News & Analysis

Industrial metals (copper, aluminium, nickel, etc.) daily review (March 19, 2010)

Contributed by Nirmal Bang

By Nirmal Bang

MARKET ROUNDUP

Industrial metals prices remained depressed in late business on Thursday, under pressure from a stronger dollar and fears that potential further monetary tightening in China could cap demand in the world's top copper consumer. Nickel being an exception posting fresh highs in last trading session.

IN FOCUS

- The global copper market recorded an 86,900 tonne surplus in January, the World Bureau of Metal Statistics (WMBS) said on Wednesday.

- The global aluminium market was in a 156,000 tonne surplus in January, down from 309,000 tonnes in the same month last year. In 2009, primary aluminium production outpaced consumption by 580,000 tonnes.

- WBMS said the zinc market was in surplus by 119,000 tonnes in January 2010, compared with a 386,000 tonne surplus for the whole of 2009.

- The lead market was in a 5,000 tonne deficit in January, with surpluses of 15,500 tonnes and 500 tonnes for nickel and tin respectively, according to WBMS.

- Swedish miner and smelter Boliden said on Wednesday it would shut a copper smeltworks and refinery in Finland later this week as a strike by port workers was hitting concentrate supplies.

- The annual rate of primary U.S. aluminum production fell 12.8 percent to 1,697,850 tonnes in February from 1,947,158 tonnes in February 2009, but gained 1.8 percent from January's annual rate of 1,668,262 tonnes, the Aluminum Association said on Thursday.

- A strike in Canada, delays in bringing the New Caledonia Goro mine into production and most recently, a problem at BHP Billiton's Nickel West operation in Kwinana, Australia, have helped lift prices.

- Global nickel production is to rise by 4 percent to total 1.371 million tonnes this year but will fall into a deficit for the first time in four years, industry consultants CRU Group said on Thursday.

- Vigorous exports to Asia and strong demand from domestic carmakers helped Japanese steel mills boost crude steel output by more than half in February from a year ago. Output at Japan's steelmakers jumped 54 percent during the month from a year earlier to 8.44 million tonnes, the Japan Iron and Steel Federation said on Thursday.

FUNDAMENTAL OUTLOOK

Industrial metals are trading a tad higher on international bourses. Outlook for industrial metals is sideways for the day, we expect industrial metals to trade in thin range. Nickel in particular looks strong for the day, buying at dips is recommended.