LME copper

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. Read more

The week’s biggest mover on the weekly Automotive MMI® was the cash price of primary copper, which saw a 7.8% increase on the LME to $6,134 per metric ton. This comes on the heels of a 1.6% decline the week prior. The copper 3-month price rose 7.7% on the LME to $6,110 per metric ton after falling 1.4% during the previous week. The price of Chinese lead rose 1.2% to CNY 12,550 ($2,020) per metric ton after falling 0.4% during the previous week. Korean 5052 coil premium over 1050 sheet prices held steady from the previous week at KRW 4,010 ($3.64) per kilogram.

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The price of US HDG dropped 1.1% this week, closing out the third consecutive week of falling prices at $639.00 per short ton.

The price of US platinum bar rose 2.5% to $1,141 per ounce after falling 0.2% during the previous week. At $763.00 per ounce, the price of US palladium bar finished the week down 2.1%.

The Automotive MMI® collects and weights 7 metal price points used in automotive production to provide a unique view into automotive metal trends. 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.

The US dollar weakened and eased concerns about its impact on corporate profits, while the euro recovered from a 12-year low in trading today.

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After months of strong jobs data, expectations have been growing that the Federal Reserve would signal a June rate rise at a meeting that begins on Tuesday. A stronger dollar erodes purchasing power for commodities. That, plus questions over China’s economic growth after comments by Premier Li Keqiang added headwinds to copper, analyst Joel Crane of Morgan Stanley in Melbourne told Reuters.

“What we’ve seen on China’s data indicators so far is fairly negative, so it’s not surprising that people would be worried about whether the post-New Year recovery is underway,” Crane said.

Premier Li vowed to keep China’s economy growing at a reasonable speed, even as he also said authorities could do more to stoke growth, which triggered a rally in Chinese equities.

The prospect of more Chinese stimulus, and a rise in interest rates in the US, helped copper to a weekly gain. Prices have been gaining ground as China’s factories ramp up after the Lunar New Year, climbing from 5-1/2 year lows of under $5,400 a metric t0n in January, but slowing economic growth and ample refined supply has blunted momentum.

The week’s biggest mover on the weekly Copper MMI® was the price of Chinese copper wire, which saw a 0.8% increase to CNY 42,780 ($6,832) per metric ton. This comes on the heels of a 0.5% decline the week prior. The price of Chinese copper bar rose 0.7% to CNY 43,620 ($6,966) per metric ton after falling 0.5% during the previous week. The cash price of Chinese copper rose 0.7% to CNY 43,820 ($6,998) per metric ton after falling 0.5% during the previous week. Closing at CNY 33,400 ($5,334) per metric ton, Chinese bright copper scrap remained unchanged for the week.

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Following a 1.4% increase in the week prior, the cash price of primary Japanese copper fell 0.3% last week to JPY 722,000 ($5,951) per metric ton. The price of US copper producer grade 122 remained steady from the previous week at $3.39 per pound. Korean copper strip prices held steady from the previous week at KRW 8,619 ($7.62) per kilogram. Following a steady week, prices for the price of US copper producer grade 102 closed flat at $3.58 per pound. The price of US copper producer grade 110 closed at $3.39 per pound after a flat week.

The copper 3-month price rose 0.4% on the LME to $5,850 per metric ton after falling 1.4% during the previous week. The primary copper cash price rose 0.2% on the LME to $5,865 per metric ton after falling 1.3% during the previous week.

The Copper MMI® collects and weights 12 global copper metal price points to provide a unique view into copper price trends. 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.

3-month copper surged to a six-week high on Tuesday after Federal Reserve Chairwoman Janet Yellen said it was preparing to consider rate rises on a meeting-by-meeting basis. Greece also secured its bailout extension from the EU and oil prices rebounded.

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Yellen said it would be several months before the Fed expects to raise interest rates but the consideration was now on the table. 3-month copper on the London Metal Exchange jumped to a session peak of $5,846 a metric ton today, the strongest since Jan. 13, and closed 2% higher at $5,785.

On Monday, March 9, the day’s biggest mover was the price of US copper producer grade 110, which saw a 1.5% decline to $3.34 per pound. After two changeless days, the price of US copper producer grade 122 fell 1.5% to $3.34 per pound. The price of US copper producer grade 102 dropped by 1.4% to $3.53 per pound after holding steady. After a 0.4% increase, the cash price of primary Japanese copper finished the day at JPY 727,000 ($6,021) per metric ton.

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Chinese copper prices were mixed for the day. The price of Chinese copper bar declined 1.2% to CNY 42,770 ($6,827) per metric ton. The cash price of Chinese copper declined 1.2% to CNY 42,970 ($6,859) per metric ton. Chinese copper wire prices saw a 1.2% decline to CNY 41,940 ($6,695) per metric ton. The price of Chinese bright copper scrap was unchanged at CNY 33,400 ($5,332) per metric ton.

The primary copper cash price weakened by 0.5% on the LME, settling at $5,826 per metric ton. Also on the LME, the 3-month price of copper fell 0.4% to $5,804 per metric ton.

The monthly Copper MMI® ticked up to 73 in March – after its fall off a tall building down to 70 in February, copper’s dead cat bounces impressively 4.3% from its big drop.

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While it’s one of only two indexes up this month, you shouldn’t read too much into this bounce:

Copper_Chart_March-2015_FNLMeow, Meow, Meow, Meow

On the London Metal Exchange, itself, copper rose 7% in the month of February. This move shouldn’t come as a surprise, either. Copper fell 25% since July 2015 and it needs some time to digest its super-sized feast of loss. Remember, prices don’t move in a straight line, they move in a zig-zag.

Therefore, this move should be taken as a normal reaction within a falling trend – simply a temporary recovery from a prolonged decline or bear market, followed by the continuation of the downtrend. There is absolutely nothing to suggest that copper has eight more lives after this dead cat bounces.

Fundamentals don’t disagree with the price action. The market is in surplus and it does not look like it will change anytime soon. The International Copper Study Group, whose members are copper-producing and consuming countries, says demand will rise just 1.1% this year while output jumps 4.3%.

As we pointed out recently, China’s production is expected to rise despite lower prices. Some production projects are already well underway and it wouldn’t be economical to suspend them at this point. Furthermore, some of these Chinese producers are government-controlled and might not be free to cut output, even if they wanted to, as prices decline.

The Blurry Production Picture

Read more

North American Palladium‘s stock rose by 51.8% in the past month. This combination of strong price performance and favorable technical data, could suggest that the stock is on the right path.

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North American is an established PGM producer that has been operating its main revenue source, its Lac des Iles mine in northern Ontario, Canada, since 1993.

The week’s biggest mover on the weekly Automotive MMI®, US palladium bar jumped 2.5% to close at $824.00 per ounce. US platinum bar gained a slight 1.0% this past week, finishing at $1,180 per ounce.

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The price of US HDG fell 1.8% over the past week to $662.00 per short ton. This was the fourth week in a row of declining prices.

The price of Chinese lead fell 1.6% for the week to settle at CNY 12,450 ($1,985) per metric ton. Finishing the fourth week of rising prices, the 3-month price of copper increased by 1.4% on the LME, finishing at $5,865 per metric ton. The cash price of primary copper increased 1.3% on the LME this week, closing out the fourth consecutive week of rising prices at $5,881 per metric ton. In the past week, Korean 5052 coil premium over 1050 sheet saw its price shift up 0.5% to KRW 4,016 ($3.65) 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. 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.

A. Gary Shilling writes that copper’s fall will continue because producers have a great incentive to increase output despite low market prices.

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In his Bloomberg View piece, Investment and Money Manager Shilling blames the commodity boom of the early 2000s that led to massive building and expansion in China.

“It’s not economical to suspend some of these projects due to high sunk costs and shutdown expenses,” Shilling writes. “Some producers, moreover, may not be free to slash output as prices swoon, especially if they’re government-controlled and need foreign exchange to service sovereign debts.”

Copper is produced mainly in the developing countries of Chile, Peru, Congo, Zambia and Russia. China is a net exporter of aluminum but an importer of copper. The International Copper Study Group, made up of copper-producing and consuming countries, says demand will rise just 1.1% this year while output jumps 4.3%.

The cash price of Japanese copper fell 1.8% on Thursday, March 5 to JPY 721,000 ($6,026) per metric ton, making it the day’s biggest mover. The price of US copper producer grade 110 showed little movement on Thursday, hovering around $3.39 per pound. The price of US copper producer grade 102 held steady around $3.58 per pound. The price of US copper producer grade 122 saw little movement yesterday, closing out around $3.39 per pound.

* Get the complete prices every day on the MetalMiner IndX℠

Chinese copper closed mixed yesterday. The price of Chinese copper wire fell 0.2% to CNY 42,530 ($6,780) per metric ton. After a couple of days of decreasing prices, the price of Chinese copper bar held steady at CNY 43,400 ($6,918). Following two days of downward movement, the Chinese copper cash price held steady at CNY 43,600 ($6,950) per metric ton. The price of Chinese bright copper scrap saw little movement at CNY 33,400 ($5,324) per metric ton.

After a 0.5% increase, the copper 3-month price finished the day on the LME at $5,865 per metric ton. Also on the LME, the primary copper cash price gained 0.5% to finish at $5,881 per metric ton.

MetalMiner’s monthly Automotive MMI® has hit some bumps in the road – but the wheels haven’t quite fallen off yet.

Automotive_Chart_March-2015_FNL

Our automotive metals price index fell to 85 in March, a decrease of 2.3% from 87 in February. While automotive continues to be one of our stronger metal sectors, particularly aluminum and palladium used in automotive applications, it’s being dragged down by crude oil and other commodities that are keeping prices low.

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Despite a relatively healthy US automotive industry and strong results from manufacturers of original equipment (OEMs), prices are not rising for automotive raw materials such as steel and copper. Copper prices are a big component of our Automotive MMI® and their free-fall continues (even though the 3-month LME copper price inched up a bit this month). General Motors recently cut production of some of its more popular models as the cars are sitting on dealer lots awaiting buyers despite low prices and abundant supply of materials. Read more

Teck Resources Ltd., Canada’s second-largest mining company, is looking to buy a copper mine as the current slump in prices puts pressure on some rivals to sell.

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Teck, which also produces coking coal and zinc, is interested in locations with low political risk, Chief Executive Officer Don Lindsay told Bloomberg News in an interview. He declined to comment on specific assets.

“There are a couple of things that we think might shake loose,” Lindsay said. “We’re looking more towards the end of the year.”

On Wednesday, March 4, the day’s biggest mover was US copper producer grade 110 price, which saw a 1.2% decline to $3.39 per pound. The price of US copper producer grade 122 closed Wednesday at $3.39 per pound, halting its two-day flat run with a 1.2% decline. The price of US copper producer grade 102 fell 1.1% to $3.58 per pound yesterday after two days of no change. The Japanese copper cash price rose 0.1% to JPY 734,000 ($6,135) per metric ton.

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Chinese copper closed mixed yesterday. Chinese copper wire prices rose 0.2% to CNY 42,610 ($6,791) per metric ton. At CNY 43,380 ($6,914) per metric ton, Chinese copper bar fell 0.2% yesterday. The Chinese copper cash price declined 0.2% to CNY 43,580 ($6,946) per metric ton. The price of Chinese bright copper scrap was unchanged at CNY 33,400 ($5,323) per metric ton.

The 3-month price of copper weakened by 0.8% on the LME, settling at $5,835 per metric ton. Also on the LME, the primary copper cash price declined 0.7% to $5,854 per metric ton.

Copper dropped on Tuesday from a seven-week peak hit in the previous session as optimism over a weekend interest rate cut in top consumer China dissipated and inventories continued to rise.

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The main stock indexes in China, which consumes some 45% of the world’s copper, fell more than 2% earlier as regulators’ approval of a flood of new initial public offerings prompted worries over tighter liquidity.

At JPY 729,000 ($6,083) per metric ton, the Japanese copper cash price moved up 2.1% on Monday, March 2, making it the day’s biggest mover. The price of US copper producer grade 110 held steady around $3.43 per pound. The price of US copper producer grade 102 held steady yesterday, remaining around $3.62 per pound. The price of US copper producer grade 122 saw little movement yesterday, closing out around $3.43 per pound.

* Get the complete prices every day on the MetalMiner IndX℠

Chinese copper prices were mixed for the day. Chinese copper bar gained 0.6% to finish at CNY 43,780 ($6,995) per metric ton. After a 0.6% increase, the Chinese copper cash price finished the day at CNY 43,980 ($7,027) per metric ton. Chinese copper wire prices inched up 0.6% to CNY 42,910 ($6,856) per metric ton. The price of Chinese bright copper scrap was unchanged at CNY 33,400 ($5,337) per metric ton.

The copper 3-month price changed direction with a 1.2% drop. After two days of improving prices, the metal finished at $5,840 per metric ton on the LME. The primary copper cash price closed at $5,880 per metric ton. Following a couple days of improvement, prices fell by 0.9% on the LME.

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