Latest News
-
Iron ore declines due to tepid China demand and higher shipments
The price of iron ore futures fell for the fourth session in a row on Wednesday. This was due to a combination of a lower demand for this steelmaking ingredient from China, the world's largest consumer, and increased shipments by Australia and Brazil, two major producers. By 0300 GMT, the most traded September iron ore contract at China's Dalian Commodity Exchange was trading 0.21% lower. It was 698 yuan (US$96.94) per metric ton. The benchmark June Iron Ore traded on the Singapore Exchange fell 0.18% to $95.9 per ton. Mark Ferguson, Director of Metals and Mining Research at S&P Global Commodity Insights, told a conference in Singapore on Wednesday that China's crude output is expected to drop to 968 millions metric tons in 2025, down 37million tons from 2024. Lange Steel, citing data from the China Iron and Steel Industry Association, said that daily crude steel production at key steel companies in May decreased by 0.3% on a month-to-month basis to 2.2 millions tons. Data from Mysteel revealed that the total volume of iron-ore shipped from Australia and Brazil increased by 0.9% week-on-week as of 25 May, reaching 27.3 million tonnes. Mysteel attributes the increase to increased ore shipments by Australia. They increased their shipments to China from 10.4% to 17.4 millions tons week-on-week. The Brazilian government also dampened sentiment by renewing 25% tariffs, which were originally imposed on 19 steel products last year. Official data released on Tuesday showed that China's industrial profit increased in April. This gives policymakers reason to be optimistic, as recent stimulus measures are helping keep the economy afloat, despite the trade tensions between the United States and China. Coking coal and coke, which are used to make steel, also fell by 0.99% and 0.75%, respectively. The Shanghai Futures Exchange saw a decline in most steel benchmarks. Rebar fell 1%, while hot-rolled steel coils lost 0.74%. Stainless steel also slipped 0.82%.
-
France's Macron and Indonesia's Prabowo discuss defense ties
The French president Emmanuel Macron and his Indonesian counterpart Prabowo Subito will meet in Jakarta on Tuesday, with a focus on strengthening defence ties between Paris and its largest arms client in Southeast Asia. Indonesia is the second stop on Macron's regional tour after Vietnam where both countries signed deals valued at over $10 billion. He will fly to Singapore Thursday. Sjafrie Sjamsoeddin welcomed Macron to Indonesia on Tuesday evening. He said that the two countries will sign a letter of intent on defence and work together on "strategic weapons hardware". He cited fighter jets, submarines, and other military hardware. The Foreign Ministry had said earlier that the two sides will discuss "existing partnerships" but did not give specifics about the topics of discussion. In 2022 the two countries will sign an $8.1 billion deal in defence that includes an order for 42 Rafale jet fighters manufactured by France's Dassault aviation, as well a number of agreements, including sub-development and ammunition. "Some commitments require follow-up and Indonesia showed interest in other military hardware but there have been no advances yet," said Khairul FAHMI, a military specialist at the Institute for Security and Strategic Studies, an Indonesian-based institute. Rafale jets are not yet delivered to Indonesia. In February, Mohamad Tonny Harjono, the chief of Indonesian Air Force Mohamad Tonny Harjono stated that six jets will arrive in Indonesia by early 2026. In addition to the Rafale agreement, Indonesia has also announced that it will buy 13 Thales long-range air-surveillance radars in 2023 and two "Scorpene' submarines in 2024 from France. Prabowo was Minister of Defence when these deals signed. Paulo Castellari, the new CEO of Eramet, is part of Macron's delegation to Indonesia's mineral-rich Indonesia. Eramet Chairwoman Christel Bories said that they would be looking to discuss mining permissions in relation to Weda Bay Nickel Mine. Indonesia has the largest known nickel reserves and is the world’s leading producer. Eramet, among other companies, has complained about the reduction of volume allowances. Eramet is still interested in nickel processing, despite having dropped a plan last year to build a BASF plant. (Reporting and writing by Ananda Teresia in Jakarta and Stanley Widanto, in Paris. Editing and proofreading by John Mair.
-
Gold prices rise as investors purchase gold on dips, and look to US economic data for clues
The gold price rose on Wednesday as investors bought at the bottom. However, gains were capped due to easing U.S. - EU trade tensions. Now, the market is awaiting the upcoming U.S. Personal Consumption Expenditures Report for clues on interest rates. As of 0237 GMT spot gold rose 0.3% to $3,308.99 per ounce. This was a slight recovery from the 1% drop in the previous session. U.S. Gold Futures increased 0.2% to $3.308.00. Donald Trump, the U.S. president, has backed off his threat to impose a 50% tariff on the European Union. He will now delay its implementation until the 9th of July, in order to allow time for negotiations between White House officials and the 27-nation group. Gold's drop below $3300 attracted some buyers. The broader market, however, is still generally optimistic now that US-EU tensions have eased. This is capping gold's upward run for the moment," said Tim Waterer. If support continues to hold in the $3.250-$3,280 range, gold could make another move towards $3.400, if risk appetite declines. Market participants are now awaiting the U.S. PCE for April data, which is due on Friday, in order to determine if Federal Reserve will be reducing interest rates. Data show that U.S. consumer sentiment rebounded in may, ending a five month slide. This was aided by a temporary truce between the U.S. and China trade war. Since December, the Fed's policy rate has remained unchanged at 4.25% to 4.50% as officials wait for more clarity about the economic and pricing impact of Trump’s tariffs. "More definitive moves in gold may need to be delayed until we have a better read on Nvidia's results and U.S. Waterer stated that Core PCE will be released on Friday. Spot silver remained at $33.31 per ounce. Platinum was up 0.4% to $1,084.07, and palladium was down 0.2% at $976.22.
-
Copper prices rise as risk appetite increases after tariff relief
The copper price in London was stable on Wednesday. This was due to an improved risk appetite in the financial markets after President Donald Trump’s latest tariff relief. However, a strong dollar held gains in check. The London Metal Exchange's three-month copper price remained at $9,593.5 a metric ton as of 0214 GMT. The Shanghai Futures Exchange's (SHFE) most-traded contract for copper edged up 0.1% to 78.390 yuan per ton ($10,886.29). Copper prices have traded in line with the overall sentiment on the global stock exchange in the past two weeks. The US stock market has been lifted by trade optimism, and this has had a ripple effect on copper prices, said Kelvin Woong, senior market analyst for Asia Pacific, OANDA. Trump reversed his decision to impose tariffs of 50% on EU imports next month. He restored the deadline of July 9 to allow time for negotiations. The risk-taking sentiment on the financial markets was boosted. Tuesday, data showed that U.S. consumers' confidence improved in May after five months of declines. This was due to a truce between Washington and Beijing in their trade war. The dollar index also added to the overnight gains. This made dollar-denominated investments more expensive for holders of other currencies. In its latest monthly bulletin, the International Copper Study Group reported that the global refined copper market had a surplus of 17,000 metric tonnes in March compared to a surplus of 180,000 metric tonnes in February. Other London metals include aluminium, which fell 0.3% at $2,478.50 per ton. Zinc also fell 0.1% to $2703, while lead declined 0.3% to 1,979.5, and nickel fell 0.3% at $15,370. Tin rose 0.1% to $22,630. The SHFE aluminium price rose by 0.5%, to 20,165 Chinese yuan per ton. Lead was down by 0.2%, at 16,765 Yuan. Nickel was 0.4% lower at 121,870 Yuan. Zinc was unchanged at 22,415 Yuan. Tin fell 0.3%, to 264440 Yuan. ($1 = 7.2008 Chinese Yuan) (Reporting and editing by Sherry Jacobi-Phillips in Bengaluru)
-
Asian shares and the U.S. Dollar climb on positive data, technology optimism
The dollar gained on Wednesday, as the United States economy showed promising signs and speculation about strong tech earnings. The markets welcomed the apparent easing of trade frictions between Europe and the U.S., while global bond market settled after an alarming surge in long term yields. The U.S. consumer sentiment surprised to the upside before Thursday's closely watched employment figures. Nvidia's shares jumped by more than 4% on Tuesday and it will be the final of the Magnificent Seven tech giants in the U.S. to announce earnings after the close of U.S. markets. Chris Weston is the head of Pepperstone's research and said that there was renewed confidence in Nvidia to beat consensus estimates. He said that if Nvidia delivers better than expected sales and profit margins, "the rally will be on." According to LSEG, the chipmaker will report that its first-quarter revenues grew by 66.2% and reached $43,28 billion. According to two sources with knowledge of the situation, European Union officials are asking companies about their U.S. investments plans. MSCI's broadest Asia-Pacific index outside Japan rose 0.3% during morning trading, while Japan's Nikkei gained 0.6% for a fourth consecutive session. The dollar index (which tracks the greenback versus a basket currencies) rose by 0.1% on Tuesday, adding to the 0.6% gain of that day. The dollar rose 0.1% against the euro to $1.132. Australian shares rose 0.17% but the currency fell 0.2% as April consumer prices data exceeded expectations. The kiwi currency fell 0.3% as the Reserve Bank of New Zealand reduced rates, as expected. Japanese bonds fell, trimming an increase yesterday, in advance of a bid for 40-year-old securities and amid speculation that the Ministry of Finance would reduce the issue of long-dated instruments. Early trading saw oil prices rise as the U.S. banned Chevron CVX.N's export of crude from Venezuela due to a new authorization for its assets in Venezuela, raising the possibility of a tighter supply. Brent crude futures increased 0.4% to $64.37 per barrel while U.S. spot gold rose 0.1% following a drop of more than 1% Tuesday.
-
France's Macron and Indonesia's Prabowo discuss strategic partnerships
On Wednesday, French President Emmanuel Macron and his Indonesian counterpart Prabowo Subito will meet in Jakarta to discuss defence ties. This is Paris' largest arms client in Southeast Asia. Indonesia is the second stop on Macron's regional tour after Vietnam where both countries signed deals valued at over $10 billion. He will fly to Singapore Thursday. The Indonesian foreign ministry stated that the two countries would discuss "existing partnerships" without providing specifics about the topics of discussion. In 2022 the two countries will sign an $8.1 billion deal in defence that includes an order for 42 Rafale jet fighters manufactured by France's Dassault aviation, as well a number of agreements, including sub-development and ammunition. "Some commitments require follow-up and Indonesia showed interest in other military hardware but there have been no advances yet," said Khairul FAHMI, a military specialist at the Institute for Security and Strategic Studies, an Indonesian-based institute. Rafale jets are not yet delivered to Indonesia. In February, Mohamad Tonny Harjono, the chief of Indonesian Air Force Mohamad Tonny Harjono stated that six jets will arrive in Indonesia by early 2026. In addition to the Rafale agreement, Indonesia has also announced that it will buy 13 Thales long-range air-surveillance radars in 2023 and two "Scorpene' submarines in 2024 from France. Prabowo was Minister of Defence when these deals signed. Paulo Castellari, the new CEO of Eramet, is part of Macron's delegation to Indonesia's mineral-rich Indonesia. Eramet Chairwoman Christel Bories said that they would be looking to discuss mining permissions in relation to Weda Bay Nickel Mine. Indonesia has the largest known nickel reserves and is the world’s leading producer. Eramet, among other companies, has complained about the reduction of volume allowances. Eramet is still interested in nickel processing, despite having dropped a plan last year to build a BASF plant. (Reporting and writing by Ananda Teresia in Jakarta and Stanley Widanto, in Paris. Editing and proofreading by John Mair.
-
Oil prices rise as U.S. bans Chevron's export of Venezuelan crude
The oil prices rose in the early hours of trading on Wednesday, as the U.S. banned Chevron's exports from Venezuela due to a new authorization for its assets there. This raised the prospect of a tighter supply. Brent crude futures gained 47 cents or 0.73% to $64.56 per barrel at 0028 GMT. U.S. West Texas Intermediate crude rose 49 cents or 0.8% to $61.38 per barrel. Sources reported that the Trump administration had issued a new approval for U.S. giant Chevron, which would allow it to retain assets in Venezuela without allowing them to export oil or expand their activities. Robert Rennie, Westpac's director of commodity and carbon strategies, wrote in a report that the loss of Chevron Venezuelan barrels will lead refiners to rely more on Middle Eastern crude. The previous license had been revoked by the U.S. president Donald Trump on 26 February. The licenses granted to Chevron, and other foreign oil companies in recent years have helped to support a small recovery of Venezuelan oil production that was hit by sanctions. This has risen to around 1 million barrels a day. The European Union has begun to ask top EU companies about their U.S. investments plans. This is a sign that Brussels will be advancing trade negotiations with Washington. Trump's move comes after he backed down from his threat over the weekend to impose tariffs of 50% on European goods, which would have hurt demand for oil and economic activity. The gains on Wednesday have largely recovered the losses of Tuesday when prices fell by around 1% following signs of limited progress in the fifth round of Iran and U.S. nuclear negotiations. The market anticipates that any resolution between Iran and the United States could increase Iranian oil supply on the market. The Organization of the Petroleum Exporting Countries (OPEC+) and its allies will meet in full on Wednesday. However, no major policy changes are anticipated. Sources say that eight members of OPEC+ could decide on a July output increase when they meet this Saturday. Rennie stated that the most likely scenario for July would be a 411,000 barrel increase per day. This would "add to the rising inventory as we approach the summer driving season here in the U.S."
-
France's Macron and Indonesia's Prabowo discuss strategic partnerships
On Wednesday, French President Emmanuel Macron and his Indonesian counterpart Prabowo Subito will meet in Jakarta to discuss defence ties. This is Paris' largest arms client in Southeast Asia. Indonesia is the second stop on Macron's regional tour after Vietnam where both countries signed deals valued at over $10 billion. He will fly to Singapore Thursday. Indonesia's Foreign Ministry said that the two countries would discuss "existing partnerships" without giving any specific details. In 2022 the two countries will sign an $8.1 billion deal for defence that includes an order of 42 Rafale jet fighters from France's Dassault. They also signed a number of agreements, including those relating to ammunition and submarine development. "Some commitments require follow-up and Indonesia showed interest in other military hardware but there have been no advances yet," said Khairul FAHMI, a military specialist at the Institute for Security and Strategic Studies, an Indonesian-based institute. Rafale jets are not yet delivered to Indonesia. According to Antara, the chief of Indonesian Air Force Mohamad Tonny Harjono stated in February that six aircraft would arrive in Indonesia by early 2026. In addition to the Rafale agreement, Indonesia also signed a 2024 agreement with the French shipyard Naval Group for the purchase of two "Scorpene", and announced in 2023 the purchase 13 long-range radars by France's Thales. Prabowo was Minister of Defence when these deals signed. Paulo Castellari, the new CEO of Eramet, is part of Macron's delegation to Indonesia's mineral-rich Indonesia. Eramet Chairwoman Christel Bories said that they would be looking to discuss mining permissions in relation to Weda Bay Nickel Mine. Indonesia has the largest known nickel reserves and is the world’s leading producer. Eramet, along with other companies, have complained about the reduction in volume allowances. The group has also been in discussions with Indonesia's newly established sovereign wealth fund Danantara about investments in the battery supply chain. Eramet is still interested to enter nickel processing, despite having dropped a plan last year to build a BASF plant. (Reporting and writing by Ananda Teresia in Jakarta and Stanley Widanto, in Paris. Editing and proofreading by John Mair.
Shanghai frenzy fuels alumina's record-breaking rally: Andy Home
Alumina costs have skyrocketed to record highs this week, compressing margins at the world's. aluminium smelters which convert the intermediate item into. metal.
The London Metal Exchange (LME) money cost, indexed. to Platts benchmark Australian alumina assessment, closed. Wednesday at $633.35 per metric ton, raising the ratio to the. aluminium price to practically 25%.
The alumina-aluminium ratio was just 15% at the start of. 2024, when alumina was priced at $350 per load.
A series of supply disturbances have driven the alumina price. higher this year. The trigger for the current rate jump was news. of export issues in Guinea, the major import source of bauxite. for China's alumina refineries.
The physical alumina market is undoubtedly tight however the. explosive nature of the rate action also signals a speculative. craze on the Shanghai Futures Exchange (ShFE).
SHANGHAI BOOM
Almost 25 million loads were negotiated on the ShFE alumina. contract on Wednesday, a record daily high and equivalent to. nearly a fifth of international yearly production.
Open interest has actually likewise skyrocketed to life-of-contract highs as. investors have bought into a gradually rising market.
The exchange changed both trading limits and margins on. Thursday, enforcing a portion point premium on speculative. positions relative to commercial hedge positions.
This is standard procedure for China's exchanges. in the face of speculative rises such as that presently washing. into the Shanghai alumina market.
This sort of futures rate volatility is a new phenomenon. for the alumina market.
Both the LME and its U.S. peer CME Group offer alumina. contracts but neither is liquid. The explosive development in the. Shanghai contract, by contrast, has actually changed the vibrant in between. paper and physical markets given that trading began in June last. year. This is the 2nd bout of turbulence on the Shanghai market. after a massive price spike in January, likewise due to issues. about Guinean bauxite supply.
ALL EYES ON GUINEA
The cost sensitivity to events in Guinea highlights how. dependent China's alumina refineries have ended up being on West African. bauxite.
China's bauxite mining sector has actually been hit by several waves. of ecological examinations, limiting domestic supply and. motivating more alumina refineries to look overseas for their. basic material.
Imports of Indonesian bauxite stopped early 2023 after the. Indonesian federal government banned exports in a drive to require its. miners downstream into refining and smelting.
Guinea has actually quickly become China's main bauxite provider. Imports doubled in between 2000 and 2023 to almost 100 million heaps. and were up by another 13% in the very first 8 months of this. year. The January alumina panic was down to a surge at an oil. terminal in the Guinean port of Conakry. This time around it's. news that a regional subsidiary of Emirates Global Aluminium has. had its bauxite exports suspended by customizeds.
Although hugely exaggerated, the cost response in Shanghai. is rational, provided the absence of alternative bauxite supply and. tighter conditions in the alumina market itself.
SUPPLY STRIKES
Alumina supply has taken multiple hits this year. U.S. manufacturer Alcoa revealed in January the irreversible. closure of its Kwinana refinery in Australia. The ramp-down was. set up to be completed by the third quarter. In May Rio Tinto declared force majeure on deliveries. from its refineries in Queensland due to limited gas capacity. levels. Century Aluminum's operations in Jamaica were briefly. interrupted by Cyclone Beryl in September and South32. has flagged concerns about its Australian operations due to. conditions on its operating licence needed by ecological. regulators.
On the other hand, Chinese demand for alumina has actually been growing. highly as the country's smelters have actually taken advantage of enhanced. power supply, particularly in the hydro-rich province of. Yunnan.
National aluminium output rose by 4.4% year-on-year in the. first eight months of 2024 with annualised run-rates increasing. by nearly 1.5 million lots since December.
That stated, China at a nationwide level does not appear to be. physically except alumina considering that it continues to export. significant amounts to Russia.
Undoubtedly, exports to Russia surged by 41% year-on-year to 1.0. million lots in January-April, turning China from net importer. to net exporter of the intermediate product.
FUTURE( S) INTERRUPTION
However physical accessibility is not the like exchange. schedule.
ShFE alumina stocks have actually come by over half considering that. June to 103,416 lots. The outcome is time-spread tightness with. the premium for cash relative to forward contracts flaring larger. this week.
Short-position holders' ability to deliver physical material. will depend upon how much alumina is located at ShFE's four. shipment points in the provinces of Shandong, Henan, Gansu and. Xinjiang.
Much also holds on how serious the hazard of disturbance to. Guinean bauxite deliveries is. The January scare quickly decreased. and there's no indication the latest event is the precursor. of a national change of policy around exports.
What has changed, however, is the response time to such. occasions.
Before the arrival of the Shanghai futures contract, spot. alumina was priced by physical freight transactions, which can be. scarce in a market dominated by annual supply. agreements.
Now a heading from Guinea can move the futures rate in. seconds, developing a detach between paper and physical. markets.
This added volatility is going to make the previously. tranquil alumina market a much more turbulent location.
It's likewise going to make smelter costs a lot more. unpredictable with a possible knock-on effect on the cost of. aluminium itself.
(source: Reuters)