As Base Metal, PGM Prices Cool Off, US Light Trucks Sell Like Hotcakes

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With April’s reading, MetalMiner‘s monthly price index tracking metals used in the automotive industry has stanched its general downward slide – the index dipped below the baseline of 100 in February 2014 and has been trending down since. The monthly Automotive MMI® registered a value of 85 in April, on par with March’s value (check out last month’s report). But with most base metals markets in a bearish mode, this index may have further to fall.

Automotive_Chart_April-2015_FNL

The downward slide had particularly begun accelerating in Q4 of last year and has continued through Q1 2015, a sign that the auto index’s basket of metals has seen the same bearish treatment as the Raw Steels, Stainless and Aluminum MMIs.

US Auto Sales ‘n Oil Prices–March 2015

Of the US Big Three, GM and Ford‘s March sales both dropped this year compared to March 2014, while Chrysler gained nearly 2% in its monthly sales over last year. However, both GM and Chrysler’s year-to-date sales so far in 2015 are quite robust over the same amount of time in 2014 (5.3% and 6.5%, respectively), while Ford’s YTD sales are also in the green.

Source: WSJ

Source: WSJ

Bargain-basement oil prices have helped consumers at the gas pump, which in turn has spurred sales. Light truck sales, for example, have been outpacing car sales for the past 15 months, and have spiked to their highest level in several years in March 2015 (above). Primary metal producers are on the bullish demand bandwagon as well – Alcoa recently received the promise of government cash for lightweight auto-grade aluminum production.

Essentially, the automotive OEMs and their suppliers should be paying close attention to our Automotive MMI® trend – with finished steel, aluminum, platinum and palladium at multi-month lows, while consumer vehicle demand appears to be high, some spot buying could be in order…but we can’t say for sure how much further this index has to fall. MetalMiner will, however, be offering an exclusive automotive metal market outlook…

SRM Automotive Summit

If you happen to be in Southeast Michigan in May – and chances are, if you work for an auto OEM or many of their suppliers, you already will be – join MetalMiner Executive Editor Lisa Reisman at the POOL4TOOL SRM Automotive Summit, to be held at the Townsend Hotel in Birmingham on Friday, May 22.

Lisa will present “Sourcing Strategies for the Automotive Metals: H2 2015.” Don’t miss out this analysis and a great overall event – register here.

This Month’s Actual Metal Prices: Automotive MMI®

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It was a strong month on the LME for the copper 3-month price. The metal posted a 3.1% increase, finishing at $6,020 per metric ton. On the LME, the primary copper cash price increased 2.9% to $6,050 per metric ton. After dropping the previous month, the price of Chinese lead prices rose 0.4% to $2,015 per metric ton. The price of Korean 5052 coil premium over 1050 sheet rose 0.3% to $3.62 per kilogram after falling the previous month.

The price of US palladium bar fell 9.2% to $733.00 per ounce. US HDG prices fell 5.0% to $629.00 per short ton. At $1,141 per ounce, US platinum bar was down 2.6% for the month.

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.

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