Friday, July 3 (US markets closed today)

• Indicators at 7:50 am CST show 3 month nickel trading around $.07/lb lower, with all base metals lower but quiet. Dollar/Euro trading is also quiet, with the Euro only stronger ahead at the moment. NYMEX crude futures are coasting at $66.80/barrel, while gold is up 4/10 of 1% and silver is up more than 4/10 of 1%. In overnight trading, Asian markets ended lower, with China ending higher. European markets are slightly lower this morning, with US markets closed. The big news of the day is BHP's decision to sell their Yabulu Refinery, while Vale's Goro nickel mine announces yet another start up delay. Not sure when or if we will be able to update later, as we have a crowd coming over for the weekend, so here are a few other updates. The Baltic Dry Index dropped 152 points overnight to settle at 3520. And LME stored inventories of nickel saw a second day of no change.  
• Bloomberg morning base metal news - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Metals & Energy - pdf here
• Market Drivers - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - "Metals finished lower yesterday on the back of grim US nonfarm payroll numbers after it was reported that economy shed 467,000 jobs in June, 100,000 more than expected. This reversed the modest declines we were seeing of late, as layoff notices flooded across the manufacturing, construction, and service-sector industries; education and health care were the only sectors to add jobs. In the meantime, the unemployment rate pushed higher to 9.5%. ... Nickel is at $16,380, down $70; surprisingly, nickel looks very solid on the charts, and with two day of closes above $15,900 resistance, we could now push higher to the $17,700 mark." (read Ed Meir's complete morning base metals report here)
• (MP) Mining major Eurasian Natural Resources Corporation PLC (ENRC) has commissioned the second chrome ore pelletiser and related facilities at Donskoy GOK chrome ore mine complex in Kazakhstan, which supplies Kazchrome company of its Ferroalloys Division.
• ThyssenKrupp Technologies receives major submarine order from Turkey - Yesterday, a contract was signed by Howaldtswerke-Deutsche Werft GmbH (HDW), Kiel, a company of ThyssenKrupp Technologies, and MarineForce International LLP (MFI), London, for the delivery of six material packages for the construction of Class 214 submarines to Turkey.
• Xstrata tells French media that construction at their New Caledonia Koniambo mega nickel mine is on schedule and is scheduled to being production of 60,000 tonnes of nickel annually in 2012.
• (MB) China's Guangzhou Lianzhong Stainless Steel is the third major stainless mill to lift its July list prices by 300 yuan ($44) per tonne
• BHP Billiton has been ordered to commission an independent engineering study at one of its West Australian nickel mines after two rockfalls in the past three weeks.
• (Yieh) China Iron & Steel Association (CISA) said that China’s daily steel output reached 1.522 million tons in June 11-20, hitting the record high this year. Based on this rate of steel output, the annual steel output of 2009 is estimated to reach 555.5 million tons, 10 percent higher than output in 2008.
• Aluminum Corporation of China (Chinalco) confirmed Thursday it had bought US$1.5 billion of Rio Tinto shares to cement its nine per cent shareholding in the miner.
• Expert: Miners to remain cautious on growth once economy rebounds - more
• Recession fallout to be long-lasting: report  - more
• Steel industry points cautiously to rebound - more

  Sale Of Yabulu Nickel Refinery, Queensland, Australia - BHP Billiton is pleased to announce it has signed an agreement to sell the Yabulu nickel refinery to companies wholly owned by Professor Clive Palmer. It is expected that the sale will be finalised by 31 July 2009. - more

  New Caledonia’s Vale Inco plant launch delayed - The launch of the Vale Inco nickel plant in the Southern Province of New Caledonia has again been delayed after it was to be operational in the middle of this year. - more

  Under-mining: Plant in southern Armenia resumes amid worker concerns - A copper-molybdenum plant in southern Armenia that ground to a halt last year influenced by the unfavorable world market situation and the broader global economic slowdown has resumed operations this week - more

  Steel industry rekindles, hope for recovery - Steel order books in Europe and the United States have improved over the past month, prompting producers to restart some idled capacity, but full recovery is some months away because real demand remains depressed. - more

  US monthly steel import applications declined 21% in June - Permit applications to import 734,667 mt of steel products were filed in the month of June, the US Commerce Department reported Wednesday. - more

  EU steel demand fell 43% in H1 2009, market bottom close: Eurofer - European steelmakers' lobby Eurofer said Thursday that apparent steel consumption in Europe had fallen 43% year on year in the first half of 2009, but added that leading indicators suggested that the economic downturn could bottom out over coming months, reporting the findings in its Economic and Steel Market Outlook 2009-2010 report. - more

  Morning Nickel Inventory and Price Statistics & Figures

• London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above) (charts and archives)
• Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
• Shanghai Jinchuan nickel price - available here   (charts)
• Industry In Crisis - Nickel Mine Closures - more
• Please let us know if any of these links stop working, stop carrying info, or become available to subscriber's only. We encourage our readers to use the services of those companies who supply reports and information free of charge. Contact us

Thursday, July 2 (US markets closed tomorrow)

  Daily Nickel/Stainless Steel Wrap-up

• Baltic Dry Index - minus 70 to 3,672. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) China Renews Call for `Stable' Dollar, Diversification of Monetary System // Toyota, Honda's Drop in U.S. Vehicle Sales Outpaces Overall Market Decline // Asian Shares Fall as U.S. Sales, India Fuel Hit Automakers; Newcrest Gains // Trichet Says ECB Rates Appropriate, Economy May Recover in Middle of 2010 // PVM Loses Almost $10 Million in Rogue Trades, May Have Caused Spike in Oil // European Stocks Drop as U.S. Unemployment Climbs; Volkswagen, Total Fall // Payrolls in U.S. Decline More Than Forecast; Unemployment Climbs to 9.5% // Morgan Stanley May Post Another Loss After Paying Back U.S. Bailout Funds // Boeing Lost Orders for 15 Dreamliners in Past Week as Airlines Scale Back // U.S. Stocks, Commodities Retreat After Unemployment Data; Treasuries Gain
• The US Dollar continues to trade higher against the Euro, by nearly 9/10 of 1%. NYMEX crude is down over 3-1/2% and under $67/barrel. Gold is down 1% and silver is off nearly 2-1/2%. Base metals looked like they were in for a good old fashioned bushwhacking this morning, but by the end of the day had regained most of their earlier losses, and most ended slightly lower. Indicator charts show nickel trading was choppy today, and slowly sunk thru much of the day, until the end when it soared back to near its starting point. Dow Jones reports three month nickel ended the day at $7.46/lb , $.02/lb lower than yesterday's 2009 record close. The funds are still investing in commodities, and the Dollar's strength caused a pause, but was no hindrance for the day. Numerous reports that LME stored inventories of nickel were flat overnight, but we doubt this is true. The Baltic Dry Index lost 70 points to 3,672. While generally dismissed by the green shooters in past months, the unemployment numbers for the last two months have staggered the bulls, albeit momentarily. Today's release was no different. The U.S. economy lost 467,000 jobs in June, after a 322,000 decline in May, with the unemployment rate rising to 9.5% from 9.4% the month before. Calculated Risk has a comparison chart that is rather depressing (chart here). US markets will be closed tomorrow for Independence Day celebrations, so while we will post a morning briefing, it may be delayed. For our US readers, Happy Fourth and have a safe and relaxing weekend!

  Reports

• Commodities Daily - pdf here
• Fortis Bank Asian metals monthly - pdf here

  Nickel market surplus estimates revised down - Metals market analysts suggest that late second-half restocking of high-grade stainless steel mill products will boost nickel demand and prices, which have slipped to a midyear average of $5.30/lb. - more

  MacroAsia still pursuing nickel project - Listed holding company MacroAsia Corp. expects to complete exploration early next year to move forward its mining project in the nickel-rich southern Palawan. - more

  Eurofer sees EU steel market bottoming out - European steel industry body Eurofer sees the EU steel market bottoming out and moving to an equilibrium by the fourth quarter of the year as destocking runs its course, it said in a statement on Thursday. - more

  Morning Briefing (8:00 AM CST is 1PM in London)

• Indicators at 7:35 am CST show 3 month nickel trading around $.15/lb lower, with all base metals backtracking off yesterday's gains. The US Dollar is stronger today, and hurting commodity trading, up 2/3 of 1% against the Euro. NYMEX crude futures are down 2% and under $68/barrel. Gold is off nearly 1% and silver is down 2-1/4%. In overnight trading Asian markets ended lower, although China ended higher and is trading at a 13 month high. European markets are lower this morning, and US futures imply Wall Street could open lower. The Bureau of Labor Statistics of the US Department of Labor unemployment numbers just released show nonfarm payrolls shrank by 467,000 in June, with the overall unemployment rate climbing in June from 9.4% to 9.5%. A closely watched indicator that is used as a key indicator that the recession has ended is workweek hours - in June they fell to a record low of 33.0 hours. It is shaping up to be an ugly trading day,  although with US markets closed tomorrow, US trading could be light.
• Guardian morning base metal news - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Metals & Energy - pdf here
• Market Drivers - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - "Metal prices surged yesterday in something of an unusual performance given that energy prices relinquished earlier gains to finish lower, while US equities also gave up much of their advances for the day. Metal prices instead pushed higher on the back of a slightly weaker dollar and relatively decent macro readings that came in from both China and Europe, both noted in yesterday's report. .. Some second thoughts about Wednesday’s steep rally may be surfacing today, where this time, both energy and metals are off sharply, as are US equity futures. There is understandable nervousness ahead of the June US nonfarm payroll report out later (expected at -365,000), which in our view, could come in somewhat higher than expected given the unimpressive ADP reading out Wednesday. The unemployment rate is expected to inch up to 9.6%, up from last month 9.4%. We also will be getting the May factory orders reading later in the day, (expected at .9%).  .. Nickel is at $16,140, down $355; we alluded to a possible bearish double-top formation showing up on the nickel charts, but yesterday's sharp move higher dispelled such a notion. We now need to see prices close above $15,900 again today if this latest move is to amount to anything." (read Ed Meir's complete morning base metals report here)
• (FT) Barclays Capital noted that nickel imports in China have risen, hitting a record high in May, while mine output has declined 21 per cent so far this year when compared with 2008. The bank cautioned, however, that prices were vulnerable. “Some of the drivers appear unsustainable and it will not be until end-demand conditions improve towards the end of the year, in our view, that there will be a concrete recovery in prices,” it said, forecasting nickel prices by late-2009 at $12,800 a tonne.
• Panoramic Resources Ltd. Thursday said it produced a record 18,750 metric tons of nickel contained in concentrate during the 2008-09 financial year, a 26% rise on the previous year - more
• (Dow Jones) The rise in LME nickel prices this week is overdone, says Commerzbank.
• (Dow Jones) Aneka Tambang 1H Nickel Sales 7,100 Tons Vs 8,500 Tons
• (Interfax) Jinchuan Group Ltd., China's largest nickel producer, increased its ex-works nickel price on July 2 by RMB 4,000 ($585.57) per ton to RMB 122,000 ($17,860.02) per ton, according to Jinchuan Group's Web site.
• (Interfax) Baoshan Iron and Steel Co. Ltd. (Baosteel), a subsidiary of China's top steelmaker Baosteel Group, is likely to raise the August ex-works prices for some of its steel products by between RMB 150 ($21.96) per ton and RMB 200 ($29.28) per ton from July price levels, a source close to Baosteel told Interfax on July 1.
• (MP) BHP Billiton has announced that it has no plans to sell its Kwinana refinery in Western Australia.
• Barings: Russian Commodities key in China’s bid for global supremacy - more
• China Iron Ore Demand to Boost Shipping, Morgan Stanley Says  - more
• IFC invests $15 mln in Kiwara for Zambia exploration - more

  JSL to attain 0.8 mt stainless steel capacity by mid-2010... Ratan Jindal promoted JSL Ltd, setting up a 1.6 million tonne per annum integrated stainless steel project at Kalinganagar in Jajpur district, hopes to attain 0.8 million tonne stainless steel making capacity by mid-2010. - more

  AK Steel Announces August 2009 Surcharges for Electrical and Stainless Steels - AK Steel has advised its customers that a $75 per ton surcharge will be added to invoices for electrical steel products shipped in August 2009. - more

• Flat-rolled carbon, stainless and electrical steel provider AK Steel declared on Wednesday that a USD75 per ton surcharge will be added to invoices for electrical and stainless steels products shipped in August 2009. - source

  Semirara halts nickel project on weak prices - Semirara Mining Corp. said on Thursday its 50-percent-held unit has suspended operations at a nickel project north of the capital due to low prices of the metal. - more

  Beijing buckles in iron ore price battle - Australia's iron ore miners have won their long-running price battle with China's government-owned steel producers. Signs of hasty compromise emerged yesterday as China battled to avoid the collapse of the 40-year-old benchmark price-setting system, which would pitch the world's largest steel producer into the uncharted waters of relying on spot-pricing and volumes to meet its iron ore needs. - more

• Chinese steel mills offer compromise - Pricing talks between Chinese steelmakers and global iron-ore suppliers dragged on after they failed to reach agreement by a June 30 deadline. - more

  Crude steel output to mark its biggest jump in the July-September quarter  - Japan's crude steel output will mark its biggest quarter-to-quarter jump on record in the July-September quarter, helped by public spending and a rundown in stocks, but the longer term outlook is still cloudy, the government said. - more

  BHP Nickel West, Mithril Pull Out of Silver Swan JV With FerrAus - BHP Billiton Nickel West and Mithril Resources Ltd have withdrawn from the Silver Swan North nickel and gold joint venture, with full ownership of the project reverting to FerrAus Ltd. - more

• BHP to undertake study of rockfall mine - BHP Billiton has been ordered to commission an independent engineering study at one of its West Australian nickel mines after two rockfalls in the past three weeks. - more
• Kagara Confirms Nickel Intersection at Lounge Lizard - Kagara Ltd has received final analytical results for underground diamond drillhole FUG471 drilled by Western Areas NL and reported on June 24. - more

  FACTBOX-World's top steel producers in 2008 - China's insatiable appetite for steel has helped the country's steelmakers overtake most of their Japanese and Korean peers in the top five ranking producers of the world in 2008. - more

  Morning Nickel Inventory and Price Statistics & Figures

• London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above) (charts and archives)
• Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
• Shanghai Jinchuan nickel price - available here   (charts)
• Industry In Crisis - Nickel Mine Closures - more
• Please let us know if any of these links stop working, stop carrying info, or become available to subscriber's only. We encourage our readers to use the services of those companies who supply reports and information free of charge. Contact us

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