Tag: energy output

Commodity Review 20190315 by Andrew Pedler – Now Available

Commodity Review 20190315 by Andrew Pedler – Now Available

China

Comments of particular interest are noted with ‘*’. 

SUMMARY  

*Copper  Pakistan’s military to take a key role in development of Reko Diq.

*Cobalt  Sector investors may not appreciate how quickly EVs are being adopted.

*Nickel  Nickel Sulphate:  demand growth to be driven by the auto and chemicals industries.

*Zinc & Lead  Namibian Zn refinery suspends operations.  Global Pb markets to be in ‘sizable’ deficit for 2019.

Tin  Reduced Chinese consumption in 2018 was offset by consumption in the rest of the world.

Aluminium  Venezuela:  no power, no aluminium.

Gold  USD gold price fell against others, so at least USD gold price increased.

Platinum & Palladium  Pd price at record levels.  Russia considered export bans for Pd.

*Oil  Price gains limited by concerns of rising USA production.  OPEC meeting this (16-17th) weekend.

Coal  Australian HCC exports continue to be stable.  Outlook on China ports still uncertain.

Iron Ore  India’s iron ore imports up significantly in 9mo to Dec18.  Exports also decreased markedly.

Shipping  Capesize rates recovered.

General 

*Japan LNG prices :  prices may be about to bottom, though perhaps not just yet.

*USA & Australia – bond yields:  curves approaching inversion.

*China Industrial and Energy Output:  Strong growth in electricity, gas, batteries, glass.

Commodity Review 20180817 by Andrew Pedler – Now Available

Commodity Review 20180817 by Andrew Pedler – Now Available

It has been a volatile week, driven primarily by reactions to USA sanctions and pending sanctions, fears of Chinese and global slower growth.  Fundamentals are being pretty much ignored.  Fear is driving prices, but inventories continue to decline. 

This week Matau focusses on the USD TWI and correlations with gold and other commodities, then at the AUD, CNY and USD indices reflected by several other key and emerging currencies, and at gold price indexed in the same key and emerging currencies.

This week’s comments of particular interest are noted with ‘*’.

SUMMARY  

*Copper  Copper supply faces shortages in the medium to long term.

*Cobalt  Cobalt faces a supply squeeze, or disruption, if demand is as forecast.

*Nickel  Exchange inventory is suited to batteries, and is falling.

*Zinc & Lead  Spot TCs are low, Chinese smelter margins are tight.  Steel (galv) demand remains strong.

Tin  Tin demand is expected to increase markedly with forecast of EVs.

*Aluminium  Chinese demand growth for Al forecast to peak in 2023.

Gold  A volatile week, with gold’s response to bad news a lot softer than years past.

Platinum & Palladium  Unions threaten to bring South Africa’s Pt industry down.

*Oil  Swings in oil prices forecast on Trump’s sanctions and forecast changes in shipping rules.

Coal  SSCC & high CV thermal prices to close to consider selling SSCV on spot markets.

Iron Ore  Japan’s largest steel maker playing down tariffs and plans to boost steel output.

Shipping  Panamaxes preferred over Capes this week with better flexibility and comparable prices.

General 

*USA TWI correlations.  Strongest with gold.  Not so much other commodities.

*Foreign Exchange relations – AUD, USD CNY & gold:  A perspective on currency movements.

PinchPoint updates: inventories continue to fall.  Prices fell on sentiment, not fundamentals.

*China – Industrial and Energy Output:  growth negative except positive for select items, and for energy.

USA – Industrial Production and Capacity Utilisation:  steady positive growth.

Commodity Review 20180817 by Andrew Pedler – Now Available

Commodity Review 20180706 by Andrew Pedler – Now Available

China

The escalating trade conflict between USA and China has unnerved base metal markets this week on the uncertainty of outcomes.  We note potential and outcomes in this issue according to the perceived strategic motives and goals of the major participants.

However most economic parameters we can see to date (see this and recent Commodity Reviews) remain sound, and we expect fundamentals will ultimately win out over sentiment.  20180706

*Copper  Still 12x labour contracts to be negotiated in 2018, many in Chile.

*Cobalt  India is actively seeking to source battery minerals Li, Co et al. COB & CLQ comments.

Nickel  CLQ comment. **Escalating trade conflict between USA & China. What are the likely outcomes.

Zinc & Lead  China’s Zn & Pb goals complicated due to co-production of Zn & Pb. MYL, NCZ comment.

Tin Interest in Cornish tin revived, in part due to associated Li brines.

Aluminium  China has issues with shutdown declarations and practise.

Gold  EXU outlining shallow mineralisation near Tampia.

Platinum & Palladium  US-European trade issues are impacting auto imports into USA.

*Oil  Russia has boosted crude production rates.

*Coal  JFY2018-19 thermal contract settlement is unsettled (Glencore/Tohoku) though others may deal.

Iron Ore  Capesize demand is up on iron ore, while Panamax is reduced..

Shipping  Capesize demand up for iron ore, though Panamax down this week.

General

Pinch Point updates:  Ni is tightening. Pb, Al & Zn, then Cu, are fundamentally tighter

*USA – PMI:  US economic outlook is strong.

*China- Industrial & Energy Output:  +ve growth in electricity and other select segments.

*USA – Construction Spending:  positive growth Residential, Non-Res, Public, Private

*Japan – Orders to Machinery:  robust growth.