This morning in metals news: Thyssenkrupp’s steel unit is facing heavy losses this year; zinc prices have gained despite elevated stocks; and copper dipped Thursday.
Thyssenkrupp faces major losses
Thyssenkrupp, which last year left Germany’s DAX index, faces a potential 1 billion euros in losses this year, Reuters reported.
Earlier this year, the German firm spun off its profitable elevator unit for €17.2 billion.
The company said it expects a stabilization to occur in the fourth quarter of the current fiscal year after a difficult first nine months. Thyssenkrupp’s steel unit, in particular, has faced significant headwinds.
“The performance of Steel Europe was again characterized by the extremely challenging situation in the steel sector,” the company said Thursday. “Demand from the auto industry, which was already noticeably lower in March, slumped further in the course of the 3rd quarter, also due to declining order volumes from other industrial customers.”
Despite the general forecast of Q4 stabilization, steel could still struggle.
“Depending on the speed at which production is restarted by our customers, thyssenkrupp expects almost all businesses, with the possible exception of Steel Europe, to report a stable performance or a slight quarter-on quarter improvement in the 4th quarter,” the company said.
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Zinc prices gains
Despite elevated stock levels on the LME, the zinc price has showed strength.
Stocks at LME warehouses have surged from just over 120,000 tons to over 200,000 tons over the last month. Opening stock on Thursday totaled 212,750 tons.
Despite this, zinc prices have gained 7.69% over the last month. The LME three-month zinc price closed Wednesday at $2,394/mt, per MetalMiner Insights data.
Copper price falls
Meanwhile, the copper price slipped Thursday, Reuters reported, based on weaker Chinese demand and an easing of supply concerns in South America.
LME three-month copper fell 1% to $6,373/mt on Thursday, Reuters reported.
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