DAILY ROUND-UP – FastMarkets on LME fees and MMG production totals

A daily round-up of the top FastMarkets stories from July 28. 

Base metals checked back from their highs and drew breath during late-Thursday LME trading but remained higher on the day, with technical covering seen.

Weaker seasonal third-quarter base metals demand plus softer Chinese data could push prices lower after the recent rebound, JP Morgan said in a report.

The noble alloys markets - molybdenum and vanadium – continued to consolidate this week, having stepped back after substantial price advances in the first half of 2016.

The decline in short-dated carry trades on the LME has clearly been felt in the aluminium ‘Tom’/next (tomorrow/next day) market where average daily volume (ADV) has declined to the lowest since at least 2007.

Production stoppages triggered by environmental checks by Chinese authorities are lifting tin, lead, and nickel prices on the Shanghai Futures Exchange, market participants said.

MMG’s copper metal in concentrate production surged 14-fold year-on-year to 90,329 tonnes in the second quarter following the start-up of its Las Bambas mine in Apurimac in Peru.

Russia’s UC Rusal’s aluminium production in the second quarter of the year was flat at 919,000 tonnes compared with the previous quarter, it said.

Equities broker Liberium has downgraded miner-trader Glencore to a ‘Sell’ rating, expecting lower copper and thermal coal prices later this year

Anglo American has lowered its copper production guidance for 2016 to 570,000-600,000 tonnes from 600,000-630,000 tonnes.

Market participants see a turning point for zinc in the fourth quarter as a long-awaited arbitrage opportunity between the London Metal Exchange (LME) and the Shanghai Futures Exchange (SHFE) could arise then prompting imports into the Chinese market.

China’s production of non-ferrous metals is likely to post slight growth this year but there remains outstanding problems in the industry in the second half, China’s Nonferrous Metals Industry Association (CNIA) said in a report this week.

Will Adams

About Will Adams

William Adams has been involved in the metals markets since 1982 – he has experience in many areas of the market from researching to trading and has worked in London, New York and Tokyo.