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Zinc prices expected to decline in 2026 due to weak demand and supply concerns
Analysts predict that zinc prices will fall from their recent highs in the remainder of the year, as a lacklustre supply offsets the disruptions to demand. Due to the 'tight ores supply' and smelter losses, the metal used to galvanise steel will be up by more than 13% in 2026 on London Metal Exchange. Zinc, which outperformed copper, nickel, lead, and aluminium last month, reached its highest level in nearly four years, at $3,658 a metric ton. Tighter-than-expected supply has prompted analysts to revise up their 2026 price forecasts, but while they see zinc remaining elevated in the second half of ?the year, they don't expect it to hold on to current levels above $3,500. Tom Price, Panmure Liberum analyst, said that China's production of steel in 2026 will be lower than its five- to six-year rolling average. Price said that if steel production falls, it will be a primary driver of demand for zinc. He believes the metal could drop to $3,100 per ton by the end of the fourth quarter. BMI, an arm of Fitch Solutions, predicts that zinc prices will drop further, to $3,000, by the end of this year, due to the long-term positioning caused by an explosion and fire at Kazzinc’s smelter in May, as well as a fire at Nexa Resources’ Cajamarquilla facility. BMI stated in a report that "prices will likely ease from their current levels, as the headline-driven premium associated with recent supply disruptions diminishes and?the market moves to a narrow surplus." This year, the market is estimated at 14 million tons. Jonathan Leng is Wood Mackenzie’s research director of zinc markets. He expects the price to drop to $3,350 at end-2026 with a global demand growth rate of only 0.9%. He still predicts an 80,000 ton deficit, and warns LME Zinc stocks Just over 100,000 tons is?only a thin cushion. Leng stated that "if there is any further disruption in smelting, we could see a spike higher." Leng stated that the recent opening of the arbitrage windows to ship zinc from Shanghai Futures Exchange warehouses to LME could lower LME prices. ShFE zinc stocks Shanghai zinc has increased by less than 3% in the past year, despite being at a record high.
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Investors' gold prices remain stable as they weigh US-Iran developments and Fed signals
?Gold held firm on 'Monday as investors assessed the escalating 'U.S.-Iran Conflict, which boosted energy prices and clouded prospects for U.S. Interest Rates. As of 9:25 am EDT (1325 GMT), spot gold was down by 0.1%, at $4,011.96 an ounce. U.S. Gold Futures for August Delivery fell 0.1% to $4015.80. The yields on the benchmark U.S. Treasury 10-year note increased by 0.5%. The U.S. Dollar was up by 0.1%, making bullion prices more expensive for foreign buyers. Iran's Revolutionary Guards claimed they had attacked U.S. military equipment across the Middle East, after another night of U.S. bombing of Iranian cities. Yemen's Iran aligned Houthis also declared a?naval blockade against Saudi Arabia. Brent crude oil prices have stabilized after reaching a high of more than a month, fueling inflation fears and?betting on higher interest rates for longer. Gold is often seen as a hedge against inflation, but high interest rates can reduce its appeal. David Meger is the director of metals at High Ridge Futures. He said that "higher energy prices are still in focus" as the escalation of tensions in the Middle East adds to the concern that the Fed's less than expected data on inflation last week may not be sufficient to prevent them from raising rates this year. Cleveland - Fed President Beth Hammack has added her voice in a growing chorus that believes interest rates need to be raised to combat persistent inflation. This will set up a heated debate at the Fed meeting next week and could lead to dissensions during Kevin Warsh’s second meeting as chairman of the central bank. According to CME FedWatch, traders now expect an interest rate increase in the U.S. by December. This is up from?73% a week ago. "We expect the Fed to use balance sheet adjustments, and not raise rates until later in this year. Meger stated that we believe the'realization' of this will actually add some support to the gold price and pressure on the dollar in the next month or two. Other than that, silver spot gained 1.7%, to $56.87 an ounce. Platinum was down by 0.3%, at $1,586.21 and palladium climbed 1.3%, to $1,264.34. (Reporting from Noel John in Bengaluru and Vedika Thorat; editing by Leroy Leo).
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India's infrastructure production rises by 5% in June, according to a new series
India's infrastructure production grew by?5% in June, the fastest pace in five months. The data was released as part of a new series that uses?2022-23 for the base year. The government released a new series on Monday, replacing the 2011-12 base years and expanding the core sector basket from eight industries to nine, including iron ore. According to the latest data from the government, infrastructure output grew by a revised 3.2% compared to a year earlier in May. The revised series shows that it grew faster than 5.2% last in January. KEY NUMBERS * The Cement production rose by 9.8% in June, compared to an 8.4% rise in May. * The?production of steel?increased by 4.6%?last month compared to an increase of 5.1% in May, which was revised. * Electricity production increased 9.8% in June compared to an increase of 11.2% in May, which was revised. * The coal production increased by 1.4% in the month of June compared with a 9.5% fall that was revised for the previous month. *?Iron Ore Production rose 43.9% from a revised 19% increase in May. * Crude oil production fell by 4.2% in June. This is the same as in May, when it was revised down. * Fertiliser output fell 3.3% in June after a revised 1% decline in May. *?Natural Gas Production shrank 7.4% in July, compared to an earlier revised decline of 5%. * The output of refinery products fell by 4.7% in June, compared to a fall of 8.2% a month earlier. * The growth in infrastructure output for April-June was 3.6%, compared to a revised 1.0% during the same period last year. (Reporting and editing by Eileen Soreng, Sarita Chaganti-Singh, and Shivangi-Acharya)
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What is China's next surprise on the oil market? Lower fuel imports and higher fuel exports: Russell
China's reaction to the conflict in Iran is not surprising, but the magnitude of the cuts. China's track record is one of consistently reducing?crude imports to lower prices and increasing arrivals when the price drops. The collapse of imports in June to their lowest level in almost 10 years was 'dramatic', particularly given that, even though crude prices?surge? in the weeks following the U.S. & Israel attack on Iran in February -28, they didn't reach the levels reached in 2022, when Russia invaded Ukraine. China's crude imports in June were 7,12 million barrels a day (bpd), down 41.3% on the same month of last year and the lowest since October 2016. A drop of this magnitude would normally have led to a huge drawdown on China's inventory, but that didn't occur. Refiners in China reduced processing rates in June to 12,47 million bpd, a 17.7% drop from the same period in 2025. This is the lowest level since March 2020 during the COVID-19 Pandemic. China does not reveal the volume of crude oil flowing in or out of strategic and commercial stocks, but an estimate can be made if you subtract the amount of oil that has been processed from total crude from both imports and domestic production. This means that refiners have a total of 11,53 million bpd. The 12.27 million bpd they processed meant that approximately 940,000 bpd were drawn from inventory, a significant increase from the 500,000 bpd of May. China, despite drawing from its stockpiles over the past two month, still added to its reserves in the first half, with a surplus of crude oil around 530,000 barrels per day. China's ability to reduce refinery runs in June was partly due to Beijing placing unofficial export restrictions on refined products. This was seen as a "measure" to ensure a sufficient supply of fuels for the domestic market, during the conflict with Iran. According to commodity analysts Kpler's data, China exported 393,000 barrels per day of light and medium distillates in June. This is slightly less than the 400,000 barrels per day in May, but higher than the 54-month-low of 338,000 barrels per day in April. It is clear that China played a major role in adjusting the demand for crude oil throughout the current Iran Crisis, which saw the loss of approximately 10 million bpd of supply of crude oil and refined products due to the closure of the Strait of Hormuz. China's exports have been reduced since April. What will China do to respond to the current crisis? Prices are key China could be planning another surprise for the markets if the answer is seen through the prisms of prices. China's crude imports are expected to recover in August and September, as refiners have likely purchased cargoes that were able to leave the Strait of Hormuz after the ceasefire between Iran and the U.S. The market expected a return of normal Middle East supply and, therefore, a glut. Benchmark Brent futures fell to $70.14 per barrel on July 2. They had been as high at $126.41 at end of April. Brent oil prices rose to $90.80 per barrel on Monday morning in the early Asian trading session, despite the return of hostilities. China's refiners will likely reduce imports as crude prices rebound. This means lower arrivals in October, given the time lag between cargoes being arranged and delivered. What happens to China's refined products exports? Beijing is confident that it will be able to survive on its huge stockpiles. Its crude oil reserves are estimated at 1.2 billion barrels. China could also be tempted by the opportunity to take advantage of high margins in Asia. Gasoil (the building block of diesel) ended July 17 at $143.03 per barrel, a $54.93 premium to the Brent closing prices and almost three times that $18.94 markup on February 27th, the day before Israel and the U.S. attacked Iran. Kpler has tracked shipments of 787,000 BPD of light and medium distillates in July. You like this column? Check out Open Interest, your new essential source of global financial commentary. ROI provides data-driven, thought-provoking analysis on everything from soybeans to swap rates. The markets are changing faster than ever. ROI can help you keep up. Follow ROI on LinkedIn, X. These are the views of a columnist who writes for.
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India's coal power plants say they have enough stocks despite increasing demand
India's coal-fired plants have enough?coal to operate for two weeks at higher rates. This eases concerns about fuel shortages due to a?rising demand for electricity and a?lower-than-average rainfall during the monsoon season. The power ministry said in a response to the parliament that coal stocks at power stations stood at 42,8 million tonnes on July 12. This is enough for 14 full days of operation with an 85% load factor. It added that utilities are also able to obtain enough coal to meet their daily needs. The peak demand for power in India increased last week by nearly 270.1 gigawatts, mainly due to the?cooling of demand. El Nino has contributed to a?weaker rain. The government is expecting India's peak power demand to reach 280 GW due to the lack of strong monsoon rainfall this year. * Coal is still the mainstay of India's power system, despite its aggressive expansion in renewable energy. According to the Ministry, coal and lignite fired plants generated approximately?75%?of power during non-solar peak demand hours. According to the power ministry, the government has increased coordination between?the coal and power ministries in order to monitor supplies and prioritise coal transportation to power plants. The government reported that India added 9.47 GW in coal-fired generation capacity between 2025 and 26 and 2.26 GW from April to July. This helped support the record-breaking electricity demand. (Reporting and editing by Susan Fenton; Sethuraman N.R.)
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Spain's biggest wildfire of the season burns for its fifth day, as a new heatwave approaches
Wildfires raged uncontrollably in Spain's central province of?Guadalajara on Monday. They burned for a fifth day and became the largest fire of the year. Forecasters warned that an approaching heatwave could increase?fire risk?across the country. Scientists have linked the trend to climate change. Spain and southern Europe face increasingly severe wildfire season. This fire occurs less than two week after a deadly wildfire in Almeria province near Bedar killed 13 people. It was one of Spain's most devastating fires in recent decades. As the La Mierla fire in Guadalajara Province expanded to over?26,000 acres, authorities evacuated an additional three municipalities on Monday. More than 1,000 people have been evacuated. Emiliano Garcia Page, regional leader for the region, said that the fire was engulfing nearly?30 populations centres. This highlights the challenges firefighters face. He said that protecting lives and preventing fires from reaching urban areas and homes remained the number one priority. The weather agency AEMET in Spain said that the heatwave would last until at least Thursday. It is expected to bring temperatures over 40 degrees Celsius across much of the southeastern interior, and to increase the wildfire risk to extreme levels. As hot, dry air from Africa moves northwards, some areas may reach temperatures of 42-44 C by Thursday. The agency also warned of the possibility of dry thunderstorms in mountainous regions of eastern Spain. Spain has already been the most affected country in Europe by fires this year. According to the EU's Copernicus Wildfire Monitoring Service, Spain had 104,423 ha of fires burning in 2026. France, on the other hand, only had 41,781 ha. The fire is "unfolding" after a particularly destructive fire season last summer. Spain recorded 354,747 acres burned, and 63 large wildfires - the largest annual burned area in the past decade. (Reporting by Emma Pinedo; Editing by Alexandra Hudson)
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IAI reports that global aluminium production fell 1.5% on an annual basis in June.
The International Aluminium Institute (IAI), which released data on Monday, showed that global primary aluminium production?inched down 1.5% from the previous year to 5.98 million metric tons. Gulf production was down by a third. In late March, two smelters located in the Gulf region, which account for around 9% global primary aluminum?capacity were attacked by Iran as part of the Middle East conflict. This has prevented the smelters from exporting metal via their normal channels. The IAI reported that the Gulf's production in June was?332,000 tonnes, down from?507,000 tons one year ago. The region's daily production remained flat at 11,000 tonnes, but was still lower than the baseline pre-war of 17,800 tonnes. Emirates Global Aluminium announced this month that production was returning to its Al Taweelah?smelter near?Abu Dhabi faster than anticipated after an emergency shut-down in 'March. However, it could still take up to a year for it to reach previous levels. IAI reported that global average daily aluminium production was 199.300 tons in May. This is up 0.3% compared to the previous month, when there was an extra day. Reporting by Tom Daly, Editing by Tomasz Janovowski
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The most violent ceasefire in history.
Mike Dolan: What's important in U.S. markets and the global economy today? By Mike Dolan. Editor-at-Large for Finance & Markets. With the World Cup hoopla this weekend, many may have missed the fact that the Iran conflict has once again descended into full-blown warfare. As Tehran retaliated on U.S. bases and gulf shipping, Iranian attacks now have killed at least three U.S. troops. The traffic through the Strait of Hormuz is now a trickle. Brent crude has also risen above $90 a barrel for the first since early June. All that and more will be discussed below. Listen to the Morning Bid podcast for the latest update on the energy crisis, the major moves in the chip stocks, and the changes both at?10 Downing Street and?11 Downing Street. Subscribe to the Morning Bid daily podcast and hear journalists discussing the latest news in finance and markets seven days a weeks. The most violent ceasefire It's not surprising that the June inflation report was received so poorly last week, given the recent increase in violence in the Middle East. The futures markets believes that there is a 2/3 chance the Fed will raise interest rates in September. Another big cloud is forming on the horizon due to shaky stocks. The South Korean market was closed on Friday but chip sales resumed today with the KOSPI dropping another 3%. Tokyo was closed on Friday, so the stock markets were quieter in the morning. The U.S. Futures are slightly higher before the bell. This follows a tough few weeks for tech stocks. The high-flying U.S. chips stocks fell 10% last week, and 20% since their record highs of June. This suggests that the market is settling down from its AI frenzy. Now, it'll turn its attention to the hyperscalers that will report their earnings this week and in the coming weeks. Alphabet will report on Wednesday. Intel, Tesla, and other companies are also reporting this week. China's Moonshot AI programme, which is the latest AI innovation from the country, offers a glimpse into how the second-largest economy in the world keeps up with the rapid technological transformation. On Monday, Andy Burnham will become the new UK Prime Minister. The market is likely to be interested in the cabinet picks he makes and his choice of finance ministry, with Shabana Mahmood being a conservative candidate for Home Secretary. Chart of the Day Crude oil prices briefly surged back above $90 a barrel on Monday, for the first since early June. The Iran war was raging after the ninth day in a row that the U.S. attacked Iran. Prices dropped below this level after Iran's Foreign Ministry said that negotiations with the U.S. can be pursued on the basis of national interests. Gulf shipping through the Strait of Hormuz is now at a crawl. Fuel prices are rising across the board. Average retail U.S. gasoline prices are now above $4 per gallon. Watch today's events Canada's June Inflation Report and the U.S. Leading Economic Index Andy Burnham, leader of the Labour Party, officially takes over as Prime Minister in the UK * ?U.S. Earnings reports from Domino's Pizza Steel Dynamics, and WR Berkley Want to receive the Morning Bid every morning in your email? Subscribe to the newsletter by clicking here. Follow us on LinkedIn, X and ROI. The opinions expressed here are the author's. These opinions do not represent those of News. News is committed, as part of the Trust Principles to independence, integrity and the absence bias. (Written by Mike Dolan).
AfD leader vows restore German-Russian relations as she seeks chancellery
Alice Weidel of the far right Alternative for Germany said that Germany should stop a boycott against Russian oil and gas to boost its flagging economy. She was describing the party's ambitions to form a national coalition.
Weidel claimed that the AfD could win two important federal state elections within the next few months. He described them as a milestone towards securing the position of German chancellor at the next national election due in 2029.
The success of Made in Germany was due to the cheap energy that Russia provided. Weidel stated that we need to get it back.
"The loss has put us years behind." The loss of hundreds of thousands of jobs has been devastating. "It has made us dependent upon the United States who sells us electricity at much higher prices."
SEES ELECTIONS as 'DECISIVE MOLESTONES
Before sanctions were imposed in 2022 over Moscow's invasion into Ukraine, Russia accounted for more than one-third of Germany's crude imports as well as more than half its natural gas.
Germany is also struggling to recover from shock following the closure of the important undersea Nord Stream Pipeline, which was crippled in September 2022 by explosions.
After a sharp rise in energy prices, the country's industrial sector is still in a rut. Volkswagen, the car giant, is also considering cutting up to 100,000 jobs.
Weidel's remarks highlight the fragility of the Western coalition that supports Ukraine. Germany's government supports Ukraine but the German population is divided.
Weidel made the remarks ahead of September elections in two key eastern German ?states, Saxony-Anhalt and Mecklenburg-Vorpommern, where the AfD is dominating polls.
If the AfD wins control, these regional governments will challenge Berlin's migration policy, which they claim is "too generous", rejecting the financial burden placed on local governments.
It would?upend the consensus-model of committee-style governance in Germany and give the AfD the opportunity to gain national power.
"Saxony-Anhalt and Mecklenburg-Vorpommern are decisive milestones," Weidel said.
"If we win in Saxony-Anhalt, then Mecklenburg-Vorpommern will probably follow. "I can see AfD at the chancellery by the next election or after."
A victory of the far-right party, Saxony-Anhalt, would be a blow for mainstream parties, such as the Christian Democrats of Chancellor Friedrich Merz, who have refused to cooperate with the AfD.
Voters could be influenced by the lower energy costs in Russia and the possibility of a cheaper alternative.
In the East, where the Soviet Union ruled until the fall the Berlin Wall over 35 years ago, Germany's relationship with Russia is more important. Many in the east have a positive view of Russia, but a negative one towards Germany's protector, the United States.
"WE WILL NOT?TURN EVERYTHING OFF ITS HEAD"
Weidel made his comments about Russia after a senior AfD legislator Markus Frohnmaier visited Russia earlier in the month. He met with Alexei 'Miller, head of Russian 'energy giant Gazprom, and demanded a reopening for the Nord Stream pipeline.
Frohnmaier rebuffed critics of his trip and said he understood U.S. Investors were examining reopening Nord Stream to Germany. This could mean that Germany would have to pay a fee in order to obtain Russian gas.
He said: "We must be very careful that Germany does not miss this window of opportunity in order to get back on the Russian market." Mr Miller stated that it would be three months before the gas supply was resumed.
Roderich Käsewetter is a Christian Democrat member of the Merz parliament who said that the AfD’s pro-Russian position?distorts the public discourse in Germany.
Kiesewetter stated that the AfD is using the romanticisation of Russia, especially with a view to the upcoming elections in Eastern Germany.
Weidel denied that her party is extremist. This was classified by Germany’s spy agency in the past year.
She said, "The way that we view ourselves and how our political opponents judge us are very different." "People describe us as far-right. We are in fact a party of the average person. "We will not change everything if we are elected." (Reporting by John O'Donnell, Editing by Andrew Heavens).
(source: Reuters)