Articles on: Metal Prices

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The Global Precious Monthly Metals Index (MMI), which tracks a basket of precious metals and precious metals prices, picked up one point for an MMI reading of 107 this month.

Keep up to date on everything going on in the world of trade and tariffs via MetalMiner’s Trade Resource Center.

Palladium Surges, Widens Spread with Platinum

Last month, we noted the narrowing of the platinum-palladium spread in platinum’s favor, down to $539 per ounce as of Sept. 1.

This past month, however, that narrowing proved short-lived, as the spread ballooned to $763 per ounce.

The palladium price has been a steady riser this year.

“The price has risen a third this year alone and hit $1,700/ounce this week on the back of a limited supply market facing off rising demand from tighter emission standards in China and a switch from diesel to petrol in Europe, both favoring palladium demand,” MetalMiner’s Stuart Burns explains. “This is despite a generally weak global automotive market, with production down everywhere. Think what it would be like with production at 2017-18 levels — probably over $2,000/ounce. It may still hit that next year.”

China’s massive automotive market has contracted this year.

Through the first eight months of the year, automotive production in China reached 15.93 million units, down 12.1% on a year-over-year basis, according to the China Association of Automobile Manufacturers. Meanwhile, Chinese automotive sales through the first eight months were down 11% compared with the first eight months of 2018.

Meanwhile, U.S. automotive production in August reached 213,000 units, approximately flat compared with August 2018, according to Federal Reserve Bank of St. Louis data.

Gold, Silver and Fed Rates

Meanwhile, in the safe-havens, market watchers should keep an eye on the Federal Reserve.

“Gold and silver are being driven more by safe-haven status and expectations the Fed will reduce rates,” Burns explained. “Lower interest rates are a boost for gold and, to a lesser extent, silver. The investment community is taking an interest in gold this year, with ETF holdings near three-year highs and heavy buying by the Chinese central bank adding almost 100 tons in the last 10 months as it seeks to diversify away for the dollar. For the time being, Fed expectations will be the prime mover for prices.”

In September, the Federal Reserve announced it would lower the range for its benchmark interest rate by 25 basis points, to a range of 1.75-2.0%, marking the Fed’s second cut this year.

However, Fed Chairman Jerome Powell indicated the possibility of another rate cut this month, USA Today reported.

“While not everyone fully shares economic opportunities and the economy faces some risks, overall, it is — as I like to say — in a good place. Our job is to keep it there as long as possible,” Powell said in opening remarks during an event at the Federal Reserve Bank of Kansas City on Oct. 9. “While we believe our strategy and tools have been and remain effective, the U.S. economy, like other advanced economies around the world, is facing some longer-term challenges — from low growth, low inflation, and low interest rates.

“While slow growth is obviously not good, you may be asking, ‘What’s wrong with low inflation and low interest rates?’ Low can be good, but when inflation — and, consequently, interest rates — are too low, the Fed and other central banks have less room to cut rates to support the economy during downturns.”

President Donald Trump has on numerous occasions this year criticized the Fed and Powell for not doing enough to cut interest rates.

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Actual Metal Prices and Trends

The U.S. silver ingot price fell 5.6% month over month to $17.21/ounce as of Oct. 1.

U.S. platinum bars fell 4.4% to $875/ounce, while U.S. palladium bars rose 12.7% to $1,638/ounce.

Chinese gold bullion fell 2.9% to $47.99/gram. U.S. gold bullion dropped 3.2% to $1,478.60/ounce.

The Raw Steels Monthly Metals Index (MMI) took another hit this month, dropping three points to 67. The index has now dropped for seven consecutive months — following an early 2019 high of 82 in March — on the back of falling steel prices.

U.S. steel prices dropped in September, with plate prices recording the greatest loss. However, historically, plate prices tend to track lower than CRC.

Based on technical analysis, prices for plate could still demonstrate more downside momentum compared to other forms of steel (HRC, CRC and HDG).

Source: MetalMiner data from MetalMiner IndX(™)

U.S. capacity utilization for the year to date remains above the critical 80% mark at 80.4%. During the period, production totaled 74.3 million tons, a 3% increase compared to the same period last year, according to the American Iron and Steel Institute (AISI).

However, weekly data for the week ending Oct. 5 indicated capacity utilization of 78%, with 1.8 million tons produced, a 3.9% decrease compared to the same period last year.

Chinese Prices Weaken

China CRC and plate prices nudged down recently, while HRC prices dropped to a greater extent.

Meanwhile, HDG prices took a clear downward turn in September.

Source: MetalMiner data from MetalMiner IndX(™)

During the course of 2019, Chinese steel prices looked fairly flat overall, with prices now lower than at the start of the year.

HRC, CRC and plate prices looked just slightly weaker compared to January prices. HDG prices dropped more noticeably, priced at CNY 5,690/mt in early October compared to the January price of around CNY 6,040/mt.

China’s Share of Total Global Production Continues to Increase

Based on data from the World Steel Association (WSA), global production of steel during the first eight months of 2019 totaled 1,239 million tons, up 4.6% percent compared to the first eight months of 2018.

China’s total share of global production totaled 53.6%, based on WSA data through August. Based on an estimated 664.04 million tons through August, production increased by 9.4% compared to the same period of 2018.

Additionally, in terms of monthly data, China’s steel production increased once again. China’s August production reached 87.25 million tons in August after dropping during the two months prior from June’s peak 2019 production of 89.09 million tons.

Meanwhile, production in Japan, the world’s third-largest steel-producing country, fell by 3.7% during the eight-month period, down to 67.589 million tons. The country’s share of global production dropped to 5.5%, compared to 5.9% during the first eight months of 2018.

U.S. production totaled 59.23 million tons through August, an increase of 4% compared to the same period of 2018, according to WSA numbers. Share of global production remained static at 4.8%. Likewise, production in India, the world’s second largest producing country, also remained flat at 6.1%, in terms of total global share of production.

Ongoing GM Strike Continues to Hurt Steel Demand

Given that demand from GM represents around 5-9% of annual steel demand in the U.S. (by various estimates), the ongoing strike continues to place a drag on U.S. steel prices.

As of Oct. 10, the strike had reached its 25th day.

What This Means for Industrial Buyers

Global growth in the production of steel appears to remain in excess of growth in steel demand, exerting downward pressure on prices.

Therefore, industrial buying organizations may benefit from understanding exactly when and how much to buy in this falling market.

Buying organizations interested in tracking industrial metals prices with ease should request a demo of the all new MetalMiner Insights platform.

Buying organizations seeking more insight into longer-term steel price trends may want to read MetalMiner’s Annual Metal Buying Outlook.

Free Partial Sample Report: 2020 MetalMiner Annual Metals Outlook

Actual Raw Steel Prices and Trends

Steel prices weakened further in September.

Korean scrap prices registered a 16.9% decrease, falling to $116/st. Korean pig iron dropped 0.2% to $358/mt.

U.S. shredded scrap prices dropped 13.6% to $254/st. The U.S. Midwest HRC futures spot price dropped 10.9%, while the Midwest HRC futures three-month price fell by 3.6% to $522/st and $530/st, respectively.

LME billet three-month prices dropped 12% to $234/st.

Chinese prices in the index showed mixed, mild movement. Chinese billet prices increased the most, rising 2.1% to $488/mt. HRC prices decreased the most, dropping 1% to $505/mt.

The Rare Earths Monthly Metals Index (MMI) dropped one point this month down to an MMI reading of 21.

Keep up to date on everything going on in the world of trade and tariffs via MetalMiner’s Trade Resource Center.

U.S. Looks Beyond China

One point of underlying tension between the U.S. and China, as the two countries have waged a bitter trade war over the past year, has been China’s dominance of rare earths.

The materials, crucial for use in a wide variety of high-tech capacities, overwhelmingly come from China.

As such, the U.S., looking to wean itself off dependence on China for said rare earths, is looking to form partnerships elsewhere, as MetalMiner’s Stuart Burns recently explained.

“Many will recall, and not a few lament, the failure to support California’s Mountain Pass mine, source of the country’s rare earth metals, as an example of how exposed the U.S. has become,” Burns explained.

“According to the Defense Visual Information Distribution Service (DFIDS), the U.S. was largely self-sufficient for most of the 20th century, with all of its rare-earth needs being met by the Mountain Pass mine.

“However, following a free trade deal between the U.S. and China in the 1990s, lower labor costs and regulatory requirements meant China could undercut Mountain Pass. Combined with problems over water supply pollution and stricter regulations, Mountain Pass was forced to shut down.”

As such, the U.S. is looking to shore up its rare earths supply chains by forming partnerships elsewhere.

“Now, the U.S. is seeking cooperation from potential supply countries outside of China — notably Australia, but also Greenland, Botswana and Peru,” Burns continued. “The U.S. is looking to develop not just alternative raw material supply but, more importantly, to develop refining facilities, too.

“A new body, the U.S. Development Finance Corporation, is set to play a significant role in facilitating the U.S. government’s efforts to take equity positions in mining projects and encouraging private sector investment, according to Frank Fannon, the U.S. assistant secretary of state for energy resources, according to Reuters.”

Trudeau, Trump Talk Rare Earths

Continuing the aforementioned theme, Bloomberg reported late last month that U.S. President Donald Trump and Canadian Prime Minister Justin Trudeau recently discussed efforts to secure supply chains for rare earths.

According to the report, a joint action plan will be presented to the government coalition that forms after the Oct. 21 elections in Canada.

“It is in our interests to ensure that we have reliable supplies of these important minerals for technology, and it’s a conversation that our government is leading on,” Trudeau was quoted as saying at a recent press conference. “Canada has many of the rare earth minerals that are so necessary for modern technologies.”

Also of note, the next round of U.S.-China trade talks are scheduled for later this week.

However, the two countries are already on shaky ground heading into the talks.

Following a tweet by Daryl Morey, general manager of the Houston Rockets NBA franchise, in which he expressed support for anti-government protestors in Hong Kong, Chinese businesses announced they would sever ties with the organization. Chinese broadcast partners Tencent and the state-owned CCTV announced they would no longer broadcast Rockets games, marking yet another point of tension between the two countries.

In addition, the Bureau of Industry and Security announced it would add 28 Chinese organizations to the Entity List for “engaging in or enabling activities contrary to the foreign policy interests of the United States.”

“The U.S. Government and Department of Commerce cannot and will not tolerate the brutal suppression of ethnic minorities within China,” Secretary of Commerce Wilbur Ross said. “This action will ensure that our technologies, fostered in an environment of individual liberty and free enterprise, are not used to repress defenseless minority populations.”

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Actual Metal Prices and Trends

Chinese yttrium prices rose 0.4% month over month to $31.48/kilogram as of Oct. 1. Chinese terbium oxide dropped 1.2% to $540.68/kilogram.

Neodymium oxide fell 0.8% to $44,695.50/mt.

Europium oxide rose 0.3% to $30.78/kilogram. Dysprosium oxide fell 2.0% to $260.90/kilogram.

freshidea/Adobe Stock

This morning in metals news, China could be pushing for a partial trade deal with the U.S., the Trump administration criticized the Louisiana governor over his characterization of the reasons for Bayou Steel Group’s closure and copper ticked up Wednesday.

Keep up to date on everything going on in the world of trade and tariffs via MetalMiner’s Trade Resource Center.

U.S.-China Move Toward Next Round of Talks

The road to the next round of U.S.-China trade talks, scheduled to begin Thursday, has been fairly bumpy.

In recent days, the U.S.’s National Basketball Association (NBA) has found itself in a PR crisis following a since-deleted tweet by Houston Rockets General Manager Daryl Morey, who expressed support for anti-government protestors in Hong Kong.

As a result, Chinese broadcasters have severed ties with the organization, which boasts a sizable Chinese following.

On Monday, the Bureau of Industry and Security announced it would add 28 Chinese organizations to its Entity List, calling out human rights abuses in Xinjiang.

However, according to a CNBC report, China is looking to make some concessions toward a partial trade deal. Among those concessions, according to the report, includes an agreement to increase purchases of agricultural products from the U.S.

Trump Administration Criticizes Louisiana Governor’s Bayou Steel Comments

On the heels of the bankruptcy of Bayou Steel Group, Louisiana Gov. John Bel Edwards indicated the closure of the business could at least in part be linked with the Trump administration’s tariffs.

Peter Navarro, Trump’s assistant for trade and manufacturing policy, struck back at the characterization.

“This is comically bad staff work: there are no tariffs on inbound recycled scrap and there is an abundance of cheap scrap on domestic soil,” Navarro was quoted as saying by nola.com. “Bayou Steel folded like a cheap tent under the weight of a leveraged buyout by Wall Street vultures picking the carcass of a highly inefficient and antiquated plant. Ironically, the Trump steel tariffs actually kept Bayou Steel as a going concern longer than it otherwise would have existed.

Copper Moves Up

With the next round of U.S.-China trade talks set to begin Thursday, copper prices inched up Wednesday.

Looking for metal price forecasting and data analysis in one easy-to-use platform? Inquire about MetalMiner Insights today!

LME copper moved up 0.3% to $5,691/mt, Reuters reported.

The Stainless Steel Monthly Metals Index (MMI) dropped back by three points to 88. The drop comes after reaching a five-year high of 91 last month, following strong increases for two consecutive months and culminating in last month’s 16-point surge.

Price increases caught up with additional values in the index, while key prices that initially surged dropped back slightly.

Keep up to date on everything going on in the world of trade and tariffs via MetalMiner’s Trade Resource Center.

LME nickel prices dropped off their early September highs, moving sideways and trading roughly in the $17,000-$18,000 band, averaging around $17,500/mt.

Source: MetalMiner analysis of the London Metal Exchange (LME) and FastMarkets

Recently, the four-day average (represented by the red line below) dropped toward the nine-day average (represented by the purple line):

Source: MetalMiner analysis of the London Metal Exchange (LME) and FastMarkets

Coupled with waning trading volume, the movement of the four-day average toward the nine-day average indicates the rally may be over.

However, looking at longer-term prices, we see nickel traded much higher prior to 2016 — a year during which commodity prices dropped:

Source: MetalMiner analysis of the London Metal Exchange (LME) and FastMarkets

The current price looks comparable to average prices during 2012-2015. Additionally, at times the metal surged higher in price during that period, compared with the current price.

However, with demand conditions looking weaker, the metal may still pull back rather than rise further.

SHFE Nickel Prices Move Sideways

Similar to LME prices, SHFE nickel prices dropped slightly off recent highs, then traded sideways:

Source: MetalMiner analysis of FastMarkets

Since SHFE nickel futures only launched in 2015, it’s trickier to look back at prices in the longer term.

Presumably, however, SHFE nickel shares LME nickel price upside risks, given that international price arbitrage tends to remove price differentials between the exchanges.

Indonesian State Miner PT Inalum Tapped to Purchase Stake in Vale Indonesia

In order to meet new Indonesia regulations that limit foreign ownership of mining resources, the Indonesian government tapped state miner PT Inalum for the purchase of PT Vale’s divestiture of around 20% of value, according to Reuters.

Multiple nickel-focused projects continue to ramp up, with production of nickel pig iron (NPI) set to double by 2020 to 530,000 tons (up from 2018’s total production of 261,000 tons).

As recently as 2014, Indonesia recorded minimal output of NPI, according to press reports.

Domestic Stainless Steel Market

Source: MetalMiner data from MetalMiner IndX(™)

Stainless 304 and 316 NAS surcharges jumped in August, following higher nickel prices.

For 304/304L-coil, the surcharge average $0.66/pound during September, while 316/316L-coil averaged $0.97/pound during September.

As of early October, surcharges continued rising.

What This Means for Industrial Buyers

Nickel prices stopped surging, and then dropped back mildly, taking the index reading back a few points; still, prices remained much higher.

Whether prices correct or rise further will depend on demand conditions moving into the fall season. Therefore, industrial buying organizations need to stay alert for the right opportunity to buy.

Buying organizations interested in tracking industrial metals prices with greater ease will want to request a demo to the new MetalMiner Insights platform.

Buying organizations seeking more insight into longer-term industrial metals price trends should read MetalMiner’s Annual Metal Buying Outlook.

Looking for metal price forecasting and data analysis in one easy-to-use platform? Inquire about MetalMiner Insights today!

Actual Stainless Steel Prices and Trends

The LME primary three-month nickel price corrected by 6.8% to $17,210/mt.

China’s primary nickel price corrected by a similar extent, 7%, to $19,165/mt. All other Chinese prices in the index increased by 0.3%, with the exception of Ferro Alloys FeMo lumps, which dropped by 0.4% this month to $18,606/mt.

India’s primary nickel price dropped back by 1.7% to $17.69/kilogram.

The U.S. 316 and 304 Allegheny Ludlum stainless surcharges increased by double-digits again — by 10.7% and 11.9%, respectively — to $1.11/pound and $0.78/pound.

Korean prices jumped this month. Stainless steel coil 430 CR 2B and 304 CR 2B rose by 25.3% and 14.8%, respectively, to $1,497/mt and $2,411/mt.

Bombardho/Adobe Stock

The Copper Monthly Metals Index (MMI) held its value at 71, with around two-thirds of the metal prices in the basket staying essentially flat. Several Chinese prices registered increases of around 2%, but the gains were not enough to move the index upward.

Keep up to date on everything going on in the world of trade and tariffs via MetalMiner’s Trade Resource Center.

The LME copper price rallied until mid-month. Thereafter, the price retraced once more, but didn’t drop back quite as far as in early September.

Source: MetalMiner analysis of London Metal Exchange (LME) and FastMarkets

News pertaining to slowing global growth, including slowing Chinese growth, took the metal lower.

SHFE Prices Continue to Move Sideways

SHFE copper prices continue to move in a historically narrow band around the CNY 46,000/mt to CNY 48,000/mt range, with prices just slightly above the midpoint at the end of September.

Source: MetalMiner analysis of FastMarkets

This may indicate fair demand, as prices are lacking momentum in either direction.

Source: MetalMiner analysis of FastMarkets

Copper demand growth in China looks relatively flat for 2019, with mild growth of 0.5% expected by some analysts, as recently pointed out by MetalMiner’s Stuart Burns. This contrasts with the International Copper Study Group’s (ICSG) estimate of 3% demand growth in China during H1 2019; however, the demand outlook continues to deteriorate into 2019.

Copper Supply Issues Continue to Support Prices, In Spite of Negative Demand Growth in ROW

According to the ICSG’s estimates, China’s 3% increase in demand was offset by a 3% decline in the rest of the world (ROW), making for an essentially flat-to-negative growth outlook as 2019 progresses.

Meanwhile, multiple global supply issues led to negative growth in both mined and refined copper output in 2019, with both contracting (as noted in the October MetalMiner Monthly Outlook report).

During a speech in September, World Bank President David Malpass said the nominal global growth rate looks set to slow to less than 3% this year. Further, the growth rate may not even hit the World Bank’s revised June forecast of 2.6%, indicating a much slower growth rate this year — compared with the rate of 6% during the past couple of years.

Given the metal’s price sensitivity to economic factors, prices continue to look weak despite the deficit for the metal this year, which ranges from 190,000 to 220,000 tons, according to ICSG figures for the first half of the year.

U.S. Drops Copper from the E.U. Retaliatory Tariff List

U.S.-based copper product importers received good news early in October that copper products were dropped from the list of imports to be impacted E.U. tariffs, awarded based on the European Union’s subsidization of Airbus, as ruled on by the World Trade Organization (WTO).

Final approval of the U.S. plan looks set to occur mid-month, with implementation of the tariffs still on that list targeted for Oct. 18.

However, the U.S. appears to maintain some bandwidth to impose additional duties at a later date. The case will continue into the foreseeable future, with other factors still in play dragging out a final outcome.

Industrial buying organizations need to continue to track the case.

What This Means for Industrial Buyers

U.S.-based importers of E.U. copper products received news that copper products were dropped from the final list of products to be impacted by the imposition of WTO-granted tariffs on various products from a handful of European countries. Still, importers of the metal need to remain on alert for potential revisions.

Meanwhile, copper prices stayed flat this month. Industrial buying organizations need to be aware that demand conditions could shift and impact prices at any time, as a lack of clarity pervades the market at this time.

Want an easier solution for tracking industrial metals prices and trade news? Request a demo of the MetalMiner Insights platform.

Buying organizations seeking more insight into longer-term copper price trends should read MetalMiner’s Annual Metal Buying Outlook.

Free Partial Sample Report: 2020 MetalMiner Annual Metals Outlook

Actual Copper Prices and Trends

This month, copper prices stopped dropping. The majority of Chinese prices recorded increases of around 2%, stopping the declining price trend that beset the index in July and August. ROW prices stayed essentially flat.

China’s primary cash price increased 2.2% to $6,629/mt, while copper wire price increase by 2.1% to $6,617/mt. Copper bar prices increased by 1.9% to $6,604/mt. China’s copper #2 price increased by 0.3% to $5,372/mt.

Korean copper strip increased by 0.8% to $7.85 per kilogram.

Japan’s primary cash price increased 0.6% to $5,912/mt.

The LME primary three-month price stayed flat with a mild 0.1% increase to $5,640/mt.

U.S. producer copper grades 110 and grade 122 both remained at $3.34 per pound, while grade 102 remained at $3.56 per pound.

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Only Indian copper cash prices dropped, falling by 0.2% to $6.13 per kilogram.

The Aluminum Monthly Metals Index (MMI) dropped by one point again this month, this month down to an MMI reading of 82.

However, rather than universal price weakness like last month, price declines in China pulled the index down (along with a milder drop in LME prices).

All other prices in the index increased, although some of the gains were relatively small (i.e., under 1%).

Keep up to date on everything going on in the world of trade and tariffs via MetalMiner’s Trade Resource Center.

LME aluminum prices weakened in September, despite looking stronger early on in the month. Less robust manufacturing and economic indicators hurt some industrial metal prices this month, including aluminum. The stronger U.S. dollar also resulted in weaker prices.

Source: MetalMiner analysis of London Metal Exchange (LME) and FastMarkets

LME prices look close to possibly dropping below yet another critical price level, $1,700/mt, after clearly breaking the $1,800/mt support level since last month.

SHFE Aluminum Prices Lost Ground in September

Over the course of 2019, SHFE aluminum prices continued to show sluggish upward momentum, constrained by the CNY 14,500/mt price level.

Source: MetalMiner analysis of Fastmarkets

However, during the past one month, SHFE prices dropped:

Source: MetalMiner analysis of Fastmarkets

The price drop looks somewhat mild, as it looks to be within the range of normal price fluctuations for the metal over the past year.

Around mid-month, news of slowing economic growth in China led to a stalling of price momentum for some key industrial metals, including aluminum.

However, not all the recent news from China indicated manufacturing is slowing.

The Caixin Purchasing Managers Index (PMI) clearly jumped into the expansionary zone, as reported in this month’s MetalMiner Monthly Outlook.

China’s National Bureau of Statistics’ (NBS) competing PMI also edged up to 49.8 (compared with August’s reading of 49.5). In particular, the production subindex jumped to 52.3, while the new orders index increased to 50.5 — both marking expansionary readings.

Recently, the Chinese government implemented fiscal measures expected to help maintain higher growth rates through improved banking sector liquidity. Expected beneficiaries of the measures include the construction industry and small businesses.

Demand in the automotive sector remains weak, adding to aluminum price weakness (as pointed out by MetalMiner’s Stuart Burns in a recent article). The government implemented measures to help improve traditional car sales; so far, the data do not show an uptick in sales as a result of these measures, which rely on implementation at the local government level.

Strong U.S. Dollar Suppresses LME Prices

One effect of slowed growth in other major countries pertains to the continued upward trend in the dollar’s value, which grew stronger vis-a-vis other major currencies.

This compounds with China’s decision to devalue the yuan in early August, which translates into yet lower prices.

Key raw material input costs have also dropped.

Therefore, producers — particularly producers in China — have a greater buffer against lower prices, allowing them to lower prices while maintaining margins. As such, those producers can then continue to produce, even at lower prices.

Additionally, when Chinese domestic prices stay the same or decline in dollar-denominated prices, increased sales volume may be the result. Chinese producers can therefore benefit without effectively offering any actual price discount. In the worst-case scenario — the case of rising prices — the alteration in the exchange rate slows the rate of increases in dollar-denominated prices.

Vietnam Announces Tariffs on Aluminum Imports from 16 Chinese Companies

Based on the findings of an investigation launched in January, Vietnam announced it would impose anti-dumping duties on some aluminum products from 16 Chinese companies.

The tax will range from 2.49% to 35.58% for five years, starting from Sept. 28, 2019.

U.S. Aluminum Premiums

The U.S. Midwest Premium increased marginally, placing it firmly at $0.18/pound, indicating supply tightness continues in spite of weaker demand.

What This Means for Industrial Buyers

Aluminum price momentum stalled in September.

Recent Chinese currency devaluation and a stronger dollar means lower prices — for now.

Industrial buying organizations need to keep an eye on the bigger picture; should demand firm up in the fall, price momentum may still turn around.

Buying organizations interested in tracking industrial metals prices with embedded forecasting should request a demo of MetalMiner Insights platform.

Buying organizations seeking more insight into longer-term aluminum price trends should read MetalMiner’s Annual Metal Buying Outlook.

Free Partial Sample Report: 2020 MetalMiner Annual Metals Outlook

Actual Metal Prices and Trends

Chinese prices in the index moved lower overall this month.

Chinese aluminum primary cash and scrap prices decreased by 2.9% and 2.8% respectively, to $1,955/mt and $1,762/mt.

Chinese aluminum billet and bar prices posted 0.2% declines, falling to $2,056/mt and $2,150/mt, respectively.

The LME primary three-month price dropped by 1.5% this month to $1,720/mt, adding to the 3.4% drop the month prior.

European commercial 1050 sheet and 5083 plate both increased by 2.6% to $2,456/mt and $2,799/mt, respectively.

India’s primary cash price increased 1% to $1.96 per kilogram.

Korean commercial 1050 sheet, 5052 coil premium over 1050, and 3003 coil premium over 1050 all increased by less than 1% – reversing last month’s mild decrease of less than 1% — down to $2.97, $3.14 and $3.02 per kilogram, respectively.

Pavel Ignatov/Adobe Stock

Before we head into the weekend, let’s take a look back at this week’s coverage on MetalMiner, which included analysis of Chinese steel production, the U.S.’s search for sources of rare earths outside of China, and falling copper and aluminum prices.

Keep up to date on everything going on in the world of trade and tariffs via MetalMiner’s Trade Resource Center.

Looking for metal price forecasting and data analysis in one easy-to-use platform? Inquire about MetalMiner Insights today!

vadiml/Adobe Stock

This morning in metals news, Codelco is holding its 2020 copper premium flat for Europe, China’s yuan could see further devaluation and Alcoa’s Baie-Comeau smelter has received certification from the Aluminum Stewardship Initiative.

Keep up to date on everything going on in the world of trade and tariffs via MetalMiner’s Trade Resource Center.

Copper Premium Flat

According to Reuters, Codelco’s copper premium will be held flat for European customers in 2020.

Codelco’s premium will check in at $98/ton, according to the report.

Reuters Poll: Yuan to Slip Further Against the Dollar

Earlier this year, the yuan slipped in value compared to the dollar to an approximately 7-to-1 ratio, which makes imports from China more attractive.

According to a Reuters poll, the yuan could slip further to levels last seen during the financial crisis of 2008.

The yuan could fall as low as 7.20 to the dollar by the end of the year, according to the Reuters poll of foreign exchange strategists.

Alcoa Smelter Gains ASI Certification

Alcoa’s Baie-Comeau smelter in Quebec has received certification from the Aluminum Stewardship Initiative (ASI), a body that formulates and sets sustainability standards for the aluminum sector.

Alcoa now has ASI-certified facilities in three countries: Brazil, Spain and Canada.

Looking for metal price forecasting and data analysis in one easy-to-use platform? Inquire about MetalMiner Insights today!

“From mine to metal, Alcoa is recognized as a sustainability leader,” said Michelle O’Neill, Alcoa’s senior vice president of government affairs and sustainability. “This latest ASI certification demonstrates our ongoing commitment to operate in a responsible manner while bringing long-lasting value to our stakeholders.”

The Construction Monthly Metals Index (MMI) held flat this month, sticking at an MMI reading of 77.

Keep up to date on everything going on in the world of trade and tariffs via MetalMiner’s Trade Resource Center.

U.S. Construction Spending

According to the U.S. Census Bureau, U.S. construction spending in August reached a seasonally adjusted annual rate of $1,287.3 billion, up 0.1% from the revised July estimate of $1,285.6 billion.

The August total, however, was down 1.9% from the August 2018 estimate of $1,312.2 billion.

Meanwhile, for the first eight months of the year, construction spending was down 2.3% compared with the first eight months of 2018.

Broken down further, spending on private construction in August reached a seasonally adjusted annual rate of $955 billion, flat compared with July.

Under the umbrella of private construction, residential construction spending reached a seasonally adjusted annual rate of $507.2 billion, up 0.9% from July. Meanwhile, nonresidential construction spending reached $447.9 billion, down 1.0% from July.

As for public construction, spending in August reached $332.3 billion, up 0.4% from July. Under public construction, educational construction spending totaled $77.0 billion, up 1.4% from July. Highway construction spending reached $98.9 billion, up 0.6% from the July estimate.

ABI Slump Continues

The Architecture Billings Index (ABI), released monthly by the American Institute of Architects (AIA), serves as an indicator of architecture billings growth in the U.S.

The ABI has been mired in a slump, coming in flat for six consecutive months prior to the most recent reading.

The recently released August ABI, however, reflected a downturn.

The August ABI checked in at 47.2, down from 50.1 the previous month (any reading greater than 50 indicates billings growth, while a sub-50 reading indicates contraction).

In its most recent ABI report, the AIA called business conditions “disappointing” for U.S. architecture firms this year.

“The national ABI score for the month was just 47.2 (any score below 50 signifies a decline in aggregate design activity),” the AIA report stated. “Additionally, the national score for new design contracts, which measures new design work coming into architecture firms, was just 47.9 (again, any score below 50 signifies a decline in aggregate new design contract activity). So, architecture firms reported a rare double decline in both new work coming into their firms and design work that was being completed.”

By region, the Midwest was hit hardest, registering an ABI of 46.4 for the month. Billings contracted in the South (48.2) and Northeast (49.1), too, while the West showed billings growth (51.2).

According to the monthly survey of industry professionals included in the ABI report, business conditions are prompting some architecture firms to consider international opportunities.

“At present, only about 10% of U.S. architecture firms are currently working on international projects, while an additional 13% don’t have current projects, but have worked internationally within the past five years,” the report noted. “Another 13% of firms have plans to pursue at least some type of international work in the near future.”

Of the remaining nearly two-thirds, over half would at least consider an international project, according to the survey results.

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Actual Metal Prices and Trends

The Chinese rebar price rose 3.6% month over month to $525.99/mt as of Oct. 1. The Chinese H-beam steel price fell 1.0% to $532.99/mt.

U.S. shredded scrap steel fell 13.6% to $254/st.

European commercial 1050 aluminum sheet rose 2.6% to $2,455.78/mt.

Chinese 62% iron ore PB fines rose 0.3% to $73.44/dmt.