Morning Bites (part 3)
📌China’s new internal combustion engine car sales grew 3% YoY in March (-25% vs. March 2019). The overall sector performance is still below the pre-Covid level, which, along with the growing popularity of EVs, continues to pressure the demand for PGMs. China’s auto sector accounts for some 26% and 17% of world autocatalyst Pd and Pt demand, respectively
📌New EV sales in China increased 35% YoY in March, after the 56% YoY surge in February. The EV sector is driving up the demand for battery metals such as cobalt, lithium, and nickel, while China has accounted for half of global EV sales in recent months. Hence, this growth might bolster the demand for the battery metals
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com:3000/news-reports
📌China’s new internal combustion engine car sales grew 3% YoY in March (-25% vs. March 2019). The overall sector performance is still below the pre-Covid level, which, along with the growing popularity of EVs, continues to pressure the demand for PGMs. China’s auto sector accounts for some 26% and 17% of world autocatalyst Pd and Pt demand, respectively
📌New EV sales in China increased 35% YoY in March, after the 56% YoY surge in February. The EV sector is driving up the demand for battery metals such as cobalt, lithium, and nickel, while China has accounted for half of global EV sales in recent months. Hence, this growth might bolster the demand for the battery metals
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com:3000/news-reports
Morning Bites (part 4)
🏗️China is to spend USD1.8tn on construction projects, Bloomberg reports. About two thirds of China’s regions have announced massive spending plans for transportation infrastructure, energy generation and industrial parks this year. Meanwhile, the recent data on China Construction Business Activity surged sharply in March, and hit its highest level (65.6 vs. the 10-y avg. of 59.2) in more than a decade. Overall, the large-scale construction might boost the demand for industrial metals, which would support our positive outlook for the commodities
#global
https://metals-wire.com:3000/news-reports
🏗️China is to spend USD1.8tn on construction projects, Bloomberg reports. About two thirds of China’s regions have announced massive spending plans for transportation infrastructure, energy generation and industrial parks this year. Meanwhile, the recent data on China Construction Business Activity surged sharply in March, and hit its highest level (65.6 vs. the 10-y avg. of 59.2) in more than a decade. Overall, the large-scale construction might boost the demand for industrial metals, which would support our positive outlook for the commodities
#global
https://metals-wire.com:3000/news-reports
🗞Today, China published its preliminary import/export statistics for March (see table above)
#statistics #China
https://metals-wire.com:3000/news-reports
#statistics #China
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Morning Bites
🔗China’s finished steel net exports surged 83% YoY in March, in line with the 83% YoY growth in January-February. Meanwhile, last month, average daily steel production mostly remained at the same level as in 2022, while inventories shortened, on the YoY basis. To recap, according to a recent Bloomberg report, China is planning to construct massive infrustructure projects this year, which might support domestic construction activity and, hence, the demand for steel in 2023
🪨China’s coal imports skyrocketed 151% YoY in March (vs. 71% YoY growth in January-February). According to Reuters, the strong dynamics were mostly due to utilities, which increased purchases amid expectations of a recovery in demand. Meanwhile, imported coal volumes were at their highest in the last three years
#coal #steel
https://metals-wire.com:3000/news-reports
🔗China’s finished steel net exports surged 83% YoY in March, in line with the 83% YoY growth in January-February. Meanwhile, last month, average daily steel production mostly remained at the same level as in 2022, while inventories shortened, on the YoY basis. To recap, according to a recent Bloomberg report, China is planning to construct massive infrustructure projects this year, which might support domestic construction activity and, hence, the demand for steel in 2023
🪨China’s coal imports skyrocketed 151% YoY in March (vs. 71% YoY growth in January-February). According to Reuters, the strong dynamics were mostly due to utilities, which increased purchases amid expectations of a recovery in demand. Meanwhile, imported coal volumes were at their highest in the last three years
#coal #steel
https://metals-wire.com:3000/news-reports
Morning Bites (part 1)
💍LVMH has reported 11% YoY growth in the organic sales of watches and jewellery in 1Q23, vs. the 3% YoY increase in 4Q22. According to the company, in jewellery, Tiffany & Co. had a strong start to the year. The popularity of the new collections also continued to grow throughout its worldwide rollout. However, despite the accelerating YoY growth rate in 1Q23, we note the still adverse macroeconomic conditions which are underpinning the risks to global jewellery demand, and could be a limiting factor for diamond demand
#diamonds
https://metals-wire.com/sector/Diamonds
💍LVMH has reported 11% YoY growth in the organic sales of watches and jewellery in 1Q23, vs. the 3% YoY increase in 4Q22. According to the company, in jewellery, Tiffany & Co. had a strong start to the year. The popularity of the new collections also continued to grow throughout its worldwide rollout. However, despite the accelerating YoY growth rate in 1Q23, we note the still adverse macroeconomic conditions which are underpinning the risks to global jewellery demand, and could be a limiting factor for diamond demand
#diamonds
https://metals-wire.com/sector/Diamonds
Morning Bites (part 2)
🇿🇦South Africa’s PGM mining output remained flat YoY in February, after the 15% YoY drop in January. Meanwhile, the country’s gold production increased 2% YoY, decelerating from the 5% YoY growth in January. In the last year, overall mining activity was subdued amid the adverse effects of the local electricity crisis. However, the moderate recovery in February, combined with the ongoing weak demand from the automotive sector, might weigh on PGM prices. To recap, South Africa accounts for ~70% of global platinum, 38% of palladium supply and 3% of global gold output
#PGMs #gold
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🇿🇦South Africa’s PGM mining output remained flat YoY in February, after the 15% YoY drop in January. Meanwhile, the country’s gold production increased 2% YoY, decelerating from the 5% YoY growth in January. In the last year, overall mining activity was subdued amid the adverse effects of the local electricity crisis. However, the moderate recovery in February, combined with the ongoing weak demand from the automotive sector, might weigh on PGM prices. To recap, South Africa accounts for ~70% of global platinum, 38% of palladium supply and 3% of global gold output
#PGMs #gold
https://metals-wire.com:3000/news-reports
Morning Bites (part 3)
🇨🇳China might limit domestic steel production at the 2022 level, Bloomberg reports. Beijing is to release the plan in April, as China's steel production grew 6% YoY in 2mo23, but demand in the country has not substantially picked up yet. Overall, if the plan was to materialise, it might be negative for iron ore sentiment (China represents ~56% of world steel supply), but support steel prices
#steel
https://metals-wire.com/sector/Steel
🇨🇳China might limit domestic steel production at the 2022 level, Bloomberg reports. Beijing is to release the plan in April, as China's steel production grew 6% YoY in 2mo23, but demand in the country has not substantially picked up yet. Overall, if the plan was to materialise, it might be negative for iron ore sentiment (China represents ~56% of world steel supply), but support steel prices
#steel
https://metals-wire.com/sector/Steel
👍2
Week ahead data releases in M&M
As the reporting season begins, we commence a series of posts devoted to the forthcoming data releases. This week, among the major M&M names, Alcoa and Freeport are to release their 1Q23 financial results (on Wednesday 19 and Thursday 20 April, respectively). For these two miners, our EBITDA estimates are slightly above the consensus
#reporting_season
https://metals-wire.com:3000/events
As the reporting season begins, we commence a series of posts devoted to the forthcoming data releases. This week, among the major M&M names, Alcoa and Freeport are to release their 1Q23 financial results (on Wednesday 19 and Thursday 20 April, respectively). For these two miners, our EBITDA estimates are slightly above the consensus
#reporting_season
https://metals-wire.com:3000/events
Morning Bites (part 1)
🔗CISA mills' daily crude steel production increased 2.7% to 2.32mnt in early April from late-March (YoY growth of 0.3%). Meanwhile, local steel inventories increased 6.2% over the same period. Although production (on an annual basis) has been growing continuously since early February, China’s government might limit national output at the level of 2022. That could potentially be a supportive factor for steel prices
#steel
https://metals-wire.com:3000/sector/Steel
🔗CISA mills' daily crude steel production increased 2.7% to 2.32mnt in early April from late-March (YoY growth of 0.3%). Meanwhile, local steel inventories increased 6.2% over the same period. Although production (on an annual basis) has been growing continuously since early February, China’s government might limit national output at the level of 2022. That could potentially be a supportive factor for steel prices
#steel
https://metals-wire.com:3000/sector/Steel
Morning Bites (part 2)
💎India’s rough diamond net imports fell 19% YoY in March, roughly in line with the -18% YoY in February. Meanwhile, India’s polished diamond net exports dropped 25% YoY (vs. the 23% YoY growth in February). Overall, we reiterate our view that adverse macroeconomic conditions globally are keeping the diamond sector under pressure, amid still soft De Beers sales and the ongoing weakish US jewellery data. We note that the dynamics were close to the mid-stream stocks accumulation area (see the chart above)
Meanwhile, India’s synthetic rough diamond net imports decreased 53% YoY in March (vs. -60% YoY in February). The share of lab-grown net rough imports in natural diamond imports also shrank to 6% in February (vs. 10% a year ago)
#diamonds
https://metals-wire.com/sector/Diamonds
💎India’s rough diamond net imports fell 19% YoY in March, roughly in line with the -18% YoY in February. Meanwhile, India’s polished diamond net exports dropped 25% YoY (vs. the 23% YoY growth in February). Overall, we reiterate our view that adverse macroeconomic conditions globally are keeping the diamond sector under pressure, amid still soft De Beers sales and the ongoing weakish US jewellery data. We note that the dynamics were close to the mid-stream stocks accumulation area (see the chart above)
Meanwhile, India’s synthetic rough diamond net imports decreased 53% YoY in March (vs. -60% YoY in February). The share of lab-grown net rough imports in natural diamond imports also shrank to 6% in February (vs. 10% a year ago)
#diamonds
https://metals-wire.com/sector/Diamonds
🗞Today, China has published its industrial production data for March (see table above)
#statistics #China
https://metals-wire.com:3000/news-reports
#statistics #China
https://metals-wire.com:3000/news-reports
Morning Bites
🔗China’s crude steel output grew 7% YoY in March, in line with the 7% YoY growth in January-February. According to Reuters, steel mills boosted their output amid improved margins and the expected robust downstream demand during the peak construction activity season. In addition, the strong Chinese March PMIs might indicate a potential recovery in domestic steel demand
🏢China's property sales were flat YoY in March (vs. -4% YoY in January-February), but still 20% below the historical highs of 2021. The decline in floor space starts accelerated to 29% YoY last month, after the 9% YoY drop in January-February. However, personal mortgage loans jumped 20% YoY (vs. -15% in January-February), while property completions also grew 31% YoY in March (vs. 8% YoY growth in January-February). Despite the uncertainty in the real estate segment, China’s strong liquidity injections data might add support to local construction activity in 2023
#steel #property
https://metals-wire.com:3000/sector/Steel
🔗China’s crude steel output grew 7% YoY in March, in line with the 7% YoY growth in January-February. According to Reuters, steel mills boosted their output amid improved margins and the expected robust downstream demand during the peak construction activity season. In addition, the strong Chinese March PMIs might indicate a potential recovery in domestic steel demand
🏢China's property sales were flat YoY in March (vs. -4% YoY in January-February), but still 20% below the historical highs of 2021. The decline in floor space starts accelerated to 29% YoY last month, after the 9% YoY drop in January-February. However, personal mortgage loans jumped 20% YoY (vs. -15% in January-February), while property completions also grew 31% YoY in March (vs. 8% YoY growth in January-February). Despite the uncertainty in the real estate segment, China’s strong liquidity injections data might add support to local construction activity in 2023
#steel #property
https://metals-wire.com:3000/sector/Steel
Morning Bites (part 1)
💍China’s jewellery retailers reported growth of 12-66% in LFL (same store) sales of gem-set jewellery in 1Q23. As such, Chow Tai Fook published 12% YoY growth in LFL sales of gem-set, platinum and K-gold jewellery in 1Q23. Sales in Mainland China were down 19% YoY, while HK and Macau sales roughly doubled (+99% YoY). Meanwhile, Luk Fook reported a 66% YoY increase in LFL gem-set jewellery sales in 1Q23. Although the retailer’s gem-set jewellery sales shrank 15% YoY in Mainland China, they jumped 88% YoY in HK and Macau. The overall dynamics were positive, following the easing of Beijing’s anti-Covid policies and the opening of HK's border with the Mainland in early February. To recap, China accounts for ~15% of global diamond jewellery retail sales. Hence, some recovery in Asia’s trading might be a moderately positive factor for rough diamond demand
#diamonds
https://metals-wire.com/sector/Diamonds
💍China’s jewellery retailers reported growth of 12-66% in LFL (same store) sales of gem-set jewellery in 1Q23. As such, Chow Tai Fook published 12% YoY growth in LFL sales of gem-set, platinum and K-gold jewellery in 1Q23. Sales in Mainland China were down 19% YoY, while HK and Macau sales roughly doubled (+99% YoY). Meanwhile, Luk Fook reported a 66% YoY increase in LFL gem-set jewellery sales in 1Q23. Although the retailer’s gem-set jewellery sales shrank 15% YoY in Mainland China, they jumped 88% YoY in HK and Macau. The overall dynamics were positive, following the easing of Beijing’s anti-Covid policies and the opening of HK's border with the Mainland in early February. To recap, China accounts for ~15% of global diamond jewellery retail sales. Hence, some recovery in Asia’s trading might be a moderately positive factor for rough diamond demand
#diamonds
https://metals-wire.com/sector/Diamonds
Morning Bites (part 2)
⛓️The World Steel Association (WSA) expects global steel demand to rise 2.3% YoY in 2023. Its previous forecast was for 1.0% YoY demand growth. For 2024, the WSA expects deceleration to a 1.7% YoY demand increase. Per the report, China’s demand is to climb 2.0% YoY in 2023, amid a pickup in the local property sector (following government support measures). Nevertheless, China’s demand is to remain flat in 2024 YoY, the report forecasts, leaving global consumption growth in 2024 to be driven by regions other than China, the WSA believes. Noteworthy is that the WSA expects ex-China steel consumption to grow 2.6% and 3.6% YoY in 2023 and 2024, respectively. Overall, if these estimates, along with the previously reported limitations on China's steel output, materialise, steel and raw materials prices (e.g. iron ore and coking coal) would be supported in coming years
#steel
https://metals-wire.com/sector/Steel
⛓️The World Steel Association (WSA) expects global steel demand to rise 2.3% YoY in 2023. Its previous forecast was for 1.0% YoY demand growth. For 2024, the WSA expects deceleration to a 1.7% YoY demand increase. Per the report, China’s demand is to climb 2.0% YoY in 2023, amid a pickup in the local property sector (following government support measures). Nevertheless, China’s demand is to remain flat in 2024 YoY, the report forecasts, leaving global consumption growth in 2024 to be driven by regions other than China, the WSA believes. Noteworthy is that the WSA expects ex-China steel consumption to grow 2.6% and 3.6% YoY in 2023 and 2024, respectively. Overall, if these estimates, along with the previously reported limitations on China's steel output, materialise, steel and raw materials prices (e.g. iron ore and coking coal) would be supported in coming years
#steel
https://metals-wire.com/sector/Steel
Morning Bites
🚘EU + UK passenger car registrations jumped 26% YoY in March from a low base, accelerating from the 13% YoY growth in February. The results were in line with preliminary estimates. Nevertheless, the figure was still 20% below the pre-COVID 2019 level (vs. -21% in February). We keep our negative outlook on EU car sales, given EV adoption and the economic slowdown. Weak car sales data is an adverse factor for PGMs demand. EU + UK accounted for 20% and 32% of the world auto-catalyst Pd and Pt demand, respectively, in 2022E
#cars
https://metals-wire.com:3000/sector/PGM
🚘EU + UK passenger car registrations jumped 26% YoY in March from a low base, accelerating from the 13% YoY growth in February. The results were in line with preliminary estimates. Nevertheless, the figure was still 20% below the pre-COVID 2019 level (vs. -21% in February). We keep our negative outlook on EU car sales, given EV adoption and the economic slowdown. Weak car sales data is an adverse factor for PGMs demand. EU + UK accounted for 20% and 32% of the world auto-catalyst Pd and Pt demand, respectively, in 2022E
#cars
https://metals-wire.com:3000/sector/PGM
Alcoa 1Q23 results - EBITDA misses forecasts
✏️1Q23 revenues dropped 19% YoY due to lower realised prices and sales volumes, 4% behind the consensus and roughly in line with us. Adjusted EBITDA, meanwhile, was down 78% YoY in 1Q23, 3% short of the consensus and 9% lower than our estimates. Nevertheless, after the previous quarter's decline, adj. EBITDA has partially recovered, mostly due to higher prices for aluminum and alumina and lower energy costs in Europe
⛏The company reiterated its FY23 sales guidance: aluminium and alumina shipments are both to decrease ~2% YoY, on average
❗️At spot prices, we expect EBITDA to materially improve QoQ in 2Q23, bolstered by sales volumes recovery and profitability improvement
#AA #Aluminium
https://metals-wire.com/company/AA_US
✏️1Q23 revenues dropped 19% YoY due to lower realised prices and sales volumes, 4% behind the consensus and roughly in line with us. Adjusted EBITDA, meanwhile, was down 78% YoY in 1Q23, 3% short of the consensus and 9% lower than our estimates. Nevertheless, after the previous quarter's decline, adj. EBITDA has partially recovered, mostly due to higher prices for aluminum and alumina and lower energy costs in Europe
⛏The company reiterated its FY23 sales guidance: aluminium and alumina shipments are both to decrease ~2% YoY, on average
❗️At spot prices, we expect EBITDA to materially improve QoQ in 2Q23, bolstered by sales volumes recovery and profitability improvement
#AA #Aluminium
https://metals-wire.com/company/AA_US
Morning Bites
⛏️China is to accelerate the construction of its iron ore projects. The government is aiming to increase domestic supply amid recent concerns about rising iron ore prices and the heavy dependence on imports. According to Reuters, the world’s largest iron ore consumer imports >70% of its needs. China is targeting output of 350mnt by 2025, which would be an increase of ~50% from 2022E. Were that to happen, it might put pressure on iron ore prices, as the anticipated increase is equal to 7% of the global seaborne market. However, we think that such an ambitious production increase might be overly upbeat, given the strict timeline
#iron_ore
https://metals-wire.com:3000/news-reports
⛏️China is to accelerate the construction of its iron ore projects. The government is aiming to increase domestic supply amid recent concerns about rising iron ore prices and the heavy dependence on imports. According to Reuters, the world’s largest iron ore consumer imports >70% of its needs. China is targeting output of 350mnt by 2025, which would be an increase of ~50% from 2022E. Were that to happen, it might put pressure on iron ore prices, as the anticipated increase is equal to 7% of the global seaborne market. However, we think that such an ambitious production increase might be overly upbeat, given the strict timeline
#iron_ore
https://metals-wire.com:3000/news-reports