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
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🇨🇳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
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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
Morning Bites
📈Russia’s gold output rose 9.1% YoY in February, after the -2.5% YoY in January, per Rosstat data. The country’s output in 2mo25 was also up 4.5% YoY. Russia accounted for ~9% of the world's mined gold supply in 2023
We keep our view that gold continues to trade above what we see as its fundamentally reasonable level for 1H25 (~USD 2,500/oz), but we expect the precious metal’s price will remain elevated in 2025, given continuing inflows into global ETFs and central banks
#gold
https://metals-wire.com/sector/Gold
📈Russia’s gold output rose 9.1% YoY in February, after the -2.5% YoY in January, per Rosstat data. The country’s output in 2mo25 was also up 4.5% YoY. Russia accounted for ~9% of the world's mined gold supply in 2023
We keep our view that gold continues to trade above what we see as its fundamentally reasonable level for 1H25 (~USD 2,500/oz), but we expect the precious metal’s price will remain elevated in 2025, given continuing inflows into global ETFs and central banks
#gold
https://metals-wire.com/sector/Gold
Morning Bites
🇵🇪 Peru’s copper output rose 7% YoY in January, accelerating from the 4% increase YoY in December, per MINEM data. Peru's top mining association, SNMPE, expects the country's 2025 copper output to hit around 2.80mnt, which is broadly in-line with the 2.74mnt in 2024
The joint production of Chile and Peru (~24% and ~12% of global Cu supply, respectively) grew <1% YoY, as Peruvian growth was offset by slowdown in Chile
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
🇵🇪 Peru’s copper output rose 7% YoY in January, accelerating from the 4% increase YoY in December, per MINEM data. Peru's top mining association, SNMPE, expects the country's 2025 copper output to hit around 2.80mnt, which is broadly in-line with the 2.74mnt in 2024
The joint production of Chile and Peru (~24% and ~12% of global Cu supply, respectively) grew <1% YoY, as Peruvian growth was offset by slowdown in Chile
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
❤1
Morning Bites
📈China’s output of aluminium products inched down 1% YoY to 9.7mnt in January-February, after a 3% YoY gain in December. Overall, we maintain our positive view on aluminium, given the rapid expansion of the new energy sector in China (~60% of global consumption). On our numbers, the fundamentally reasonable Al price for 2025 is USD ~2,900/t
🥉China's output of copper products rose 10% YoY in 2mo25 to 3.2mnt, vs. +17% in December. We reiterate our view that surging grid investments in China, solid demand trends globally and the monetary policy easing cycle in key economies (the US/EU and China) are likely to add further support to the red metal’s price (which we expect to reach USD 12,000/t in 2025). China represents ~55% of global Cu demand
#aluminium #copper
https://metals-wire.com/news-reports
📈China’s output of aluminium products inched down 1% YoY to 9.7mnt in January-February, after a 3% YoY gain in December. Overall, we maintain our positive view on aluminium, given the rapid expansion of the new energy sector in China (~60% of global consumption). On our numbers, the fundamentally reasonable Al price for 2025 is USD ~2,900/t
🥉China's output of copper products rose 10% YoY in 2mo25 to 3.2mnt, vs. +17% in December. We reiterate our view that surging grid investments in China, solid demand trends globally and the monetary policy easing cycle in key economies (the US/EU and China) are likely to add further support to the red metal’s price (which we expect to reach USD 12,000/t in 2025). China represents ~55% of global Cu demand
#aluminium #copper
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Morning Bites
🌏Global manufacturing PMIs showed mixed dynamics in March. The Eurozone Markit Manufacturing PMI was 48.6 (vs. 47.6 in February) while the US ISM manufacturing PMI slid to 49.0
🇨🇳The official NBS Manufacturing PMI in China rose to 50.5 (vs. 50.2 a month ago). Meanwhile, the Caixin China Manufacturing PMI stood at 51.2
🇮🇳 India’s manufacturing PMI of 57.6 remains one of the strongest indicators among the world's key economies
❗️Overall, EU and US PMI indices were below 50.0, underlining the weakness of local manufacturing activity. Meanwhile, we reiterate our view that China’s fiscal stimulus might bolster local demand for industrial metals this year (e.g. aluminum and copper)
#PMIs
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🌏Global manufacturing PMIs showed mixed dynamics in March. The Eurozone Markit Manufacturing PMI was 48.6 (vs. 47.6 in February) while the US ISM manufacturing PMI slid to 49.0
🇨🇳The official NBS Manufacturing PMI in China rose to 50.5 (vs. 50.2 a month ago). Meanwhile, the Caixin China Manufacturing PMI stood at 51.2
🇮🇳 India’s manufacturing PMI of 57.6 remains one of the strongest indicators among the world's key economies
❗️Overall, EU and US PMI indices were below 50.0, underlining the weakness of local manufacturing activity. Meanwhile, we reiterate our view that China’s fiscal stimulus might bolster local demand for industrial metals this year (e.g. aluminum and copper)
#PMIs
https://metals-wire.com/news-reports
Morning Bites
💎US jewellery sales were flat YoY in February, vs. the revised -1% YoY in January, IDEX reports, citing the local Department of Commerce data. According to Rapaport, the market was steady in February with retailers seeing stable but not record-breaking sales
💍Hong Kong jewellery and watch sales dropped another 13% YoY in February, after the 18% YoY decline in January, per government data. According to Rapaport, over the last few months, visitors have been turning away from luxury purchases, while HK residents have been spending money while traveling abroad rather than domestically
Overall, we maintain our cautiously upbeat view on the global diamond market, but it might take longer than we had originally 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
💎US jewellery sales were flat YoY in February, vs. the revised -1% YoY in January, IDEX reports, citing the local Department of Commerce data. According to Rapaport, the market was steady in February with retailers seeing stable but not record-breaking sales
💍Hong Kong jewellery and watch sales dropped another 13% YoY in February, after the 18% YoY decline in January, per government data. According to Rapaport, over the last few months, visitors have been turning away from luxury purchases, while HK residents have been spending money while traveling abroad rather than domestically
Overall, we maintain our cautiously upbeat view on the global diamond market, but it might take longer than we had originally 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
🏦 Global central banks purchased 24t of gold net in February, vs. the 19t buy in January, marking the 21th consecutive month of reserves accumulation, the World Gold Council reports. The major contributors were Poland (+29t) and China (+5t). On the sellers' side were Uzbekistan and Kazakhstan which sold 12t and 8t, respectively
At spot, gold continues to trade above what we see as its fundamentally reasonable level for 1H25 (~USD 2,500/oz); however, upside risks prevail for the precious metal’s price, given the steady inflows into global ETFs and central banks, as well as trade war uncertainties
#gold
https://metals-wire.com/sector/Gold
🏦 Global central banks purchased 24t of gold net in February, vs. the 19t buy in January, marking the 21th consecutive month of reserves accumulation, the World Gold Council reports. The major contributors were Poland (+29t) and China (+5t). On the sellers' side were Uzbekistan and Kazakhstan which sold 12t and 8t, respectively
At spot, gold continues to trade above what we see as its fundamentally reasonable level for 1H25 (~USD 2,500/oz); however, upside risks prevail for the precious metal’s price, given the steady inflows into global ETFs and central banks, as well as trade war uncertainties
#gold
https://metals-wire.com/sector/Gold
Morning Bites
🚘US light vehicle sales grew 9% YoY in March, vs. the 2% YoY gain in February. The figure has almost reached the pre-Covid 2019 level (-3% vs. March 2019). Meanwhile, 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 a USD 1,000 new EV purchase tax). This move, if it materialised, would negatively affect local BEV sales (as was the case in Germany), 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 grew 9% YoY in March, vs. the 2% YoY gain in February. The figure has almost reached the pre-Covid 2019 level (-3% vs. March 2019). Meanwhile, 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 a USD 1,000 new EV purchase tax). This move, if it materialised, would negatively affect local BEV sales (as was the case in Germany), 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
🔗CISA mills' daily crude steel production in late-March was reported at 2.13mnt, down 1.9% vs. the previous ten days, and +0.2% YoY. Meanwhile, on a YTD basis (through 31 March), the output rose 0.6% YoY, per CISA data. Local steel inventories declined 9.9% over the period (-17.4% YoY)
In our view, China’s fiscal stimulus for 2025 (incl. 5% GDP growth target, an increase in official budget deficit from 3% to 4%, etc), might bolster the recovery in the local property sector, which started to gradually bottom out in 2H24. Furthermore, Beijing plans to cut 'excessive' steel output in 2025 (might affect 2-5% of China’s 2024 supply, per market participants’ estimates). Overall, these measures might cool down surging Chinese steel exports, and support global steel prices in 2025, we believe
China accounts for ~57% of global steel supply
#steel
https://metals-wire.com/sector/Steel
🔗CISA mills' daily crude steel production in late-March was reported at 2.13mnt, down 1.9% vs. the previous ten days, and +0.2% YoY. Meanwhile, on a YTD basis (through 31 March), the output rose 0.6% YoY, per CISA data. Local steel inventories declined 9.9% over the period (-17.4% YoY)
In our view, China’s fiscal stimulus for 2025 (incl. 5% GDP growth target, an increase in official budget deficit from 3% to 4%, etc), might bolster the recovery in the local property sector, which started to gradually bottom out in 2H24. Furthermore, Beijing plans to cut 'excessive' steel output in 2025 (might affect 2-5% of China’s 2024 supply, per market participants’ estimates). Overall, these measures might cool down surging Chinese steel exports, and support global steel prices in 2025, we believe
China accounts for ~57% of global steel supply
#steel
https://metals-wire.com/sector/Steel
Morning Bites
📈Gold-backed ETFs purchased 92t of gold net in March, after the +100t in February, according to World Gold Council data. Inflows were again recorded in every region, with the strongest accumulation in North America (+67t). Overall, since the return of ETFs to gold purchasing in May 2024, global funds have accumulated 366t net (~9% of world physical demand, in annualised terms), following the monetary easing cycle in key economies (EU/US and China) as well as geopolitical unrest
Although at spot gold continues to trade above what we see as its fundamentally reasonable level for 1H25 (~USD 2,500/oz), we think the precious metal’s price will remain elevated in 2025, given ongoing inflows into global ETFs and central banks, in addition to the global trade related concerns
#ETF #gold
https://metals-wire.com/news-reports
📈Gold-backed ETFs purchased 92t of gold net in March, after the +100t in February, according to World Gold Council data. Inflows were again recorded in every region, with the strongest accumulation in North America (+67t). Overall, since the return of ETFs to gold purchasing in May 2024, global funds have accumulated 366t net (~9% of world physical demand, in annualised terms), following the monetary easing cycle in key economies (EU/US and China) as well as geopolitical unrest
Although at spot gold continues to trade above what we see as its fundamentally reasonable level for 1H25 (~USD 2,500/oz), we think the precious metal’s price will remain elevated in 2025, given ongoing inflows into global ETFs and central banks, in addition to the global trade related concerns
#ETF #gold
https://metals-wire.com/news-reports