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For the big story in the aluminum world right now, look no further than MetalMiner Executive Editor Lisa Reisman’s analysis of the court case between the London Metal Exchange and Rusal – and the big surprise that took place yesterday.

Aluminum Prices Today

The 3-month price of aluminum saw the biggest decline of the day, dropping 1.0 percent on the LME to close at $1,985 per metric ton on Wednesday, July 30. On the LME, the cash price of primary aluminum fell 0.7 percent to $1,974 per metric ton. After falling for two days, the Indian aluminum cash price rose 0.4 percent.

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MetalMiner’s monthly Copper MMI® was the best performing of the metal price series this month, registering a value of 92 in January, an increase of 3.4 percent from 89 in December.

The LME 3-month price of primary went up 4.9 percent, from $7,029 to $7,370 per metric ton. Copper moved up after meeting support levels at the end of November, drawing a modest uptrend since June.

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However, looking at the long-term picture, so far we just see this mid-term uptrend as a retracing of the overall falling trend.

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We expect copper to keep gaining support in the short term, but likely finding resistance around $7,500 per metric ton. In the long term, with the picture looking pretty similar for the rest of the base metals, we are copper-bearish.

What This Means For Metal Buyers 

Despite rising prices in previous months, it may seem risky for copper buyers to take long positions in presence of an overall falling market.

Key Price Drivers

At $4.14, the price of US copper producer grade 110 finished the month up 6.2 percent. The price of US copper producer grade 102 reached $4.33 per pound after a 5.9 percent increase. It was a strong month for the Japanese copper cash price. The metal posted a 5.7 percent increase, finishing at $7,547 per metric ton. The primary copper cash price closed the month at $7,387 per metric ton after gaining 5.1 percent on the LME. After rising 4.9 percent, the 3-month price of copper finished the month at $7,370 per metric ton on the LME. After dropping the previous month, the Chinese copper cash price prices rose 2.8 percent to $8,836 per metric ton. The price of Chinese copper wire rose 2.5 percent to $8,627 per metric ton after falling the previous month.

Chinese bright copper scrap fell 0.3 percent to $7,185 per metric ton.

Korean copper strip experienced a flat month, staying around $10.73 per kilogram.

The Copper MMI® collects and weights 12 global copper metal price points to provide a unique view into copper price trends over a 30-day period. For more information on the Copper MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.

Stainless-steel-nickel-prices-index-metalminer-january-2013

MetalMiner’s monthly Stainless MMI® bounced back two points to a value of 80 in January, a 2.6 percent drop from December’s reading.

Nickel prices found support last month, driving the index up. The 3-month price of nickel rose 3.8 percent on the LME, while transactional prices of Chinese and Indian primary nickel went up by 3.4 and 3.5 percent, respectively.

The picture might look positive for nickel, but according to last month’s MMI report, we called for higher prices in the month of December as nickel prices bottomed at the end of November.

Compare with last month’s trends – here’s our free December MMI® Report.

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Indeed, nickel went up and found resistance again at levels lower than previous peaks, falling back again since the end of December.

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We are still bearish on nickel. However, Indonesia’s ban on unprocessed mineral exports set to begin on Jan. 12 could change the picture. Investor sentiment could drive nickel prices up, even though Chinese buyers have been stocking up ahead the ban and we don’t think this ban will cause constrains in the near term.

We believe that trying to determine how and when this ban will impact nickel prices  is nothing more than a guess. Therefore, we will remain cautious and see how the market reacts. Check out MetalMiner’s nickel price forecasting offering.

What This Means For Metal Buyers 

Nickel, the main driver of stainless prices, remains in a downtrend. Folks are calling for higher nickel prices due to the Indonesia export ban, although with a price-falling tendency and both nickel and stainless markets still remaining in an oversupply situation, steering clear of placing forward buys yet may be a good way to go, but we do suggest watching the market closely for new signals.

Other Key Price Drivers

After dropping the previous month, the nickel spot price prices rose 4.5 percent on the LME to $14,010 per metric ton. The price of Chinese primary nickel gained 3.4 percent to finish the month at $15,883 per metric ton.

Allegheny Ludlum 316 stainless surcharge prices fell 1.9 percent to $0.89 per pound after rising the previous month. After rising the previous month, Allegheny Ludlum 304 stainless surcharge prices dropped 1.8 percent to $0.65 per pound.

Chinese ferro-chrome held pat last month at $1,372 per metric ton. The price of Chinese ferro-moly held steady around $23,966 per metric ton last month. Chinese 304 stainless steel scrap experienced a flat month, staying around $2,711 per metric ton. Last month was consistent for Chinese 316 stainless steel scrap, which did not move from $2,661 per metric ton. Chinese 304 stainless coil held pat last month at $2,711 per metric ton. At a price of $4,297 per metric ton, Chinese 316 stainless coil did not budge the entire month.

Don’t forget to read December 2013 MMI analysis before January’s full report comes out next week!

The Stainless MMI® collects and weights 14 global stainless steel and raw material price points to provide a unique view into stainless steel price trends over a 30-day period. For more information on the Stainless MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.

Rare-Earths-metals-price-index-metalminer-january-2014

The monthly Rare Earths MMI® registered a value of 34 in January, a decrease of 10.5 percent from 38 in December.

As further indication that Beijing’s campaign to reign in the Wild West that was the Chinese rare earths market in the last decade, China’s biggest producer of rare earths, the Inner Mongolia Baotou Steel Rare-Earth Group, has recently acquired nine regional mining companies as part of a government master plan to consolidate the sector.

Since 2010, it has tried to improve industry regulation, imposing tough new production and export quotas, raising environmental standards and cracking down on smuggling, once the source of nearly a third of the rare earths flowing to international markets. Arguably it was the flow of illegally produced rare earths onto the world market that decimated Western producers in the 1990s and 2000s, rather than a concerted plot by Beijing to take over the rare earth market.

Since 2010, Beijing has sought to consolidate both refining and mining under the control of a small number of state-owned producers. As a result, prices have risen steadily this year as illegal exports have been curbed and legal export prices have been raised. Nevertheless, export quotas are far from being fully utilized as global markets have reduced their dependence on rare earth metals and sectors like renewables and electric autos have failed to hit earlier volume expectations.

The domestic Chinese renewable energy market has conversely been strong with ongoing investment projects in wind turbines and solar energy creating competition for rare earths against export markets.

What This Means for Metal Buyers

While good news for producers such as Molycorp and their Mountain Pass mine, rising prices last year were not such good news for consumers based outside of China, such as the North American and European renewables sectors which have generally seen RE prices rise during 2013. A recent dip in MetalMiner’s latest price index may be the first indication of a supply surplus in 2014.

Key Price Drivers

At $10,743 per metric ton, yttria was down 18.7 percent for the month. Dysprosium oxide prices fell 18.6 percent to $289.24 per kilogram. A 18.1 percent decline for terbium oxide left the price at CNY 3,400 ($561.95) per kilogram. The price of lanthanum oxide fell 17.9 percent to $3,801 per metric ton. The price of samarium oxide closed the month at $3,140 per metric ton after dropping 17.4 percent. Following a 12.5 percent decline in price, praseodymium neodymium oxide finished the month at $52,063 per metric ton. Cerium oxide prices dropped by 12.3 percent this month to $4,132 per metric ton. A 11.3 percent drop over the past month left neodymium oxide at $52,063 per metric ton. After falling 10.0 percent, neodymium finished the month at $66,938 per metric ton. A 8.2 percent drop over the past month left europium oxide at $743.76 per kilogram. Rare earth carbonate prices dropped by 5.5 percent this month to $4,297 per metric ton.

Yttrium prices rose 3.6 percent to $47.93 per kilogram. Praseodymium oxide prices inched up 1.8 percent to $95,862 per metric ton.

At a price of $809.87 per kilogram, terbium metal did not budge the entire month.

The Rare Earths MMI® collects and weights 14 global rare earth metal price points to provide a unique view into rare earth metal price trends over a 30-day period. For more information on the Rare Earths MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.

Raw-Steels-price-index-metalminer-january-2014

MetalMiner’s monthly Raw Steels MMI® – tracking finished steel and raw material prices across global markets – rose to a reading of 87 in January, an increase of 2.3 percent from December. Higher prices of iron ore, scrap and a 3.3 percent rise in Chinese slab kept the index moving up.

On the other hand, flat-rolled products haven’t experienced big movements during the month of December. Prices are in a bull market since June of this year, and this uptrend is still in force, but losing buying pressure. This loss of momentum makes us wonder how long this trend will last.

Compare with last month’s trends – here’s our free December MMI® Report.

What to Watch For in 2014:

Strong momentum in the auto sector has being a key factor in supporting prices of US flat-rolled steel products and, as my colleague Lisa Reisman wrote recently, “Automotive demand will likely remain solid at least through the first half of 2014.” Also, a recovery in the US construction markets would contribute to domestic and global steel demand.

In regards to China, surveys showed that growth in the country’s services industries slowed last month, confirming a loss of steam from the largest producer and consumer of steel. The HSBC/Markit Economics services Purchasing Managers’ Index (PMI) declined to 50.9 in December, the lowest level since August 2011. The success of the Chinese government in rebalancing its economy will be a factor to watch in 2014.

The sustainability of higher steel prices in 2014 will continue to depend on the improvement in demand across regions, no further deterioration of the euro-zone debt crisis and higher raw material prices.

What This Means for Metal Buyers 

Steel prices are finding support. On the other hand, a steady yet not strong uptrend makes us think about a possible top in prices in the short term. Buyers may want to take note of this before taking long positions. MetalMiner now features steel price forecasting.

Key Price Drivers

On the LME, the 3-month price of steel billet climbed 18.8 percent, settling at $285.00 per metric ton. The price of US shredded scrap rose 6.5 percent over the past month to $410.00 per short ton, the second straight month of gains. At $236.35 per metric ton, the price of Chinese coking coal finished the month 2.9 percent higher. This was the second straight month of declines.

For the second month in a row, the price of Chinese slab increased, rising 2.6 percent over the past month to $596.66 per metric ton. Finishing the month at $612.24 per metric ton, Korean pig iron recorded a 1.6 percent increase. The spot price of the US HRC futures contract saw its value rise 1.4 percent to $675.00 per short ton.

Korean steel scrap prices fell 7.0 percent to $313.24 per metric ton after rising the previous month. Last month, the 3-month price of the US HRC futures contract dropped 2.9 percent to $633.00 per short ton.

At a price of $514.02 per metric ton, Chinese billet did not budge the entire month.

The Raw Steels MMI® collects and weights 13 global steel and raw material price points to provide a unique view into global steel price trends over a 30-day period. For more information on the Raw Steels MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.

Construction-industry-metals-index-metalminer-january-2013

Coming off the heels of a 0.8% construction spending growth rate from September to October 2013, construction numbers continued their upward trajectory with a 1% improvement for November, taking total US construction spending to a seasonally adjusted $934.4 billion run rate. Both residential and non-residential construction spending grew from October’s figures.

Our friends at Gerdau Market Update regularly publish one of the more comprehensive non-residential and residential construction market indicators tracked by the steel industry. This month’s chart notes where non-residential construction momentum comes from – specifically warehouses, educational facilities, offices and banks. Manufacturing plant construction has also led the gains.

And though these gains remain positive, Gerdau Market Update notes that the 12-month non-residential square footage total of 921 million square feet remains well under pre-recession peaks of 1.9 billion square feet. Using Dodge data, Gerdau Market Update notes it might take until 2020 to reach those kinds of peaks based on current trends.

MetalMiner’s favorite economic forecasters, ITR Economics, recently hosted a webinar in which they made a few comments regarding construction markets. The first, that the firm readjusted their economic forecast due to the housing market “surprise to the upside” during 2012 and 2013. But the economists warn that housing starts, though still in an upward cycle, have hit a declining rate of growth (in other words, housing has hit the top of its upside in the current economic cycle).

Moreover, ITR projects housing starts will reach their peak during the first half of 2014 and begin to decline during the second half. The firm indicated a mild decline. ITR, like Gerdau Market Update, sees strength in non-residential segments including private sector warehousing and logistics as well as office buildings and other commercial space.

What This Means For Metal Buyers

Despite a recent re-opening of an ArcelorMittal merchant bar plant in Tennessee, steel producers will likely maintain pricing power during the first half of 2014 for construction-related products, but a softer construction market during the second half may put price pressures on mills.

MetalMiner’s monthly construction index rose by 2 points from 89 to 91 with help from a strong US scrap market as well as firming semi-finished aluminum prices in Europe.

Main Price Drivers

At $410.00 per short ton, US shredded scrap finished the month up 6.5 percent. European 1050 aluminum prices inched up 1.3 percent to $2,842 per metric ton. The weekly US Rocky Mountain bar fuel surcharge rose a slight 1.2 percent over the past month to $0.54 per mile. The weekly US Midwest bar fuel surcharge grew 0.4 percent to finish at $0.54 per mile. After a 0.3 percent increase, the weekly US Gulf Coast bar fuel surcharge finished the month at $0.52 per mile.

Chinese rebar prices fell 3.5 percent to $595.01 per metric ton after rising the previous month.

Prices for the Chinese low price of 62% Australian iron ore fines remained constant this past month, holding at around $160.32 per dry metric ton. Chinese aluminum bar held pat last month at $2,347 per metric ton. The price of Chinese H-beam steel held steady around $576.83 per metric ton last month.

The Construction MMI® collects and weights 9 metal price points used within the construction industry to provide a unique view into construction industry price trends over a 30-day period. For more information on the Construction MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.

Aluminum-price-index-metalminer-january-2014L

While Alcoa is slated to announce Q4 earnings later this week, MetalMiner’s results of the monthly Aluminum MMI® for January are already in. Our aluminum price index registered a value of 92 in January, an increase of 1.1 percent from 91 in December.

LME prices remain low, however, averaging $1,784 per ton in the month of December versus $1,794 per ton in November.

On the other hand, prices have gained some buying pressure after meeting a support level at the beginning of the month. As we stated in our last Aluminum MMI®, prices are under a long-term downtrend with prices falling and new peaks always remaining lower than previous ones.

As For Premiums… 

As my colleague Stuart Burns wrote recently, “in an effort to reduce the physical premiums being charged in the market and reduce the excessive load-out queues, the LME is introducing increased load-out rates and other restrictions to LME warehouses that have queues of more than 50 days, but so far, physical premiums have risen rather than fallen in anticipation of the change.

“We could have unexpected and unpredictable price movements as a result of unseen stock movements into and out of the aluminum market. Make no mistake: shadow warehouse stocks present a risk to the market, and there’s probably not much any of us can do about it.”

With all that said, we expect prices to keep gaining support during this month, but most likely trading below $1,900 per metric ton as they face resistance at that level. In the near term, we still see aluminum prices struggling and for that reason, placing any forward buys may be risky until we see signals pointing to a trend reversal.

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Key Price Drivers

After dropping the previous month, the cash price of primary aluminum prices rose 3.5 percent on the LME to $1,771 per metric ton. The aluminum 3-month price rose 3.3 percent on the LME to $1,811 per metric ton after falling the previous month. The cash price of primary Indian aluminum rose 2.2 percent to settle at $1.81 per kilogram. After dropping the previous month, the price of European 1050 aluminum prices rose 1.3 percent to $2,842 per metric ton.

At $3,324 per metric ton, European 5083 plate was down 4.2 percent for the month. Chinese aluminum scrap closed the month at $2,063 per metric ton after dropping 2.0 percent. With a 1.3 percent decline, the Chinese aluminum cash price closed the month at $2,330 per metric ton. Last month, Chinese aluminum billet prices dropped by 0.4 percent to $2,347 per metric ton.

Hovering around $4.00 per kilogram for the month, Korean 3003 coil premium over 1050 sheet remained unchanged. Prices for Korean 5052 coil premium over 1050 sheet remained constant this past month, holding at around $4.14 per kilogram. Last month was consistent for Chinese aluminum bar, which did not move from $2,347 per metric ton. At a price of $3.95 per kilogram, Korean 1050 aluminum sheet did not budge the entire month.

The Aluminum MMI® collects and weights 12 global aluminum price points to provide a unique view into aluminum price trends over a 30-day period. For more information on the Aluminum MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.

Automotive-industry-metals-price-index-metalminer-january-2014

2013 proved a great year for automakers as well as a beacon of hope for metal producers that supply to that industry. MetalMiner’s Automotive MMI®, the best performing of all indexes throughout 2013, moved above its January 2012 baseline reading of 100 to 101.

Hot dipped galvanized steel, copper and lead pricing lent support during December, while key precious metals used in the automotive industry held relatively steady.

MetalMiner has consistently warned that the automotive sector has reached its peak, but the numbers continue to delight.

And despite profit warnings from companies such as Ford, the proverbial bloom is not off the rose.

Ford warned, not because of slowing US automotive sales (forecasted to continue to grow, albeit more slowly), but because of sluggish demand in Europe, a currency devaluation in Venezuela where Ford has a large plant and rising cost pressures, most notably in technology and factory expansions.

Ford has now idled new factories for its Fusion and Focus to reduce inventory (MetalMiner warned of the rising inventory levels back in August).

Automotive parts maker Johnson Controls also issued a 2014 profit warning. The company sees growth for automotive seating units rising 1-2% against higher US sales volumes. But a 2.5-3% drop in its automotive-electronic unit as well as a drop in its interiors business will drag earnings. The company still forecasts rising global auto production.

Meanwhile, Chrysler has announced a 6% increase in December sales, mostly due to truck sales.

Despite rising automotive inventory levels, increased competition from the Japanese OEMs – who have started to claw back at market share and big investments on behalf of many of the OEMs – the outlook remains positive.

Steel producers that serve the auto market such as AK Steel have seen their stock prices trade at a 52-week high against rising automotive production and sales.

What This Means for Metal Buyers

Automotive demand will likely remain solid at least through the first half of 2014. This will lend price support to US flat-rolled steel products.

Key Price Drivers

Following a 4.9 percent upswing on the LME, the 3-month price of copper closed the month at $7,370 per metric ton. US HDG prices inched up 2.5 percent to $771.00 per short ton. After dropping the previous month, the Chinese lead price prices rose 1.6 percent to $2,351 per metric ton. US platinum bar shifted up 0.4 percent last month to settle at $1,357 per ounce.

The price of US palladium bar drifted 1.4 percent lower to $706.00 per ounce.

Prices for Korean 5052 coil premium over 1050 sheet remained constant this past month, holding at around $4.14 per kilogram.

The Automotive MMI® collects and weights 7 metal price points used in automotive production to provide a unique view into automotive metal trends over a 30-day period. For more information on the Automotive MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.

renewable-energy-metals-price-index-metalminer-january-2014

The monthly Renewables MMI® registered a value of 64 in January, a decrease of 1.5 percent from 65 in December.

The price drop of neodymium, used in permanent magnet generators (PMGs) of wind turbines, single-handedly accounted for the slight decrease in MetalMiner’s metals price index tracking the renewable energy industry. All other metals, including steel plate across four regions and the grain-oriented electrical steel (GOES), either rose in price or kept steady.

Wind power companies were scurrying to retain the wind production tax credit from US Congress before Jan. 1, only to have them expire. Some parties feel as though the market for wind power is skewed in the US:  According to a report by the Institute for Energy Research, “taxpayers in 30 states and the District of Columbia paid more to the federal government in 2012 to support wind subsidies than wind producers in those states received…of those 30 net losing states, 11 states and the District of Columbia had no wind production and received zero subsidies but still paid their share of the tax burden related to federal wind subsidies.”

But other indicators, such as huge wind turbine deals recently signed by Siemens, Vestas and other producers, point to rather healthy demand for turbines (and, by extension, the neodymium, steel plate and other raw materials comprising them). “Under a recent agreement, among the largest in land-based wind power, MidAmerican will buy 448 turbines from Siemens,” according to the NYT. “The turbines, which Siemens will maintain for the first 15 years of operations, are to be installed in five projects in Iowa.”

With a yearly boom-and-bust cycle driven to such a high degree by (generally wacky) US energy policy, the wind market and its impact on the prices of raw materials used by the sector are difficult to reconcile. However, the PV market may get a boost due to Ford’s hopes to make solar-powered hybrids; indeed, the plug-in electric vehicle market (the other major user of neodymium) is strong – in America, nearly 40% more cars were sold between July and December.

Key Price Drivers of Renewables Index

At $66,938 per metric ton, neodymium was down 10.0 percent for the month.

The price of US steel plate climbed 4.5 percent to $795.00 per short ton. At $642.94 per metric ton, Chinese steel plate finished the month up 3.2 percent. Japanese steel plate saw its price rise 2.7 percent to $721.51 per metric ton. US grain-oriented electrical steel (GOES) rose 0.6 percent to $3,060 per short ton after falling the previous month.

Chinese cobalt cathodes traded sideways last month, staying around $32,395 per metric ton. Hovering around $2,289 per metric ton for the month, silicon remained unchanged. At a price of $854.28 per metric ton, Korean steel plate did not budge the entire month.

The Renewables MMI® collects and weights 8 metal price points used extensively within the renewable energy industry to provide a unique view into renewable energy metal price trends over a 30-day period. For more information on the Renewables MMI®, how it’s calculated or how your company can use the index, please drop us a note at: info (at) agmetalminer (dot) com.