ROUND-UP – FastMarkets most read stories for the week ending January 8

A round-up of FastMarkets’ top stories published during the week ending January 8.

JANUARY 8

LME base metals ended a volatile first week of the New Year mixed on the LME after the downturn in global equities ended but worries over China’s economic health remain.

Copper faces major challenges this year but the fundamental situation might not be entirely dire because China has amped up its sector specific stimulus while another round of price-related mining cuts is likely, Bank of America Merrill Lynch (BoA ML) said.

Anglo American’s copper mines are a prime target for a take-over as mining majors look to acquire major assets, SP Angel said in a note on Friday.

Spot copper treatment and refining charges (TC/RCs) have continued to decline this year, reaching four-month lows below $100 - the market has corrected following the usual seasonal fourth-quarter spike.

Copper miner Freeport-McMoRan will meet Chinese smelter Jiangxi Copper next week but the momentum behind its campaign for lower copper treatment and refining charges (TC/RCs) than already agreed for 2016 supply is ebbing amid growing support for numbers signed last month by Antofagasta from other miners including Codelco.

The weakening of the yuan since the start of 2016 may ease the pressure that prompted some Chinese producers to announce output cuts, JP Morgan said.

AIM-listed London-based copper producer Central Asia Metals (CAML) saw a record copper production of 12,071 tonnes in 2015, up 8.4 percent from the previous year, with output expected to rise further to 13,000-14,000 tonnes this year.

Liu Jianping has been appointed as the chairman of the board and non-executive director of Chinalco Mining Corp International (CMCI) effective January 6, after the resignation of previous chairman Zhang Chengzhong.

JANUARY 7 

LME base metals ended a volatile Thursday session mixed on the LME – global financial markets reacted with relief after Chinese authorities suspended the circuit breaker rule on the Shanghai stock exchange ahead of the Friday open.

The copper market was a victim of the mass sell-off in the Chinese stock market on Thursday, as a wave of selling pressure took the red metal to $4,430 per tonne.

A New York judge has dismissed claims that the trading and metals warehouse affiliates of Glencore, Goldman Sachs and JPMorgan Chase engaged in a conspiracy to monopolize the trade of London Metal Exchange zinc in order to manipulate prices and fundamentals.

Copper bonded stocks in Shanghai have increased for the fourth consecutive month to above 400,000.

Nyrstar NV has launched the formal sales process for all or a majority of its mining assets, the company announced on Thursday.

Three-month cobalt and molybdenum both traded on the LME today, with the business on Select the first trades registered on the platform since autumn 2015 amid the rout in global equities and significant losses in other base metals.

European nickel consumers have concluded contracts for 2016 full-plate cathode supply at lower premiums and for reduced volumes.

Credit ratings agency Standard & Poor’s (S&P) has downgraded its rating for bonds issued by commodities house and base metal trader Noble Group to junk today, although Fitch reaffirmed its stable rating.

JANUARY 6 

LME base metals swung away from their early-afternoon lows during late-Wednesday LME trading to close mixed although the moves were end-of-day covering – sentiment remains dour. Comex copper, meanwhile, dipped 0.75 cents to close at $2.0880 per pound.

US Midwest aluminium premium has taken an unexpected step backwards because a mild early winter has freed up excess scrap.

The United States copper cathode spot market has started 2016 slowly as producers are easily able to supply a market that is dealing with subdued industrial demand.

The steep decline in zinc concentrate treatment charges (TCs) early in December appears to have stalled this year, with the market largely returning to relative normality following a rush of spot activity last month.

The mooted purchase of 150,000 tonnes of copper by China’s State Reserve Bureau (SRB) will have only a limited impact on the price, several industry sources said.

Jeremy Isaacs has stepped down from his position as non-executive chairman of Marex Spectron and will be succeeded by Simon Heale.

Malaysia has imposed a three-month ban on bauxite mining in Peninsular Malaysia’s largest state of Pahang effective January 15.

The LME has updated the indicative penalties for members found guilty of misconduct.

Global mining shares came under pressure in London on Wednesday amid ever-gloomier sentiment and growing concerns about a slowdown in demand, particularly from China.

Canada’s Imperial Metals Corp has suspended copper pit operations at its Huckleberry mine in British Columbia, the company said in a release on Wednesday.

JANUARY 5 

LME base metals were unable to sustain early upside probes during late-Tuesday LME trading, with contracts drifting back to mixed finishes amid a lack of enthusiasm. Comex copper, meanwhile, ended up 1.6 cents to close at $2.0955 per pound.

Premiums for physical metal started 2016 much as they ended 2015, with few notable movements this week. Click here for the full price table. 

Mercuria Energy Resources has completed a transaction to sell 51 percent of warehouse company Henry Bath & Son Ltd to CMST Development (CMSTD), a Chinese logistics provider better known as Zhongchu.

Warehouse operators may take legal action against the London Metal Exchange (LME) should it press ahead with a charge capping (CC) proposal.

CME Group average daily volumes were a record 13.9 million contracts per day, an increase of two percent on the previous year.

China’s State Reserve Bureau (SRB) is looking to buy 150,000 tonnes of copper through a tender that is expected to take place this week.

JANUARY 4 

LME base metals ended the first of day of the year in negative territory – a rout in Chinese equities spread to the rest of the world, which weighed on the complex.

Comex copper prices tumbled to a two-week low as Chinese equities began the new year on a somber note following weak manufacturing data.

The forward curve for CME Group’s Aluminum MW US Transaction Premium (AUP) contract has moved deeper into backwardation in March and April, which suggests that the end of the first quarter could be a trouble spot.

Mueller Industries has agreed to build a copper tube mill in Bahrain in a joint venture with Cayan Ventures and Bahrain Mumtalakat Holding Co.

Market participants expect only a limited impact on China’s aluminium production should a mining ban limit bauxite exports from Malaysia to China.

Jean Marchand, global sales and marketing director for aluminium remelt ingots at Rio Tinto, has left the company after nearly 35 years to start his retirement.

China’s electrolytic aluminium production rose 10.4 percent year-on-year to 29.1 million tonnes in January-November.

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.