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Metal Bulletin’s Charlotte Radford reviews some of the key news and price moves from the past seven days.
The annual Cobalt Development Institute Conference took place in Toronto this week, and CRU analysts told delegates that a new cycle of undersupply in cobalt “is about to begin”, thanks to steady growth in the battery sector. Chinese cobalt refiners are sharply increasing production for cobalt-containing tertiary material this year in response to this robust demand.
Latest information from the World Bureau of Metal Statistics revealed that aluminium was the only base metal to record a deficit at the end of the first quarter. The wider contango on the LME has led to more stable aluminium premiums in Europe, adding weight to suggestions that big consumers had been waiting for the falls to run their course, and creating greater optimism. Speaking at LME Week Asia, Mercuria md James Wu suggested that aluminium premiums are now at their lowest point.
Kevin Moore, former senior manager and chairman of General Motors’ global strategic hedging team, offered a consumer’s perspective on the LME aluminium contract. A research note from Goldman Sachs has suggested that China is likely to increase its share of the global aluminium market on lower prices and rising production volumes.
Andrea Hotter examined zinc prices in light of slow Chinese demand, falling premiums, and an increasingly net long market. Find the full article here.
Meanwhile, it was another harsh week for ferro-alloys suppliers, as Janie Davies reported in Tapped In, Metal Bulletin’s new ores and alloys blog.
Monaco-based trading house Levmet is joining other companies in recognising greater opportunities for proprietary trading in the commodities market. The company’s founder and president, Ashley Levett, also spoke to Metal Bulletin about its recent shareholding changes and growth in the base metals markets.
On the LME, aluminium prices hit a one-month low on Thursday, and nickel prices took a hit to fall 4.8% on Tuesday as warehouse inventories reached new record levels. The alloying metal’s price had fallen to 12,760 per tonne in Friday’s official settlements.
Track the day’s losses and gains with our rolling price report.
LME Week Asia was under way in Hong Kong from Monday, and HKEx ceo Charels Li took the opportunity to speak about the exchange’s plans to forge greater links between China and the international commodities market.
Meanwhile, GF Financial’s Edward Shi spoke to Shivani Singh about “tremendous opportunities” in China, in light of the news that Beijing would allow greater trading freedom to state-owned enterprises.
Find our round-up of LME Week Asia’s hot topics here.
In company news, Noble Group has signed syndicated committed unsecured revolving loan facilities worth $2.3 billion. Full details are here.
Triland Metals is looking to Singapore to expand its operations, and will consider membership on other exchanges, the company’s chief operating officer, Martin Pratt, told Metal Bulletin.
Zinc producer Nyrstar has agreed a two-year option to sell the Coricancha mining complex in Peru to Canadian precious metals firm Great Panther Silver.
Peru’s largest mining labour federation began an indefinite national strike at the beginning of the week, claiming proposed government laws would undermine workers’ rights and affect job security. As yet, the action has not had a great impact on the activity of the country’s leading metals producers, Danielle Assalve reported.
Evraz Highveld may remain in business rescue for more than 18 months, according to the minutes of the first meeting between the company’s employees and business rescue practitioners. On Thursday, the miner requested an extension to the deadline to provide a full business rescue plan, originally scheduled for publication on Friday May 22. The plan is now expected to be released by the end of August.
Practitioners have stated that the firm has a “reasonable prospect” of turning around, but continued uncertainty has had an impact on ferro-vanadium production and prices. In Europe, a two-tier market has emerged, where one side has lost faith in the ability of prices to stay strong, while the other believes further increases are likely.
In this week’s people moves, Eric Taarland joined ENRC Marketing (Africa) as sales manager; Goldman Sachs appointed Yubin Fu as commodity analyst covering metals; Michael Schifman joined the base metals division of Cargill’s Risk Management business, and Jeremy Weir will replace Simon Collins as head of refined metals and concentrates trading at Geneva-based trading house Trafigura.
Charlotte Radford charlotte.radford@metalbuleltin.com