Comments

Nickel – expectation of tightening supply and stainless steel difficult to rise

Date Jan 04 2018 17:04:16Source:SHMET

With regards to NI FP, offers in Shanghai bonded zone keep standing at the range of $350-$400, and so does CIF delivery. The SHFE Spot/LME 3M arb for Russian NI was stable, at 7.85 and that for 3M SHFE/LME at 7.96, equated to a loss of RMB2076 in spot (2%of import tax) and a loss of RMB1164 3M forward.

Recently nickel ore inventory at port has been declining and a fir broke out in some large nickel factory, which have led to an expectation of a tight nickel supply. Demand is turning weaker for the time being, with stainless steel market price difficult to rise. subsequent capacity in stainless steel market will also be gradually decreasing. The overall transaction in the imports of nickel premium market maintains flat.

Edited by SHMET

Zinc – the operation rate of galvanized mills limited, with demand being weaker

Date Jan 04 2018 17:03:44Source:SHMET

Zinc Premiums in Shanghai bonded, and CIF shanghai saw no change, at $155-$165/mt and $160-$170/mt respectively. Today LME C-3m valued at 19.5B, while the SHFE Spot/LME 3M arb also retreated to around 7.72, the spot import loss to RMB1261/mt and expanding loss slightly in forward market, around RMB1263/mt lost. Custom duty exempt brands, Australian and Korean, still generate quite a loss of RMB957/mt in spot import market, but may lose RMB959/mt in forward import.

LME zinc c-3m base is closing at $19.5, and the market seems to want to get back into the squeeze. Under the background of the weak consumption in winter, the production of galvanized mills is limited, with the operation rate gradually declining. Downstream restocking is weaker, with short-term domestic zin ingot inventory appearing recovery, causing a slight insufficient momentum for short-term domestic zinc price increase. Zinc premium market enquiries are light, with the transactions being general. 

Edited by SHMET

Aluminum – focus on Xinjing illegal capacity and high inventory hard to alleviate

Date Jan 04 2018 17:02:42Source:SHMET

Traders reported that spot premiums CIF shanghai remained at level $95-$115 as usual, so did the physical warrants. LME C-3m valued edged to $15.5C. SHFE Spot/LME 3M arb flattened out at 6.63, suggesting importing may lose around RMB3049/mt in spot market and RMB2788/mt in forward market.

The Development and Reform Commission of Xinjiang autonomous region fail to report honestly illegal electrolytic aluminum capacity according to the national requirements and also fail to conduct supervision and inspection on the work of clearing electrolytic aluminum, leading to that 800,000 tonnes of illegal electrolytic aluminum capacity from East Hope and 200,000 tonnes of illegal electrolytic aluminum capacity from Xinjiang Jiarun have been built and put into production for nearly 2 years. It is necessary to continue paying attention to whether the production of illegal electrolytic aluminum is discontinued. In terms of consumption, the high inventory has not been alleviated. Electrolytic aluminum market sentiment is still depressed, with traders keeping stepping aside.

 

Edited by SHMET

Copper – domestic contango narrowed and terminal factories not active in buying

Date Jan 04 2018 17:02:08Source:SHMET

Premiums for CIF Shanghai stood at $65-$80while that for shanghai bonded warehouse flatted at $75-$85, a continuing component of previous re-stabilization. LME C-3m valued was $46C. SHFE Spot/LME 3M arb stayed steadily at around 7.66, with an import loss of RMB320/mt, whilst 3M SHFE/LME arb may lose RMB657/mt, with ratio of 7.67.

After the long-term orders of copper concentrate has been decided, the subsequent production of the smelters will be guaranteed, although TC/RCs has been declining recently. The contango has narrowed sharply, but the terminal factories are not active in buying. Traders make general inquiries in the copper imports market and the market transaction is more stable.

 

Edited by SHMET

Nickel – that Jinchuan caught fire has little effect and spread between Russian nickel and Jinchuan

Date Jan 03 2018 16:49:01Source:SHMET

With regards to NI FP, offers in Shanghai bonded zone keep standing at the range of $350-$400, and so does CIF delivery. The SHFE Spot/LME 3M arb for Russian NI was stable, at 7.84 and that for 3M SHFE/LME at 7.87, equated to a loss of RMB2190 in spot (2%of import tax) and a loss of RMB2290 3M forward.

The actual impact of that Jinchuan caught fire is not expected to be large. The contango of imports of nickel to Jinchuan nickel expanded to around 600 yuan/tonne, while spot imports of nickel to Wuxi market maintained at RMB250B/tonne. The overall transaction in the imports of nickel premium market maintains flat.

 

Edited by SHMET
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