given prospects for further monetary tightening in the US and softer growth in China. As such, we would not be surprised to …
29th March 2017
There are many drivers of the price of aluminium, including demand, supply and investor sentiment. However, in this Metals Watch, we are going to focus on the supply-side. In particular, we are going to assess the outlook for the cost of some of the main …
27th March 2017
The latest import data from China and India show a mixed picture of gold demand in the two largest consumers. While China’s demand has started the new year on a soft note, an easing of the liquidity crunch in India saw imports rise to a three-month high. …
The price of zinc has climbed higher since the start of 2017 on expectations that strong demand coupled with dwindling supply, following last year’s output cuts and mine closures, would lead to a shortage of the refined metal. However, we think that the …
24th March 2017
China’s metals imports appear to have started the year on a soft note. Higher prices might have deterred purchases but we think that, in some cases, demand has also been sluggish. That said, we are wary of reading too much into the data given the usual …
23rd March 2017
World Steel Association (WSA) data showed a 4.1% y/y rise in global steel production in February, in large part driven by rapid expansion in China and India. … Global Steel Production …
22nd March 2017
According to the International Aluminium Institute (IAI), global primary aluminium output rose by 11.3% y/y last month, broadly unchanged from the 11.4% growth rate in January. … Global Aluminium Production …
20th March 2017
The latest data show that central banks’ holdings of gold increased in January. However, we think that a strong US dollar will be a major headwind for gold demand from the official sector this year. … Central banks’ gold demand starts the year on a …
15th March 2017
China’s activity and investment data for the first two months of the year point to robust metals demand. However, we are wary that this may represent the high point of 2017, given signs of a steadily tightening policy environment. … China Industrial …
14th March 2017
South Africa’s overall mine production recovered slightly in January, as higher prices acted as an incentive for producers to increase output. The strength in the output data was broad-based, with gold the only significant exception … South Africa’s Mine …
The big story this month is an unexpected surge in LME copper stocks, which appears to be related to investors closing long positions in the futures market. At the same time, China’s exchange stocks have continued to rise, pointing to lacklustre demand. … …
10th March 2017
After rising for most of February, gold prices have slumped in recent days, falling below the $1,200 per ounce mark, on expectations that the Fed will press ahead with a rate hike next week. We expect prices to fall further over the coming months as the …
While we have been positive on the prospects for cobalt prices for some time now, we think that the most recent rally is overdone. Admittedly, the market is tightening. But, in our view, the move-up in prices to the highest level since November 2008 has …
8th March 2017
The prices of some industrial metals eased back in February, but the bigger picture is that they broadly held on to the gains made in January. A combination of optimism about demand, notably in the US and China, and concerns over supply supported prices. …
3rd March 2017
The latest import data out of China and India show weak demand for gold in the two largest consumers. While China’s data could be distorted by the timing of the New Year, in India the liquidity crunch continues to weigh on gold imports. … China and …
27th February 2017
Optimism about demand, fuelled by a pick-up in China’s activity data and the prospect of fiscal stimulus in the US, continues to buoy investor sentiment in the industrial metals markets. However, there are now signs that China’s economy is starting to …
24th February 2017
China’s metals imports were broadly weak in January. This is in line with the most recent activity data which show that the Chinese economy, while still holding up well, may have lost some momentum in January. That said, shifts in the timing of the …
World Steel Association (WSA) data, released this afternoon, show a 7% y/y rise in global steel output in January. Production in all major producing regions rose, which is in stark contrast to the start of 2016, when output fell sharply. … Global Steel …
21st February 2017
According to the International Aluminium Institute (IAI), global primary aluminium output rose by 11.4% y/y last month, up from 7.8% y/y in December, led by a 19% y/y surge in China’s production. … Global Aluminium Production …
20th February 2017
China’s exchange stocks have soared since the start of the year on a combination of optimism about demand and concerns about supply. … Stocks continue to build in …
16th February 2017
Oversupply has been plaguing the silver market for the past ten years. However, the latest data show that production cuts across the industrial and precious metal industries are starting to take their toll on silver mine supply. We expect silver output to …
15th February 2017
High prices are spurring iron ore production at a time when we think demand will start to slow. As such, the recent rally in prices appears unsustainable. … Why are we so negative on the outlook for iron ore …
Nickel ore supply is likely to fall this year which underpins our forecast of a rise in refined nickel prices. But the scale of any rally will be constrained by high prevailing stocks. … Uncertain ore supply to support nickel …
13th February 2017
South Africa’s overall mine production fell in 2016, with all the main metals seeing a drop in output. The PGM market appears finally to be tightening but we think that it will take some time to rise further, owing to high stocks. … South Africa’s Mine …
9th February 2017
Global gold demand rose 2% y/y in 2016 to reach a three-year high of 4,309 tonnes. This increase was predominantly the result of strong safe-haven demand in the first half of the year. In 2017, we expect gold prices to be mainly driven by changes in US …
8th February 2017
The prices of most metals rose last month (see Chart), buoyed by ongoing investor buying and expectations of strong demand in China and the US. The decision by the Fed to keep rates on hold in January, coupled with the uncertainty around President Trump’s …
3rd February 2017
Demand for gold in the two main consumers – China and India – plummeted in 2016 on a combination of higher prices, increased regulation in India and lower appetite for gold jewellery in China. Looking forward, we expect overall demand to remain subdued …
There have been some large moves in stocks, notably in Shanghai, over the last month. Stockbuilding was evident in China which may have been a symptom of weak demand, but we think it is more likely to be a reflection of optimism about future demand. … …
2nd February 2017
While we had always been positive on the outlook for metals in 2016, even we were surprised by the scale of the rally. Indeed, we are now concerned that the prevailing optimism about demand for industrial metals could prove unfounded. At the same time, we …
30th January 2017
After a weak start to the year, global steel production recovered and was growing briskly at 5.5% y/y in December, encouraged by high prevailing prices. In our view, the steel market is more than comfortably supplied, which suggests prices could fall back …
25th January 2017
China’s refinery output continued to grow in December, encouraged by higher prices and signs of a more general revival in the economy. However, we think optimism about demand will fade over the course of the year and that we may be a near a peak in …
24th January 2017
According to the International Aluminium Institute (IAI), global primary aluminium output rose by 7.8% y/y last month, up from 3% y/y in November, led by a whopping 14.2% y/y jump in China’s production. … Global Aluminium Production (Dec. & …
23rd January 2017
The pattern of China’s trade in industrial metals and ores in 2016 was determined in part by trends in global mine supply. Lower mine output of some ores was a factor curbing imports, but higher US dollar prices may also have been weighing on demand in …
China’s activity data for December show the economy finishing the year on a strong note. That said, there were signs of somewhat slower growth in output last month and the downturn in state-led infrastructure spending is a particular cause for concern. … …
20th January 2017
After slumping in the days following Trump’s win, the price of gold has since recovered some ground and is now trading at around $1,200 per ounce. However, we think that risks are now skewed to the downside and that prices might fall back this year. … How …
18th January 2017
South Africa’s overall mine production remained subdued in November, with all metals seeing a drop in output. The PGM market appears finally to be tightening but we think that it will take some time for prices to respond, owing to high stocks. … South …
17th January 2017
The latest data show that central banks’ holdings of gold were broadly unchanged in November. However, year-to-date purchases remain substantially lower than in 2015 and this weakness could persist through 2017. The pace of the official sector’s purchases …
12th January 2017
The prices of most metals rose last year, but industrial metals substantially outperformed precious. While we had always been positive on the outlook for metals in 2016, even we were surprised by the scale of the rally. Indeed, we are now concerned that …
5th January 2017
The prospect of reduced mine supply from the Philippines was a key driver of the rally in nickel prices in the second half of 2016. However, the price of nickel still underperformed its base metal peers and it fell back sharply in the final weeks of last …
3rd January 2017
According to the International Aluminium Institute (IAI), global primary aluminium output rose by 2.9% y/y last month, up from 1.5% y/y in October, as India, Russia and China continued to expand output. … Global Aluminium Production …
20th December 2016
Aside from a 14% m/m jump in copper inventories, there haven’t been any big changes in stocks over the past month. However, the year-to-date picture is more mixed, with the aluminium, tin and zinc markets now looking substantially tighter than a year ago. …
15th December 2016
China’s activity data for November painted a positive picture for metals demand. However, there are signs of a slowdown in the all-important construction sector which, coupled with official efforts to curb credit growth, point to weaker activity in the …
14th December 2016
Platinum has substantially underperformed its sister metals – palladium and rhodium – this year as its higher correlation with gold has seen its price fall sharply since the US presidential election. Looking forward, we only see limited upside for prices …
9th December 2016
A slump in PGM output drove South Africa’s total mine production lower in October, after tentative signs of a recovery in September. While this is not good news for South Africa’s economy, it is exactly what it’s needed in the PGM sector where abundant …
8th December 2016
Investors have been encouraged by stronger economic data out of China and the prospect of fiscal stimulus in the US and have significantly increased their exposure to industrial metals. Conversely, gold has suffered from waning self-haven demand. However, …
6th December 2016