Copper – Gold – USA – Japan

Comments of particular interest are noted with ‘*’.  

Matau’s Comments:

  • Japan’s steel industry reports decent recovery growth from the pandemic period, though still has some way to go.  However its vehicles output is well down.
  • USA’s Durable goods orders report decent growth (perhaps enhanced by covid induced low past year data.  However vehicle output is well down (like Japan’s and as reported last week – China’s). 
    • Matau believes it likely that global vehicle  output is being restricted by the shortage of micro-chips, which is also reported to be impacting demand for Pt & Pd
  • Base metals’ pinchpoint graphs continue to highlight (very) tight markets.  The prices are now responding strongly to low stocks.  
    • Copper markets report as being under continued supply pressure.
    • Ni & Co have been shown to enhance catalysts for production of hydrogen, which may add to demand for these two key New Energy metals.
    • High prices have still NOT drawn additional stocks onto exchanges for: Cu, Zn, Pb, Ni nor Sn.  
    • In fact for most of these stock levels are continuing to decline despite high prices. 
    • Implies very tight markets.
  • New Energy Vehicles’ much touted massive growth rates might grind to a halt in a couple of years if some battery configuration changes do not become available.  Matau believes that the resources industry will struggle to supply raw materials at the optimistic growth rates of the manufacturers and entrepreneurs.  Actual rates will have to reduce to the actual rates of raw materials supply growth.

SUMMARY  

*Copper  Chile’s Cu output recorded its worst month this year, with falling grades and labour disputes. 

*Cobalt  Catalysts with Co & Ni make ‘green’ hydrogen production cheaper and more efficient.  

*Nickel  Ramu Ni (PNG) Ni-Co output suspended due to pandemic (for an est 2-3 wks). 

Zinc & Lead  Teck’s Red Dog mine output increased yr-to-date. 

*Tin  The tin market has yet to solve the supply-demand imbalance. 

Aluminium  USA and the European Union (EU) have agreed to ease tariffs on steel and aluminium products. 

Gold  Au price fell on rising USA bond yields & stronger USD. 

Platinum & Palladium  Analysts’ price forecasts reduced for Pt & Pd.

*Oil  Nov 4th OPEC+ meeting expected to extend production cuts. 

*Iron Ore  The iron ore seaborne market supply might lose 40 million tonnes (Mt) in 2022. 

*Shipping  Coal exports have staged a significant recovery so far in 2021, helping the dry bulk market’s rally.

General 

Top 10 Copper miners: Production in Chile was impacted by the pandemic in 2020-21.

World Gold Council:  Sep21Qtr demand down largely due to ETF sales.

*Japan – Industrial Production:  Steel products up but vehicles down (chip shortages?)

*USA – Durable Goods Orders et al:  Durables up but vehicles down (chip shortages ?).