Nine big questions for LME week Asia 2014

Copper. The arbitrage window into China opened the week before the conference began, and bonded stocks are decreasing. After the sharp decline seen following Black Friday, March 7, when LME copper prices lost around 5% of their value, premiums in Shanghai assessed by Metal Bulletin firmed up last week. Has the bear story in China been overdone?

Copper. The arbitrage window into China opened the week before the conference began, and bonded stocks are decreasing. After the sharp decline seen following Black Friday, March 7, when LME copper prices lost around 5% of their value, premiums in Shanghai assessed by Metal Bulletin firmed up last week. Has the bear story in China been overdone?

What about copper TC/RCs, which moved up again this week on?

What caused and drove on the crash in copper prices last month? Technical selling by algorithmic traders? Covering of out-of-the-money options? Selling that started in iron ore and steel markets? Big bets by bearish funds in China? All of the above?

The market is falling over itself to revise its forecasts for nickel prices upwards: refined nickel prices have risen by about a quarter since the start of the year on the nickel ore export ban in Indonesia and shadowy fears about a curtailment of Russian nickel supply in the west. So how long will those nickel ore stockpiles in China last? As they run down, how likely is it that Chinese companies will actually move NPI production to Indonesia? And how will such factors affect the flight of nickel prices over the rest of the year?

It’s the LME’s week in Asia, in the Hong Kong Exchange’s backyard. But the LME’s largest contract in terms of volume — aluminium — faces competition from the USA-based CME’s new aluminium contracts, which it launches on May 6. How will the North American aluminium market respond to the lawsuits that are going on in its backyard, along with the defeat the LME suffered in the UK courts — an outcome that LME ceo Garry Jones described as being detrimental to the market?

Problems with the aluminium contract aside, trading in and with China is central to HKEx ceo Charles Li’s plans for the LME, as well as the Hong Kong Exchange. The Securities & Futures Commission recently welcomed a pilot programme to enable Hong Kong and mainland investors to trade each other’s markets. How long will it be till a similar deal enables commodity traders in the mainland and Hong Kong to have easier access to the other market?

If you can make the connections, do you have the products that people want to trade? Launching new commodity contracts is partly science and partly art. So what new products will HKEx and LME announce next week? Mini metal futures traded in RMB on HKEx? Iron ore or coking coal even?

Perhaps April 2014 will see the announcement of a new membership category?

Emir moves closer to being implemented. Will it prompt new business plans for brokers — or a complete shake-out? And what will that mean for users of the market?

What is the future for aluminium usage in the auto sector compared with steel?

Alex Harrison 
aharrison@metalbulletin.com
Twitter: @alexharrison_mb

What to read next
The publication of Fastmarkets’ nickel sulfate, in-whs Rotterdam assessment for Friday March 7 was delayed because of a reporter error. Fastmarkets’ pricing database has been updated.
The publication of the affected prices was delayed for 31 minutes.  The following assessments were published late: MB-AL-0300 Aluminium 6063 extrusion billet premium, ddp Italy (Brescia region), $ per tonne MB-AL-0302 Aluminium 6063 extrusion billet premium, ddp North Germany (Ruhr region), $ per tonne These prices are a part of the Fastmarkets aluminium billet North Europe package. […]
The US-Ukraine mineral partnership deal has stalled due to security concerns, leaving future negotiations uncertain despite Ukraine's critical role in global mineral supplies. Meanwhile, President Trump has imposed tariffs on Canada, Mexico, and China and launched a copper import investigation to address national security risks and reduce reliance on foreign resources.
Trump’s tariffs on Canadian and Mexican metals have introduced significant instability to the U.S. metals sector. The 25% tariffs, coupled with retaliatory measures from Canada and Mexico, have fuelled price volatility, supply chain disruptions, and operational uncertainty across multiple industries. These trade policies are reshaping global market dynamics as stakeholders brace for long-term impacts on steel, aluminium, copper, and other metal commodities.
The following prices were affected:MB-CU-0361 Copper import arbitrage, $ per tonneMB-CU-0362 Copper import arbitrage, yuan per tonneMB-NI-0106 Nickel import arbitrage, $ per tonneMB-NI-0107 Nickel import arbitrage, yuan per tonneMB-ZN-0083 Zinc import arbitrage, $ per tonneMB-ZN-0084 Zinc import arbitrage, yuan per tonneMB-AL-0289 Aluminium import arbitrage, $ per tonneMB-AL-0290 Aluminium import arbitrage, yuan per tonne These prices are part of the Fastmarkets base metals package. […]
Presenters shared insights into zinc market dynamics at the International Zinc Association’s (IZA) International Zinc and Zinc Oxide conference held February 23-26 in San Diego.