DAILY ROUND-UP – FastMarkets on LME Week Asia and a nickel shortage in Europe

A round-up of the top FastMarkets stories from June 13.

A significant recovery in metal prices is still around 12 months away while instability and the lack of supply response continue to weigh on prices, Sucden Financial non-executive director Jeremy Goldwyn said.

Chinese market participants are trading everything but metals because interest in the sector has slumped, Sucden Financial non-executive director Jeremy Goldwyn said.

FastMarkets reporters are at LME Asia. Here are some of the key quotes from the beginning of the week.  

Base metals ended Monday trading on the LME mixed - sentiment remains cautious while wider global market uncertainties are weighing, traders said.

The CME Group’s aluminium premium contracts returned to a backwardation last week after months of stability as participants placed bearish bets following a pessimistic conference in Chicago.

Several base metals brokers are considering launching an alternative trading platform to LME. One of the bigger obstacles will be to convince market participants outside of the London bubble that another exchange is needed.

The arbitrage window between London Metal Exchange copper prices and those on the Shanghai Futures Exchange has opened marginally for the first time since before Lunar New Year in February, according to FastMarkets and brokerage data.

The LME has approved Jump Trading Futures LLC as category 3 member.

The recent surge in copper stocks in LME-bonded warehouses across East Asia stems from a combination of three factors, Barclays said.

lack of nickel in Europe has pushed briquette premiums to their highest since November 2014, creating opportunities for traders in the Far East.

Total global copper stocks at the end of 2015 were an estimated 4.8 million tonnes or 22 percent of global demand, with 4 million tonnes of that total visible, JP Morgan said.

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.