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
Morning Bites (part 2)
💎De Beers cut rough diamonds prices at its 5th cycle amid sluggish demand, according to Rapaport. Sightholders say that the prices were reduced for >2ct and 1-1.5ct items, with a discount of 5-10% primarily aimed at lower quality stones. In addition, the company extended its buyback terms for some >2ct categories. We note that De Beers sales have been consistently lower YoY in 2023. Petra Diamonds also reduced its LFL prices, by 13%, at the May auction. Hence, we reiterate our view that the diamond market globally is still heavily stressed, affected by the adverse macroeconomic conditions
#diamonds
https://metals-wire.com/sector/Diamonds
💎De Beers cut rough diamonds prices at its 5th cycle amid sluggish demand, according to Rapaport. Sightholders say that the prices were reduced for >2ct and 1-1.5ct items, with a discount of 5-10% primarily aimed at lower quality stones. In addition, the company extended its buyback terms for some >2ct categories. We note that De Beers sales have been consistently lower YoY in 2023. Petra Diamonds also reduced its LFL prices, by 13%, at the May auction. Hence, we reiterate our view that the diamond market globally is still heavily stressed, affected by the adverse macroeconomic conditions
#diamonds
https://metals-wire.com/sector/Diamonds
🗞Today, China published its preliminary import/export statistics for May (see 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 net finished steel exports rose 11% YoY in May, after the 83% YoY surge in April. During the last month, average daily steel production contracted on a YoY basis, while inventories also shrank vs. the 2022 levels. Overall, China’s strong liquidity inflows, as well as plans for massive infrastructure projects this year, might bolster domestic construction activity and, hence, steel demand in 2023. In addition, Beijing is considering new support measures for the property sector
🪨China’s coal imports grew 93% YoY in May (vs. the +73% YoY in April). However, the imports shrunk 3% MoM, amid weaker demand from the power and steel sectors, as well as high inventories, according to Reuters. The positive YoY dynamics reflect the low base effect from 2022, as well as the lifting of restrictions on Australian coal imports, in our view
#coal #steel
https://metals-wire.com:3000/news-reports
🔗China’s net finished steel exports rose 11% YoY in May, after the 83% YoY surge in April. During the last month, average daily steel production contracted on a YoY basis, while inventories also shrank vs. the 2022 levels. Overall, China’s strong liquidity inflows, as well as plans for massive infrastructure projects this year, might bolster domestic construction activity and, hence, steel demand in 2023. In addition, Beijing is considering new support measures for the property sector
🪨China’s coal imports grew 93% YoY in May (vs. the +73% YoY in April). However, the imports shrunk 3% MoM, amid weaker demand from the power and steel sectors, as well as high inventories, according to Reuters. The positive YoY dynamics reflect the low base effect from 2022, as well as the lifting of restrictions on Australian coal imports, in our view
#coal #steel
https://metals-wire.com:3000/news-reports
Morning Bites (part 2)
🔗CISA mills daily crude steel production during late May was 2.10mnt, a 6.7% drop from the previous ten days (-9.7% YoY). At the same time, local steel inventories declined 4.0% (-12.9% YoY). This was the fourth consecutive fall for ten-day periods (starting from April 20), likely associated with CISA’s call to lower China’s production amid low steel prices. In addition, some mills in Tangshan (~13% of China’s steel output) have recently received a municipal notice not to exceed the 2022 production level. Such dynamics, if they persist, are likely to be favorable for the steel prices, in our view
#steel
https://metals-wire.com:3000/sector/Steel
🔗CISA mills daily crude steel production during late May was 2.10mnt, a 6.7% drop from the previous ten days (-9.7% YoY). At the same time, local steel inventories declined 4.0% (-12.9% YoY). This was the fourth consecutive fall for ten-day periods (starting from April 20), likely associated with CISA’s call to lower China’s production amid low steel prices. In addition, some mills in Tangshan (~13% of China’s steel output) have recently received a municipal notice not to exceed the 2022 production level. Such dynamics, if they persist, are likely to be favorable for the steel prices, in our view
#steel
https://metals-wire.com:3000/sector/Steel
Morning Bites (part 1)
💎Petra Diamonds has postponed its May-June tenders to August. According to IDEX, the miner initially planned to offer 380kct this month, but has decided to sell the stones in August, together with the 76kct of gems unrealised in May. Similarly, De Beers has postponed its auctions during cycles 5-6 amid weak demand from Indian cutters, and also recently lowered prices. Hence, we reiterate our view that the adverse macroeconomic conditions globally and continuously weak US jewellery sales (~50% of the global demand) are likely to keep the diamond sector subdued, at least in the near future
#diamonds
https://metals-wire.com/sector/Diamonds
💎Petra Diamonds has postponed its May-June tenders to August. According to IDEX, the miner initially planned to offer 380kct this month, but has decided to sell the stones in August, together with the 76kct of gems unrealised in May. Similarly, De Beers has postponed its auctions during cycles 5-6 amid weak demand from Indian cutters, and also recently lowered prices. Hence, we reiterate our view that the adverse macroeconomic conditions globally and continuously weak US jewellery sales (~50% of the global demand) are likely to keep the diamond sector subdued, at least in the near future
#diamonds
https://metals-wire.com/sector/Diamonds
Morning Bites (part 2)
📈Gold-backed ETFs increased their holdings 19t in May, following the 15t gain in April, marking the third consecutive monthly inflow. According to the World Gold Council (WGC), during last month, almost all regions saw positive demand, except for Europe (-2t). Hence, some improvement in world ETF sentiment supports our bullish view on the yellow metal’s performance, in addition to the steady YoY growth in physical gold demand and rising gold miners’ cash costs. We note that a recent WGC poll underpins the positive sentiment of global CBs’ managers towards gold holdings
#ETF #gold
https://metals-wire.com:3000/news-reports
📈Gold-backed ETFs increased their holdings 19t in May, following the 15t gain in April, marking the third consecutive monthly inflow. According to the World Gold Council (WGC), during last month, almost all regions saw positive demand, except for Europe (-2t). Hence, some improvement in world ETF sentiment supports our bullish view on the yellow metal’s performance, in addition to the steady YoY growth in physical gold demand and rising gold miners’ cash costs. We note that a recent WGC poll underpins the positive sentiment of global CBs’ managers towards gold holdings
#ETF #gold
https://metals-wire.com:3000/news-reports
Morning Bites (part 1)
🚘New car registrations in France, the UK, Spain, Italy and Germany rose 17% YoY in May, in line with the 16% YoY growth in April. Nevertheless, the figure was still 25% below the (2019) pre-COVID level. Specifically, in Germany and Spain, car sales were down 26% and 27%, respectively, vs. 2019, while sales in France were 25% lower. At the same time, sales in the UK and Italy were 21% and 24% below the 2019 figures, respectively. Given that these five countries represent ~70% of new vehicle registrations in Europe, we assume that car sales in the region have likely continued to show some YoY recovery, while remaining well below their pre-pandemic levels
#cars
https://metals-wire.com:3000/sector/PGM
🚘New car registrations in France, the UK, Spain, Italy and Germany rose 17% YoY in May, in line with the 16% YoY growth in April. Nevertheless, the figure was still 25% below the (2019) pre-COVID level. Specifically, in Germany and Spain, car sales were down 26% and 27%, respectively, vs. 2019, while sales in France were 25% lower. At the same time, sales in the UK and Italy were 21% and 24% below the 2019 figures, respectively. Given that these five countries represent ~70% of new vehicle registrations in Europe, we assume that car sales in the region have likely continued to show some YoY recovery, while remaining well below their pre-pandemic levels
#cars
https://metals-wire.com:3000/sector/PGM
Morning Bites (part 2)
🏗China’s excavator sales decreased 19% YoY in May (domestic + export), after the 23% YoY drop in April. We note that the decline was slightly softer than the CME had estimated (-25% YoY). Specifically, domestic excavator sales dropped 46% YoY, vs. the 41% YoY fall in April. The ongoing deterioration in excavator sales (since May 2021) indicates a stagnation in the Chinese real estate segment. However, the potential introduction of new support measures for the sector, together with plans for massive infrastructure projects, might boost demand for industrial metals (e.g. steel, aluminium and copper) later in 2023, in our view
#steel
https://metals-wire.com/sector/Steel
🏗China’s excavator sales decreased 19% YoY in May (domestic + export), after the 23% YoY drop in April. We note that the decline was slightly softer than the CME had estimated (-25% YoY). Specifically, domestic excavator sales dropped 46% YoY, vs. the 41% YoY fall in April. The ongoing deterioration in excavator sales (since May 2021) indicates a stagnation in the Chinese real estate segment. However, the potential introduction of new support measures for the sector, together with plans for massive infrastructure projects, might boost demand for industrial metals (e.g. steel, aluminium and copper) later in 2023, in our view
#steel
https://metals-wire.com/sector/Steel
Morning Bites (part 3)
⛏Newmont has suspended operations at its Peñasquito mine in Mexico, following a labour strike, the company reports. On Wednesday, a local labour union demanded an increase in the profit-sharing benefit provided for in the Collective Bargaining Agreement from 10% to 20%. The NYSE halted trading of Newmont’s shares briefly before the action. In our view, a persistence of these operational issues could support sentiment on the gold market: Peñasquito accounted for 0.5% of global gold production in 2022
#gold
https://metals-wire.com/sector/Gold
⛏Newmont has suspended operations at its Peñasquito mine in Mexico, following a labour strike, the company reports. On Wednesday, a local labour union demanded an increase in the profit-sharing benefit provided for in the Collective Bargaining Agreement from 10% to 20%. The NYSE halted trading of Newmont’s shares briefly before the action. In our view, a persistence of these operational issues could support sentiment on the gold market: Peñasquito accounted for 0.5% of global gold production in 2022
#gold
https://metals-wire.com/sector/Gold
Morning Bites (part 1)
📌China’s new internal combustion engine (ICE) car sales rose 18% YoY in May, following the 72% YoY surge from a low base in April. Overall, the sales were moderately below the pre-Covid level (-8% vs. May 2019). Total passenger car sales (EV + ICE) increased 28% YoY, and were 25% higher than 2019 levels. China's auto sector accounts for 26% and 17% of the world's autocatalyst Pd and Pt demand, respectively. Although the dynamics were more upbeat than in previous months, the figure is still lower than in 2019, which might keep weighing on the PGMs performance
📌New EV sales in China surged 60% YoY in May, after the 113% YoY spike in April. Given China has accounted for ~50% of global EV demand in recent months, further growth in the appetite for EVs will drive up the consumption of the battery metals basket (e.g. cobalt, lithium and nickel), in our view
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com:3000/news-reports
📌China’s new internal combustion engine (ICE) car sales rose 18% YoY in May, following the 72% YoY surge from a low base in April. Overall, the sales were moderately below the pre-Covid level (-8% vs. May 2019). Total passenger car sales (EV + ICE) increased 28% YoY, and were 25% higher than 2019 levels. China's auto sector accounts for 26% and 17% of the world's autocatalyst Pd and Pt demand, respectively. Although the dynamics were more upbeat than in previous months, the figure is still lower than in 2019, which might keep weighing on the PGMs performance
📌New EV sales in China surged 60% YoY in May, after the 113% YoY spike in April. Given China has accounted for ~50% of global EV demand in recent months, further growth in the appetite for EVs will drive up the consumption of the battery metals basket (e.g. cobalt, lithium and nickel), in our view
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com:3000/news-reports
Morning Bites (part 2)
💍Signet has reported a further 13.9% YoY decline in same-store sales in 1Q23 (February-April), after the 9.1% YoY drop in 4Q22. Same-store sales in North America were down 14.2% YoY (-9.3% YoY in the previous quarter), while the international segment’s sales declined 8.5% YoY (-6.8% YoY in 4Q22). According to Signet CEO Virginia Drosos, the dynamics were affected by macroeconomic headwinds that worsened late in the quarter, as well as fewer engagements (half of Signet's revenues comes from bridal). The company has cut its FY24 sales guidance: proceeds are now expected to be 7-9% lower YoY (vs. the 0-2% YoY drop seen earlier). Overall, the results are in line with the continuously weak US jewellery data (since October 2022), which underpins our cautious view on the diamond sector globally
#diamonds
https://metals-wire.com:3000/news-reports
💍Signet has reported a further 13.9% YoY decline in same-store sales in 1Q23 (February-April), after the 9.1% YoY drop in 4Q22. Same-store sales in North America were down 14.2% YoY (-9.3% YoY in the previous quarter), while the international segment’s sales declined 8.5% YoY (-6.8% YoY in 4Q22). According to Signet CEO Virginia Drosos, the dynamics were affected by macroeconomic headwinds that worsened late in the quarter, as well as fewer engagements (half of Signet's revenues comes from bridal). The company has cut its FY24 sales guidance: proceeds are now expected to be 7-9% lower YoY (vs. the 0-2% YoY drop seen earlier). Overall, the results are in line with the continuously weak US jewellery data (since October 2022), which underpins our cautious view on the diamond sector globally
#diamonds
https://metals-wire.com:3000/news-reports
Morning Bites (part 3)
🏭Rio Tinto aims to expand its Canadian aluminium plant’s capacity 160kt, the company reports. Hence, the AP60 low-carbon smelter will reach production of 220kt per annum by end-2026, following the USD 1.1bn investment. Overall, we do not expect the new volumes to have a material effect on the market balance: they account for only 0.2% of global Al supply in 2022
#aluminium
https://metals-wire.com/sector/Aluminium
🏭Rio Tinto aims to expand its Canadian aluminium plant’s capacity 160kt, the company reports. Hence, the AP60 low-carbon smelter will reach production of 220kt per annum by end-2026, following the USD 1.1bn investment. Overall, we do not expect the new volumes to have a material effect on the market balance: they account for only 0.2% of global Al supply in 2022
#aluminium
https://metals-wire.com/sector/Aluminium
Morning Bites (part 1)
🏦China’s aggregate financing fell 45% YoY in May to CNY 1.56tn, reversing from the 31% YoY growth in April. The figure was 22% below the consensus. At the same time, traditional bank loans shrank 28% YoY (+11% YoY in April), a 15% miss to the market forecast. Following the sluggish Chinese economic recovery (indicated by soft PMIs and weak real estate sales), Beijing is considering new measures to support the economy, mostly by stimulus for its property sector. In addition, a recent cut in short-term borrowing costs, strong liquidity inflows in early-2023 and plans for massive infrastructure projects might also bolster a recovery in China’s construction activity later this year, supporting the consumption of industrial metals (e.g., steel, aluminum and copper)
#global
https://metals-wire.com:3000/news-reports
🏦China’s aggregate financing fell 45% YoY in May to CNY 1.56tn, reversing from the 31% YoY growth in April. The figure was 22% below the consensus. At the same time, traditional bank loans shrank 28% YoY (+11% YoY in April), a 15% miss to the market forecast. Following the sluggish Chinese economic recovery (indicated by soft PMIs and weak real estate sales), Beijing is considering new measures to support the economy, mostly by stimulus for its property sector. In addition, a recent cut in short-term borrowing costs, strong liquidity inflows in early-2023 and plans for massive infrastructure projects might also bolster a recovery in China’s construction activity later this year, supporting the consumption of industrial metals (e.g., steel, aluminum and copper)
#global
https://metals-wire.com:3000/news-reports
Morning Bites (part 2)
🇿🇦South Africa’s PGM mining output dropped 5% YoY in April, decelerating from the 9% YoY fall in March. Meanwhile, domestic gold output jumped 27% YoY, after the +22% YoY in March, most likely amid the low base effect from 2022. Given that South Africa represents ~70% of global Pt and 38% of Pd supply, respectively (as well as 3% of world gold output), the deterioration in mining, driven by the local electricity crisis, might further weigh on supply. However, weak demand from the automotive sector could offset the positive effect on PGM prices
🇸🇪 Sweden’s Ronnskar smelter has been halted after a fire destroyed a cell house, Reuters reports. Meanwhile, the company expects to resume production at the site (0.8% of global refined Cu output in 2022) in several weeks. Hence, the impact on market sentiment is likely to be rather limited, we believe
#PGMs #gold #copper
https://metals-wire.com:3000/news-reports
🇿🇦South Africa’s PGM mining output dropped 5% YoY in April, decelerating from the 9% YoY fall in March. Meanwhile, domestic gold output jumped 27% YoY, after the +22% YoY in March, most likely amid the low base effect from 2022. Given that South Africa represents ~70% of global Pt and 38% of Pd supply, respectively (as well as 3% of world gold output), the deterioration in mining, driven by the local electricity crisis, might further weigh on supply. However, weak demand from the automotive sector could offset the positive effect on PGM prices
🇸🇪 Sweden’s Ronnskar smelter has been halted after a fire destroyed a cell house, Reuters reports. Meanwhile, the company expects to resume production at the site (0.8% of global refined Cu output in 2022) in several weeks. Hence, the impact on market sentiment is likely to be rather limited, we believe
#PGMs #gold #copper
https://metals-wire.com:3000/news-reports
🗞Today, China has published its industrial production data for May (see 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 fell 7% YoY in May, following the 2% YoY drop in April. The decline comes in line with the government's intention to limit steel production. Noteworthy, the reduction mainly came from EAF mills, which had to curb losses. China represents ~57% of global crude steel supply
🏢China's property sales were down 20% YoY in May (vs. -17% YoY in April), and 45% below the historical highs of 2021. The decline in floor space starts was 28% YoY last month, the same as in April. However, personal mortgage loans jumped 22% YoY (also +22% YoY in April), while property completions grew 24% YoY in May. Despite some ongoing uncertainty in China’s real estate segment, the strong liquidity injections in early 2023, together with the potential introduction of new support policies, might trigger a recovery in construction activity later this year, we believe
#steel #property
https://metals-wire.com:3000/sector/Steel
🔗China’s crude steel output fell 7% YoY in May, following the 2% YoY drop in April. The decline comes in line with the government's intention to limit steel production. Noteworthy, the reduction mainly came from EAF mills, which had to curb losses. China represents ~57% of global crude steel supply
🏢China's property sales were down 20% YoY in May (vs. -17% YoY in April), and 45% below the historical highs of 2021. The decline in floor space starts was 28% YoY last month, the same as in April. However, personal mortgage loans jumped 22% YoY (also +22% YoY in April), while property completions grew 24% YoY in May. Despite some ongoing uncertainty in China’s real estate segment, the strong liquidity injections in early 2023, together with the potential introduction of new support policies, might trigger a recovery in construction activity later this year, we believe
#steel #property
https://metals-wire.com:3000/sector/Steel