🗞Today China has published its industrial production data for October (see the table above)
#statistics #China
https://metals-wire.com:3000/news-reports
#statistics #China
https://metals-wire.com:3000/news-reports
Morning Bites (part 1)
🔗China’s crude steel output rose 11% YoY in October, decelerating from the 18% YoY in September. The growth in annual terms is generally due the low base effect. In October 2022, apparent steel consumption rose 10% YoY, decelerating from the 18% YoY increase in September. On our numbers, 10mo22 production was down 2.3% YoY. China is on track to reach its goal of flat or lower steel output in 2022 YoY
🏢China's property sales fell 21% YoY in October (vs. -16% YoY in September). Floor space starts were down 35% YoY in October, after the 44% YoY drop in September. Similarly, personal mortgage loans were down 31% YoY in October (vs. -18% in September). At the same time, property completions declined 9% YoY in October (vs. -6% YoY in September). While we have not yet seen any substantial measures that might bring about a recovery in the Chinese real estate sector, Beijing's recent announcement could slightly support sentiment
#steel #property
https://metals-wire.com:3000/sector/Steel
🔗China’s crude steel output rose 11% YoY in October, decelerating from the 18% YoY in September. The growth in annual terms is generally due the low base effect. In October 2022, apparent steel consumption rose 10% YoY, decelerating from the 18% YoY increase in September. On our numbers, 10mo22 production was down 2.3% YoY. China is on track to reach its goal of flat or lower steel output in 2022 YoY
🏢China's property sales fell 21% YoY in October (vs. -16% YoY in September). Floor space starts were down 35% YoY in October, after the 44% YoY drop in September. Similarly, personal mortgage loans were down 31% YoY in October (vs. -18% in September). At the same time, property completions declined 9% YoY in October (vs. -6% YoY in September). While we have not yet seen any substantial measures that might bring about a recovery in the Chinese real estate sector, Beijing's recent announcement could slightly support sentiment
#steel #property
https://metals-wire.com:3000/sector/Steel
Morning Bites (Part 2)
💎India’s rough diamond net imports dropped 32% YoY in October, accelerating from the 7% YoY decline in September. Similarly, India’s polished diamond net exports were down 26% YoY in October (vs. +14% YoY in September). According to GJEPC chairman, Vipul Shah, the slowdown in the EU, the interest rate hike in the US and the zero Covid policy in China are challenges for the diamond sector. We reiterate our view that the unfavourable macroeconomic conditions may adversely affect upcoming diamond sales on the YoY basis.
At the same time, India’s lab-grown rough diamond net imports were down 49% YoY in October (vs +4% YoY in September). The share of lab-grown net rough imports in natural diamond imports declined to 5% in October, from 7% in September.
#diamonds
https://metals-wire.com:3000/news-reports
💎India’s rough diamond net imports dropped 32% YoY in October, accelerating from the 7% YoY decline in September. Similarly, India’s polished diamond net exports were down 26% YoY in October (vs. +14% YoY in September). According to GJEPC chairman, Vipul Shah, the slowdown in the EU, the interest rate hike in the US and the zero Covid policy in China are challenges for the diamond sector. We reiterate our view that the unfavourable macroeconomic conditions may adversely affect upcoming diamond sales on the YoY basis.
At the same time, India’s lab-grown rough diamond net imports were down 49% YoY in October (vs +4% YoY in September). The share of lab-grown net rough imports in natural diamond imports declined to 5% in October, from 7% in September.
#diamonds
https://metals-wire.com:3000/news-reports
🗓3Q22 reporting season - concluding remarks
📉On average, the 3Q22 EBITDA results of major miners came 12% below the consensus estimates and our forecasts. This deviation was mainly driven by lower than expected revenues, while absolute pre-EBITDA costs were roughly in line with our expectations.
🌊The revenue underperformance was driven by lower than expected sales volumes due to weak demand for metals amid the unfavourable macroeconomic conditions. Meanwhile, realised prices met our expectations, on average.
💵It is worth noting that, since sales volumes were lower than we expected and the absolute pre-EBITDA costs were in line with our forecasts, the unit costs significantly exceeded our estimates.
#reporting_season
https://metals-wire.com:3000/events
📉On average, the 3Q22 EBITDA results of major miners came 12% below the consensus estimates and our forecasts. This deviation was mainly driven by lower than expected revenues, while absolute pre-EBITDA costs were roughly in line with our expectations.
🌊The revenue underperformance was driven by lower than expected sales volumes due to weak demand for metals amid the unfavourable macroeconomic conditions. Meanwhile, realised prices met our expectations, on average.
💵It is worth noting that, since sales volumes were lower than we expected and the absolute pre-EBITDA costs were in line with our forecasts, the unit costs significantly exceeded our estimates.
#reporting_season
https://metals-wire.com:3000/events
Morning Bites (part 1)
💍According to MasterCard SpendingPulse, preliminary US jewellery sales shrank 4% YoY in October, after the 1% YoY increase in September. Of note, if these estimates materialise, October will show negative YoY dynamics for the first time since May 2020. Meanwhile, we reiterate our concern that the currently unfavourable economic conditions pose risks to jewellery sales and diamond demand. In addition, luxury goods sales (excluding jewellery) are also expected to be down 9% YoY in October
#diamonds
https://metals-wire.com:3000/news-reports
💍According to MasterCard SpendingPulse, preliminary US jewellery sales shrank 4% YoY in October, after the 1% YoY increase in September. Of note, if these estimates materialise, October will show negative YoY dynamics for the first time since May 2020. Meanwhile, we reiterate our concern that the currently unfavourable economic conditions pose risks to jewellery sales and diamond demand. In addition, luxury goods sales (excluding jewellery) are also expected to be down 9% YoY in October
#diamonds
https://metals-wire.com:3000/news-reports
Morning bites (part 2)
⛏Tesla-backed Goro nickel mine has been forced to curtail its production in 4Q22, as heavy rain caused a “limited release of salt-laden liquid” from its tailing dam. Goro mine produced 1.3% of global nickel in 2020. However, the impact on 2022 world output is likely to be rather limited, as the company expects to meet the minimum quantities required by its customer contracts and return to full capacity shortly. We note that LME Nickel prices jumped 7% on Tuesday amid the miner's supply concerns
#Nickel
https://metals-wire.com:3000/news-reports
⛏Tesla-backed Goro nickel mine has been forced to curtail its production in 4Q22, as heavy rain caused a “limited release of salt-laden liquid” from its tailing dam. Goro mine produced 1.3% of global nickel in 2020. However, the impact on 2022 world output is likely to be rather limited, as the company expects to meet the minimum quantities required by its customer contracts and return to full capacity shortly. We note that LME Nickel prices jumped 7% on Tuesday amid the miner's supply concerns
#Nickel
https://metals-wire.com:3000/news-reports
Morning Bites (part 3)
💎De Beers has reported sales of USD 450mn at its 9th cycle in 2022. This was in line with the historical average and also 5% higher YoY (vs. +3% YoY at the 8th cycle in 2022). According to De Beers CEO Bruce Cleaver, the miner faced good demand for rough stones. Of note, Cycle 9 sales decreased 11% relative to Сycle 8, reflecting the traditionally quieter time ahead of polishing factories reopening in India following Diwali. Despite some acceleration of YoY growth, we are concerned about the unfavourable economic conditions, which pose risks to the current diamond demand
#diamonds
https://metals-wire.com:3000/news-reports
💎De Beers has reported sales of USD 450mn at its 9th cycle in 2022. This was in line with the historical average and also 5% higher YoY (vs. +3% YoY at the 8th cycle in 2022). According to De Beers CEO Bruce Cleaver, the miner faced good demand for rough stones. Of note, Cycle 9 sales decreased 11% relative to Сycle 8, reflecting the traditionally quieter time ahead of polishing factories reopening in India following Diwali. Despite some acceleration of YoY growth, we are concerned about the unfavourable economic conditions, which pose risks to the current diamond demand
#diamonds
https://metals-wire.com:3000/news-reports
Morning Bites (part 1)
⛏The Uzbekistan government plans to triple copper mining in the coming years. According to President Shavkat Mirziyoyev, local red metal output will grow to 500kt as the country aims to create an industrial copper cluster. Uzbekistan currently mines 150kt of copper, and processes 70kt. On our numbers, the increase would be equal to 1.5% of the estimated global mine supply in 2022, were it to materialise. However, no details of the government's plan have been announced yet. Separately, we note that recent large copper projects globally have been delayed by up to 30%, and in this case it might be even longer, given the team’s lack of execution experience
#copper
https://metals-wire.com:3000/news-reports
⛏The Uzbekistan government plans to triple copper mining in the coming years. According to President Shavkat Mirziyoyev, local red metal output will grow to 500kt as the country aims to create an industrial copper cluster. Uzbekistan currently mines 150kt of copper, and processes 70kt. On our numbers, the increase would be equal to 1.5% of the estimated global mine supply in 2022, were it to materialise. However, no details of the government's plan have been announced yet. Separately, we note that recent large copper projects globally have been delayed by up to 30%, and in this case it might be even longer, given the team’s lack of execution experience
#copper
https://metals-wire.com:3000/news-reports
Morning Bites (part 2)
🏭Indonesia's Antam and China's CNGR 80kt nickel industrial park are to start operations in 2025. Although the project was announced earlier, the timeline has only now been officially revealed. Meanwhile, CNGR is to invest in the nickel matte facility in a park managed by Antam’s unit. The park's installed capacity accounted for 3% of global refined nickel production in 2021, which is likely to support the metal's supply amid the growing demand for electric vehicles
#nickel
https://metals-wire.com:3000/news-reports
🏭Indonesia's Antam and China's CNGR 80kt nickel industrial park are to start operations in 2025. Although the project was announced earlier, the timeline has only now been officially revealed. Meanwhile, CNGR is to invest in the nickel matte facility in a park managed by Antam’s unit. The park's installed capacity accounted for 3% of global refined nickel production in 2021, which is likely to support the metal's supply amid the growing demand for electric vehicles
#nickel
https://metals-wire.com:3000/news-reports
SQM 3Q22 results - moderately above expectations
✏️3Q22 revenue rose 4.5x YoY (+7% vs. our forecast) supported by strong sales volumes. Meanwhile, EBITDA was up 7.2x YoY in 3Q22, +14% vs. the consensus and +12% vs. us as sales were higher than expected, while costs were essentially in line
⛏The company's BoD approved expanding its lithium hydroxide capacity from 40mt to 100mt in Chile by 2025, requiring additional USD 360mn capex
❗️On our numbers, 4Q22 EBITDA might show a low-single digit increase QoQ, at spot prices
$SQM #lithium
https://metals-wire.com:3000/company/SQM_US/
✏️3Q22 revenue rose 4.5x YoY (+7% vs. our forecast) supported by strong sales volumes. Meanwhile, EBITDA was up 7.2x YoY in 3Q22, +14% vs. the consensus and +12% vs. us as sales were higher than expected, while costs were essentially in line
⛏The company's BoD approved expanding its lithium hydroxide capacity from 40mt to 100mt in Chile by 2025, requiring additional USD 360mn capex
❗️On our numbers, 4Q22 EBITDA might show a low-single digit increase QoQ, at spot prices
$SQM #lithium
https://metals-wire.com:3000/company/SQM_US/
Morning Bites (part 1)
🔗China’s aluminium product output rose 8.6% YoY to 5.25mt in October, accelerating from the 6.1% YoY upside in September. According to Reuters, the growth is associated with the low base of 2021, amid domestic electricity curbs that lowered demand from the midstream, as well as with growing overseas demand for Chinese aluminium goods
📈Chinese output of copper products was up 15% YoY in October to 1.95mt (vs. +17% YoY in September). In particular, the figure was supported by a 33% YoY hike in the output of local power generation equipment (vs. +78% YoY in previous month), as well as a 5% YoY increase in the production of air conditioners (in line YoY in September). In our view, despite the weak construction data, China's copper demand might be further bolstered by the recovery in industrial production, which would be favourable for the red metal's price
#aluminium #copper
https://metals-wire.com:3000/news-reports
🔗China’s aluminium product output rose 8.6% YoY to 5.25mt in October, accelerating from the 6.1% YoY upside in September. According to Reuters, the growth is associated with the low base of 2021, amid domestic electricity curbs that lowered demand from the midstream, as well as with growing overseas demand for Chinese aluminium goods
📈Chinese output of copper products was up 15% YoY in October to 1.95mt (vs. +17% YoY in September). In particular, the figure was supported by a 33% YoY hike in the output of local power generation equipment (vs. +78% YoY in previous month), as well as a 5% YoY increase in the production of air conditioners (in line YoY in September). In our view, despite the weak construction data, China's copper demand might be further bolstered by the recovery in industrial production, which would be favourable for the red metal's price
#aluminium #copper
https://metals-wire.com:3000/news-reports
👍1
Morning Bites (part 2)
🚘EU + UK passenger car registrations were up 14% YoY in October, accelerating from +8% YoY in September. Despite some supply chain issues easing, the increase was mainly due to the low base effect, while the latest sales results were 25% below the pre-COVID 2019 level (vs. -19% in September). We reiterate our negative outlook on EU car sales, given that the local energy crisis and deteriorating macroeconomic conditions are putting buyers off. As a result, we think that the soft EU car sales are going to have an adverse effect on PGM demand from auto producers
#cars
https://metals-wire.com:3000/news-reports
🚘EU + UK passenger car registrations were up 14% YoY in October, accelerating from +8% YoY in September. Despite some supply chain issues easing, the increase was mainly due to the low base effect, while the latest sales results were 25% below the pre-COVID 2019 level (vs. -19% in September). We reiterate our negative outlook on EU car sales, given that the local energy crisis and deteriorating macroeconomic conditions are putting buyers off. As a result, we think that the soft EU car sales are going to have an adverse effect on PGM demand from auto producers
#cars
https://metals-wire.com:3000/news-reports
Morning Bites (part 3)
📉CISA mills daily crude steel output fell 2.9% to 1.99mnt in early November from the last ten days of October. However, this represented a 10.4% YoY increase (vs. 16.9% YoY in previous ten days). In turn, steel inventories slightly rose (1%) over the period (still 28.8% above the 2021 level, as of 10 November). Hence, we do not expect any short-term changes in the local steel demand, while some YoY weakness might indicate an overall softening interest from the metal's consumers
#steel
https://metals-wire.com:3000/news-reports
📉CISA mills daily crude steel output fell 2.9% to 1.99mnt in early November from the last ten days of October. However, this represented a 10.4% YoY increase (vs. 16.9% YoY in previous ten days). In turn, steel inventories slightly rose (1%) over the period (still 28.8% above the 2021 level, as of 10 November). Hence, we do not expect any short-term changes in the local steel demand, while some YoY weakness might indicate an overall softening interest from the metal's consumers
#steel
https://metals-wire.com:3000/news-reports
Morning Bites
🇵🇪Peru's Las Bambas mine is working at only 30% of capacity, according to a company source. To recap, after a truce in June-July, the blockades at the mine restarted in late-October, gradually reducing operations due to the lack of supplies, and now the extent of the disruption has been revealed. On our numbers, Las Bambas' missing volumes account for ~1% of global copper mined supply. This is likely to add slight upbeat sentiment over the red metal's price, although most of the disruption effect has likely already been priced in
#copper
https://metals-wire.com:3000/news-reports
🇵🇪Peru's Las Bambas mine is working at only 30% of capacity, according to a company source. To recap, after a truce in June-July, the blockades at the mine restarted in late-October, gradually reducing operations due to the lack of supplies, and now the extent of the disruption has been revealed. On our numbers, Las Bambas' missing volumes account for ~1% of global copper mined supply. This is likely to add slight upbeat sentiment over the red metal's price, although most of the disruption effect has likely already been priced in
#copper
https://metals-wire.com:3000/news-reports
👍1
Morning Bites (part 1)
🇿🇦South Africa’s PGM mining output was down 1% YoY in September, after the 13% YoY drop in August. At the same time, the country’s gold production shrank 12% YoY, decelerating from the -17% YoY in August. Overall, the local output of metals continued to drag, amid the energy crisis and industrial strikes. We note that the country accounts for some 70% and 38% of platinum and palladium supply, respectively, as well as for 3% of global gold production. Hence, if this situation persists, further production losses could add support for PGM prices and slight upbeat sentiment for the yellow metal
#PGMs #gold
https://metals-wire.com:3000/news-reports
🇿🇦South Africa’s PGM mining output was down 1% YoY in September, after the 13% YoY drop in August. At the same time, the country’s gold production shrank 12% YoY, decelerating from the -17% YoY in August. Overall, the local output of metals continued to drag, amid the energy crisis and industrial strikes. We note that the country accounts for some 70% and 38% of platinum and palladium supply, respectively, as well as for 3% of global gold production. Hence, if this situation persists, further production losses could add support for PGM prices and slight upbeat sentiment for the yellow metal
#PGMs #gold
https://metals-wire.com:3000/news-reports
Morning Bites (part 2)
🪨China’s coking coal imports rose 42% YoY in October, after the 58% YoY hike in September. The strong dynamics were mostly due to the low base effect provoked by COVID restrictions at the Mongolian border in 2021. In turn, imports from Russia (~39% of the total) jumped 3x YoY, although they were slightly lower MoM. Meanwhile, the increase in China’s coking coal imports was in line with the 11% YoY growth in the country's crude steel production last month
#coal
https://metals-wire.com:3000/sector/Coal
🪨China’s coking coal imports rose 42% YoY in October, after the 58% YoY hike in September. The strong dynamics were mostly due to the low base effect provoked by COVID restrictions at the Mongolian border in 2021. In turn, imports from Russia (~39% of the total) jumped 3x YoY, although they were slightly lower MoM. Meanwhile, the increase in China’s coking coal imports was in line with the 11% YoY growth in the country's crude steel production last month
#coal
https://metals-wire.com:3000/sector/Coal
Morning Bites (part 1)
🔋LG Chem is to build a 120kt EV battery cathode plant in the US, and plans to invest over USD 3bn. The factory is slated to start mass production in 2H25 and reach full capacity by 2027. The NCMA battery cathodes it is to produce consist of ~89% nickel, 5% cobalt and manganese, as well as ~1% aluminium. On our numbers, the new plant's capacity is equal to 4% of global nickel consumption in 2021. Hence, the project is likely to add some support to long-term base metal prices, as it is in line with the higher forecasted demand for EVs in the future
#nickel #cars
https://metals-wire.com:3000/news-reports
🔋LG Chem is to build a 120kt EV battery cathode plant in the US, and plans to invest over USD 3bn. The factory is slated to start mass production in 2H25 and reach full capacity by 2027. The NCMA battery cathodes it is to produce consist of ~89% nickel, 5% cobalt and manganese, as well as ~1% aluminium. On our numbers, the new plant's capacity is equal to 4% of global nickel consumption in 2021. Hence, the project is likely to add some support to long-term base metal prices, as it is in line with the higher forecasted demand for EVs in the future
#nickel #cars
https://metals-wire.com:3000/news-reports
Morning Bites (part 2)
🔗Global crude steel output was flat YoY at 147mnt in October, reversing from the 4% YoY decline in September, according to the World Steel Association. Meanwhile, the 11% YoY increase in steel output from China, which accounted for 54% of global steel production in October (vs. 57% in September), was mostly due to the low base effect from the 2021 COVID restrictions. The drop in ex-China steel output accelerated further to 15% YoY, from 11% YoY in the previous month. Steel output in the EU fell 16% YoY (vs. -17% YoY in September), amid the ongoing energy crisis and soft demand, while US steel production plunged 10% YoY (vs. -8% YoY in September). However, the decline in Russia’s steel output decelerated to 5% YoY in October, from 7% YoY in September, according to the WSA
📉We reiterate our negative outlook on global steel output, following the adverse macroeconomic conditions
#steel
https://metals-wire.com:3000/sector/Steel
🔗Global crude steel output was flat YoY at 147mnt in October, reversing from the 4% YoY decline in September, according to the World Steel Association. Meanwhile, the 11% YoY increase in steel output from China, which accounted for 54% of global steel production in October (vs. 57% in September), was mostly due to the low base effect from the 2021 COVID restrictions. The drop in ex-China steel output accelerated further to 15% YoY, from 11% YoY in the previous month. Steel output in the EU fell 16% YoY (vs. -17% YoY in September), amid the ongoing energy crisis and soft demand, while US steel production plunged 10% YoY (vs. -8% YoY in September). However, the decline in Russia’s steel output decelerated to 5% YoY in October, from 7% YoY in September, according to the WSA
📉We reiterate our negative outlook on global steel output, following the adverse macroeconomic conditions
#steel
https://metals-wire.com:3000/sector/Steel
Morning Bites (part 3)
📌China’s new internal combustion engine car sales shrank 8% YoY in October, after the 11% YoY growth in September. Overall, the figure is in line with the growing domestic appetite for EVs. China’s auto sector accounts for some 26% and 17% of global autocatalyst Pd and Pt demand, respectively, which we think implies a slightly negative cross-read for future PGM consumption
📌China’s new EV sales jumped 82% YoY in October, slightly decelerating from the 94% YoY growth in September. The outstanding performance of EV sales in China is a moderate positive in terms of the global demand for the battery metals basket (nickel, lithium and cobalt), since China accounts for 49% of the world EV market
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com:3000/news-reports
📌China’s new internal combustion engine car sales shrank 8% YoY in October, after the 11% YoY growth in September. Overall, the figure is in line with the growing domestic appetite for EVs. China’s auto sector accounts for some 26% and 17% of global autocatalyst Pd and Pt demand, respectively, which we think implies a slightly negative cross-read for future PGM consumption
📌China’s new EV sales jumped 82% YoY in October, slightly decelerating from the 94% YoY growth in September. The outstanding performance of EV sales in China is a moderate positive in terms of the global demand for the battery metals basket (nickel, lithium and cobalt), since China accounts for 49% of the world EV market
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com:3000/news-reports