Morning Bites (part 2)
🏦 The PBoC has further slowed its gold purchases, having bought only 2t of gold in April, after the +5t in March, marking the 18th consecutive month of reserves accumulation. China’s central bank's gold holdings now stand at 2,264t, with ~316t added since November 2022 (~5% of annualised demand). We reiterate our view that the gold price, at spot, has already exceeded its fundamentally reasonable level (USD 2,200-2,300/oz for 2024, on our numbers)
#gold
https://metals-wire.com/sector/Gold
🏦 The PBoC has further slowed its gold purchases, having bought only 2t of gold in April, after the +5t in March, marking the 18th consecutive month of reserves accumulation. China’s central bank's gold holdings now stand at 2,264t, with ~316t added since November 2022 (~5% of annualised demand). We reiterate our view that the gold price, at spot, has already exceeded its fundamentally reasonable level (USD 2,200-2,300/oz for 2024, on our numbers)
#gold
https://metals-wire.com/sector/Gold
Morning Bites (part 3)
🚘New car registrations in France, the UK, Spain, Italy and Germany gained 12% YoY in April, after the broadly flat dynamics in March. However, the figure remained well below the pre-COVID level (-21% vs. April 2019). Specifically, in Germany, France and Italy, car sales were 22% lower than the same month in 2019, while registrations in Spain and UK were 23% and 17% weaker, respectively
Given these five countries represented >70% of new vehicle registrations in Europe in 2023, local car sales have likely remained subdued in April
#cars
https://metals-wire.com/sector/PGM
🚘New car registrations in France, the UK, Spain, Italy and Germany gained 12% YoY in April, after the broadly flat dynamics in March. However, the figure remained well below the pre-COVID level (-21% vs. April 2019). Specifically, in Germany, France and Italy, car sales were 22% lower than the same month in 2019, while registrations in Spain and UK were 23% and 17% weaker, respectively
Given these five countries represented >70% of new vehicle registrations in Europe in 2023, local car sales have likely remained subdued in April
#cars
https://metals-wire.com/sector/PGM
🗞Last week, China published its preliminary import/export statistics for April (see table above)
#statistics #China
https://metals-wire.com/news-reports
#statistics #China
https://metals-wire.com/news-reports
Morning Bites (part 1)
🔗China’s finished steel net exports jumped 17% YoY in April, after the 29% YoY growth in March. According to Bloomberg, persistently weak domestic steel demand is driving up exports. We remind readers that China’s strong liquidity injections in early 2024 might bolster domestic construction activity and, hence, the demand for steel later this year
🪨China’s coal imports rose 11% YoY in April, accelerating from the 1% YoY gain in March. According to Reuters, the increase in imports might reflect that domestic coal demand is picking up ahead of the peak season for electricity consumption
#coal #steel
https://metals-wire.com/news-reports
🔗China’s finished steel net exports jumped 17% YoY in April, after the 29% YoY growth in March. According to Bloomberg, persistently weak domestic steel demand is driving up exports. We remind readers that China’s strong liquidity injections in early 2024 might bolster domestic construction activity and, hence, the demand for steel later this year
🪨China’s coal imports rose 11% YoY in April, accelerating from the 1% YoY gain in March. According to Reuters, the increase in imports might reflect that domestic coal demand is picking up ahead of the peak season for electricity consumption
#coal #steel
https://metals-wire.com/news-reports
Morning Bites (part 2)
📉Gold-backed ETFs reduced their holdings by 33t in April, accelerating from the revised -13t in March, the World Gold Council reports. This was the 11th consecutive month of declines. Specifically, the main sellers were European funds with a net outflow of 52t, which was partially offset by net purchases of 19t in Asia. Overall, in the last 11 months, global ETF holdings have shrank 397t (~9% of physical gold demand in 2023 in annualised terms)
Regarding the market fundamentals, we reiterate our view that the spot gold price has already exceeded its fundamentally reasonable level (USD 2,200-2,300/oz for 2024), driven by persistently strong demand from global central banks and market expectations of an upcoming US Fed funds rate cut in 2024
#ETF #gold
https://metals-wire.com/sector/Gold
📉Gold-backed ETFs reduced their holdings by 33t in April, accelerating from the revised -13t in March, the World Gold Council reports. This was the 11th consecutive month of declines. Specifically, the main sellers were European funds with a net outflow of 52t, which was partially offset by net purchases of 19t in Asia. Overall, in the last 11 months, global ETF holdings have shrank 397t (~9% of physical gold demand in 2023 in annualised terms)
Regarding the market fundamentals, we reiterate our view that the spot gold price has already exceeded its fundamentally reasonable level (USD 2,200-2,300/oz for 2024), driven by persistently strong demand from global central banks and market expectations of an upcoming US Fed funds rate cut in 2024
#ETF #gold
https://metals-wire.com/sector/Gold
Morning Bites (part 3)
💎US jewellery sales increased 7% YoY in March, slightly accelerating from the +6% YoY in February, which marked the sharpest gain in the last two years, IDEX reports, citing the US Department of Commerce. According to Rapaport, local diamond trading was stable in March, despite weak orders for some rough categories (1.0-1.5ct). In our view, a further recovery in local demand would accelerate the release of the industry's inventories and underpin improving sentiment in the global diamond market
We remind readers that the US accounts for ~53% of global gem-set jewellery demand
#diamonds
https://metals-wire.com/sector/Diamonds
💎US jewellery sales increased 7% YoY in March, slightly accelerating from the +6% YoY in February, which marked the sharpest gain in the last two years, IDEX reports, citing the US Department of Commerce. According to Rapaport, local diamond trading was stable in March, despite weak orders for some rough categories (1.0-1.5ct). In our view, a further recovery in local demand would accelerate the release of the industry's inventories and underpin improving sentiment in the global diamond market
We remind readers that the US accounts for ~53% of global gem-set jewellery demand
#diamonds
https://metals-wire.com/sector/Diamonds
Morning Bites (part 1)
🔗CISA mills' daily crude steel production in late April was reported at 2.20mnt, up 3.8% from the previous ten days, but -0.5% YoY. Meanwhile, local steel inventories were 12.3% lower over the period (and also -12.3% YoY). In our view, China’s subdued production (based on the CISA data, -1.6% YTD) reflects overall sluggish domestic steel demand, which has also triggered exports growth. Record high liquidity inflows in early 2024, however, might bolster China’s construction recovery this year (and, hence, local steel demand), in our view
China accounts for ~57% of world steel supply
#steel
https://metals-wire.com/sector/Steel
🔗CISA mills' daily crude steel production in late April was reported at 2.20mnt, up 3.8% from the previous ten days, but -0.5% YoY. Meanwhile, local steel inventories were 12.3% lower over the period (and also -12.3% YoY). In our view, China’s subdued production (based on the CISA data, -1.6% YTD) reflects overall sluggish domestic steel demand, which has also triggered exports growth. Record high liquidity inflows in early 2024, however, might bolster China’s construction recovery this year (and, hence, local steel demand), in our view
China accounts for ~57% of world steel supply
#steel
https://metals-wire.com/sector/Steel
Morning Bites (part 2)
📌China’s new internal combustion engine car sales declined 1% YoY in April, after the 1% YoY gain in March. The numbers were still slightly below their pre-Covid levels (-2% vs. December 2019), amid the strong appetite for EVs, which continues to pressure PGM consumption. To recap, the Chinese automotive sector represents some 20% and 17% of the global demand for Pd and Pt, respectively
📌New EV sales in China surged 34% YoY in April, in line with the 35% YoY increase in March. In our view, persistently high local EV sales might further support the consumption of the battery metals basket (i.e. cobalt, lithium and nickel), as China has accounted for ~50% of global EV demand in recent months
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com/news-reports
📌China’s new internal combustion engine car sales declined 1% YoY in April, after the 1% YoY gain in March. The numbers were still slightly below their pre-Covid levels (-2% vs. December 2019), amid the strong appetite for EVs, which continues to pressure PGM consumption. To recap, the Chinese automotive sector represents some 20% and 17% of the global demand for Pd and Pt, respectively
📌New EV sales in China surged 34% YoY in April, in line with the 35% YoY increase in March. In our view, persistently high local EV sales might further support the consumption of the battery metals basket (i.e. cobalt, lithium and nickel), as China has accounted for ~50% of global EV demand in recent months
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com/news-reports
Morning Bites (part 3)
🚘US light vehicle sales slid 2% YoY in April, after the 4% YoY growth in March. Meanwhile, the figure was only 2% lower than the pre-Covid 2019 level. Seasonally-adjusted sales volumes inched up 1% YoY last month, but were 3% below the 2019 level. Although US car sales might accelerate their recovery in 2024, bolstered by the widely expected US Fed funds rate cut, the positive effect on automotive demand for PGMs might be rather limited, in our view, amid the growing appetite for EVs globally
On our numbers, North America accounted for 22% and 15% of world autocatalyst Pd and Pt consumption, respectively, in 2023
#cars
https://metals-wire.com/news-reports
🚘US light vehicle sales slid 2% YoY in April, after the 4% YoY growth in March. Meanwhile, the figure was only 2% lower than the pre-Covid 2019 level. Seasonally-adjusted sales volumes inched up 1% YoY last month, but were 3% below the 2019 level. Although US car sales might accelerate their recovery in 2024, bolstered by the widely expected US Fed funds rate cut, the positive effect on automotive demand for PGMs might be rather limited, in our view, amid the growing appetite for EVs globally
On our numbers, North America accounted for 22% and 15% of world autocatalyst Pd and Pt consumption, respectively, in 2023
#cars
https://metals-wire.com/news-reports
Morning Bites (part 1)
🇨🇱Chile’s copper output stayed flat YoY in March, after the 10% YoY jump in February, according to INE data. Meanwhile, Codelco’s output (top Chilean miner, ~7% of global Cu supply) might increase up to 5% YoY in 2024. Therefore, were the recovery in the world's top copper producing country to persist, this might partially unwind the pressure on global supply, we believe. Chile accounted for ~24% of global copper supply in 2023
🇵🇪 Peru’s copper output remained unchanged YoY in March, vs. the 13% YoY increase in February, according to MINEM data. We remind readers that the Peruvian government has announced plans to boost domestic Cu output another 9% YoY in 2024, after the +13% YoY seen in 2023. Peru accounts for ~12% of global Cu supply
#copper
https://metals-wire.com/sector/Copper
🇨🇱Chile’s copper output stayed flat YoY in March, after the 10% YoY jump in February, according to INE data. Meanwhile, Codelco’s output (top Chilean miner, ~7% of global Cu supply) might increase up to 5% YoY in 2024. Therefore, were the recovery in the world's top copper producing country to persist, this might partially unwind the pressure on global supply, we believe. Chile accounted for ~24% of global copper supply in 2023
🇵🇪 Peru’s copper output remained unchanged YoY in March, vs. the 13% YoY increase in February, according to MINEM data. We remind readers that the Peruvian government has announced plans to boost domestic Cu output another 9% YoY in 2024, after the +13% YoY seen in 2023. Peru accounts for ~12% of global Cu supply
#copper
https://metals-wire.com/sector/Copper
Morning Bites (part 2)
💎 India’s rough diamond net imports declined 15% YoY in April, broadly in line with the -16% YoY in March. Meanwhile, India’s polished diamond net exports were down 15% YoY, vs. -31% YoY in March. Synthetic rough diamond net imports rose 19% YoY, reversing from the 13% YoY drop in March. The share of lab-grown net rough imports in total trading stood at 5% in April. On our numbers, the Indian midstream (~95% of the world's polished stones supply) has turned into the stock accumulation zone
#diamonds
https://metals-wire.com/sector/Diamonds
💎 India’s rough diamond net imports declined 15% YoY in April, broadly in line with the -16% YoY in March. Meanwhile, India’s polished diamond net exports were down 15% YoY, vs. -31% YoY in March. Synthetic rough diamond net imports rose 19% YoY, reversing from the 13% YoY drop in March. The share of lab-grown net rough imports in total trading stood at 5% in April. On our numbers, the Indian midstream (~95% of the world's polished stones supply) has turned into the stock accumulation zone
#diamonds
https://metals-wire.com/sector/Diamonds
Morning Bites (part 3)
🇿🇦South Africa’s PGM mining output fell 4% YoY in March, marking the first decline since July 2023, according to official statistics. The country’s gold production declined 5% YoY, in line with February. We remind readers that major SA PGM miners Sibanye, Impala and Amplats have recently announced job cuts in response to unfavourable market conditions, which might result in production being lower YoY in 2024. At the same time, the demand for PGMs remains rather subdued, amid persistent inflationary pressures in key economies (e.g. the US and EU) and the growing appetite for EVs globally.
To recap, SA accounts for ~70% of global Pt, 38% of Pd supply and 3% of global gold production.
#PGMs #gold
https://metals-wire.com/news-reports
🇿🇦South Africa’s PGM mining output fell 4% YoY in March, marking the first decline since July 2023, according to official statistics. The country’s gold production declined 5% YoY, in line with February. We remind readers that major SA PGM miners Sibanye, Impala and Amplats have recently announced job cuts in response to unfavourable market conditions, which might result in production being lower YoY in 2024. At the same time, the demand for PGMs remains rather subdued, amid persistent inflationary pressures in key economies (e.g. the US and EU) and the growing appetite for EVs globally.
To recap, SA accounts for ~70% of global Pt, 38% of Pd supply and 3% of global gold production.
#PGMs #gold
https://metals-wire.com/news-reports
Morning Bites (part 1)
🏗China’s excavator sales were flat YoY in April (domestic + export), after the -2% YoY in March, according to the CCMA data. The figure was broadly in line with the CME estimates, with domestic sales still being materially below the 2021 level (-60% vs. April 2021). Although this indicates that there is still no looming recovery in China's construction sector, Beijing is considering the state purchasing unsold real estate, according to Bloomberg. As per market participants, the measure might require at least CNY 1-2tn (USD ~140-280bn); unsold inventories now stand at 3.6bn sqm, with an estimated cost of CNY ~7tn. In our view, this might add support to local construction activity and, hence, the demand for industrial metals in 2024
To recap, China accounts for 52% of global steel consumption, and for 57% and 61% of world Cu and Al demand, respectively
#steel
https://metals-wire.com/sector/Steel
🏗China’s excavator sales were flat YoY in April (domestic + export), after the -2% YoY in March, according to the CCMA data. The figure was broadly in line with the CME estimates, with domestic sales still being materially below the 2021 level (-60% vs. April 2021). Although this indicates that there is still no looming recovery in China's construction sector, Beijing is considering the state purchasing unsold real estate, according to Bloomberg. As per market participants, the measure might require at least CNY 1-2tn (USD ~140-280bn); unsold inventories now stand at 3.6bn sqm, with an estimated cost of CNY ~7tn. In our view, this might add support to local construction activity and, hence, the demand for industrial metals in 2024
To recap, China accounts for 52% of global steel consumption, and for 57% and 61% of world Cu and Al demand, respectively
#steel
https://metals-wire.com/sector/Steel
Morning Bites (part 2)
🏦China’s aggregate financing was negative CNY 200bn in April (vs. CNY 4.87tn in March), which was the first negative reading since January 2002. According to Bloomberg, China’s credit in April contracted amid record net repayments (sovereign bond sales slowed, while loan expansion was worse than expected due to weak demand). On our numbers, if bond sales had been the same as in April 2023, aggregate financing would have been ~CNY 350bn. Meanwhile, traditional bank loans inched up 2% YoY, reversing the 20% YoY decline in February and March, being 39% below the consensus. Although the liquidity dynamics were weak, we note that April is usually a low season for new credit in China
Overall, in 4mo24, the PBoC data showed a total of CNY 10.19tn in new loans (-10% YoY)
#global
https://metals-wire.com/news-reports
🏦China’s aggregate financing was negative CNY 200bn in April (vs. CNY 4.87tn in March), which was the first negative reading since January 2002. According to Bloomberg, China’s credit in April contracted amid record net repayments (sovereign bond sales slowed, while loan expansion was worse than expected due to weak demand). On our numbers, if bond sales had been the same as in April 2023, aggregate financing would have been ~CNY 350bn. Meanwhile, traditional bank loans inched up 2% YoY, reversing the 20% YoY decline in February and March, being 39% below the consensus. Although the liquidity dynamics were weak, we note that April is usually a low season for new credit in China
Overall, in 4mo24, the PBoC data showed a total of CNY 10.19tn in new loans (-10% YoY)
#global
https://metals-wire.com/news-reports
🗞Today, China has published its industrial production data for April (see table above)
#statistics #China
https://metals-wire.com/news-reports
#statistics #China
https://metals-wire.com/news-reports
Morning Bites
🔗China’s crude steel output dropped 7% YoY in April, following the -8% YoY in March. Output remained weak YoY, following the subdued domestic demand, which has also resulted in high Chinese steel exports. To recap, China represents ~57% of global steel supply
🏢China's property sales fell 14% YoY in April (after the -24% YoY in March), being 54% below the 2021 level. Floor space starts were down 12% YoY in April (after the 26% YoY decline in March), and were -65% vs. 2021. Personal mortgage loans also came in 36% lower YoY (vs. -47% in March), while property completions dropped 15% YoY (vs. -22% YoY in March). Despite the ongoing slowdown in China’s property sector, possible state buying of unsold real estate might add support to local construction activity, we believe
#steel #property
https://metals-wire.com/sector/Steel
🔗China’s crude steel output dropped 7% YoY in April, following the -8% YoY in March. Output remained weak YoY, following the subdued domestic demand, which has also resulted in high Chinese steel exports. To recap, China represents ~57% of global steel supply
🏢China's property sales fell 14% YoY in April (after the -24% YoY in March), being 54% below the 2021 level. Floor space starts were down 12% YoY in April (after the 26% YoY decline in March), and were -65% vs. 2021. Personal mortgage loans also came in 36% lower YoY (vs. -47% in March), while property completions dropped 15% YoY (vs. -22% YoY in March). Despite the ongoing slowdown in China’s property sector, possible state buying of unsold real estate might add support to local construction activity, we believe
#steel #property
https://metals-wire.com/sector/Steel