Morning Bites (part 2)
🚗💨Internal combustion engine (ICE) car registrations in EU rose 13% YoY in 1Q23 from a low base, after the 3% YoY growth in 4Q22. Petrol car sales were up 18% YoY (vs. +5% YoY in 1Q22), while diesel car registrations were almost flat (vs. -1% YoY). Diesel cars accounted for 26% of ICE car sales (vs. 28% in 4Q22 and 29% in 1Q22). Overall, the sales are still far below the 2019 levels, weighing on PGMs prices: the EU represents 20% and 31% of global Pd and Pt autocatalyst demand, respectively
🚘EU+UK EV sales rose 18% YoY in 1Q23, following the 31% YoY growth in 4Q22. BEV sales gained 33% YoY (vs. +36% YoY in 4Q22), while PHEV sales shrank 3% YoY (vs. +22% YoY). The share of BEVs in total EV sales grew slightly to 66%, from 64% in 4Q22. In our view, continuously strong local EV sales likely to positively affect the demand for battery metals (e.g. nickel, lithium and cobalt)
#cars #EV #nickel #lithium #cobalt
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🚗💨Internal combustion engine (ICE) car registrations in EU rose 13% YoY in 1Q23 from a low base, after the 3% YoY growth in 4Q22. Petrol car sales were up 18% YoY (vs. +5% YoY in 1Q22), while diesel car registrations were almost flat (vs. -1% YoY). Diesel cars accounted for 26% of ICE car sales (vs. 28% in 4Q22 and 29% in 1Q22). Overall, the sales are still far below the 2019 levels, weighing on PGMs prices: the EU represents 20% and 31% of global Pd and Pt autocatalyst demand, respectively
🚘EU+UK EV sales rose 18% YoY in 1Q23, following the 31% YoY growth in 4Q22. BEV sales gained 33% YoY (vs. +36% YoY in 4Q22), while PHEV sales shrank 3% YoY (vs. +22% YoY). The share of BEVs in total EV sales grew slightly to 66%, from 64% in 4Q22. In our view, continuously strong local EV sales likely to positively affect the demand for battery metals (e.g. nickel, lithium and cobalt)
#cars #EV #nickel #lithium #cobalt
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Morning Bites (part 3)
💎 India – Jewellery segment revenues at Titan were up 33% YoY in CY 1Q23, accelerating from the 15% YoY growth in CY 4Q22. According to the retailer, the average realised ticket price was up 8% YoY, while the number of buyers rose 15%, following the strong Indian wedding season. Hence, we reiterate our view that these dynamics might indicate a somewhat positive read-across for local gold and rough diamonds demand. Nevertheless, the diamond segment globally is likely to remain materially stressed in the near future, given the unfavourable macroeconomic conditions
#diamonds
https://metals-wire.com:3000/sector/Diamonds
💎 India – Jewellery segment revenues at Titan were up 33% YoY in CY 1Q23, accelerating from the 15% YoY growth in CY 4Q22. According to the retailer, the average realised ticket price was up 8% YoY, while the number of buyers rose 15%, following the strong Indian wedding season. Hence, we reiterate our view that these dynamics might indicate a somewhat positive read-across for local gold and rough diamonds demand. Nevertheless, the diamond segment globally is likely to remain materially stressed in the near future, given the unfavourable macroeconomic conditions
#diamonds
https://metals-wire.com:3000/sector/Diamonds
Morning Bites
🔗Global crude steel output declined 2% YoY to 161mnt in April, reversing from the 2% YoY growth in March, according to the World Steel Association. Specifically, China’s production fell 2% YoY (vs. the 7% YoY growth in March), which likely reflected Beijing's plan to limit national steel output, as well as the similar call from CISA amid low domestic realised prices. China represented 57% of the global steel supply in April. Overall, ex-China steel production shrank 4% YoY. In particular, EU production dropped 12% YoY (after -6% YoY in March), while US steel production also declined by 5% YoY. Russia’s steel output was up 2% YoY after the flat YoY dynamics in March
#steel
https://metals-wire.com:3000/sector/Steel
🔗Global crude steel output declined 2% YoY to 161mnt in April, reversing from the 2% YoY growth in March, according to the World Steel Association. Specifically, China’s production fell 2% YoY (vs. the 7% YoY growth in March), which likely reflected Beijing's plan to limit national steel output, as well as the similar call from CISA amid low domestic realised prices. China represented 57% of the global steel supply in April. Overall, ex-China steel production shrank 4% YoY. In particular, EU production dropped 12% YoY (after -6% YoY in March), while US steel production also declined by 5% YoY. Russia’s steel output was up 2% YoY after the flat YoY dynamics in March
#steel
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Morning Bites
🔗CISA mills' daily crude steel production during mid-May was 2.25mnt, a 0.2% decrease compared with the first ten days of May (YoY drop of 2.3%). Meanwhile, local steel inventories declined 7.6% over the same period (-18.6% YoY). To recap, according to the WSA, China‘s steel output was down 2% YoY in April, which likely reflected CISA’s recent call to cut production amid low domestic steel prices. Overall, Chinese steel output fell YoY for the third consecutive 10-day period (from 20 April): hence, were the dynamics to persist, this could add support to steel prices
💎India’s midstream producers in Surat are extending their summer holidays, amid recession risks and soft US/EU demand, IDEX reports. According to the local diamond workers’ union, there have been 10,000 layoffs in Surat (90% of world polished stones supply) in the last two months to avoid overproduction. Hence, the news underpins our cautious view on the diamond market
#steel #diamonds
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🔗CISA mills' daily crude steel production during mid-May was 2.25mnt, a 0.2% decrease compared with the first ten days of May (YoY drop of 2.3%). Meanwhile, local steel inventories declined 7.6% over the same period (-18.6% YoY). To recap, according to the WSA, China‘s steel output was down 2% YoY in April, which likely reflected CISA’s recent call to cut production amid low domestic steel prices. Overall, Chinese steel output fell YoY for the third consecutive 10-day period (from 20 April): hence, were the dynamics to persist, this could add support to steel prices
💎India’s midstream producers in Surat are extending their summer holidays, amid recession risks and soft US/EU demand, IDEX reports. According to the local diamond workers’ union, there have been 10,000 layoffs in Surat (90% of world polished stones supply) in the last two months to avoid overproduction. Hence, the news underpins our cautious view on the diamond market
#steel #diamonds
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Morning Bites
🏗China’s excavator sales are set to be down 25% YoY in May (domestic + export), following the 23% YoY decline in April, according to preliminary estimates from Construction Machinery and Equipment. Meanwhile, domestic excavator sales are seen declining 46% YoY (vs. -41% YoY in April), but export sales rising some 7% YoY (roughly in line with the 9% YoY growth in April). Overall, domestic excavator sales have been showing negative dynamics since May 2021, which underpins the ongoing stagnation in the local property sector. However, we reiterate our view that the near-record liquidity inflows in early-2023 are likely to bolster domestic construction activity. In addition, China’s plan for massive infrastructure projects could well also support the demand for steel and industrial metals (e.g. aluminium and copper) later in 2023
#steel
https://metals-wire.com/sector/Steel
🏗China’s excavator sales are set to be down 25% YoY in May (domestic + export), following the 23% YoY decline in April, according to preliminary estimates from Construction Machinery and Equipment. Meanwhile, domestic excavator sales are seen declining 46% YoY (vs. -41% YoY in April), but export sales rising some 7% YoY (roughly in line with the 9% YoY growth in April). Overall, domestic excavator sales have been showing negative dynamics since May 2021, which underpins the ongoing stagnation in the local property sector. However, we reiterate our view that the near-record liquidity inflows in early-2023 are likely to bolster domestic construction activity. In addition, China’s plan for massive infrastructure projects could well also support the demand for steel and industrial metals (e.g. aluminium and copper) later in 2023
#steel
https://metals-wire.com/sector/Steel
Morning Bites
🇮🇳India’s steel demand is set to grow 7.5% YoY in FY 2023-24 (April 2023 - March 2024), following the 13.3% YoY jump a year ago, according to a report by the Indian Steel Association. The agency expects local steel consumption to expand a further 6.3% YoY in FY 2024-25. Despite the upbeat sentiment on the Indian market, China remains a key steel consumer in Asia, driving 52% of global demand for the metal in 2022E (vs. ~6% by India). However, India’s strong dynamics are likely to be a long-term supportive factor for steel prices, in our view
#steel
https://metals-wire.com/sector/Steel
🇮🇳India’s steel demand is set to grow 7.5% YoY in FY 2023-24 (April 2023 - March 2024), following the 13.3% YoY jump a year ago, according to a report by the Indian Steel Association. The agency expects local steel consumption to expand a further 6.3% YoY in FY 2024-25. Despite the upbeat sentiment on the Indian market, China remains a key steel consumer in Asia, driving 52% of global demand for the metal in 2022E (vs. ~6% by India). However, India’s strong dynamics are likely to be a long-term supportive factor for steel prices, in our view
#steel
https://metals-wire.com/sector/Steel
Morning Bites
💎Alrosa plans to launch restoration works at the Mir mine this year, after a severe flood in 2017 meant that operations were suspended, according to Yakutia’s regional minister, Aysen Nikolayev. Full capacity is to be reached by 2030. The Mir mine contains high grade stones and accounted for ~2.5% of global diamond production before the accident, as well as 11% of Alrosa’s output. Despite the project’s large scale, we do not expect the news to affect market sentiment. Specifically, the ramp-up period is rather long, while the plans for Mir's recovery were confirmed back in mid-2022
#diamonds
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💎Alrosa plans to launch restoration works at the Mir mine this year, after a severe flood in 2017 meant that operations were suspended, according to Yakutia’s regional minister, Aysen Nikolayev. Full capacity is to be reached by 2030. The Mir mine contains high grade stones and accounted for ~2.5% of global diamond production before the accident, as well as 11% of Alrosa’s output. Despite the project’s large scale, we do not expect the news to affect market sentiment. Specifically, the ramp-up period is rather long, while the plans for Mir's recovery were confirmed back in mid-2022
#diamonds
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Morning Bites
🪨Asian seaborne thermal coal imports reached historical highs in May, Reuters reports, citing Kpler estimates. The regional offloads were likely 78.4mnt during the month: in particular, China imported 28.2mnt (roughly flat MoM), amid strong electricity demand. As for the second largest importer, India, its inflows jumped 16% MoM to 16.6mnt, due to local economic growth and weather effects. In our view, were the dynamics to persist, it could add some support to thermal coal prices globally (which have slumped 60-70% from their highs of 2022)
#coal
https://metals-wire.com:3000/sector/Coal
🪨Asian seaborne thermal coal imports reached historical highs in May, Reuters reports, citing Kpler estimates. The regional offloads were likely 78.4mnt during the month: in particular, China imported 28.2mnt (roughly flat MoM), amid strong electricity demand. As for the second largest importer, India, its inflows jumped 16% MoM to 16.6mnt, due to local economic growth and weather effects. In our view, were the dynamics to persist, it could add some support to thermal coal prices globally (which have slumped 60-70% from their highs of 2022)
#coal
https://metals-wire.com:3000/sector/Coal
Morning Bites (part 1)
⚒Norilsk Nickel sees a 200kt Ni market surplus and 300koz Pd deficit in 2023
• The Ni market is set to remain in a surplus of ~200kt in 2023-24 (vs. the previous estimate of 110kt) due to greater Indonesian NPI output and new Class-1 capacities in China and Indonesia, per Norilsk Nickel. As for 2023, the miner sees Ni supply at 3.45mnt (+10% YoY), with low-grade metal production driving most of the surplus (160kt). Overall, this might be an adverse factor for the sentiment on Ni producers in coming years
• In 2023, the Pd market might stay in a 0.3mnoz deficit (vs. 0.8mnoz seen earlier), amid the revised impact from China’s emission regulations and lower ICE-car sales. Still, supply risks persist from operational issues in S. Africa, as well as the deterioration in recycling. Pd output is seen at 6.5mnoz (-1% YoY). As previously estimated, the Pt market is likely to stay balanced in 2023, with 5.9mnoz of supply (+3% YoY)
#nickel #PGMs
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⚒Norilsk Nickel sees a 200kt Ni market surplus and 300koz Pd deficit in 2023
• The Ni market is set to remain in a surplus of ~200kt in 2023-24 (vs. the previous estimate of 110kt) due to greater Indonesian NPI output and new Class-1 capacities in China and Indonesia, per Norilsk Nickel. As for 2023, the miner sees Ni supply at 3.45mnt (+10% YoY), with low-grade metal production driving most of the surplus (160kt). Overall, this might be an adverse factor for the sentiment on Ni producers in coming years
• In 2023, the Pd market might stay in a 0.3mnoz deficit (vs. 0.8mnoz seen earlier), amid the revised impact from China’s emission regulations and lower ICE-car sales. Still, supply risks persist from operational issues in S. Africa, as well as the deterioration in recycling. Pd output is seen at 6.5mnoz (-1% YoY). As previously estimated, the Pt market is likely to stay balanced in 2023, with 5.9mnoz of supply (+3% YoY)
#nickel #PGMs
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Morning Bites (part 2)
📈Russia’s gold production was up 10.5% YoY in April, decelerating from the 26.5% YoY jump in March, according to Rosstat. However, on our numbers, the figure was still down 11.5% vs. the 2021 level: the positive dynamics seen recently are likely driven by the low base effect from 2022. Despite some YoY recovery in Russia’s output (~9% of the world's gold mine output), we reiterate our bullish view on the precious metal, amid strong physical gold demand and rising producer cash costs globally
#gold
https://metals-wire.com/sector/Gold
📈Russia’s gold production was up 10.5% YoY in April, decelerating from the 26.5% YoY jump in March, according to Rosstat. However, on our numbers, the figure was still down 11.5% vs. the 2021 level: the positive dynamics seen recently are likely driven by the low base effect from 2022. Despite some YoY recovery in Russia’s output (~9% of the world's gold mine output), we reiterate our bullish view on the precious metal, amid strong physical gold demand and rising producer cash costs globally
#gold
https://metals-wire.com/sector/Gold
Morning Bites (part 1)
🇨🇱Chile’s copper production declined 1% YoY in April, decelerating from the 5% YoY drop in March. Overall, in April, the country's Cu output remained close to its historical lows, and was the lowest of any April since 2005. This dynamic has been mostly driven by the continuous drought in the region, as well as negative structural effects (e.g. grade depletion). In our view, if these factors keep weighing on Chilean mining (~27% of world mined Cu supply), they might partially offset the negative effect on prices from new project launches (Kamoa, QB2, Udokan, etc) in 2023
#copper
https://metals-wire.com:3000/sector/Copper
🇨🇱Chile’s copper production declined 1% YoY in April, decelerating from the 5% YoY drop in March. Overall, in April, the country's Cu output remained close to its historical lows, and was the lowest of any April since 2005. This dynamic has been mostly driven by the continuous drought in the region, as well as negative structural effects (e.g. grade depletion). In our view, if these factors keep weighing on Chilean mining (~27% of world mined Cu supply), they might partially offset the negative effect on prices from new project launches (Kamoa, QB2, Udokan, etc) in 2023
#copper
https://metals-wire.com:3000/sector/Copper
Morning Bites (part 2)
🌏Global manufacturing PMIs showed overall negative dynamics in May. The Eurozone Markit Manufacturing PMI declined to 44.8 (consensus estimate - 44.6), from 45.8 in April, its lowest point since May 2020. The US ISM manufacturing PMI also fell, to 46.9 (from 47.1 in April)
❗️The global manufacturing sector remained subdued in May, as indicated by PMIs below 50.0. The continuous deterioration in activity in the EU/US and China is likely to have an adverse impact on the demand for industrial metals (e.g. steel, aluminum and copper). Nonetheless, China's significant liquidity injections in early 2023 and plans for massive infrastructure projects might bolster metals consumption later this year
#PMIs
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🌏Global manufacturing PMIs showed overall negative dynamics in May. The Eurozone Markit Manufacturing PMI declined to 44.8 (consensus estimate - 44.6), from 45.8 in April, its lowest point since May 2020. The US ISM manufacturing PMI also fell, to 46.9 (from 47.1 in April)
❗️The global manufacturing sector remained subdued in May, as indicated by PMIs below 50.0. The continuous deterioration in activity in the EU/US and China is likely to have an adverse impact on the demand for industrial metals (e.g. steel, aluminum and copper). Nonetheless, China's significant liquidity injections in early 2023 and plans for massive infrastructure projects might bolster metals consumption later this year
#PMIs
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Morning Bites (part 1)
🏦 Global central banks suddenly sold substantial volumes of gold in April, marking the first decline in holdings since March 2022, the World Gold Council (WGC) reports. Overall, CBs were net sellers of 71t of gold (vs. the revised +1.1t in March). The main contributors were Turkey (-81t: 14% of its reserves) and Kazakhstan (-13t). On the buyers' side were Poland and China (+15t and +8t, respectively). Although CB dynamics were bearish in April, we reiterate our positive view on the precious metal's price, amid inflation pressures and the adverse macroeconomic situation globally. In addition, a WGC poll underpins the positive sentiment among CB managers toward gold holdings
#gold
https://metals-wire.com/sector/Gold
🏦 Global central banks suddenly sold substantial volumes of gold in April, marking the first decline in holdings since March 2022, the World Gold Council (WGC) reports. Overall, CBs were net sellers of 71t of gold (vs. the revised +1.1t in March). The main contributors were Turkey (-81t: 14% of its reserves) and Kazakhstan (-13t). On the buyers' side were Poland and China (+15t and +8t, respectively). Although CB dynamics were bearish in April, we reiterate our positive view on the precious metal's price, amid inflation pressures and the adverse macroeconomic situation globally. In addition, a WGC poll underpins the positive sentiment among CB managers toward gold holdings
#gold
https://metals-wire.com/sector/Gold
Morning Bites (part 2)
🇵🇪Peru’s copper output jumped 31% YoY in April, following the 20% YoY growth in March. According to the Ministry of Energy and Mines, this was driven by the strong performance of domestic pits, in particular Las Bambas and Cerro Verde (and partly due to the low base effect from 2022-21). Meanwhile, the combined output of Peru (11% of global Cu supply) and Chile (27%) was 8% higher YoY. We note that, in annual terms, the increase seems to be in line with the plan of Peru’s government to achieve 15% YoY Cu output growth during 2023. Despite the solid supply additions in Peru, Chile’s deteriorating mining segment might partially outweigh the negative effect on prices, in our view
#copper
https://metals-wire.com:3000/sector/Copper
🇵🇪Peru’s copper output jumped 31% YoY in April, following the 20% YoY growth in March. According to the Ministry of Energy and Mines, this was driven by the strong performance of domestic pits, in particular Las Bambas and Cerro Verde (and partly due to the low base effect from 2022-21). Meanwhile, the combined output of Peru (11% of global Cu supply) and Chile (27%) was 8% higher YoY. We note that, in annual terms, the increase seems to be in line with the plan of Peru’s government to achieve 15% YoY Cu output growth during 2023. Despite the solid supply additions in Peru, Chile’s deteriorating mining segment might partially outweigh the negative effect on prices, in our view
#copper
https://metals-wire.com:3000/sector/Copper
Morning Bites (part 3)
🏗️China is considering new measures to support its property sector and boost the economy, Bloomberg reports. As the local real estate segment remains stressed in 2023, Beijing is working on a new support package. According to a Bloomberg source, Chinese regulators are considering reducing down payments, as well as lowering agent commissions on transactions. Although the timing and volume of the new measures were not specified, they might bolster China’s construction activity and the demand for industial metals (together with the plans for massive infrastructure projects in 2023). The country represents 52% of global steel consumption, as well as 55% and 58% of world copper and aluminium demand, respectively
#global
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🏗️China is considering new measures to support its property sector and boost the economy, Bloomberg reports. As the local real estate segment remains stressed in 2023, Beijing is working on a new support package. According to a Bloomberg source, Chinese regulators are considering reducing down payments, as well as lowering agent commissions on transactions. Although the timing and volume of the new measures were not specified, they might bolster China’s construction activity and the demand for industial metals (together with the plans for massive infrastructure projects in 2023). The country represents 52% of global steel consumption, as well as 55% and 58% of world copper and aluminium demand, respectively
#global
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Morning Bites (part 4)
🇨🇳China might extend tax incentives for EV purchases, amid other efforts to boost sluggish post-Covid recovery, Bloomberg reports. A 4-year extension to recently ended financial and tax incentives was discussed for some EVs and hybrids below CNY 300k (~USD 42k). Beijing has been promoting the domestic EV industry for more than 10 years: previously, buyers received discounts of CNY 60k (~USD 8k) for purchasing EVs, but the programme ended in 2022. In our view, if the tax incentives were prolonged, this would add further support to demand for the battery metals basket (e.g. lithium, nickel and cobalt)
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com:3000/news-reports
🇨🇳China might extend tax incentives for EV purchases, amid other efforts to boost sluggish post-Covid recovery, Bloomberg reports. A 4-year extension to recently ended financial and tax incentives was discussed for some EVs and hybrids below CNY 300k (~USD 42k). Beijing has been promoting the domestic EV industry for more than 10 years: previously, buyers received discounts of CNY 60k (~USD 8k) for purchasing EVs, but the programme ended in 2022. In our view, if the tax incentives were prolonged, this would add further support to demand for the battery metals basket (e.g. lithium, nickel and cobalt)
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com:3000/news-reports
Morning Bites (part 5)
💍Hong Kong jewellery and watch sales grew 75% YoY in April, after the 165% YoY surge in March, according to government data. In addition to the resurgence in tourism after HK’s border with the Mainland was reopened in early-2023 (in April, 2.9mn visitors arrived in HK vs. <5k a year ago), the robust recovery was also affected by improved consumer sentiment. Despite some moderate upbeat sentiment in Asia, the impact on the global diamond market, which is still being heavily stressed by adverse macroeconomic conditions, is rather limited
#diamonds
https://metals-wire.com/sector/Diamonds
💍Hong Kong jewellery and watch sales grew 75% YoY in April, after the 165% YoY surge in March, according to government data. In addition to the resurgence in tourism after HK’s border with the Mainland was reopened in early-2023 (in April, 2.9mn visitors arrived in HK vs. <5k a year ago), the robust recovery was also affected by improved consumer sentiment. Despite some moderate upbeat sentiment in Asia, the impact on the global diamond market, which is still being heavily stressed by adverse macroeconomic conditions, is rather limited
#diamonds
https://metals-wire.com/sector/Diamonds
Morning Bites (part 1)
💎US jewellery sales continued their downtrend, falling 7% YoY in April, after the revised 9% YoY drop in March, according to the Department of Commerce. Although US inflation has slowed somewhat, local consumer sentiment was hit significantly in previous months, IDEX reports. Therefore, we maintain our view that the ongoing YoY decline in US jewellery sales (since October 2022, except for the <1% growth in January), affected by adverse macroeconomic conditions, might keep the global demand for rough diamonds subdued in the near future. To recap, the US accounts for ~50% of world diamond gem-set jewellery sales
#diamonds
https://metals-wire.com/sector/Diamonds
💎US jewellery sales continued their downtrend, falling 7% YoY in April, after the revised 9% YoY drop in March, according to the Department of Commerce. Although US inflation has slowed somewhat, local consumer sentiment was hit significantly in previous months, IDEX reports. Therefore, we maintain our view that the ongoing YoY decline in US jewellery sales (since October 2022, except for the <1% growth in January), affected by adverse macroeconomic conditions, might keep the global demand for rough diamonds subdued in the near future. To recap, the US accounts for ~50% of world diamond gem-set jewellery sales
#diamonds
https://metals-wire.com/sector/Diamonds