Morning Bites (part 2)
⛏ Indonesia has proposed higher royalty rates across the Ni supply chain, Reuters reports, citing the local Ministry of Energy and Mineral Resources. Specifically, the royalty rate for nickel ore sales might switch from a fixed 10% to a variable 14-19%, depending on the global Ni price benchmark. Furthermore, ferronickel and NPI royalties are also proposed at variable 5-7% (vs. currently fixed rates of 2% and 5%, respectively)
Although the measure is still being discussed, we calculate that the new Ni royalty rates in Indonesia, if applied, would raise the 90%-lie marginal Ni cash cost by 4-6%, on our numbers, which would support global equilibrium Ni price
#Nickel
https://metals-wire.com/news-reports
⛏ Indonesia has proposed higher royalty rates across the Ni supply chain, Reuters reports, citing the local Ministry of Energy and Mineral Resources. Specifically, the royalty rate for nickel ore sales might switch from a fixed 10% to a variable 14-19%, depending on the global Ni price benchmark. Furthermore, ferronickel and NPI royalties are also proposed at variable 5-7% (vs. currently fixed rates of 2% and 5%, respectively)
Although the measure is still being discussed, we calculate that the new Ni royalty rates in Indonesia, if applied, would raise the 90%-lie marginal Ni cash cost by 4-6%, on our numbers, which would support global equilibrium Ni price
#Nickel
https://metals-wire.com/news-reports
Morning Bites
🏗China’s excavator sales jumped 53% YoY in February (domestic + export) from a low base, after the 1% YoY growth seen in January, according to CCMA data. Specifically, domestic sales roughly doubled YoY (but were still down 52% vs. 2021 level). We remind readers that the upcoming March data is the most seasonally important print for Chinese excavator sales, and might provide insight into the prospects for the local property sector recovery in 2025
In our view, China’s new fiscal stimulus for 2025, (incl. 5% GDP growth target, and an increase in official budget deficit from 3% to 4%, etc), could spur recovery in the Chinese real estate sector, which started to gradually bottom out in 2H24. Furthermore, Beijing plans to cut 'excessive' steel output in 2025 (up to 2-5% of China’s 2024 supply, per market estimates). Overall, these measures might cool surging Chinese steel exports, and support global steel prices in 2025, we believe
#steel
https://metals-wire.com/sector/Steel
🏗China’s excavator sales jumped 53% YoY in February (domestic + export) from a low base, after the 1% YoY growth seen in January, according to CCMA data. Specifically, domestic sales roughly doubled YoY (but were still down 52% vs. 2021 level). We remind readers that the upcoming March data is the most seasonally important print for Chinese excavator sales, and might provide insight into the prospects for the local property sector recovery in 2025
In our view, China’s new fiscal stimulus for 2025, (incl. 5% GDP growth target, and an increase in official budget deficit from 3% to 4%, etc), could spur recovery in the Chinese real estate sector, which started to gradually bottom out in 2H24. Furthermore, Beijing plans to cut 'excessive' steel output in 2025 (up to 2-5% of China’s 2024 supply, per market estimates). Overall, these measures might cool surging Chinese steel exports, and support global steel prices in 2025, we believe
#steel
https://metals-wire.com/sector/Steel
Morning Bites
🇨🇳Total car sales in China increased 34% YoY in February (vs. -1% YoY in January), which was likely associated with an earlier start of Lunar New Year in 2025
📌China’s new ICE car sales rose 12% YoY in February, vs. the -14% YoY in January. Meanwhile, the sales of local catalyst-containing cars (ICE+PHEV) were up 23% YoY, which would be a positive factor for PGM market fundamentals if it signalled the start of a sustainable trend, in our view. We also note that the Chinese automotive sector accounts for 20% and 17% of global Pd and Pt demand, respectively
📌New EV sales in China surged 87% YoY in February, vs. +29% YoY in January. Specifically, BEV sales (61% of total EV registrations) gained 85% YoY, while PHEVs also added 90% YoY
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com/news-reports
🇨🇳Total car sales in China increased 34% YoY in February (vs. -1% YoY in January), which was likely associated with an earlier start of Lunar New Year in 2025
📌China’s new ICE car sales rose 12% YoY in February, vs. the -14% YoY in January. Meanwhile, the sales of local catalyst-containing cars (ICE+PHEV) were up 23% YoY, which would be a positive factor for PGM market fundamentals if it signalled the start of a sustainable trend, in our view. We also note that the Chinese automotive sector accounts for 20% and 17% of global Pd and Pt demand, respectively
📌New EV sales in China surged 87% YoY in February, vs. +29% YoY in January. Specifically, BEV sales (61% of total EV registrations) gained 85% YoY, while PHEVs also added 90% YoY
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com/news-reports
Morning Bites
💎India’s rough diamond net imports were down 49% YoY in February, vs. the -37% YoY the January. Meanwhile, polished diamond net exports slid 21% YoY. Synthetic rough diamond net imports also decreased 59% YoY. The share of lab-grown net rough imports in total trading stood at 7%
Although GJEPC has recently noted the looming recovery in the diamond industry, market participants confirm still high midstream inventories in early-2025. Hence, the potential diamond market recovery might take longer than we had initially anticipated
India accounts for ~95% of the world's polished stone supply
#diamonds
https://metals-wire.com/sector/Diamonds
💎India’s rough diamond net imports were down 49% YoY in February, vs. the -37% YoY the January. Meanwhile, polished diamond net exports slid 21% YoY. Synthetic rough diamond net imports also decreased 59% YoY. The share of lab-grown net rough imports in total trading stood at 7%
Although GJEPC has recently noted the looming recovery in the diamond industry, market participants confirm still high midstream inventories in early-2025. Hence, the potential diamond market recovery might take longer than we had initially anticipated
India accounts for ~95% of the world's polished stone supply
#diamonds
https://metals-wire.com/sector/Diamonds
🗞Today, China has published its industrial production data for January-February (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 declined 2% YoY in January-February vs. the 12% YoY gain in December, per NBS data. According to Bloomberg, Beijing plans to cut 'excessive' steel output in 2025 (up to 2-5% of China’s 2024 supply, per market estimates). Overall, these measures might cool surging Chinese steel exports, and support global steel prices in 2025, we believe
🏢China's property sales slid 5% YoY in 2mo25, after being flat YoY in December, and were down 38% vs. 2021 levels. Meanwhile, floor space starts declined a further 30% YoY in 2mo25 (- 61% vs. 2021). Personal mortgage loans also fell 12% YoY in 2mo25 (-61% vs. 2021), while property completions declined 16% YoY. In our view, China’s new fiscal stimulus for 2025, (incl. 5% GDP growth target, and an increase in official budget deficit from 3% to 4%, etc), could spur recovery in the Chinese real estate sector, which started to gradually bottom out in 2H24
#steel #property
https://metals-wire.com/sector/Steel
🔗China’s crude steel output declined 2% YoY in January-February vs. the 12% YoY gain in December, per NBS data. According to Bloomberg, Beijing plans to cut 'excessive' steel output in 2025 (up to 2-5% of China’s 2024 supply, per market estimates). Overall, these measures might cool surging Chinese steel exports, and support global steel prices in 2025, we believe
🏢China's property sales slid 5% YoY in 2mo25, after being flat YoY in December, and were down 38% vs. 2021 levels. Meanwhile, floor space starts declined a further 30% YoY in 2mo25 (- 61% vs. 2021). Personal mortgage loans also fell 12% YoY in 2mo25 (-61% vs. 2021), while property completions declined 16% YoY. In our view, China’s new fiscal stimulus for 2025, (incl. 5% GDP growth target, and an increase in official budget deficit from 3% to 4%, etc), could spur recovery in the Chinese real estate sector, which started to gradually bottom out in 2H24
#steel #property
https://metals-wire.com/sector/Steel
Morning Bites (part 2)
🚘US light vehicle sales were up 2% YoY in February, vs. the 4% YoY gain in January. Meanwhile, the figure has almost reached the pre-Covid 2019 level (-1% vs. February 2019). According to Reuters, the new US administration is planning to cancel the USD 7,500 tax credit for EV purchases as part of tax reform legislation (which could even be replaced with USD 1,000 new EV purchase tax). 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
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 were up 2% YoY in February, vs. the 4% YoY gain in January. Meanwhile, the figure has almost reached the pre-Covid 2019 level (-1% vs. February 2019). According to Reuters, the new US administration is planning to cancel the USD 7,500 tax credit for EV purchases as part of tax reform legislation (which could even be replaced with USD 1,000 new EV purchase tax). 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
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
🇿🇦South Africa’s PGM mining output slid 4% YoY in January, vs. the -7% YoY in December, according to official data. Meanwhile, local gold production inched up 1% YoY, after the decline of 8% YoY in December. In our view, the ongoing monetary easing cycle in the EU/US and China, the increase in EU import duties (from 10% up to 45%) on Chinese BEVs (encouraging the production of catalyst-containing cars), as well as the expected cancellation of EV-support programmes in the US (which might be even replaced with USD 1,000 new EV purchase tax) could bolster the PGM prices recovery in 2025
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 slid 4% YoY in January, vs. the -7% YoY in December, according to official data. Meanwhile, local gold production inched up 1% YoY, after the decline of 8% YoY in December. In our view, the ongoing monetary easing cycle in the EU/US and China, the increase in EU import duties (from 10% up to 45%) on Chinese BEVs (encouraging the production of catalyst-containing cars), as well as the expected cancellation of EV-support programmes in the US (which might be even replaced with USD 1,000 new EV purchase tax) could bolster the PGM prices recovery in 2025
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
💍China’s jewellery and watch retail sales rose 5% YoY in January-February, reversing from the -9% YoY seen in December, per NBS data. According to Rapaport, the engagement market provided some support to Chinese diamond demand in early-2025, but overall sales remained soft with little desire for new inventory from retailers
Overall, we keep our cautiously upbeat view on the global diamond market, but it might take longer than we had initially anticipated to recover, given the still high midstream inventories and the slowdown in the US downstream market in early-2025 (~53% of the world gem-set jewellery trade)
#diamonds
https://metals-wire.com/sector/Diamonds
💍China’s jewellery and watch retail sales rose 5% YoY in January-February, reversing from the -9% YoY seen in December, per NBS data. According to Rapaport, the engagement market provided some support to Chinese diamond demand in early-2025, but overall sales remained soft with little desire for new inventory from retailers
Overall, we keep our cautiously upbeat view on the global diamond market, but it might take longer than we had initially anticipated to recover, given the still high midstream inventories and the slowdown in the US downstream market in early-2025 (~53% of the world gem-set jewellery trade)
#diamonds
https://metals-wire.com/sector/Diamonds
Morning Bites (part 1)
🇨🇱Chile’s copper output slid 2% YoY in January, hitting the lowest monthly point in the last 9 years, after the 14% YoY gain in December, per INE data. We maintain our positive view on copper amid Chile’s long-term supply issues (beyond 2027), growing demand for renewables globally, and surging investments in China’s grid infrastructure (which represents ~8% of global Cu demand, on our numbers)
Chile accounts for ~24% of global Cu supply
#copper
https://metals-wire.com/sector/Copper
🇨🇱Chile’s copper output slid 2% YoY in January, hitting the lowest monthly point in the last 9 years, after the 14% YoY gain in December, per INE data. We maintain our positive view on copper amid Chile’s long-term supply issues (beyond 2027), growing demand for renewables globally, and surging investments in China’s grid infrastructure (which represents ~8% of global Cu demand, on our numbers)
Chile accounts for ~24% of global Cu supply
#copper
https://metals-wire.com/sector/Copper
Morning Bites (part 2)
💍Signet has reported a 1.1% YoY drop in same-store sales for 4Q24 (November-January), vs. the 0.7% YoY decrease in 3Q24. However, Signet CEO J.K. Symancyk noted the positive demand trends in January across all categories, including bridal. According to the management estimates, if the trend persists, 1Q25 same-store sales might recover, gaining 2.0% YoY
Overall, we keep our cautiously upbeat view on the global diamond market, but it might take longer than we had initially anticipated to recover, given the still high midstream inventories and the slowdown in the US downstream market in early-2025 (~53% of the world gem-set jewellery trade)
#diamonds
https://metals-wire.com/news-reports
💍Signet has reported a 1.1% YoY drop in same-store sales for 4Q24 (November-January), vs. the 0.7% YoY decrease in 3Q24. However, Signet CEO J.K. Symancyk noted the positive demand trends in January across all categories, including bridal. According to the management estimates, if the trend persists, 1Q25 same-store sales might recover, gaining 2.0% YoY
Overall, we keep our cautiously upbeat view on the global diamond market, but it might take longer than we had initially anticipated to recover, given the still high midstream inventories and the slowdown in the US downstream market in early-2025 (~53% of the world gem-set jewellery trade)
#diamonds
https://metals-wire.com/news-reports
Morning Bites
🏭Global primary aluminium output slid 0.7% YoY in February, vs. the +2.6% YoY seen in January, and marked the first negative YoY reading since February 2022, per International Aluminium Institute (IAI) data. Chinese production (60% of global Al output) was flat YoY last month, while ex. China output declined 1.6% YoY. Overall, strong consumption dynamics in Asia (incl. grid) and the ongoing monetary easing cycle in key economies (EU/US and China) are likely to add further support to Al, which continues to trade below what we see as its fundamentally reasonable level (USD 2,900-3,000/t for 2025F, on our numbers)
We also note that there is limited potential for additional supply growth in China, as local Al output is capped at 45mnt (China produced 43.4mnt in 2024, as well as 42.5mnt in 2mo25 in annualised terms, per IAI data)
#aluminium
https://metals-wire.com/sector/Aluminium
🏭Global primary aluminium output slid 0.7% YoY in February, vs. the +2.6% YoY seen in January, and marked the first negative YoY reading since February 2022, per International Aluminium Institute (IAI) data. Chinese production (60% of global Al output) was flat YoY last month, while ex. China output declined 1.6% YoY. Overall, strong consumption dynamics in Asia (incl. grid) and the ongoing monetary easing cycle in key economies (EU/US and China) are likely to add further support to Al, which continues to trade below what we see as its fundamentally reasonable level (USD 2,900-3,000/t for 2025F, on our numbers)
We also note that there is limited potential for additional supply growth in China, as local Al output is capped at 45mnt (China produced 43.4mnt in 2024, as well as 42.5mnt in 2mo25 in annualised terms, per IAI data)
#aluminium
https://metals-wire.com/sector/Aluminium
Morning Bites (part 1)
🇨🇳Investment in China’s grid infrastructure jumped 33% YoY in 2mo25, after the -3% YoY seen in December, per NBS data. The figure was also >70% above the 2020-23 average. On our numbers, the grid accounted for 10-15% of Al and Cu demand in China, so upbeat investments (due to the growing installations of renewable energy) are fundamentally supportive of demand for these base metals
Although State Grid sees only a 10% YoY capex increase in 2025, the actual figure might be higher, in our view: historically the company has often exceeded its investment guidance
🥈Solar panel installations in China rose 2% YoY in January-February, vs. +29% YoY in December, per NEA data. Given the solid demand for renewable energy in China, we maintain our positive view on silver, copper and aluminium, which are the key beneficiary metals of the proposed global transition to clean energy in 2024-30
#silver #copper #aluminium
https://metals-wire.com/news-reports
🇨🇳Investment in China’s grid infrastructure jumped 33% YoY in 2mo25, after the -3% YoY seen in December, per NBS data. The figure was also >70% above the 2020-23 average. On our numbers, the grid accounted for 10-15% of Al and Cu demand in China, so upbeat investments (due to the growing installations of renewable energy) are fundamentally supportive of demand for these base metals
Although State Grid sees only a 10% YoY capex increase in 2025, the actual figure might be higher, in our view: historically the company has often exceeded its investment guidance
🥈Solar panel installations in China rose 2% YoY in January-February, vs. +29% YoY in December, per NEA data. Given the solid demand for renewable energy in China, we maintain our positive view on silver, copper and aluminium, which are the key beneficiary metals of the proposed global transition to clean energy in 2024-30
#silver #copper #aluminium
https://metals-wire.com/news-reports
Morning Bites (part 2)
🇨🇳China plans to expand its industrial metals reserves in 2025, seeking to ensure resilient supply amid surging energy-transition demand and geopolitical tensions, Bloomberg reports. Cobalt, copper, nickel and lithium are among the metals Beijing plans to purchase
Although the targeted volumes were not disclosed, China, on our numbers, accumulated net 200-400ktpa (1-2% of global demand) of copper to its strategic reserve in 2013-16, and 600kt in 2020. Even excluding this factor, we see a global Cu market deficit of ~2% in 2025 amid strong renewable energy demand and growing investments in China's grid, all of which which underpins our positive view on the red metal
As for nickel, we do not expect a notable effect on sentiment, as the Ni market has remained in a stable surplus since 2022, while China is unlikely to have issues with access to Indonesian metal (~55% of global Ni supply)
#copper
https://metals-wire.com/sector/Copper
🇨🇳China plans to expand its industrial metals reserves in 2025, seeking to ensure resilient supply amid surging energy-transition demand and geopolitical tensions, Bloomberg reports. Cobalt, copper, nickel and lithium are among the metals Beijing plans to purchase
Although the targeted volumes were not disclosed, China, on our numbers, accumulated net 200-400ktpa (1-2% of global demand) of copper to its strategic reserve in 2013-16, and 600kt in 2020. Even excluding this factor, we see a global Cu market deficit of ~2% in 2025 amid strong renewable energy demand and growing investments in China's grid, all of which which underpins our positive view on the red metal
As for nickel, we do not expect a notable effect on sentiment, as the Ni market has remained in a stable surplus since 2022, while China is unlikely to have issues with access to Indonesian metal (~55% of global Ni supply)
#copper
https://metals-wire.com/sector/Copper
Morning Bites
🥉Global mined copper production gained 2.1% YoY in January, vs. the revised +4.5% YoY in December, the International Copper Study Group (ICSG) reports. Per the ICSG, the growth was mainly driven by Peru (+7% YoY, primarily due to the ramp-up of the Quellaveco mine) and DRC (+6% YoY, mostly as a consequence of the expansion of the Kamoa mine). The ICSG also reports global refined Cu consumption growth of 1.0% YoY in January
We maintain our positive view on copper, amid long-term supply issues, growing demand for renewables globally and surging investments in China’s grid infrastructure (which represents ~8% of global Cu demand, on our numbers)
#copper
https://metals-wire.com/sector/Copper
🥉Global mined copper production gained 2.1% YoY in January, vs. the revised +4.5% YoY in December, the International Copper Study Group (ICSG) reports. Per the ICSG, the growth was mainly driven by Peru (+7% YoY, primarily due to the ramp-up of the Quellaveco mine) and DRC (+6% YoY, mostly as a consequence of the expansion of the Kamoa mine). The ICSG also reports global refined Cu consumption growth of 1.0% YoY in January
We maintain our positive view on copper, amid long-term supply issues, growing demand for renewables globally and surging investments in China’s grid infrastructure (which represents ~8% of global Cu demand, on our numbers)
#copper
https://metals-wire.com/sector/Copper
Morning Bites (part 1)
🚘EU + UK passenger car registrations declined 3% YoY in February, in line with January. The figure matched our estimates, remaining 16% below the pre-COVID 2019 level
We maintain our view that the ongoing monetary easing cycle in the EU/US and China, the increase in EU import duties (from 10% up to 45%) on Chinese BEVs (encouraging the production of catalyst-containing cars), and the expected cancellation of EV-support programmes in the US (which could even be replaced with USD 1,000 new EV purchase tax), might bolster the PGM market fundamentals
In 2023, the EU+UK accounted for some 23% and 30% of world autocatalyst Pd and Pt demand, respectively
#cars
https://metals-wire.com/sector/PGM
🚘EU + UK passenger car registrations declined 3% YoY in February, in line with January. The figure matched our estimates, remaining 16% below the pre-COVID 2019 level
We maintain our view that the ongoing monetary easing cycle in the EU/US and China, the increase in EU import duties (from 10% up to 45%) on Chinese BEVs (encouraging the production of catalyst-containing cars), and the expected cancellation of EV-support programmes in the US (which could even be replaced with USD 1,000 new EV purchase tax), might bolster the PGM market fundamentals
In 2023, the EU+UK accounted for some 23% and 30% of world autocatalyst Pd and Pt demand, respectively
#cars
https://metals-wire.com/sector/PGM
Morning Bites (part 2)
🔗Global crude steel output declined 3% YoY to 145mnt in February, broadly in line with January, according to World Steel Association (WSA) data. China’s production (55% of global crude steel supply) fell 3% YoY (-6% YoY in January), while ex-China steel output also slipped 4% YoY. The WSA numbers show that Russian output dropped 3% YoY, while both US and EU production lost 7% YoY last month. Indian output (~9% of global steel supply) continued its growth, adding 6% YoY in February
In our view, China’s fiscal stimulus for 2025, (incl. 5% GDP growth target, and an increase in the official budget deficit from 3% to 4%, etc), could spur recovery in the Chinese real estate sector, which started to gradually bottom out in 2H24. Furthermore, Beijing plans to cut 'excessive' steel output in 2025 (2-5% YoY, per market estimates). These measures might cool surging Chinese steel exports, and support global prices in 2025, we believe
#steel
https://metals-wire.com/sector/Steel
🔗Global crude steel output declined 3% YoY to 145mnt in February, broadly in line with January, according to World Steel Association (WSA) data. China’s production (55% of global crude steel supply) fell 3% YoY (-6% YoY in January), while ex-China steel output also slipped 4% YoY. The WSA numbers show that Russian output dropped 3% YoY, while both US and EU production lost 7% YoY last month. Indian output (~9% of global steel supply) continued its growth, adding 6% YoY in February
In our view, China’s fiscal stimulus for 2025, (incl. 5% GDP growth target, and an increase in the official budget deficit from 3% to 4%, etc), could spur recovery in the Chinese real estate sector, which started to gradually bottom out in 2H24. Furthermore, Beijing plans to cut 'excessive' steel output in 2025 (2-5% YoY, per market estimates). These measures might cool surging Chinese steel exports, and support global prices in 2025, we believe
#steel
https://metals-wire.com/sector/Steel
Morning Bites
🔗CISA mills' daily crude steel production in mid-March was reported at 2.17mnt, up 1.6% vs. the previous ten days, and +5.8% YoY. Meanwhile, on a YTD basis (through 20 March), the output rose 1.9% YoY, per CISA data. Local steel inventories also increased 4.1% over the period (but were -13.4% YoY)
CISA has recently suggested halting new capacity additions in China, due to the oversupplied market, while Beijing plans to cut excessive output in 2025 (by 2-5% YoY, per market estimates). In our view, future supply cuts might cool surging Chinese exports, partially unwinding pressure on global steel prices
China accounts for ~57% of global steel supply
#steel
https://metals-wire.com/sector/Steel
🔗CISA mills' daily crude steel production in mid-March was reported at 2.17mnt, up 1.6% vs. the previous ten days, and +5.8% YoY. Meanwhile, on a YTD basis (through 20 March), the output rose 1.9% YoY, per CISA data. Local steel inventories also increased 4.1% over the period (but were -13.4% YoY)
CISA has recently suggested halting new capacity additions in China, due to the oversupplied market, while Beijing plans to cut excessive output in 2025 (by 2-5% YoY, per market estimates). In our view, future supply cuts might cool surging Chinese exports, partially unwinding pressure on global steel prices
China accounts for ~57% of global steel supply
#steel
https://metals-wire.com/sector/Steel