Comments on: Where is the Copper Market Headed in 2008? http://agmetalminer.com/2007/12/27/where-is-the-copper-market-headed-in-2008/ Sourcing & Trading Intelligence for Global Metals Markets Sun, 20 May 2012 19:02:00 +0200 hourly 1 http://wordpress.org/?v=3.3.2 By: Daniel http://agmetalminer.com/2007/12/27/where-is-the-copper-market-headed-in-2008/comment-page-1/#comment-12 Daniel Wed, 02 Jan 2008 17:28:02 +0000 http://agmetalminer.com/2007/12/27/where-is-the-copper-market-headed-in-2008/#comment-12 Thanks for the thoughts! On the demand side, it appears that the emerging economies need to grow at a decent pace to make up for the decline in demand expected from W.Europe and the US. They don't need to do great, or as fast as this year, demand just can't fall off a cliff. I've been thinking of supply for the zinc market lately--within the context of knowing that a lot of it is FCFC (From China For China) , is higher-cost and with break-even costs that appear to me close to a single greenback. With another year of (at least) slow appreciation of the RMB versus the USD, those margins could get squeezed even further. And with the government also wanting to close a lot of the smaller zinc mines, it seems that the possibility for supply forecasts to be higher than expected are reasonable (and this time we're not reliant on those yearly strikes in S.America!). On the other hand, if the emerging economies--especially China--slow significantly in 2008, the supply near term probably won't matter too much and the bottom could be lower than a filthy yank, possibly 80 cents. Anyway, take these thoughts for what they're worth...just an amateur thinking out loud. I really enjoy the blog! Thanks for the thoughts! On the demand side, it appears that the emerging economies need to grow at a decent pace to make up for the decline in demand expected from W.Europe and the US. They don’t need to do great, or as fast as this year, demand just can’t fall off a cliff.

I’ve been thinking of supply for the zinc market lately–within the context of knowing that a lot of it is FCFC (From China For China) , is higher-cost and with break-even costs that appear to me close to a single greenback.

With another year of (at least) slow appreciation of the RMB versus the USD, those margins could get squeezed even further. And with the government also wanting to close a lot of the smaller zinc mines, it seems that the possibility for supply forecasts to be higher than expected are reasonable (and this time we’re not reliant on those yearly strikes in S.America!).

On the other hand, if the emerging economies–especially China–slow significantly in 2008, the supply near term probably won’t matter too much and the bottom could be lower than a filthy yank, possibly 80 cents.

Anyway, take these thoughts for what they’re worth…just an amateur thinking out loud. I really enjoy the blog!

]]> By: admin http://agmetalminer.com/2007/12/27/where-is-the-copper-market-headed-in-2008/comment-page-1/#comment-11 admin Wed, 02 Jan 2008 13:36:24 +0000 http://agmetalminer.com/2007/12/27/where-is-the-copper-market-headed-in-2008/#comment-11 A large proportion of zinc is used in galvanized steel for which demand could be expected to drop off in North America and Western Europe, both of whose automotive, white goods and construction industries are expected to be in the doldrums for the next 12 months dampening demand. China in particular and Asia in general however will not experience the same drop off in demand although they are unlikely to grow at the same level that they have for the last five years. In addition some limited new production capacity is coming online in joint Copper/Zinc mines, in Russia and China. All in all therefore I would expect Zinc prices to weaken in 2008, driven by the same fundamentals as Copper but without that metals fund buying interest. - SB A large proportion of zinc is used in galvanized steel for which demand could be expected to drop off in North America and Western Europe, both of whose automotive, white goods and construction industries are expected to be in the doldrums for the next 12 months dampening demand.

China in particular and Asia in general however will not experience the same drop off in demand although they are unlikely to grow at the same level that they have for the last five years. In addition some limited new production capacity is coming online in joint Copper/Zinc mines, in Russia and China.

All in all therefore I would expect Zinc prices to weaken in 2008, driven by the same fundamentals as Copper but without that metals fund buying interest. – SB

]]> By: admin http://agmetalminer.com/2007/12/27/where-is-the-copper-market-headed-in-2008/comment-page-1/#comment-10 admin Sun, 30 Dec 2007 03:06:16 +0000 http://agmetalminer.com/2007/12/27/where-is-the-copper-market-headed-in-2008/#comment-10 We'll cover the zinc market in the first two weeks of 2008 and that's a promise! We’ll cover the zinc market in the first two weeks of 2008 and that’s a promise!

]]> By: Daniel http://agmetalminer.com/2007/12/27/where-is-the-copper-market-headed-in-2008/comment-page-1/#comment-9 Daniel Fri, 28 Dec 2007 16:22:33 +0000 http://agmetalminer.com/2007/12/27/where-is-the-copper-market-headed-in-2008/#comment-9 I'd be very interested in what you think about the direction of zinc prices--and, if lower, by how much. I’d be very interested in what you think about the direction of zinc prices–and, if lower, by how much.

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