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
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🔗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
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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
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🚘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
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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
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📉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
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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
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🇵🇪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
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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
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🇿🇦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
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🪨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
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🔋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
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📌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
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Morning Bites
🔗CISA mills daily crude steel output was up 0.8% to 2.00mnt in mid-November from the first ten days of the month. The dynamics show a 13.6% YoY increase (vs. +10.4% YoY in the previous ten days). In turn, steel inventories rose a further slight 3% over the period (+24.2% above the 2021 level, as of 20 November). Overall, the continuous YoY stock build-up (since end-1Q22) might indicate rather soft demand from the midstream
📈Russian gold output jumped 19.1% YoY in October, accelerating from the 1.9% YoY growth in September, Rosstat reports. Furthermore, on the 10mo22 basis, Russia's production of the yellow metal ticked up 1.1% YoY. In our view, the production recovery is an adverse factor for global gold prices, since in 2021 Russia accounted for ~9% of the world's gold mine output
#steel #gold
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🔗CISA mills daily crude steel output was up 0.8% to 2.00mnt in mid-November from the first ten days of the month. The dynamics show a 13.6% YoY increase (vs. +10.4% YoY in the previous ten days). In turn, steel inventories rose a further slight 3% over the period (+24.2% above the 2021 level, as of 20 November). Overall, the continuous YoY stock build-up (since end-1Q22) might indicate rather soft demand from the midstream
📈Russian gold output jumped 19.1% YoY in October, accelerating from the 1.9% YoY growth in September, Rosstat reports. Furthermore, on the 10mo22 basis, Russia's production of the yellow metal ticked up 1.1% YoY. In our view, the production recovery is an adverse factor for global gold prices, since in 2021 Russia accounted for ~9% of the world's gold mine output
#steel #gold
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Morning Bites (part 1)
💍China’s jewellery and watch retail sales were down 32% YoY in October, completely in-line with the YoY decline in September. Overall, the dynamics correspond to the recent bearish trend, which started at the end of 2Q22. In our view, the sales might fall even more, given the recent jump in local COVID cases, which are likely to result in new lockdowns
🪨Western banks are restricting lending to the coal segment for ESG reasons, Reuters reports, citing a dozen mining company executives. As such, projects to expand operations are being left on the table. Meanwhile, the Reuters article claims that demand for the fossil fuel is so tight that some miners are selling higher-value coking coal to electricity companies instead of steelmakers. The news might be slightly supportive for coal prices in medium term, given US, European and Australian combined coal output stands for ~19% of the global supply in 2021
#diamonds #coal
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💍China’s jewellery and watch retail sales were down 32% YoY in October, completely in-line with the YoY decline in September. Overall, the dynamics correspond to the recent bearish trend, which started at the end of 2Q22. In our view, the sales might fall even more, given the recent jump in local COVID cases, which are likely to result in new lockdowns
🪨Western banks are restricting lending to the coal segment for ESG reasons, Reuters reports, citing a dozen mining company executives. As such, projects to expand operations are being left on the table. Meanwhile, the Reuters article claims that demand for the fossil fuel is so tight that some miners are selling higher-value coking coal to electricity companies instead of steelmakers. The news might be slightly supportive for coal prices in medium term, given US, European and Australian combined coal output stands for ~19% of the global supply in 2021
#diamonds #coal
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Morning Bites (part 2)
🏗SteelOrbis sees China’s preliminary excavator sales up 25% YoY in November (domestic + export), accelerating from the 8% YoY increase in October. Meanwhile, domestic excavator sales are estimated to rise 11% YoY, rebounding from the 10% YoY drop in October. As a top-indicator of construction activity, growth in domestic excavator sales, were it to materialise, would indicate some revival in the country's property sector. That would be favourable for China’s demand for industrial metals, particularly for steel. However, there continue to be some risks from the demand side, given the latest surge in COVID cases
#global
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🏗SteelOrbis sees China’s preliminary excavator sales up 25% YoY in November (domestic + export), accelerating from the 8% YoY increase in October. Meanwhile, domestic excavator sales are estimated to rise 11% YoY, rebounding from the 10% YoY drop in October. As a top-indicator of construction activity, growth in domestic excavator sales, were it to materialise, would indicate some revival in the country's property sector. That would be favourable for China’s demand for industrial metals, particularly for steel. However, there continue to be some risks from the demand side, given the latest surge in COVID cases
#global
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Morning Bites (part 3)
💎Petra Diamonds lowered its LFL rough prices 5.1% at the October-November auction, vs. September. Meanwhile, the miner's LFL rough prices were up 12.6% YoY. According to Petra, the demand for rough stones is restrained at the moment. In our view, some price weakness might indicate that midstream demand has started to cool, but the overall levels continue to be solid. However, we are still concerned about the unfavourable macroeconomic conditions and the new COVID wave in China that could have an adverse effect on the sales of top miners
#diamonds
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💎Petra Diamonds lowered its LFL rough prices 5.1% at the October-November auction, vs. September. Meanwhile, the miner's LFL rough prices were up 12.6% YoY. According to Petra, the demand for rough stones is restrained at the moment. In our view, some price weakness might indicate that midstream demand has started to cool, but the overall levels continue to be solid. However, we are still concerned about the unfavourable macroeconomic conditions and the new COVID wave in China that could have an adverse effect on the sales of top miners
#diamonds
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Morning Bites (part 1)
🔋Mexico is to start producing lithium batteries in late-2023. As such, the country's foreign minister said that Mexico was prepared for 2023 investments from S. Korea and China. However, the lithium is to come from the Sonora project, which was expected to start production in 2H24. In our view, new battery capacities, should the project materialise, would reflect the surging global demand for EVs. It is worth noting that, at full capacity, Sonora would account for >30% of global lithium mine production, per USGC, while Mexico represents 1.9% of world lithium reserves
#EV #lithium
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🔋Mexico is to start producing lithium batteries in late-2023. As such, the country's foreign minister said that Mexico was prepared for 2023 investments from S. Korea and China. However, the lithium is to come from the Sonora project, which was expected to start production in 2H24. In our view, new battery capacities, should the project materialise, would reflect the surging global demand for EVs. It is worth noting that, at full capacity, Sonora would account for >30% of global lithium mine production, per USGC, while Mexico represents 1.9% of world lithium reserves
#EV #lithium
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Morning Bites (part 2)
🏗 Freeport-McMoRan, the US copper miner and Chinese smelters agreed to increase the TC/RC for 2023 by 35% YoY, Reuters reported. As such, the TC/RC was set at USD 88/t -- the highest figure since 2017. The indication is also 35% higher than the October 2022 contract. However, we do not expect a substantial impact on the copper price, since the new TC/RC level just catches up with the spot price and implies that the market does not expect a concentrate shortage in 2023. CRU also sees a surplus of 300kt on the market in 2023
#copper
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🏗 Freeport-McMoRan, the US copper miner and Chinese smelters agreed to increase the TC/RC for 2023 by 35% YoY, Reuters reported. As such, the TC/RC was set at USD 88/t -- the highest figure since 2017. The indication is also 35% higher than the October 2022 contract. However, we do not expect a substantial impact on the copper price, since the new TC/RC level just catches up with the spot price and implies that the market does not expect a concentrate shortage in 2023. CRU also sees a surplus of 300kt on the market in 2023
#copper
https://metals-wire.com:3000/news-reports
Morning Bites (part 1)
🏭Vale Indonesia aims to finish construction of its nickel HPAL factory by end-2025. Completion was previously targeted for 2026. The plant is slated to produce 120kt of nickel in mixed hydroxide precipitate per annum, which is to be used in EV batteries. We remind readers that the latest announced capacity is double the level announced in September. On our numbers, the project will boost long-term nickel consumption, since it is equal to 4.2% of global demand for the metal in 2021
⛏Workers at the Escondida copper mine in Chile have accepted BHP's offer and will not strike, the local labour union reports. The decision came on the back of management's proposal to improve hygiene and employee safety.
Escondida is the world's largest copper mine, accounting for ~4.8% of global mined supply in 2021. In our view, the normalisation of operating activities might have a slightly unfavourable effect on copper prices
#copper #nickel
https://metals-wire.com:3000/news-reports
🏭Vale Indonesia aims to finish construction of its nickel HPAL factory by end-2025. Completion was previously targeted for 2026. The plant is slated to produce 120kt of nickel in mixed hydroxide precipitate per annum, which is to be used in EV batteries. We remind readers that the latest announced capacity is double the level announced in September. On our numbers, the project will boost long-term nickel consumption, since it is equal to 4.2% of global demand for the metal in 2021
⛏Workers at the Escondida copper mine in Chile have accepted BHP's offer and will not strike, the local labour union reports. The decision came on the back of management's proposal to improve hygiene and employee safety.
Escondida is the world's largest copper mine, accounting for ~4.8% of global mined supply in 2021. In our view, the normalisation of operating activities might have a slightly unfavourable effect on copper prices
#copper #nickel
https://metals-wire.com:3000/news-reports
Morning Bites (part 2)
📝Sibanye Stillwater is to allocate capex of USD 616mn to advance the Keliber lithium project in Finland. Of note, the South African miner raised its stake in the Finnish mining and battery chemicals maker from 30% to 85% in October. Meanwhile, the capex programme is to start with the construction of a refinery plant within country's Kokkola industrial park, which is projected to supply 15kt of lithium hydroxide per annum, with first output planned for 2025. We estimate the new lithium capacity to account for ~4% of the global lithium output, which would support supply amid growing consumer interest for EVs globally
#lithium #EV
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📝Sibanye Stillwater is to allocate capex of USD 616mn to advance the Keliber lithium project in Finland. Of note, the South African miner raised its stake in the Finnish mining and battery chemicals maker from 30% to 85% in October. Meanwhile, the capex programme is to start with the construction of a refinery plant within country's Kokkola industrial park, which is projected to supply 15kt of lithium hydroxide per annum, with first output planned for 2025. We estimate the new lithium capacity to account for ~4% of the global lithium output, which would support supply amid growing consumer interest for EVs globally
#lithium #EV
https://metals-wire.com:3000/news-reports
Morning Bites (part 1)
🔗NLMK is to lower its December HRC prices for traders 1.8% to RUB 45.8k/t (USD 753/t) ex-VAT CPT Moscow custody warehouse. Furthermore, rebar prices under the same terms were revised down 1.2% to RUB 35.0k/t (USD 575/t) ex-VAT
• The HRC domestic premium is currently at USD 224/t (vs. the historical average of USD 38/t)
• Meanwhile, the rebar-billet discount reached USD 43/t (vs. the historical premium of USD 20/t)
• Given the price decreases, the domestic HRC premium might shorten to USD 208/t, and the rebar discount to billet could widen to USD 51/t
#steel
https://metals-wire.com:3000/news-reports
🔗NLMK is to lower its December HRC prices for traders 1.8% to RUB 45.8k/t (USD 753/t) ex-VAT CPT Moscow custody warehouse. Furthermore, rebar prices under the same terms were revised down 1.2% to RUB 35.0k/t (USD 575/t) ex-VAT
• The HRC domestic premium is currently at USD 224/t (vs. the historical average of USD 38/t)
• Meanwhile, the rebar-billet discount reached USD 43/t (vs. the historical premium of USD 20/t)
• Given the price decreases, the domestic HRC premium might shorten to USD 208/t, and the rebar discount to billet could widen to USD 51/t
#steel
https://metals-wire.com:3000/news-reports