ROUND-UP – The top FastMarkets stories from the week ending Oct 14

A round-up of the top FastMarkets stories from Oct 16. 

Friday, October 14

Aurubis has cut its contractual premium for copper cathode for 2017 to $86 per tonne from $92 this year, marking the lowest offer available to European customers since the Hamburg-based producer started setting annual premiums in 2013.

Louis Dreyfus Commodities is open to third-party investment in its already ring-fenced metals business sometime in the second half of next year, with a view of consolidating its trading position and seizing potential growth opportunities, Metal Bulletin understands.

Chilean environmental regulator SMA has filed charges against Antofagasta’s Los Pelambres copper mine for alleged irregularities.

Base metals ended LME trading mixed on Friday, October 14, with copper dropping to its lowest in a month.

Spot copper concentrate sales slowed in the first half of October after a period of smelter restocking at the end of the third quarter, leaving traders free to focus on long-term deals.

Aluminium extrusion billet premiums have softened in the US and in Germany over the past month – two of the world’s strongest premium markets face increased supply while sellers look to shift tonnages from weaker areas of demand.

Copper has fallen out of favour, with LME trading volumes low and prices rangebound, which are sending investors scurrying for the exit doors.

The LME has appointed Jason Tudor – previously Asia-Pacific head of commodities and global head of metals, indices & exotics at Citi Bank – as a consultant. 

Simon Maddocks and James Newman are leaving CWT Commodities after the warehousing operator decided to close its London office. 

Deliverable copper stocks in Shanghai Futures Exchange-approved warehouses have risen 14,381 tonnes or 13.4% over the past fortnight to 121,439 tonnes as of Friday, October 14.

Thursday, October 13 

ISTIM Metals will soon add Port Klang in Malaysia to the list of its LME-approved warehouse locations while it continues to expand its global footprint.

Kennecott Utah Copper LLC, a subsidiary of Rio Tinto Group, will sell mining equipment related to a partially built molybdenum facility near Salt Lake City, Utah, auction house Hilco Industries said.

Nyrstar has restarted operations at its Port Pirie lead smelter in Australia, the company confirmed to Metal Bulletin on Thursday, October 13.

Aluminium produced at Rio Tinto Plc’s smelter in Kitimat, British Columbia, is making its way into the U.S. Midwest, sources within the company confirmed to AMM, possibly reflecting fundamental tightness in North America and price weakness in Japan.

Chile’s annual copper mine production is set to fall 3.9% in 2016 from last year, mostly affected by lower volumes from BHP Billiton’s Escondida mine, the country’s copper commission, Cochilco said. 

Ambrian plc is closing its metals trading business because of a continuously challenging trading environment.

China National Gold Group (CNCG) has commissioned a 20,000-tonne-per-year copper smelter in the Republic of the Congo,. 

BHP Billiton is working to ramp up operations at its Olympic Dam copper-gold mine in South Australia after full power was restored to its site late evening local time on Wednesday, October 12.

Sherritt International Corp has restarted operations at its Moa nickel-cobalt joint venture in Cuba, suffering only “minimal” damage as a result of Hurricane Matthew.

Wednesday, October 12 

A worker was killed at Capstone Mining Corp’s Cozamin copper-silver mine on Monday, October 10, it said.

Rio Tinto Kennecott, in partnership with the Critical Materials Institute (CMI) -  a US Department of Energy Innovation Hub led by Ames Laboratory – has initiated new research to optimise the efficient extraction of critical minerals and metals from the company’s operations in Utah.

Alcoa Inc reported a profitable third quarter for its downstream business, but lower demand for airframes related to model transitions by original equipment manufacturers (OEMs) continues to weigh on the company’s bottom line.

Alcoa Inc has nearly halved the scale of its previously projected aluminium deficit for 2016, maintaining its assertion that the market will be in arrears by year-end but factoring in restarts of curtailed Chinese capacity.

US copper consumers are in no hurry to sign annual deals but negotiations should pick up steam in November, market participants said.   

Natixis is expanding into base metals again under the helm of Peter Barnes – formerly of Deutsche Bank - after reducing activity in the sector over the past four years.

The waiting time for aluminium to be delivered out of LME-registered warehouses has dropped overall while new queues have emerged in South Korea and Taiwan, according to the exchange’s latest queue report.

Hong Kong Exchange & Clearing (HKEX) has appointed Guo Xiaoli as CEO of its commodity-trading platform, which will offer spot trading with physical delivery. 

Tuesday, October 11 

Base metals premiums were mixed this week – although exchange prices for base metals are higher than where they started the year, physical markets are taking divergent paths, largely based on supply-side reactions to those low end-2015 levels.

Alcoa sees a global aluminium shortfall of 615,000 tonnes in 2016 and a global alumina market in a deficit of 1.6 million tonnes, it said while reporting forecast-missing revenue and earnings-per-share for the third quarter.

China’s Xinxing Ductile Iron Pipes Co has initiated nickel pig iron (NPI) production on Obi Island in Indonesia’s North Maluku province.

Brazil’s unwrought aluminium exports fell in September to its lowest level in over a year, reflecting a sharp decline in shipments to Switzerland.

The surge in available LME lead over the past week is an indication of tough physical market conditions for the metal, which should maintain the pressure on premiums if prices remain high. 

The aluminium price on the Shanghai Futures Exchange is expected to move higher in the near-term as transportation disruptions in China continue to delay stock arrivals and keep domestic spot supply tight in the eastern and southern regions post-Chinese national day holidays.

Monday, October 10 

Noranda Aluminum Holding Corp agreed to sell its remaining upstream ventures – which include its Gramercy, La. refinery and St. Ann, Jamaica bauxite mine – and has also reached a global settlement with all of its creditors. 

Average daily volume (ADV) across the suite of London Metal Exchange (LME) contracts fell 11.4 percent year-on-year in September to 571,295 lots. 

Indian miner Vedanta Resources produced 296,000 tonnes of aluminium in the September quarter, up 27% year-on-year and 21% quarter-on-quarter.

Castleton Commodities International (CCI) has been building a stockpile of aluminium around an oil facility in Braithwaite on the outskirts of New Orleans and more tonnage is on its way. 

 

 

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.