LIVE FUTURES REPORT 01/06: LME nickel hits 1-mth high; rest of complex consolidates

Base metals on the London Metal Exchange were mostly lower during morning trading on Friday June 1, with sideways trading predominantly in effect across the complex.

Nickel prices on the London Metal Exchange climbed 3% during morning trading on Friday June 1, reaching levels not seen since the metal’s mid-April sanction-related spike. Meanwhile, sideways trading takes effect across the rest of the complex.

Despite performing well over the week, nickel’s three-month price is trading marginally lower during the morning session, but continues to outperform the rest of the complex, reaching a high of $15,690 per tonne – its highest since April 19 – and recording a weekly rise of more than 6%.

“Base metals prices are reacting fairly calmly to the escalation of the trade dispute [with the United States]. No doubt China’s official Purchasing Managers’ Index for industry is playing some part in this, as it climbed unexpectedly to an eight-month high of 51.9 in May, which signals continued expansion,” Commerzbank Research noted. 

“Nickel above all is performing well, trading just under its mid-April three-year high. Falling LME stocks are driving up prices,” it added. 

Nickel volumes traded on the exchange are currently leading the complex at 5,800 lots as of 10:50 am London time.

Copper’s three-month price continues to consolidate around $6,850 per tonne, trading in a narrow high-low range of $39 per tonne while its cash/three-month spread remains in a contango of $7.25 per tonne. 

The red metal’s stagnancy comes amid wider trade tension concerns after US president Trump’s tariff impositions of 25% on steel and 10% on aluminium take effect from today, ending temporary exemptions for Canada, Mexico and the European Union. 

Elsewhere, zinc’s three-month price edged below the $3,100 per tonne support level, dropping gains made earlier in the week that saw the metal climb to a weekly high of $3,164 per tonne. 

Lead remains firmly above $2,400 per tonne as ongoing drawdowns in LME stock continue to prop prices after the metal surged 3.3% on May 21. 

Tin prices are showing similar resilience, hovering close to the $20,600 per tonne region and gaining 3.7% on the week. 

The metal’s cash/three-month spread has narrowed from a backwardation of $120b per tonne earlier this month, to its current reading of $30.63b per tonne.
 
Remaining predominantly static, aluminium’s three-month price continues to consolidate just below $2,300 per tonne, showing little reaction to the US’ decision to impose 10% tariffs on the light metal. 

Base metals sluggish; copper, tin up 

  • The three-month copper price recently traded at $6,859 per tonne, recording an increase of $6. Copper stocks climbed a net 28,150 tonnes to 311,525 tonnes. Some 7,675 tonnes of material were freshly canceled across Asia and Europe. 
  • The three-month aluminium price edged $10.50 lower to $2,281.50 per tonne. Stocks climbed 500 tonnes to 1,206,375 tonnes. Approximately 2,275 tonnes of material were freshly canceled in Port Klang and Busan, with 975 tonnes rewarranted in Gwangyang. 
  • The three-month nickel price decreased $20 to $15,200 per tonne. Stocks fell 2,958 tonnes to 287,646 total tonnes. Some 816 tonnes of material was rewarranted in Kaohsiung, with 144 tonnes freshly canceled in Johor. 
  • Zinc’s three-month price edged $14 lower to $3,086 per tonne. Stocks were down 100 tonnes to 245,650 tonnes with 550 tonnes freshly canceled in New Orleans.
  • The three-month price for lead recently traded at $2,443 per tonne, down $15. Lead stocks were down 75 tonnes to 133,475 tonnes. 
  • Tin’s three-month price increased $15 to $20,615 per tonne. Stocks were down 5 tonnes to 2,420 tonnes.

Currency moves and data releases 

  • The dollar index was up 0.15% at 94.05.
  • In other commodities, the Brent crude oil spot price was up 0.29% at $77.79 per barrel.
  • In US data on Thursday, personal income in the US increased $49.5 billion – or 0.3% – in April, in line with forecasts.
  • The economic agenda is fairly busy today with a host of manufacturing PMI data out across Japan, Europe and the US. Other US data of note includes average hourly earnings, non-farm employment change and the unemployment rate.