Morning Bites (part 1)
🚗💨Internal combustion engine (ICE) car registrations in Europe inched up 1% YoY in 3Q23, after the 7% YoY growth in 2Q23. Petrol car sales were up 5% YoY (vs. +12% YoY in 2Q23), while diesel car registrations declined 9% YoY. Diesel cars accounted for 25% of total ICE car sales, the same as in 2Q23. Overall, the figures remain significantly below the 2019 levels, weighing on PGM prices: the EU represents 20% and 31% of global Pd and Pt autocatalyst demand, respectively
🚘 EV sales in Europe jumped 35% YoY in 3Q23, in line with the 2Q23 dynamics. Specifically, BEV sales gained 50% YoY (vs. +57% YoY in 2Q23), while PHEV sales rose 11% YoY. The share of BEVs in total EV sales increased slightly to 69%, from 67% in 2Q23. In our view, continuously strong local EV sales are likely to have a positive effect on the demand for battery metals (e.g. nickel, lithium and cobalt)
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com:3000/news-reports
🚗💨Internal combustion engine (ICE) car registrations in Europe inched up 1% YoY in 3Q23, after the 7% YoY growth in 2Q23. Petrol car sales were up 5% YoY (vs. +12% YoY in 2Q23), while diesel car registrations declined 9% YoY. Diesel cars accounted for 25% of total ICE car sales, the same as in 2Q23. Overall, the figures remain significantly below the 2019 levels, weighing on PGM prices: the EU represents 20% and 31% of global Pd and Pt autocatalyst demand, respectively
🚘 EV sales in Europe jumped 35% YoY in 3Q23, in line with the 2Q23 dynamics. Specifically, BEV sales gained 50% YoY (vs. +57% YoY in 2Q23), while PHEV sales rose 11% YoY. The share of BEVs in total EV sales increased slightly to 69%, from 67% in 2Q23. In our view, continuously strong local EV sales are likely to have a positive effect on the demand for battery metals (e.g. nickel, lithium and cobalt)
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com:3000/news-reports
Morning Bites (part 2)
📉Russia’s gold output dropped 9.2% YoY in September, accelerating from the 3.6% YoY fall in August, according to Rosstat data. Despite three consecutive months of declines, local production was still up 1.7% YoY on the 9mo23 basis. Russia accounts for ~9% of the world's mined gold output. Overall, given miners’ rising cash costs, persistently strong demand from global central banks and potentially lower US Fed funds rate in 1H24, we maintain our bullish view on gold's performance
#gold
https://metals-wire.com/sector/Gold
📉Russia’s gold output dropped 9.2% YoY in September, accelerating from the 3.6% YoY fall in August, according to Rosstat data. Despite three consecutive months of declines, local production was still up 1.7% YoY on the 9mo23 basis. Russia accounts for ~9% of the world's mined gold output. Overall, given miners’ rising cash costs, persistently strong demand from global central banks and potentially lower US Fed funds rate in 1H24, we maintain our bullish view on gold's performance
#gold
https://metals-wire.com/sector/Gold
❤1
Vale 3Q23 results - below expectations
📝Vale's 3Q23 revenues roughly met the market forecasts. However, EBITDA came in weaker (-5% vs. the consensus and -8% vs. us), on the back of cost pressures in the nickel and copper segments being higher than we had anticipated
⛏The miner has recently reiterated its FY23 production outlook for iron ore, while copper output is now expected to be ~9% lower than the previously guided figures, as the YTD performance is lagging the initial plans
💰According to the company, its iron ore C1 cash cost decreased 7% QoQ (+13% YoY) to USD 21.90/t, with Vale on track to meet its USD 21.50–22.50/t target for FY23
📌On our numbers, Vale's 4Q23F EBITDA might show a slight QoQ improvement, at spot, supported by potentially higher proceeds from its base metals business
#VALE #Iron_ore
https://metals-wire.com/company/VALE_US/
📝Vale's 3Q23 revenues roughly met the market forecasts. However, EBITDA came in weaker (-5% vs. the consensus and -8% vs. us), on the back of cost pressures in the nickel and copper segments being higher than we had anticipated
⛏The miner has recently reiterated its FY23 production outlook for iron ore, while copper output is now expected to be ~9% lower than the previously guided figures, as the YTD performance is lagging the initial plans
💰According to the company, its iron ore C1 cash cost decreased 7% QoQ (+13% YoY) to USD 21.90/t, with Vale on track to meet its USD 21.50–22.50/t target for FY23
📌On our numbers, Vale's 4Q23F EBITDA might show a slight QoQ improvement, at spot, supported by potentially higher proceeds from its base metals business
#VALE #Iron_ore
https://metals-wire.com/company/VALE_US/
Week ahead data releases in M&M
As the reporting season continues, several M&M names are due to publish their earnings this week. Regarding Barrick (one of the major global gold miners), our EBITDA estimate is moderately above the consensus
#reporting_season
https://metals-wire.com:3000/events
As the reporting season continues, several M&M names are due to publish their earnings this week. Regarding Barrick (one of the major global gold miners), our EBITDA estimate is moderately above the consensus
#reporting_season
https://metals-wire.com:3000/events
Morning Bites
🏗China’s preliminary excavator sales were down 35% YoY in October (domestic + export), broadly in-line with the 33% YoY decline in September, according to CME estimates. Specifically, domestic sales (a key indicator of construction activity) are set to be 43% weaker YoY, after the 40% YoY drop in September. Were this trend to persist, it would indicate no recovery in China's stressed real estate sector, we believe. However, new economic stimulus, in the form of higher government spending, aimed at infrastructure investment, might add support to local construction activity, and hence, China’s demand for industrial metals in late 2023-24
China represents 52% of global steel consumption, as well as 55% and 58% of world copper and aluminium demand, respectively
#steel
https://metals-wire.com/sector/Steel
🏗China’s preliminary excavator sales were down 35% YoY in October (domestic + export), broadly in-line with the 33% YoY decline in September, according to CME estimates. Specifically, domestic sales (a key indicator of construction activity) are set to be 43% weaker YoY, after the 40% YoY drop in September. Were this trend to persist, it would indicate no recovery in China's stressed real estate sector, we believe. However, new economic stimulus, in the form of higher government spending, aimed at infrastructure investment, might add support to local construction activity, and hence, China’s demand for industrial metals in late 2023-24
China represents 52% of global steel consumption, as well as 55% and 58% of world copper and aluminium demand, respectively
#steel
https://metals-wire.com/sector/Steel
Morning Bites
🔗China’s CISA predicts lower domestic steel supply in 4Q23, on the back of energy consumption regulations and measures to protect the environment. The CISA also noted soft domestic demand, as the local real estate sector remains subdued. Overall, the news underpins our view that Beijing might implement more steel production restrictions in late-2023 to keep national steel output no higher than the 2022 levels. On our numbers, to meet this requirement, steel supply for the rest of the year must be ~11% YoY lower, on average. That would be a positive factor for steel prices, if it at least partially materialised
According to the CISA, China’s crude steel consumption fell 1.5% YoY in 9mo23 to 731mnt, while production increased 1.7% YoY to 795mnt. Meanwhile, exports surged 32% YoY to 67mnt over the period
#steel
https://metals-wire.com:3000/sector/Steel
🔗China’s CISA predicts lower domestic steel supply in 4Q23, on the back of energy consumption regulations and measures to protect the environment. The CISA also noted soft domestic demand, as the local real estate sector remains subdued. Overall, the news underpins our view that Beijing might implement more steel production restrictions in late-2023 to keep national steel output no higher than the 2022 levels. On our numbers, to meet this requirement, steel supply for the rest of the year must be ~11% YoY lower, on average. That would be a positive factor for steel prices, if it at least partially materialised
According to the CISA, China’s crude steel consumption fell 1.5% YoY in 9mo23 to 731mnt, while production increased 1.7% YoY to 795mnt. Meanwhile, exports surged 32% YoY to 67mnt over the period
#steel
https://metals-wire.com:3000/sector/Steel
Morning Bites (part 1)
🏆Global physical gold demand declined 13% YoY to 1,225t in 3Q23, following the revised 4% YoY gain in 2Q23, per the World Gold Council (WGC) data. Meanwhile, total global gold demand was down 7% YoY (vs. the revised +8% YoY in 2Q23). Central bank purchases last quarter dropped 27% YoY, mostly due to the high base effect (still +14% YoY on the 9mo23 basis). At the same time, the demand for gold jewellery shrank 2% YoY in 3Q23 (vs. +3% YoY in 2Q23). In spite of there being some correction in physical gold demand, it was still up 2% YoY in 9mo23. Gold mine production grew ~2% YoY in 3Q23, vs. the 4% YoY growth in 2Q23. Overall, we keep our positive view on the precious metal's price, amid miners’ rising cash costs, strong demand from global central banks and the potentially lower US Fed funds rate in 1H24
#gold
https://metals-wire.com/sector/Gold
🏆Global physical gold demand declined 13% YoY to 1,225t in 3Q23, following the revised 4% YoY gain in 2Q23, per the World Gold Council (WGC) data. Meanwhile, total global gold demand was down 7% YoY (vs. the revised +8% YoY in 2Q23). Central bank purchases last quarter dropped 27% YoY, mostly due to the high base effect (still +14% YoY on the 9mo23 basis). At the same time, the demand for gold jewellery shrank 2% YoY in 3Q23 (vs. +3% YoY in 2Q23). In spite of there being some correction in physical gold demand, it was still up 2% YoY in 9mo23. Gold mine production grew ~2% YoY in 3Q23, vs. the 4% YoY growth in 2Q23. Overall, we keep our positive view on the precious metal's price, amid miners’ rising cash costs, strong demand from global central banks and the potentially lower US Fed funds rate in 1H24
#gold
https://metals-wire.com/sector/Gold
Morning Bites (part 2)
🇨🇱Chile’s copper production increased 4% YoY in September, after the 3% YoY growth in August, while remaining close to its historical lows. We remind readers that Chile's mining industry (~27% of world copper output) has been affected by a persistent drought and unfavourable structural effects (e.g. grade depletion). Hence, in our view, if the adverse factors in Chile’s mining sector persist, they might at least partially offset the supply additions from new Cu projects (e.g. QB2 and Udokan), which are set to launch in 2023
#copper
https://metals-wire.com:3000/sector/Copper
🇨🇱Chile’s copper production increased 4% YoY in September, after the 3% YoY growth in August, while remaining close to its historical lows. We remind readers that Chile's mining industry (~27% of world copper output) has been affected by a persistent drought and unfavourable structural effects (e.g. grade depletion). Hence, in our view, if the adverse factors in Chile’s mining sector persist, they might at least partially offset the supply additions from new Cu projects (e.g. QB2 and Udokan), which are set to launch in 2023
#copper
https://metals-wire.com:3000/sector/Copper
Morning Bites (part 1)
🌏Global manufacturing PMIs showed overall weak dynamics in October. The Eurozone Markit Manufacturing PMI was reported at 43.0 (vs. 43.4 in September), missing the estimates of 43.7. The US ISM manufacturing PMI also fell to 46.7, after the 10-month high of 49.0 in September, well below expectations of 49.0
🇨🇳The official NBS Manufacturing PMI in China suddenly dropped to 49.5 in October (from 50.2 in September), missing the 50.2 estimates, in line with the Caixin China Manufacturing PMI (49.5 vs. 50.6 in September), that also missed the estimates of 50.8
❗️Overall, the dynamics of the main global PMIs deteriorated in October, staying below 50.0, which might weigh further on the manufacturing sector. On the other hand, China’s new economic stimulus, aimed at infrastructure projects, might add support to local construction activity in 4Q23-2024 and, hence, bolster the demand for industrial metals
#PMIs
https://metals-wire.com:3000/news-reports
🌏Global manufacturing PMIs showed overall weak dynamics in October. The Eurozone Markit Manufacturing PMI was reported at 43.0 (vs. 43.4 in September), missing the estimates of 43.7. The US ISM manufacturing PMI also fell to 46.7, after the 10-month high of 49.0 in September, well below expectations of 49.0
🇨🇳The official NBS Manufacturing PMI in China suddenly dropped to 49.5 in October (from 50.2 in September), missing the 50.2 estimates, in line with the Caixin China Manufacturing PMI (49.5 vs. 50.6 in September), that also missed the estimates of 50.8
❗️Overall, the dynamics of the main global PMIs deteriorated in October, staying below 50.0, which might weigh further on the manufacturing sector. On the other hand, China’s new economic stimulus, aimed at infrastructure projects, might add support to local construction activity in 4Q23-2024 and, hence, bolster the demand for industrial metals
#PMIs
https://metals-wire.com:3000/news-reports
Morning Bites (part 2)
💍Hong Kong jewellery and watch sales grew 27% YoY in September, decelerating from the 57% YoY increase in August, according to the government data. We remind readers that the recovery in sales was triggered by the reopening of HK’s border with the Mainland in early 2023 (in September, 2.8mn visitors arrived in HK vs. 66k a year ago). Sales were also 17% stronger vs. the pre-Covid 2019 levels. However, given the weak sentiment on the main retail gem-set jewellery markets (the US and China, which jointly represent ~65% of the global polished stones demand), we keep our cautious view on the diamond sector, as it is still heavily affected by the adverse macroeconomic conditions globally
#diamonds
https://metals-wire.com/sector/Diamonds
💍Hong Kong jewellery and watch sales grew 27% YoY in September, decelerating from the 57% YoY increase in August, according to the government data. We remind readers that the recovery in sales was triggered by the reopening of HK’s border with the Mainland in early 2023 (in September, 2.8mn visitors arrived in HK vs. 66k a year ago). Sales were also 17% stronger vs. the pre-Covid 2019 levels. However, given the weak sentiment on the main retail gem-set jewellery markets (the US and China, which jointly represent ~65% of the global polished stones demand), we keep our cautious view on the diamond sector, as it is still heavily affected by the adverse macroeconomic conditions globally
#diamonds
https://metals-wire.com/sector/Diamonds
Barrick 3Q23 results - overall neutral
📝Barrick's 3Q23 revenues were 7% lower than the consensus, but overall met our estimates. Meanwhile, adjusted EBITDA was broadly in-line with the market forecasts (+3% vs. the consensus and -3% vs. us)
📉In 3Q23, the company's AISC decreased 7% QoQ (-1% YoY) to USD 1,255/oz. Barrick reiterated its AISC target for FY23 at USD 1,170-1,250/oz
⛏The gold miner updated its FY23 production guidance: output is now set to be marginally below the low end of the previous 4.2-4.6mnoz range, given the equipment issues hindering the ramp-up at Pueblo Viejo mine
💰The BoD has declared a quarterly dividend of USD 0.10/sh., which offers a 0.6% DY — in line with the dividend policy
📌At spot, we expect Barrick's 4Q23F EBITDA to moderately improve QoQ, as current gold prices are ~4% higher vs. the 3Q23 avg., while sales volumes might show some recovery by end-2023
#GOLD #gold
https://metals-wire.com/company/GOLD_US/
📝Barrick's 3Q23 revenues were 7% lower than the consensus, but overall met our estimates. Meanwhile, adjusted EBITDA was broadly in-line with the market forecasts (+3% vs. the consensus and -3% vs. us)
📉In 3Q23, the company's AISC decreased 7% QoQ (-1% YoY) to USD 1,255/oz. Barrick reiterated its AISC target for FY23 at USD 1,170-1,250/oz
⛏The gold miner updated its FY23 production guidance: output is now set to be marginally below the low end of the previous 4.2-4.6mnoz range, given the equipment issues hindering the ramp-up at Pueblo Viejo mine
💰The BoD has declared a quarterly dividend of USD 0.10/sh., which offers a 0.6% DY — in line with the dividend policy
📌At spot, we expect Barrick's 4Q23F EBITDA to moderately improve QoQ, as current gold prices are ~4% higher vs. the 3Q23 avg., while sales volumes might show some recovery by end-2023
#GOLD #gold
https://metals-wire.com/company/GOLD_US/
Morning Bites
🏦 Global central banks accumulated net 77t of gold in September, vs. the revised +86t in August, marking the 4th consecutive increase in holdings, the World Gold Council (WGC) reports. The main contributors were China (+26t), Poland (+19t), Uzbekistan (+9t) and Turkey (+8t). There was only 1t of gross sales, underpinning solid gold demand from central banks. Overall, given miners’ rising cash costs, persistently strong demand from global central banks and a potentially lower US Fed funds rate in 1H24, we maintain our bullish view on gold's performance
#gold
https://metals-wire.com/sector/Gold
🏦 Global central banks accumulated net 77t of gold in September, vs. the revised +86t in August, marking the 4th consecutive increase in holdings, the World Gold Council (WGC) reports. The main contributors were China (+26t), Poland (+19t), Uzbekistan (+9t) and Turkey (+8t). There was only 1t of gross sales, underpinning solid gold demand from central banks. Overall, given miners’ rising cash costs, persistently strong demand from global central banks and a potentially lower US Fed funds rate in 1H24, we maintain our bullish view on gold's performance
#gold
https://metals-wire.com/sector/Gold
Week ahead data releases in M&M
Reporting season is drawing to a close, and several major M&M names are due to release their 3Q23 financials this week. Regarding Kinross, we are slightly more conservative than the consensus. Meanwhile, we expect Arcelor to reveal upbeat EBITDA figures
We also await the official customs data from China and De Beers’ sales results
#reporting_season
https://metals-wire.com:3000/events
Reporting season is drawing to a close, and several major M&M names are due to release their 3Q23 financials this week. Regarding Kinross, we are slightly more conservative than the consensus. Meanwhile, we expect Arcelor to reveal upbeat EBITDA figures
We also await the official customs data from China and De Beers’ sales results
#reporting_season
https://metals-wire.com:3000/events
🗞Today, China published its preliminary import/export statistics for October (see table above)
#statistics #China
https://metals-wire.com:3000/news-reports
#statistics #China
https://metals-wire.com:3000/news-reports
Morning Bites (part 1)
🔗China’s net finished steel exports surged 65% YoY in October, following the 81% YoY increase in September. Meanwhile, Chinese steel output remains elevated (+2% YoY in 9mo23), despite Beijing’s plan to cap national steel supply at the 2022 levels. In addition, according to a Mysteel survey, less than 20% of Chinese steel mills were operating at a profit by the end of October (vs. ~33% in late September). This might trigger more production restrictions later in 4Q23 and, hence, bolster steel prices, we believe
🪨China’s coal imports grew 23% YoY in October, decelerating from the +28% YoY in September, as high stocks moderated buying from utilities, according to Reuters. We note that in 10mo23, the figure was up 67% YoY, supported by higher industrial usage, seasonal restocking and tightened domestic supply. To recap, China accounted for 53% of global coal demand in 2022E, according to the IEA estimates
#coal #steel
https://metals-wire.com:3000/news-reports
🔗China’s net finished steel exports surged 65% YoY in October, following the 81% YoY increase in September. Meanwhile, Chinese steel output remains elevated (+2% YoY in 9mo23), despite Beijing’s plan to cap national steel supply at the 2022 levels. In addition, according to a Mysteel survey, less than 20% of Chinese steel mills were operating at a profit by the end of October (vs. ~33% in late September). This might trigger more production restrictions later in 4Q23 and, hence, bolster steel prices, we believe
🪨China’s coal imports grew 23% YoY in October, decelerating from the +28% YoY in September, as high stocks moderated buying from utilities, according to Reuters. We note that in 10mo23, the figure was up 67% YoY, supported by higher industrial usage, seasonal restocking and tightened domestic supply. To recap, China accounted for 53% of global coal demand in 2022E, according to the IEA estimates
#coal #steel
https://metals-wire.com:3000/news-reports
Morning Bites (part 2)
🔗CISA mills' daily crude steel production during late October was 1.92mnt, a 5.7% decline from the previous ten days and a 5.2% drop YoY. Meanwhile, local steel inventories decreased 16.6% over the same period (-16.4% YoY). Although the output declined for the 5th consecutive 10-day period, Chinese steel production on a YTD basis was still up 2.3% YoY, per CISA data. Hence, considering Beijing’s intention to cap national steel output below the 2022 levels, we might see tighter supply later in 4Q23. However, to meet the supply cap, the output for the rest of the year must be on average ~12% YoY lower. In our view, any further production restrictions would be supportive for steel prices. China represents ~57% of global steel output
#steel
https://metals-wire.com/sector/Steel
🔗CISA mills' daily crude steel production during late October was 1.92mnt, a 5.7% decline from the previous ten days and a 5.2% drop YoY. Meanwhile, local steel inventories decreased 16.6% over the same period (-16.4% YoY). Although the output declined for the 5th consecutive 10-day period, Chinese steel production on a YTD basis was still up 2.3% YoY, per CISA data. Hence, considering Beijing’s intention to cap national steel output below the 2022 levels, we might see tighter supply later in 4Q23. However, to meet the supply cap, the output for the rest of the year must be on average ~12% YoY lower. In our view, any further production restrictions would be supportive for steel prices. China represents ~57% of global steel output
#steel
https://metals-wire.com/sector/Steel
Morning Bites (part 3)
🚘US light vehicle sales inched up 2% YoY in October, following the 19% YoY growth in September (but were still 12% below the pre-Covid 2019 level). Seasonally adjusted sales volumes were up 5% YoY last month (-7% vs. 2019). According to a market source, the deceleration in sales was affected by labour union strikes against GM, Ford and Stellantis, which weighed on logistics. Meanwhile, we do not expect the US car market to rebound to pre-Covid levels in 2023 (sales in 10mo23 were +12% YoY, but remain 10% below the 10mo19 figure). Hence, local demand for PGMs from the automotive sector is likely to remain subdued, we believe. Of note, North America accounted for ~22% and 16% of the world autocatalyst Pd and Pt consumption, respectively, in 2022
#cars
https://metals-wire.com:3000/news-reports
🚘US light vehicle sales inched up 2% YoY in October, following the 19% YoY growth in September (but were still 12% below the pre-Covid 2019 level). Seasonally adjusted sales volumes were up 5% YoY last month (-7% vs. 2019). According to a market source, the deceleration in sales was affected by labour union strikes against GM, Ford and Stellantis, which weighed on logistics. Meanwhile, we do not expect the US car market to rebound to pre-Covid levels in 2023 (sales in 10mo23 were +12% YoY, but remain 10% below the 10mo19 figure). Hence, local demand for PGMs from the automotive sector is likely to remain subdued, we believe. Of note, North America accounted for ~22% and 16% of the world autocatalyst Pd and Pt consumption, respectively, in 2022
#cars
https://metals-wire.com:3000/news-reports
Morning Bites (part 1)
🏦China raised its gold reserves for the 12th consecutive month, purchasing 23t in October (~6% of annualised physical gold demand in 2022), after the +27t in September, Bloomberg reports. Hence, the PBoC's gold holdings now stand at 2,215t, with ~266t added since November 2022 (6% of annualised demand). Overall, given the strong demand from global central banks, as well as miners’ rising cash costs and the potentially lower US Fed funds rate in 1Q24, we maintain our bullish view on gold's performance
#gold
https://metals-wire.com/sector/Gold
🏦China raised its gold reserves for the 12th consecutive month, purchasing 23t in October (~6% of annualised physical gold demand in 2022), after the +27t in September, Bloomberg reports. Hence, the PBoC's gold holdings now stand at 2,215t, with ~266t added since November 2022 (6% of annualised demand). Overall, given the strong demand from global central banks, as well as miners’ rising cash costs and the potentially lower US Fed funds rate in 1Q24, we maintain our bullish view on gold's performance
#gold
https://metals-wire.com/sector/Gold
Morning Bites (part 2)
📉Gold-backed ETFs saw outflows of 37t in October, vs. the -59t in September, marking the 5th month of consecutive declines. According to the World Gold Council (WGC), last month, North American funds sold 28t, while net outflows from the EU were 11t, with only 1t purchased in Asia. As a result, global ETF net outflows in 10mo23 reached 225t (~6% of global physical gold demand in 2022 in annualised terms). We reiterate our view that ETF sales remain one the main factors pressuring gold prices. However, the potential decrease in US Fed funds rate in 1Q24, following the consensus estimates, might add support to the precious metal’s performance
#ETF #gold
https://metals-wire.com:3000/sector/Gold
📉Gold-backed ETFs saw outflows of 37t in October, vs. the -59t in September, marking the 5th month of consecutive declines. According to the World Gold Council (WGC), last month, North American funds sold 28t, while net outflows from the EU were 11t, with only 1t purchased in Asia. As a result, global ETF net outflows in 10mo23 reached 225t (~6% of global physical gold demand in 2022 in annualised terms). We reiterate our view that ETF sales remain one the main factors pressuring gold prices. However, the potential decrease in US Fed funds rate in 1Q24, following the consensus estimates, might add support to the precious metal’s performance
#ETF #gold
https://metals-wire.com:3000/sector/Gold