Morning Bites (part 1)
🔗China’s net finished steel exports surged 45% YoY in August, following the 13% YoY increase in July. Meanwhile, we note Beijing’s stated intention to boost the domestic economy via new support measures for the property sector, as well as plans to cap steel output at the 2022 level (it was still +3% YoY in 7mo23). These factors might add some support for steel prices, we believe
🪨China’s coal imports grew 51% YoY in August (vs. +67% YoY in July). The surge in imports has continued (+82% YoY in 8mo23): seaborne prices for power-generation fuel remain attractive, especially taking into account the constrained domestic supplies, Reuters reports. To recap, China, accounted for 53% of global coal consumption in 2022E, according to the IEA estimates
#coal #steel
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🔗China’s net finished steel exports surged 45% YoY in August, following the 13% YoY increase in July. Meanwhile, we note Beijing’s stated intention to boost the domestic economy via new support measures for the property sector, as well as plans to cap steel output at the 2022 level (it was still +3% YoY in 7mo23). These factors might add some support for steel prices, we believe
🪨China’s coal imports grew 51% YoY in August (vs. +67% YoY in July). The surge in imports has continued (+82% YoY in 8mo23): seaborne prices for power-generation fuel remain attractive, especially taking into account the constrained domestic supplies, Reuters reports. To recap, China, accounted for 53% of global coal consumption in 2022E, according to the IEA estimates
#coal #steel
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Morning Bites (part 2)
🔗CISA mills' daily crude steel production during late-August was 2.01mnt, a 7.7% drop from the previous ten days (+0.7% YoY). Meanwhile, local steel inventories fell 11.4% over the same period (-7.6% YoY). We note that Tangshan has announced new steel production restrictions for September, in addition to the recent measures aimed at producers in the top steelmaking provinces (Jiangsu, Shandong). Although China’s crude steel supply was stronger YoY in 2023 (+3% YoY in 7mo23), we keep in mind Beijing’s intention not to exceed the 2022 production levels
#steel
https://metals-wire.com/sector/Steel
🔗CISA mills' daily crude steel production during late-August was 2.01mnt, a 7.7% drop from the previous ten days (+0.7% YoY). Meanwhile, local steel inventories fell 11.4% over the same period (-7.6% YoY). We note that Tangshan has announced new steel production restrictions for September, in addition to the recent measures aimed at producers in the top steelmaking provinces (Jiangsu, Shandong). Although China’s crude steel supply was stronger YoY in 2023 (+3% YoY in 7mo23), we keep in mind Beijing’s intention not to exceed the 2022 production levels
#steel
https://metals-wire.com/sector/Steel
Morning Bites (part 3)
🚗💨Internal combustion engine (ICE) car registrations in the EU rose 7% YoY in 2Q23, after the 13% YoY growth in 1Q23. Diesel cars accounted for 25% of ICE car sales (vs. 26% in 1Q23 and 29% in 2Q22). Overall, the demand for PGMs in the EU remains subdued, as sales have been persistently below their pre-pandemic 2019 levels. To recap, the EU represents ~20% and 31% of global Pd and Pt autocatalyst demand, respectively
🚘EU+UK EV sales rose 35% YoY in 2Q23, following the 18% YoY growth in 1Q23. BEV sales gained 57% YoY (vs. +33% YoY in 1Q23), while PHEV sales inched up 6% YoY (vs. -3% YoY in 1Q23). The share of BEVs in total EV sales grew slightly to 67%, from 66% in 1Q23. Non-ICE cars accounted for 51% of total EU sales (vs. 46% in 2Q22). Overall, EVs continue to gain popularity, which is a favourable factor for the demand for battery metals (nickel, lithium and cobalt)
#cars #EV #nickel #lithium #cobalt
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🚗💨Internal combustion engine (ICE) car registrations in the EU rose 7% YoY in 2Q23, after the 13% YoY growth in 1Q23. Diesel cars accounted for 25% of ICE car sales (vs. 26% in 1Q23 and 29% in 2Q22). Overall, the demand for PGMs in the EU remains subdued, as sales have been persistently below their pre-pandemic 2019 levels. To recap, the EU represents ~20% and 31% of global Pd and Pt autocatalyst demand, respectively
🚘EU+UK EV sales rose 35% YoY in 2Q23, following the 18% YoY growth in 1Q23. BEV sales gained 57% YoY (vs. +33% YoY in 1Q23), while PHEV sales inched up 6% YoY (vs. -3% YoY in 1Q23). The share of BEVs in total EV sales grew slightly to 67%, from 66% in 1Q23. Non-ICE cars accounted for 51% of total EU sales (vs. 46% in 2Q22). Overall, EVs continue to gain popularity, which is a favourable factor for the demand for battery metals (nickel, lithium and cobalt)
#cars #EV #nickel #lithium #cobalt
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👍2
Morning Bites (part 1)
📉Gold-backed ETFs reduced their holdings 46t in August (vs. the revised -35t in July), the third consecutive month to record a decline. As a result, global ETF net outflows YTD reached 130t. According to the World Gold Council (WGC), last month, North American funds sold 44t, while net outflows from the EU was 8t, which was slightly offset by 7t inflows in Asia. We reiterate our view that ETF sales remain the main factor pressuring gold prices, amid strong demand from central banks, an unfavorable macroeconomic environment globally and rising cash costs of gold miners
#ETF #gold
https://metals-wire.com:3000/sector/Gold
📉Gold-backed ETFs reduced their holdings 46t in August (vs. the revised -35t in July), the third consecutive month to record a decline. As a result, global ETF net outflows YTD reached 130t. According to the World Gold Council (WGC), last month, North American funds sold 44t, while net outflows from the EU was 8t, which was slightly offset by 7t inflows in Asia. We reiterate our view that ETF sales remain the main factor pressuring gold prices, amid strong demand from central banks, an unfavorable macroeconomic environment globally and rising cash costs of gold miners
#ETF #gold
https://metals-wire.com:3000/sector/Gold
Morning Bites (part 2)
🚘New car registrations in France, the UK, Spain, Italy and Germany rose 20% YoY in August, vs. the +18% YoY in July. However, the figure was still 17% below the (2019) pre-COVID level. Specifically, in Germany and Spain, car sales were down 22% and 25%, respectively, on the 2019 level, while registrations in France were 12% lower. At the same time, sales in the UK and Italy were 7% and 11% below the 2019 figures, respectively. Given that these five countries represent ~70% of new vehicle registrations in Europe, the region’s car sales have likely followed the recovery trend, while remaining below their pre-pandemic levels
#cars
https://metals-wire.com:3000/sector/PGM
🚘New car registrations in France, the UK, Spain, Italy and Germany rose 20% YoY in August, vs. the +18% YoY in July. However, the figure was still 17% below the (2019) pre-COVID level. Specifically, in Germany and Spain, car sales were down 22% and 25%, respectively, on the 2019 level, while registrations in France were 12% lower. At the same time, sales in the UK and Italy were 7% and 11% below the 2019 figures, respectively. Given that these five countries represent ~70% of new vehicle registrations in Europe, the region’s car sales have likely followed the recovery trend, while remaining below their pre-pandemic levels
#cars
https://metals-wire.com:3000/sector/PGM
Morning Bites (part 3)
🥉Global copper production was up 2.1% YoY in 1H23, the International Copper Study Group reports. In June, output increased 4.5% YoY (vs. +1.5% YoY in May). Although global mined Cu supply in 1H23 was supported by some start-ups and expansions, this growth was partially offset by the operational issues in Chile, China, Indonesia, Panama and the US, as well as the protests in Peru, noted in the report. In particular, Indonesian output was down 6% YoY in 1H23, as operations at Grassberg were disrupted by rainfall and landslides, while Panamian production is estimated to have declined 8% YoY since Cobre Panama supply was interrupted for 15 days as a result of export restrictions imposed by the Maritime Port Authority
#copper
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🥉Global copper production was up 2.1% YoY in 1H23, the International Copper Study Group reports. In June, output increased 4.5% YoY (vs. +1.5% YoY in May). Although global mined Cu supply in 1H23 was supported by some start-ups and expansions, this growth was partially offset by the operational issues in Chile, China, Indonesia, Panama and the US, as well as the protests in Peru, noted in the report. In particular, Indonesian output was down 6% YoY in 1H23, as operations at Grassberg were disrupted by rainfall and landslides, while Panamian production is estimated to have declined 8% YoY since Cobre Panama supply was interrupted for 15 days as a result of export restrictions imposed by the Maritime Port Authority
#copper
https://metals-wire.com:3000/sector/Copper
Morning Bites (part 1)
🚘US light vehicle sales rose 16% YoY in August, following the 15% YoY growth in July (but were still -20% vs. the pre-Covid 2019 level). Seasonally adjusted sales volumes were up 15% YoY last month (-11% vs. 2019). According to market participants, economic headwinds driven by high interest rates and car prices might slow the sales recovery in 2H23. Overall, we do not expect the US car market to rebound to pre-Covid levels in 2023, and so think that the local demand for PGMs from the automotive sector is likely to remain subdued. We remind readers that North America accounted for ~22% and 16% of the world autocatalyst Pd and Pt consumption, respectively, in 2022
#cars
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🚘US light vehicle sales rose 16% YoY in August, following the 15% YoY growth in July (but were still -20% vs. the pre-Covid 2019 level). Seasonally adjusted sales volumes were up 15% YoY last month (-11% vs. 2019). According to market participants, economic headwinds driven by high interest rates and car prices might slow the sales recovery in 2H23. Overall, we do not expect the US car market to rebound to pre-Covid levels in 2023, and so think that the local demand for PGMs from the automotive sector is likely to remain subdued. We remind readers that North America accounted for ~22% and 16% of the world autocatalyst Pd and Pt consumption, respectively, in 2022
#cars
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Morning Bites (part 2)
🏦China’s aggregate financing recovered 26% YoY in August to CNY 3.12tn, after hitting the lowest point since July 2014 the previous month. At the same time, the figure came in 27% ahead of the consensus. Meanwhile, traditional bank loans rose 9% YoY to CNY 1.36tn, also surpassing the consensus estimate of CNY 1.20tn. Overall, although China’s economic recovery has stumbled after solid 1Q23, its PMI data was the strongest among largest economies. We also keep in mind Beijing’s intention to support the economy via the real estate segment, which might bolster industrial metals demand later in 2H23
China represents 52% of global steel consumption, as well as 55% and 58% of world copper and aluminium demand, respectively
#global
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🏦China’s aggregate financing recovered 26% YoY in August to CNY 3.12tn, after hitting the lowest point since July 2014 the previous month. At the same time, the figure came in 27% ahead of the consensus. Meanwhile, traditional bank loans rose 9% YoY to CNY 1.36tn, also surpassing the consensus estimate of CNY 1.20tn. Overall, although China’s economic recovery has stumbled after solid 1Q23, its PMI data was the strongest among largest economies. We also keep in mind Beijing’s intention to support the economy via the real estate segment, which might bolster industrial metals demand later in 2H23
China represents 52% of global steel consumption, as well as 55% and 58% of world copper and aluminium demand, respectively
#global
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Morning Bites (part 1)
🏦China has increased its gold reserves for the 10th consecutive month, purchasing 29t in August (~7% of annualised physical gold demand in 2022), after the +23t in July, Bloomberg reports. Hence, PBoC gold holdings now stand at 2,165t, with ~218t added in November 2022 - August 2023 (~6% of annualised demand). Given adverse macroeconomic conditions globally, as well as the rising cash costs of miners and strong demand from central banks, we maintain our positive view on gold performance
⛏️Udokan has produced its first copper concentrate, Reuters reports. One of the world's largest copper projects, it had been delayed (2022), before being launched on Monday in line with the revised plan. To recap, Udokan is expected to bring 0.6% of global Cu output in the first production stage, with a potential expansion to 1.6%. The mine accounts for ~3.1% of global Cu reserves
#gold #copper
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🏦China has increased its gold reserves for the 10th consecutive month, purchasing 29t in August (~7% of annualised physical gold demand in 2022), after the +23t in July, Bloomberg reports. Hence, PBoC gold holdings now stand at 2,165t, with ~218t added in November 2022 - August 2023 (~6% of annualised demand). Given adverse macroeconomic conditions globally, as well as the rising cash costs of miners and strong demand from central banks, we maintain our positive view on gold performance
⛏️Udokan has produced its first copper concentrate, Reuters reports. One of the world's largest copper projects, it had been delayed (2022), before being launched on Monday in line with the revised plan. To recap, Udokan is expected to bring 0.6% of global Cu output in the first production stage, with a potential expansion to 1.6%. The mine accounts for ~3.1% of global Cu reserves
#gold #copper
https://metals-wire.com:3000/news-reports
Morning Bites (part 2)
💎US jewellery sales shrank 2% YoY in July, vs. the revised 5% YoY drop in June, IDEX reports, citing the US Department of Commerce. This was the 10th month of YoY drops since October 2022 (only January 2023 saw a rise, of 1% YoY). According to IDEX, still high inflation and rising interest rates continue to weigh on consumer spending, especially as concerns luxury goods. This underpins our view that persistently weak US sales (~50% of world gem-set jewellery trade) are likely to put further stress on the demand for rough diamonds, which has been affected by the adverse macroeconomic conditions globally
#diamonds
https://metals-wire.com/sector/Diamonds
💎US jewellery sales shrank 2% YoY in July, vs. the revised 5% YoY drop in June, IDEX reports, citing the US Department of Commerce. This was the 10th month of YoY drops since October 2022 (only January 2023 saw a rise, of 1% YoY). According to IDEX, still high inflation and rising interest rates continue to weigh on consumer spending, especially as concerns luxury goods. This underpins our view that persistently weak US sales (~50% of world gem-set jewellery trade) are likely to put further stress on the demand for rough diamonds, which has been affected by the adverse macroeconomic conditions globally
#diamonds
https://metals-wire.com/sector/Diamonds
Morning Bites
📌China’s new internal combustion engine car sales rose 1% YoY in August, reversing from the 12% YoY decline in July. Sales, however, remained below their pre-Covid level (-7% vs. August 2019), likely amid the growing appetite for EVs, which is a stress factor for the consumption of PGMs. To recap, China represents some 26% and 17% of world autocatalyst Pd and Pt demand, respectively
📌New EV sales in China jumped 27% YoY in August, following the 32% YoY surge in July. As China has accounted for ~50% of global EV demand in recent months, this further increase in EV sales could add support to the demand for the battery metals basket (e.g. cobalt, lithium and nickel), we believe
#cars #EV #nickel #lithium #cobalt
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📌China’s new internal combustion engine car sales rose 1% YoY in August, reversing from the 12% YoY decline in July. Sales, however, remained below their pre-Covid level (-7% vs. August 2019), likely amid the growing appetite for EVs, which is a stress factor for the consumption of PGMs. To recap, China represents some 26% and 17% of world autocatalyst Pd and Pt demand, respectively
📌New EV sales in China jumped 27% YoY in August, following the 32% YoY surge in July. As China has accounted for ~50% of global EV demand in recent months, this further increase in EV sales could add support to the demand for the battery metals basket (e.g. cobalt, lithium and nickel), we believe
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com:3000/news-reports
Morning Bites (part 1)
🔗CISA mills' daily crude steel production during early September was 2.16mnt, growth of 5.5% from the previous ten days (also a 2.9% increase YoY). Meanwhile, local steel inventories grew 7.3% over the same period (-7.4% YoY). Overall, in 7mo23, Chinese production was still +3% YoY, despite Beijing’s stated call to cap national steel output below the 2022 levels: we might see tighter supply later in 2H23, especially amid new measures aimed at mills in the top steelmaking provinces (e.g., Jiangsu, Shandong). To recap, China represents ~57% of global steel output
#steel
https://metals-wire.com/sector/Steel
🔗CISA mills' daily crude steel production during early September was 2.16mnt, growth of 5.5% from the previous ten days (also a 2.9% increase YoY). Meanwhile, local steel inventories grew 7.3% over the same period (-7.4% YoY). Overall, in 7mo23, Chinese production was still +3% YoY, despite Beijing’s stated call to cap national steel output below the 2022 levels: we might see tighter supply later in 2H23, especially amid new measures aimed at mills in the top steelmaking provinces (e.g., Jiangsu, Shandong). To recap, China represents ~57% of global steel output
#steel
https://metals-wire.com/sector/Steel
👍2
Morning Bites (part 2)
🏗China’s excavator sales dropped 28% YoY in August (domestic + export), after the 30% YoY fall in July. The decline has roughly met CME estimates (-30% YoY). Of note, CCMA expects sales to drop some 14% YoY in FY23, while the YTD fall is 25%. Specifically, domestic excavator sales — a key indicator of construction activity — were down 38% YoY (vs. -45% YoY in July). Overall, continuously weak excavator sales underpin the ongoing stagnation in China’s real estate segment, which might keep weighing on demand for industrial metals. We remind our readers that China accounts for 52% of global steel consumption, as well as 55% and 58% of world Cu and Al demand, respectively
#steel
https://metals-wire.com/sector/Steel
🏗China’s excavator sales dropped 28% YoY in August (domestic + export), after the 30% YoY fall in July. The decline has roughly met CME estimates (-30% YoY). Of note, CCMA expects sales to drop some 14% YoY in FY23, while the YTD fall is 25%. Specifically, domestic excavator sales — a key indicator of construction activity — were down 38% YoY (vs. -45% YoY in July). Overall, continuously weak excavator sales underpin the ongoing stagnation in China’s real estate segment, which might keep weighing on demand for industrial metals. We remind our readers that China accounts for 52% of global steel consumption, as well as 55% and 58% of world Cu and Al demand, respectively
#steel
https://metals-wire.com/sector/Steel
🗞Today, China has published its industrial production data for August (see table above)
#statistics #China
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#statistics #China
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Morning Bites (part 1)
🔗China’s crude steel output was up 3% YoY in August, decelerating from the 12% YoY growth in July. According to MySteel, only half of Chinese steel mills were operating at profit at the end of August (vs. ~66% in late July), which could result in further output cuts MoM, we believe. We note that China represents ~57% of global crude steel supply
🏢China's property sales dropped further, being down 24% YoY in August (also -24% YoY in July) and 50% below the levels of 2020. Floor space starts were down 23% YoY last month (-26% YoY in July), while personal mortgage loans also shrank 28% YoY (-24% YoY in July). At the same time, property completions grew 10% YoY in August. Despite the stagnant situation in China’s property sector, the mooted support policies, were they to materialise, might bolster construction activity later in 2H23
#steel #property
https://metals-wire.com:3000/sector/Steel
🔗China’s crude steel output was up 3% YoY in August, decelerating from the 12% YoY growth in July. According to MySteel, only half of Chinese steel mills were operating at profit at the end of August (vs. ~66% in late July), which could result in further output cuts MoM, we believe. We note that China represents ~57% of global crude steel supply
🏢China's property sales dropped further, being down 24% YoY in August (also -24% YoY in July) and 50% below the levels of 2020. Floor space starts were down 23% YoY last month (-26% YoY in July), while personal mortgage loans also shrank 28% YoY (-24% YoY in July). At the same time, property completions grew 10% YoY in August. Despite the stagnant situation in China’s property sector, the mooted support policies, were they to materialise, might bolster construction activity later in 2H23
#steel #property
https://metals-wire.com:3000/sector/Steel
Morning Bites (part 2)
🇿🇦South Africa’s PGM mining output fell 10% YoY in July, reversing from the 11% YoY growth in June. Meanwhile, the country’s gold production was up 13% YoY, decelerating from the 29% YoY spike in the previous month. Although persistent electricity shortages, logistical issues and inflationary pressures keep weighing on the country’s production, demand for PGMs remains weak against the backdrop of growing appetite for EVs globally. That is why PGM prices are at subdued levels (-60% and -30% since mid-2021 for Pd and Pt, respectively). To recap, SA accounts for ~70% of global platinum, 38% of palladium supply and 3% of global gold production
#PGMs #gold
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🇿🇦South Africa’s PGM mining output fell 10% YoY in July, reversing from the 11% YoY growth in June. Meanwhile, the country’s gold production was up 13% YoY, decelerating from the 29% YoY spike in the previous month. Although persistent electricity shortages, logistical issues and inflationary pressures keep weighing on the country’s production, demand for PGMs remains weak against the backdrop of growing appetite for EVs globally. That is why PGM prices are at subdued levels (-60% and -30% since mid-2021 for Pd and Pt, respectively). To recap, SA accounts for ~70% of global platinum, 38% of palladium supply and 3% of global gold production
#PGMs #gold
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Morning Bites
💎India’s rough diamond net imports dropped 4% YoY in August, marking the ninth month of declines since December 2022 (only April showed growth, of 7% YoY). Meanwhile, India’s polished diamond net exports fell 38% YoY, after the 44% YoY decline in July, while synthetic rough diamond net imports suddenly rose 16% YoY (-16% YoY in July) after ten months of decline. The share of lab-grown net rough imports in diamond imports was 9% in August, vs. 10% in July. Overall, the weak demand data from India’s midstream cutters (~95% of world polished stones supply) and their inventory accumulation (see the chart above) underpin our cautious view on the global diamond market
#diamonds
https://metals-wire.com/sector/Diamonds
💎India’s rough diamond net imports dropped 4% YoY in August, marking the ninth month of declines since December 2022 (only April showed growth, of 7% YoY). Meanwhile, India’s polished diamond net exports fell 38% YoY, after the 44% YoY decline in July, while synthetic rough diamond net imports suddenly rose 16% YoY (-16% YoY in July) after ten months of decline. The share of lab-grown net rough imports in diamond imports was 9% in August, vs. 10% in July. Overall, the weak demand data from India’s midstream cutters (~95% of world polished stones supply) and their inventory accumulation (see the chart above) underpin our cautious view on the global diamond market
#diamonds
https://metals-wire.com/sector/Diamonds
Morning Bites
🪨BMA has partially suspended operations at the Peak Downs coal mine after an accident, where two trucks slid over on September 9, Argus reports. The asset has produced ~11mnt during the FY23 (ended in Jun-23) and accounted for ~4% of the global metallurgical coal seaborn market. Although no workers were injured, the market has reacted sharply to the news: Australian HCC prices jumped 11% WoW (+17% MoM) to USD 300/t last week. Overall, this was triggered by tight coking coal supply with limited spot availability (stockpiles across operations were already low), while demand from India remains strong (its steel production was up 9% YoY in 7mo23)
#coal
https://metals-wire.com/sector/Coal
🪨BMA has partially suspended operations at the Peak Downs coal mine after an accident, where two trucks slid over on September 9, Argus reports. The asset has produced ~11mnt during the FY23 (ended in Jun-23) and accounted for ~4% of the global metallurgical coal seaborn market. Although no workers were injured, the market has reacted sharply to the news: Australian HCC prices jumped 11% WoW (+17% MoM) to USD 300/t last week. Overall, this was triggered by tight coking coal supply with limited spot availability (stockpiles across operations were already low), while demand from India remains strong (its steel production was up 9% YoY in 7mo23)
#coal
https://metals-wire.com/sector/Coal