Morning Bites (part 1)
💎De Beers has cut rough prices 10-15% across all categories, Bloomberg reports, citing its sources. This was the largest cut since January (also -10%), and the first cut since May (4-6% for small units). On our numbers, the total price cut this year is >20%. Previously, the company followed a price-over-volume approach. In our view, the lack of liquidity amid the slump in PGM prices could have persuaded Anglo American to take such a step. This was underpinned by the reduction in purchasing flexibility for sightholders
To recap, the GJEPC noted a looming recovery amid significant reductions in polished inventories and price increases in certain categories. Moreover, junior miners (30% of global supply) making negative FCF, as well as the ongoing supply reduction, is a strong near-bottom market indicator
We continue to believe that in 4Q24-1Q25, polishers will unwind their inventories, paving the way for restocking in 2025
#diamonds
https://metals-wire.com/sector/Diamonds
💎De Beers has cut rough prices 10-15% across all categories, Bloomberg reports, citing its sources. This was the largest cut since January (also -10%), and the first cut since May (4-6% for small units). On our numbers, the total price cut this year is >20%. Previously, the company followed a price-over-volume approach. In our view, the lack of liquidity amid the slump in PGM prices could have persuaded Anglo American to take such a step. This was underpinned by the reduction in purchasing flexibility for sightholders
To recap, the GJEPC noted a looming recovery amid significant reductions in polished inventories and price increases in certain categories. Moreover, junior miners (30% of global supply) making negative FCF, as well as the ongoing supply reduction, is a strong near-bottom market indicator
We continue to believe that in 4Q24-1Q25, polishers will unwind their inventories, paving the way for restocking in 2025
#diamonds
https://metals-wire.com/sector/Diamonds
Morning Bites (part 2)
🌏Global manufacturing PMIs showed mixed dynamics in November. The Eurozone Markit Manufacturing PMI was 45.2 (vs. 45.9 in October), while the US ISM manufacturing PMI rose to 48.4, surpassing market expectations of 47.5
🇨🇳The official NBS Manufacturing PMI in China was 50.3 (vs. 50.1 a month ago). Meanwhile, the Caixin China Manufacturing PMI rose to 51.5, ahead of the forecasts of 50.5
🇮🇳 India’s manufacturing PMI of 56.5 remains one of the strongest indicators among the world's key economies
❗️In October, EU/US PMIs remained below 50.0, underlining the ongoing slowdown in their manufacturing activity. Meanwhile, China’s new economic stimulus might add some support to local demand for industrial metals in 2025 (e.g. steel, aluminum and copper), we believe
#PMIs
https://metals-wire.com/news-reports
🌏Global manufacturing PMIs showed mixed dynamics in November. The Eurozone Markit Manufacturing PMI was 45.2 (vs. 45.9 in October), while the US ISM manufacturing PMI rose to 48.4, surpassing market expectations of 47.5
🇨🇳The official NBS Manufacturing PMI in China was 50.3 (vs. 50.1 a month ago). Meanwhile, the Caixin China Manufacturing PMI rose to 51.5, ahead of the forecasts of 50.5
🇮🇳 India’s manufacturing PMI of 56.5 remains one of the strongest indicators among the world's key economies
❗️In October, EU/US PMIs remained below 50.0, underlining the ongoing slowdown in their manufacturing activity. Meanwhile, China’s new economic stimulus might add some support to local demand for industrial metals in 2025 (e.g. steel, aluminum and copper), we believe
#PMIs
https://metals-wire.com/news-reports
Morning Bites
💎US jewellery sales jumped 9% YoY in October, vs. the revised spike of 10% YoY in September, IDEX reports. According to IDEX, declining interest rates and slowing inflation, coupled with low layoff rates and wage growth, are driving the positive sales momentum
We reiterate our view that the solid downstream demand in the US (~53% of global gem-set jewellery trade) is likely to accelerate the ongoing destocking in 4Q24-1Q25, supporting sentiment in the stressed diamond market, we believe
#diamonds
https://metals-wire.com/sector/Diamonds
💎US jewellery sales jumped 9% YoY in October, vs. the revised spike of 10% YoY in September, IDEX reports. According to IDEX, declining interest rates and slowing inflation, coupled with low layoff rates and wage growth, are driving the positive sales momentum
We reiterate our view that the solid downstream demand in the US (~53% of global gem-set jewellery trade) is likely to accelerate the ongoing destocking in 4Q24-1Q25, supporting sentiment in the stressed diamond market, we believe
#diamonds
https://metals-wire.com/sector/Diamonds
Morning Bites (part 1)
🏦 Global central banks purchased net 60t of gold in October, vs. the +53t in September, the World Gold Council (WGC) reports. The major contributors were India (+27t) and Turkey (+17t). No significant sales volumes were recorded. Although the PBoC has suspended gold purchases, the WGC estimates that the official statistics for 9mo24 reflect only 33% of total demand from government institutions
Although, at spot, gold continues to trade above what we see as its fundamentally reasonable level for 4Q24 (~USD 2,400/oz), we think there are more upside risks in the precious metal’s price, given the steady inflows into global ETFs and central banks, as well as the ongoing geopolitical tensions
#gold
https://metals-wire.com/sector/Gold
🏦 Global central banks purchased net 60t of gold in October, vs. the +53t in September, the World Gold Council (WGC) reports. The major contributors were India (+27t) and Turkey (+17t). No significant sales volumes were recorded. Although the PBoC has suspended gold purchases, the WGC estimates that the official statistics for 9mo24 reflect only 33% of total demand from government institutions
Although, at spot, gold continues to trade above what we see as its fundamentally reasonable level for 4Q24 (~USD 2,400/oz), we think there are more upside risks in the precious metal’s price, given the steady inflows into global ETFs and central banks, as well as the ongoing geopolitical tensions
#gold
https://metals-wire.com/sector/Gold
Morning Bites (part 2)
💍Hong Kong jewellery and watch sales shrank 11% YoY in October, decelerating from the 18% YoY decline seen in September, per the government data. According to Rapaport, demand is expected to pick up in November ahead of Christmas and the Chinese New Year
Despite slack demand in HK, sentiment remains strong in the key US market (~53% of the world's gem-set jewellery trade), which might support the depressed diamond sector, were this trend to persist
#diamonds
https://metals-wire.com/sector/Diamonds
💍Hong Kong jewellery and watch sales shrank 11% YoY in October, decelerating from the 18% YoY decline seen in September, per the government data. According to Rapaport, demand is expected to pick up in November ahead of Christmas and the Chinese New Year
Despite slack demand in HK, sentiment remains strong in the key US market (~53% of the world's gem-set jewellery trade), which might support the depressed diamond sector, were this trend to persist
#diamonds
https://metals-wire.com/sector/Diamonds
Morning Bites (part 1)
🔗CISA mills' daily crude steel production in late-November was reported at 2.09mnt, +0.5% vs. the previous ten days, and up 3.7% YoY. On the 11mo24 basis, output was still down 2.0% YoY, according to the CISA data. Local steel inventories fell 15.4% over the period (but were up 1.4% YoY)
We reiterate our view that the new monetary support measures announced by Beijing (as well as the additional stimulus to be discussed at the economic forum on 11-12 December) might bolster local construction activity in 2025
China accounts for ~57% of global steel supply
#steel
https://metals-wire.com/sector/Steel
🔗CISA mills' daily crude steel production in late-November was reported at 2.09mnt, +0.5% vs. the previous ten days, and up 3.7% YoY. On the 11mo24 basis, output was still down 2.0% YoY, according to the CISA data. Local steel inventories fell 15.4% over the period (but were up 1.4% YoY)
We reiterate our view that the new monetary support measures announced by Beijing (as well as the additional stimulus to be discussed at the economic forum on 11-12 December) might bolster local construction activity in 2025
China accounts for ~57% of global steel supply
#steel
https://metals-wire.com/sector/Steel
Morning Bites (part 2)
📉 Gold-backed ETFs sold net 29t of gold in November, marking the first net sale since April, vs. +43t in October. According to the World Gold Council, European funds led the entire global outflows, with net sales of 26t
Although ETFs’ sales could have been the main factor pressuring gold prices in November, inflows might pick up in the coming months given the recently started monetary easing cycle in key economies (EU/US and China), we believe. Global funds have accumulated net 135t since May (~5% of physical gold demand in 2023 in annualised terms)
#ETF #gold
https://metals-wire.com/news-reports
📉 Gold-backed ETFs sold net 29t of gold in November, marking the first net sale since April, vs. +43t in October. According to the World Gold Council, European funds led the entire global outflows, with net sales of 26t
Although ETFs’ sales could have been the main factor pressuring gold prices in November, inflows might pick up in the coming months given the recently started monetary easing cycle in key economies (EU/US and China), we believe. Global funds have accumulated net 135t since May (~5% of physical gold demand in 2023 in annualised terms)
#ETF #gold
https://metals-wire.com/news-reports
Morning Bites
🏦 The PBoC resumed official gold purchases in November. It bought ~5t, marking the first increase in reserves since April, Bloomberg reports. Although PBoC did not report any purchases in May-October, we note that the official statistics for 9mo24 reflect only 33% of total demand from government institutions (per WGC estimates)
We maintain our view that gold continues to trade above what we see as its fundamentally reasonable level for 4Q24 (~USD 2,400/oz), but that there are more upside risks in the precious metal’s price, given the steady demand from global central banks, the ongoing monetary easing cycle in key economies (EU/US and China), and global geopolitical unrest
#gold
https://metals-wire.com/sector/Gold
🏦 The PBoC resumed official gold purchases in November. It bought ~5t, marking the first increase in reserves since April, Bloomberg reports. Although PBoC did not report any purchases in May-October, we note that the official statistics for 9mo24 reflect only 33% of total demand from government institutions (per WGC estimates)
We maintain our view that gold continues to trade above what we see as its fundamentally reasonable level for 4Q24 (~USD 2,400/oz), but that there are more upside risks in the precious metal’s price, given the steady demand from global central banks, the ongoing monetary easing cycle in key economies (EU/US and China), and global geopolitical unrest
#gold
https://metals-wire.com/sector/Gold
🗞Today, China published its preliminary import/export statistics for November (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 rose 19% YoY in November, after the +46% YoY surge in October. To recap, soft domestic demand led to elevated exports in 11mo24, which might also remain high in late-2024, amid China's concerns about global trade relations in 2025. We reiterate our view that the new monetary support measures announced by Beijing (as well as the additional stimulus to be discussed at the economic forum on 11-12 December) might bolster local construction activity in 2025
🪨China’s coal imports jumped 26% YoY in November, after the 28% YoY rise in October. According to Reuters, China's coal imports surged to a record high in November, as imported supply was cheaper than domestic coal
🏭 China’s aluminum exports surged 37% YoY in November (the volume has only been surpassed once before, in May 2022), ahead of China's 13% export rebates cancellation from December
#coal #steel
https://metals-wire.com/news-reports
🔗China’s finished steel net exports rose 19% YoY in November, after the +46% YoY surge in October. To recap, soft domestic demand led to elevated exports in 11mo24, which might also remain high in late-2024, amid China's concerns about global trade relations in 2025. We reiterate our view that the new monetary support measures announced by Beijing (as well as the additional stimulus to be discussed at the economic forum on 11-12 December) might bolster local construction activity in 2025
🪨China’s coal imports jumped 26% YoY in November, after the 28% YoY rise in October. According to Reuters, China's coal imports surged to a record high in November, as imported supply was cheaper than domestic coal
🏭 China’s aluminum exports surged 37% YoY in November (the volume has only been surpassed once before, in May 2022), ahead of China's 13% export rebates cancellation from December
#coal #steel
https://metals-wire.com/news-reports
Morning Bites (part 2)
💍Signet has reported a 0.7% YoY drop in same-store sales in 3Q24 (August-October), decelerating from the -3.4% YoY in 2Q24. Despite the YoY decline, we note that sequential same store sales improved for the 6th consecutive quarter. According to the retailer’s press release, same store sales in North America weakened 0.8% YoY, while proceeds from the international segment improved 1.6% YoY
In our view, the consistent recovery trends in the world's key US downstream market (~53% of global retail gem-set jewellery trade) could accelerate the ongoing destocking, supporting sentiment in the stressed diamond market
#diamonds
https://metals-wire.com/news-reports
💍Signet has reported a 0.7% YoY drop in same-store sales in 3Q24 (August-October), decelerating from the -3.4% YoY in 2Q24. Despite the YoY decline, we note that sequential same store sales improved for the 6th consecutive quarter. According to the retailer’s press release, same store sales in North America weakened 0.8% YoY, while proceeds from the international segment improved 1.6% YoY
In our view, the consistent recovery trends in the world's key US downstream market (~53% of global retail gem-set jewellery trade) could accelerate the ongoing destocking, supporting sentiment in the stressed diamond market
#diamonds
https://metals-wire.com/news-reports
Morning Bites (part 1)
🚘New car registrations in France, the UK, Spain, Italy and Germany dropped 4% YoY in November, following the 3% YoY slide in October, and remained firmly below their pre-COVID level (-15% vs. November 2019). In Germany and Spain, car sales were 18% and 11% below their 2019 levels, respectively, while registrations in France were 23% weaker. As for Italy, sales were 18% below the 2019 level, while UK sales were down 2%
Given that these five countries represented >70% of new vehicle registrations in Europe in 2023, the region’s car sales likely declined YoY last month, remaining well below their pre-pandemic levels
#cars
https://metals-wire.com/sector/PGM
🚘New car registrations in France, the UK, Spain, Italy and Germany dropped 4% YoY in November, following the 3% YoY slide in October, and remained firmly below their pre-COVID level (-15% vs. November 2019). In Germany and Spain, car sales were 18% and 11% below their 2019 levels, respectively, while registrations in France were 23% weaker. As for Italy, sales were 18% below the 2019 level, while UK sales were down 2%
Given that these five countries represented >70% of new vehicle registrations in Europe in 2023, the region’s car sales likely declined YoY last month, remaining well below their pre-pandemic levels
#cars
https://metals-wire.com/sector/PGM
Morning Bites (Part 2)
⚒Nornickel now expects a greater nickel market surplus, of 150kt, in 2024-25. The company also sees the Pd/Pt markets as balanced in 2024-25
• The Ni market surplus is to increase in 2024-25 (previous estimate: 100kt), driven by lower Chinese stainless steel production and batteries falling short of expectations due to weak non-Chinese NEV sales and a higher LFP share
• The miner now sees the Pd market balanced in 2024-25 (previous forecast: deficits of 0.9mnoz in 2024 and of 0.3mnoz in 2025). The new forecast is based on stronger output from Russian operations and revised automotive demand in China, Japan and the US. Nornickel reiterated its estimate for a balanced Pt market in 2024. For 2025, the forecast is for a deficit of 0.2mnoz due to less refined production in SA
• Although the miner expects the Cu market to be broadly balanced in 2024-26, this looks conservative to us, given surging grid investments
#nickel #PGMs
https://metals-wire.com/news-reports
⚒Nornickel now expects a greater nickel market surplus, of 150kt, in 2024-25. The company also sees the Pd/Pt markets as balanced in 2024-25
• The Ni market surplus is to increase in 2024-25 (previous estimate: 100kt), driven by lower Chinese stainless steel production and batteries falling short of expectations due to weak non-Chinese NEV sales and a higher LFP share
• The miner now sees the Pd market balanced in 2024-25 (previous forecast: deficits of 0.9mnoz in 2024 and of 0.3mnoz in 2025). The new forecast is based on stronger output from Russian operations and revised automotive demand in China, Japan and the US. Nornickel reiterated its estimate for a balanced Pt market in 2024. For 2025, the forecast is for a deficit of 0.2mnoz due to less refined production in SA
• Although the miner expects the Cu market to be broadly balanced in 2024-26, this looks conservative to us, given surging grid investments
#nickel #PGMs
https://metals-wire.com/news-reports
Morning Bites
🇿🇦South Africa’s PGM mining output grew 3% YoY in October, after the 7% YoY gain in September, according to official statistics. Meanwhile, gold production shrank 3% YoY, after the 4% YoY decline in September. In our view, the ongoing monetary easing cycle in the EU/US and China, and the increase in EU import duties on Chinese BEVs (from 10% up to 45%), as well as the continuous global Pd/Pt market deficit, might trigger a recovery in PGM prices in 2025
Moreover, according to Reuters, the new US administration is planning to cancel the USD 7,500 tax credit for EV purchases as part of the tax reform legislation. This move, if it materialised, would negatively affect local BEV sales (similar to Germany's case), which is a favourable factor for PGM market fundamentals, we believe
SA accounts for ~70% of global Pt, 38% of Pd supply and 3% of world gold production
#PGMs #gold
https://metals-wire.com/news-reports
🇿🇦South Africa’s PGM mining output grew 3% YoY in October, after the 7% YoY gain in September, according to official statistics. Meanwhile, gold production shrank 3% YoY, after the 4% YoY decline in September. In our view, the ongoing monetary easing cycle in the EU/US and China, and the increase in EU import duties on Chinese BEVs (from 10% up to 45%), as well as the continuous global Pd/Pt market deficit, might trigger a recovery in PGM prices in 2025
Moreover, according to Reuters, the new US administration is planning to cancel the USD 7,500 tax credit for EV purchases as part of the tax reform legislation. This move, if it materialised, would negatively affect local BEV sales (similar to Germany's case), which is a favourable factor for PGM market fundamentals, we believe
SA accounts for ~70% of global Pt, 38% of Pd supply and 3% of world gold production
#PGMs #gold
https://metals-wire.com/news-reports
Morning Bites
🇨🇳Total car sales in China grew 12% YoY in November (vs. +7% YoY in October)
📌China’s new ICE car sales dropped 7% YoY in November, after the 14% YoY fall in October. Although the growing appetite for EVs in China is affecting PGM consumption, sales of catalyst-containing cars (ICE + PHEV) rose 6% YoY in November. We note that the Chinese automotive sector accounts for 20% and 17% of global Pd and Pt demand, respectively
📌New EV sales in China jumped 47% YoY in November, vs. +50% YoY in October. Specifically, BEV (60% of total EV registrations vs. 68% a year ago) sales grew 29%, while PHEVs added 86% YoY. Given the gradual shift to hybrids in China (which contain catalysts), this might add some support to the PGM market fundamentals in the medium term
In 1H24, China accounted for ~58% of global EV sales
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com/news-reports
🇨🇳Total car sales in China grew 12% YoY in November (vs. +7% YoY in October)
📌China’s new ICE car sales dropped 7% YoY in November, after the 14% YoY fall in October. Although the growing appetite for EVs in China is affecting PGM consumption, sales of catalyst-containing cars (ICE + PHEV) rose 6% YoY in November. We note that the Chinese automotive sector accounts for 20% and 17% of global Pd and Pt demand, respectively
📌New EV sales in China jumped 47% YoY in November, vs. +50% YoY in October. Specifically, BEV (60% of total EV registrations vs. 68% a year ago) sales grew 29%, while PHEVs added 86% YoY. Given the gradual shift to hybrids in China (which contain catalysts), this might add some support to the PGM market fundamentals in the medium term
In 1H24, China accounted for ~58% of global EV sales
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com/news-reports
🗞Today, China has published its industrial production data for November (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 crude steel output grew 3% YoY in November, in line with October's dynamics. Meanwhile, on an 11mo24 basis, the production remained 3% lower YoY (per NBS data), amid soft domestic demand and low steel margins. According to the Mysteel agency, only ~50% of China's steel mills were operating at a profit by the end-November
🏢China's property sales grew 3% YoY in November (vs. flat YoY in October), but were still 46% below the 2021 level. Meanwhile, floor space starts declined a further 27% YoY, being 62% lower than 2021. Personal mortgage loans were flat YoY in November, while property completions fell 39% YoY (vs. a 20% YoY drop in the previous month). Although the recent economic stimulus might bolster the slowly picking up Chinese property sector, more actions are required for a full-scale rebound in construction activity, we believe
#steel #property
https://metals-wire.com/sector/Steel
🔗China’s crude steel output grew 3% YoY in November, in line with October's dynamics. Meanwhile, on an 11mo24 basis, the production remained 3% lower YoY (per NBS data), amid soft domestic demand and low steel margins. According to the Mysteel agency, only ~50% of China's steel mills were operating at a profit by the end-November
🏢China's property sales grew 3% YoY in November (vs. flat YoY in October), but were still 46% below the 2021 level. Meanwhile, floor space starts declined a further 27% YoY, being 62% lower than 2021. Personal mortgage loans were flat YoY in November, while property completions fell 39% YoY (vs. a 20% YoY drop in the previous month). Although the recent economic stimulus might bolster the slowly picking up Chinese property sector, more actions are required for a full-scale rebound in construction activity, we believe
#steel #property
https://metals-wire.com/sector/Steel