Updated twice daily before 8:00 am CST and by 1 pm CST

Wednesday, December 31

• Baltic Dry Index to be published next on January 2nd. Opened 2008 at 8891, rose to 11,793 on 5/20, fell to 774 on 12/24 and closed 2008 at 663. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) Yen, Dollar Head for 2008 Gain Versus Euro in Flight to Safety // U.S. Jobless Claims Fell Last Week, Skewed by Holiday // Asian Stocks Pare Record Annual Decline as Mining Shares Rally // European Stocks Advance, Trim Biggest Annual Decline on Record // U.S. Stocks Rise, Trimming Worst Yearly Drop Since Depression
•  The US Dollar continues to trade higher against the Euro, by about 1-1/3%, while crude oil trading has turned around from earlier losses, and is now higher by nearly 3% and back over $40/barrel. Metals, both precious and base, traded, or are still trading, solidly in the green. In the base metals sector, the increases were respectable, especially for nickel. Below we post what traders are saying is the primary reason. Whatever the reason, it has been a while since we seen nickel fluctuate by $1000/tonne in one session, and today we did. Dow Jones reports three month nickel ended the day and year at $5.30/lb , slightly off earlier high's and a $980/tonne increase for the day.  From the technical side, Sucden's day old chart (here) shows today's session opened with an RSI at 87 and SStoch at 81.8/64.9, implying the market was seriously overbought. The chart gives a good example of trading breaking out of trend, and today's upward movement was even more extreme. From the fundamental side, LME warehouses took in nearly 500 tonnes overnight, bringing the year end total to 78,390 tonnes. We started the year with 47,946 tonnes. Dow Jones reported today "Nickel led the rise and traders said the buying was a combination of end of year short-covering and book squaring as well as some buying in anticipation of the that on the DJ-AIGCI nickel, zinc and copper will have to be bought during the rebalancing expected early in January." So what is this commodity index re-weighing that DJ says is partially responsible for nickel prices surging the last few days? Here is a short clip from a Business Line article written on January 8th, at the beginning of this year, when the 2008 re-weighting of the Dow Jones AIG Commodity Index was approaching. "Rebalancing and re-weighting generally means an index may reallocate out of commodities that have appreciated in value and into commodities that have underperformed..... Already this week, base metals have started to move higher, with aluminium up 4.5 per cent from the start of year lows, nickel up 15 per cent and zinc up 9 per cent. Traders said this was the result of market participants “getting in early” due to the anticipation of higher prices during the re-weightings this week. Short covering is also emerging, with speculative players in particular looking to cover or at least reduce positions before the weightings lifts prices, traders said..... The re-weighting takes place between the fifth and ninth trading day of the year...." (further pdf explanation from Dow Jones Index here) Here is a brief review of nickel prices for 2008. Using official cash prices from the London Metal Exchange, nickel ended last year at $11.79/lb. On March 6, 2008, cash nickel peaked at $15.10/lb, and hit its annual bottom on October 24th at $4.00/lb. It ended 2008 officially at $4.90/lb.
• And thus we close out our coverage of 2008, and look forward to a new year. We want to give a special 'thank you' to site sponsors during 2008, Marine Fasteners, Duraloy Technologies, and Roca Mines. For those of you looking to reach a diversified audience from stainless steel buyers, to miners, to investors, please consider a sponsorship during 2009. We would also like to thank our readers and those who have written us during the past year. We have been contacted by many wonderful people from around the world, thanks to this website. And finally, we sincerely wish each of you a New Year filled with health, happiness, and hope for a better tomorrow. Happy New Year, Feliz Ano ~Nuevo, Prosit Neujahr, Gott nytt år!, Manigong Bagong Taon!, Godt Nyttår, Akimashite Omedetto Gozaimasu, Selamat Tahun Baru, Saehae Bock Mani ba deu sei yo!, Xin Nian Kuai Le, Kul 'am wa antum bikhair, Bonne Annee, L'Shannah Tovah, Nupela yia i go long yu, Feliz Ano Novo, S Novim Godom, Yeni Yiliniz Kutlu Olsun, .....!!    

  Commodity/Economic Comments

• (Reuters) "Indonesia's output ... ..nickel-in-matte output fell 4.8 percent to 74,160 tonnes this year, from 77,930 tonnes in 2007."
• Shanghai Daily - "Chinese mills no longer need to apply for permits for exporting steel from today, the Ministry of Commerce said yesterday, confirming earlier reports. But industry analysts say the removal won't necessarily boost exports since the government didn't seek to restrict shipments with such permits previously. China's steel product exports totaled 56.06 million tons in the first 11 months last year, down 3.1 percent from 2007."
• The Crash: What Went Wrong? - How did the most dynamic and sophisticated financial markets in the world come to the brink of collapse? The Washington Post examines how Wall Street innovation outpaced Washington regulation. - more
• Commodities Story of the Year: Floating Oil Storage - more

  The year ahead Part 2 – Base metals prospects - The prospects for base metals in the year ahead may be better than generally foreseen by the markets, although any recovery is likely to be relatively slow. - more

  Steel makers had boom-to-bust scenario in 2008 - Steel makers witnessed boom-to-bust scenario in 2008 as prices soared before demand vanished - more

  History, NOT current - article we linked to on April 6, 2007 - Nickel price 'loses touch with industrial reality' - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 7:50 am CST show 3 month nickel trading around $.19/lb higher and has broken into the $5/lb territory. Dollar is trading nearly 2% higher against the Euro this morning, but metals don't seem to notice. Most base metals are higher, while precious are all trading in the red. Nickel is having another good day, although Dow Jones is quoting a LME trader as giving short covering the credit for the increase. Crude oil continues to fall, down 3.7% so far today. Asian markets ended higher overnight, and European markets are trading higher today. Another trader told the media yesterday that nickel traders were keeping a close eye on equity markets, particularly the Dow, which had a good day in the face of some dismal news yesterday, so this could be helping boost nickel prices. Futures show a slightly positive opening on Wall Street this morning. The day isn't over yet, but here are some numbers for you. MarketWatch is reporting the following drops in equity markets for 2008. Dow Jones Industrial Average -35%, S&P 500 -39%, Nasdaq -42%, Dow Jones Financials -55%, Amex Oil Index -38%, Germany DAX -40%, FTSE 100 -31%, Japan Nikkei 225 -42%, China Shanghai Composite -65%, Mexico IPC -24%, and Brazil Bovespa -41%.  
• Bloomberg morning metal news - more

  Reports

• Daily Market Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here
• Metals Insight - pdf here
• Metals Commentary - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - "Metal prices held on to modest gains yesterday, as poor macroeconomic headlines and rising LME stocks kept gains in check.  .. The best performer in the group was nickel, which underwent a short-covering rally of sorts, finishing up by almost 11% on the day. Although nickel prices are up again today, we think the potential for further gains from here is limited since in our view, bounces in most metal complexes should be treated as rallies in a bear market, at least until we see a substantial shift in the macro picture. ... Elsewhere, Asian markets will brace themselves for Japanese Q3 GDP due out later this week, with projections nothing short of horrific. To cite one, Barclays Capital expects the Japanese economy to have shrunk by an annual rate of 12.1% during the quarter, this the sharpest decline since 1974. In the meantime, South Korea’s industrial output fell 10.7% in November vs. October. ... We are currently at $10,900, up $190, and quieter today. The short-covering move may extend itself into next week, but we expect the sellers to eventually reemerge." (read Ed Meir's complete morning base metals report here)
• (Dow Jones) LME base metals are mostly higher, led by nickel and zinc, in thin volumes as year-end short-covering boosts prices, says a London-based trader.
• Macquarie analyst Adam Rowley - "Demand is still looking terrible for the next few months ....We need significant improvement in global growth and we are not expecting that in the first half of 2009."
• (MB) LME nickel boosted by year-end buying in pre-market
• (SBB) German stainless mills see orders fall 68% in November
• (Yieh) According to the China Metal Material Circulation Association, China’s stainless steel output will reach 7.1 million tons this year, constituting a decline of 6 percent in comparison to 2007. At the beginning of this year, the number was expected to reach 8.3 million tons, but now it has fallen substantially.
• Demand for commodities to fall: analysts - more
• A History of Home Values - graph here
• 10 Outrageous Claims 2009 - more
• Philippines - putting another nickel in? - more

  Mills have cut production but buyers have reduced purchasing more - Steel buyers aren't showing much enthusiasm for early 2009, according to a poll by Purchasing magazine, since incoming customer orders are down, manufacturing operations are depressed and prices on all raw materials have been collapsing. - more

  China's steel makers lose nearly $1.9 bln in Nov  - The country's main steel makers saw a loss of 12.77 billion yuan (1.87 billion U.S. dollars) in November, the second monthly net loss after October, according to the latest data released by China Iron and Steel Association (CISA) on Monday. - more

  Kremlin Intervention, China Demand to Stabilize Russian Nickel - Russia’s leading mining company, and one of the leading suppliers of nickel to China’s stainless steelmills, may be facing further revenue and profit cuts in 2009, as the international nickel price continues to fall, and inventories of the metal grow. - more

  Leadership of Nickel Companies Recognized - The government of Cuba recognized the economic leadership of its nickel companies Tuesday, since this year displaced tourism as main source of revenues. - more

  Posco may put India plans on hold - Korean steel giant Posco is considering putting its India plans on hold. - more

• India's iron ore exports may fall as China demand seen temporary - Iron ore exports may be on the rise - thanks to a spurt in demand from China - but the slump is far from over, fear Goa’s iron ore exporters - 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)
• India Metals Prices - Delhi - Dec 31 - 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

Tuesday, December 30

• Baltic Dry Index  next published on Jan 2, 2009 (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Globe and Mail) U.S. consumer confidence drops to record low (Bloomberg) Consumer Confidence in U.S. Slumps to Record on Jobs // October Home Prices in 20 U.S. Metro Areas Fall 18% // U.S. Weekly Retail Sales Fall Most in Almost 6 Years // Asian Stocks Advance on Earnings Optimism; BHP Rises on Oil  // Japan Economy May Shrink 12.1 Percent, Barclays Says // ECB Pressured to Cut Rates by Weaker Sales, Lending
• The Dollar is only slightly lower against the Euro, while crude oil continues to slump, down 1-3/4%, but off earlier lows. Precious metals ended mixed, and except for aluminum, base metals ended higher. But only slightly. Except for nickel. Nickel was spiking during our morning update, but it had only just begun. In late kerb trading, indicator charts show the metals shot up. No news out today that should have any affect on the price, unless there was a rumor floating around on the LME floor that hasn't hit the newswires yet. A substantial gain in LME inventories overnight would not be seen as favorable to the price, and the RSI and SStoch showed trading technicals in balance, so it might turn out to be no more than some panicky short covering before the years end. Whatever the reason, Dow Jones reports three month nickel ended the day at $4.86/lb . Consumer confidence came in lower than expected today, after analysts had forecast a short bump up from last months dismal number. This was based on the theory that 5 year low gasoline prices would be seen as a positive, but high unemployment and foreclosures drew the overall sentiment lower. So far today, Wall Street is shrugging off the bad news and looking to the government's bail-out of GMAC Financing as a way to get the car industry selling vehicles again. At this stage of the game, is it really people can't get car loans, or are people too nervous to invest in a car when they don't know if they'll have a job next month? That is, if they still have one. Another report said for those of you who have been faithfully paying your mortgages, you may have seen the value of your home fall an average of 18% over the last year. Did we mention what happened to most retirement plans over the last 12 months? And they want us to run out and take a loan out on a new car?? We are still waiting for someone, anyone, to explain how we American's are supposed to pay for the billions in bail-outs already spent, and the billions more President-elect Obama is talking about. And will all this money being spent actually work? Seems to us that the $750 check that was sent out earlier in the year to most American's was a big fat goose egg when it came to doing any good for the economy. One thing is for sure. 2009 is shaping up to be an interesting period.     

  Commodity/Economic Comments

• Video - Jim Rogers "Prepared For The Worst"; Rogers On His Mettle; Cultivating Growth - here
• Copper group executives sentenced on bribery charges - more

  Steel merger puts second Chinese firm in top 5  - Three Chinese steel mills agreed on Tuesday to merge into the country's biggest listed steelmaker, creating a second Chinese industry champion in the world's top five steel producers. - more

  South Africa Trade Gap Widens to 12.1 Billion Rand  - South Africa’s trade deficit unexpectedly widened to 12.1 billion rand ($1.3 billion) last month as a global economic recession slashed demand for exports of platinum and ferrochrome. - more

  Faces of the Crisis: Oleg Deripaska - It has been a bad time to be a Russian oligarch, particularly if you are Oleg Deripaska. It was just four months ago off Corfu that Mr Deripaska, then Russia’s richest man with an estimated fortune of $28bn, was positioning himself for his most ambitious deal: the take­over of the world’s biggest nickel miner, which would put him at the helm of a $90bn-plus metals and mining giant on a par with BHP Billiton. - more

  Reading Material

• JP Morgan - Introduction to Base Metals and the London Metal Exchange - pdf here
• Commodities and Equities: A “Market of One”? - pdf here
• Technical Analysis for Metals Trading - pdf here

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 7:50 am CST show 3 month nickel trading around  $.15/lb higher and indicator charts show some buying enthusiasm for the metal in the last hour. Other base metals are mixed this morning, as the Dollar trades nearly 3/4 of 1% lower against the Euro. Precious metals are all lower, and crude oil is trading flat. In overnight trading, Asian markets ended slightly higher, and this morning, European markets are higher. US futures show a higher opening on news GMAC financing got some help from the government in the form of $6 billion dollars. We added a page overnight, tracking the Chinese, Japanese, European, and American Purchasing Managers Index (PMI's) since January 2007 (here). Consumer confidence figures are due out in the US today and expected to increase on gas prices being the lowest in 5 years.  
• Bloomberg morning metal news - more

  Reports

• Daily Market Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here
• Metals Insight - pdf here
• Daily Metals - pdf here
• Global Mining News - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - "Metal prices finished lower yesterday despite a weaker dollar and rising energy prices, the latter boosted by festering geopolitical problems, particularly from the Middle East. Instead, as we wrote in yesterday's note, LME metals seem to be transfixed more on the dreary macro economic headlines, and in this regard, there is little out there that could be considered inspiring-- or bullish. ... We are seeing a weaker LME session as of this writing amid fairly quiet trading conditions, as participants get ready to close out what has been a most memorable year. ... The dollar continues to weaken against the euro, and is now trading at 1.4170. However, along with metals, energy prices are also down, and importantly, not teeing off the weaker greenback. ... We are currently at $9,800, up $100, and quiet." (read Ed Meir's complete morning base metals report here)
• (Yieh) China ceased cutting its price offer for stainless steel to Taiwan since last week due to a more stable nickel based stainless steel price; meanwhile, they are also considering renegotiating previous offers with Taiwan’s steel mills. China has currently increased the price for their 304 series stainless steel products by RMB300/ton for domestic 304/2B and US$100/ton for export price. Some of foremost stainless steel mills’ offers are even higher.
• (SG) It is reported that Baosteel and Taiyuan Steel have fixed purchase prices for high carbon ferrochrome after purchase suspension for months. Baosteel offers price at CNY 6,000/50 base tonne and Taiyuan Steel quoted price at CNY 6,100/50 base tonne. However, the prices are said to be valid only to certain suppliers.
• (Dow Jones) Brazilian mining giant Companhia Vale do Rio Doce (RIO), or Vale, announced late Monday the incorporation of its nickel mining subsidiary, Mineracao Onca Puma S.A. ... The Onca Puma project is expected to come on stream in the first half of 2009 and eventually produce 58,000 metric tons per year..... Apart from Onca Puma, Vale also plans to bring another nickel mining venture into production in 2009 at Goro, New Caledonia. Initial output will be around 16,000 tons a year, eventually rising to 60,000 tons a year.
• OZ Minerals wins two-month refinancing lifeline - more
• A recent survey showed that over 60 percent of the 25,110 respondents had lost nearly 70 percent of the money they invested in the Chinese stock market. - more
• Commodities markets expected to stabilize in 2009 - more
• Rise and fall of commodities gives hints for 2009 - more
• Analysts bullish on 2009 commodity market fortunes  - more
• Foundations of Crisis - by Doug Casey - more

  Steel production to decline by 10% in 2009, say analysts - The steel business faces reduced production in 2009 of at least 10 per cent, analysts say. - more

  China's Tangshan Steel to merge with two firms - Tangshan Iron & Steel Co said on Tuesday that it had agreed to merge with two smaller Chinese steel makers to form one of the country's biggest listed steel producers. - more

• Tangshan Steel to merge with rivals - Tangshan Iron & Steel said today that it had agreed to merge with two smaller steel makers to form one of China's biggest listed steel mills, a sign of the country's accelerating push to consolidate the fragmented steel industry. - more
• Two thirds of China's major steel mills in the red - About two thirds of China's major steel mills were in the red in November, suffering from high prices in raw materials and the decreasing prices of steel products. - more
• China industry association to increase monitoring of iron ore imports - report - The China Iron and Steel Association will increase its monitoring of iron ore imports next year to prevent hoarding, the China Business News reported. - more

  JSW Steel Says Margins Will Shrink on Price Slump - JSW Steel Ltd., India’s third-largest producer, said profit margins will shrink in the financial third quarter as the global recession cuts demand and prices. - more

• Miners seek export duty withdrawal on chrome ore, concentrate - Domestic miners have sought removal of export duty on chrome and its concentrate used in processing of steel products, saying the offtake has fallen by over 70 per cent since last year with manufacturers axing output amid slump in demand. - more

  Ittefaq Steel plans to lay off 1,800 workers - The second largest steel manufacturer in the Kingdom plans to lay off 1,800 workers as a result of a deepening glut in the Saudi steel market, Al-Watan daily reported yesterday. - 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)
• India Metals Prices - Delhi - Dec 30 - 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

Monday, December 29

• Baltic Dry Index will next be updated on January 2nd, 2009. Ended 2008 at 774. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) Holiday Sales Drop to Force Bankruptcies, Closings // Dollar Falls on Concern Middle East Conflict May Cut Oil Supply // U.S. Stocks Drop as Dow Chemical, Rohm Overshadow Energy Gains // Asian Stocks Advance on Merger Speculation, Commodity Prices // Hong Kong’s Exports Fall 5.3%, First Decline in Five Months // Ruble Falls to Record Low Versus Euro as Russia Weakens Defense (Reuters) Lehman bankruptcy filing wiped out billions: report (Globe and Mail) Investors await 2008's last week of dismal data
• Base metals ended slightly higher, and while precious were trading higher earlier, they have since lost of their fizz. Dollar, which was nearly 2% lower against the Euro earlier in the day, is now only a 1/4 of 1% lower, and crude oil, which took a Middle East bounce earlier, is now also trading lower. European markets ended mostly higher, while US markets are trading mostly lower. In other words, today's market is souring as it grows older. Indicator charts show nickel had a quiet session with the day's chart looking like a mountain range... albeit a small one. Dow Jones reports three month nickel ended the day at $4.40/lb . For the first time in the last 6 trading days, LME nickel inventories did not grow by another 1000 tonnes plus. Considering the amount that has been arriving on a daily basis lately, this respite may only be because of the holidays. Total nickel levels stored in approved LME warehouses are fast approaching the 78,000 tonne level. In the screwy world of fasteners, China has announced a little tit for tat against the European's, by announcing it will investigate the imports of steel fasteners, after the Europeans added an anti-dumping charge to imports from China. The European's and Canadians have had anti-dumping duties on stainless steel fasteners from China for years. We appreciate your patience over the past few weeks as our ability to update in a timely fashion was greatly impaired. It appears we are back to normal operation again.  

  Commodity/Economic Comments

• Novosti - OAO GMK Norilsk Nickel, the world's largest producer of nickel and palladium and one of the largest producers of platinum and copper, is counting on state aid in the form of lower customs duties on exports of metal, told reporters on Friday the company director, Vladimir Strzhalkovsky. According to him, this is one possible option for the help of the state. "We expect that the state can be expressed, for example, to reduce customs duties on our group metals," - said Strzhalkovsky.
• Russia media - Ministry of Industry and Trade of the Russian Federation recommends that the Government of the Russian Federation establish a special safeguard duty of 28.1% on all imported stainless steel pipes for a period of three years.
• (Reuters) Severstal, Russia's largest steel maker, said on Monday it had idled a blast furnace at its Cherepovets Steel Mill because of weak demand. Blast Furnace No. 1 normally produces about 1.1 million tonnes of pig iron per year.
• There's No Pain-Free Cure for Recession - more
• 2008 Mining Hot Air awards - more

  Cuba Develops Nickel Industry - Cuba is developing the nickel industry, which is expected to produce more than 70,400 tons of mineral in 2008. - more

  Russia govt unveils list of strategic enterprises - Russia has unveiled a list of strategic enterprises entitled to preferential government support in the economic crisis but said the list was not complete and did not guarantee the receipt of the financial help. ... Among others, the list includes  ... Norilsk Nickel (GMKN.MM), the world's biggest producer of nickel and palladium ...  - more

  Chinese iron ore port inventories drop 19% in December - A temporary recovery in steel prices in China has apparently led many small and mid-sized steel mills in China to resume production. - more

  OZ fails to secure new loans deal - OZ Minerals' hopes of being able to announce it had won a month's breathing space to renegotiate more than $800 million of debts were dashed last night when it failed to get approval from all its bankers. - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 7:45 am CST show 3 month nickel trading around $.17/lb higher in thin trading, as the Euro trades 1.25% higher against the Dollar. Crude oil climbs on Middle East tensions (by 3.2% and over $40/barrel), but off earlier high's. Metals, both precious and industrial, are trading in the green, although nickel has gotten the most favorable bounce so far. Overnight, Asian markets ended higher, and European markets are also trading higher this morning. US futures show a quiet opening. Most of the news articles are posted below in the weekend update.    
• Bloomberg morning metal news - more

  Reports

• Daily Market Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here
• Metals Insight - pdf here
• Metals Commentary - pdf here
• Metals Weekly - pdf here
• US Imports of Steel Mill Products - more   All Stainless - more

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - (still waiting for daily report - will post when received)
• (Bloomberg) Russia may annul its export duty on nickel and copper to support producers after metal prices plunged. A government commission on protective measures in trade recommended dropping the current 5 percent duty on nickel and 10 percent duty on cathode copper, the government said on its Web site late Dec. 26.
• Weekly Forecast by SMM Specialist - here
• Analysts expect tough year for commodities - more
• Commodity costs expected to soar from climate change - more
• (SBB) German stainless mills see orders fall 68% in November

  Miners seek export duty withdrawal on chrome ore, concentrate - Domestic miners have sought removal of export duty on chrome and its concentrate used in processing of steel products, saying the offtake has fallen by over 70 per cent since last year with manufacturers axing output amid slump in demand. - more

• Ore ships stuck at Sandheads - As a clear sign of iron ore trade picking up after the government waived export duty on the commodity, around 27 ships that would either load or unload ore at Haldia are stuck at sandheads. - more

  China's steel industry sees 12.77b yuan loss in Nov - China's 71 major mills may post a loss of up to 12.77 billion yuan ($1.86 billion) in November, China Securities Journal reported on Dec 29 citing anonymous sources. - more

• China's Major Power Producers Reject 2009 Coal Prices - China's five biggest state power producers rejected a 10 percent price increase sought by the nation's suppliers of thermal coal for next year as slowing demand for energy undermines profitability. - more (thanks CO)

  Japan steel-makers expecting 12% drop in profits - report - Japan's two biggest steelmakers will likely downgrade earnings for the year to March 2009 and announce a 12% drop in profits, a leading Japanese business newspaper said Sunday. - more

  China starts anti-dumping probe into EU carbon steel fasteners - China's Ministry of Commerce started Monday an anti-dumping investigation into carbon steel fasteners imported from the European Union (EU), the country's latest response to the latter's proposed high anti-dumping duties on Chinese fastener exports. - more

  The End of Mineweb as we know it - Before the global collapse of mine commodities and mining equities in the autumn of 2008, Mineweb, the Johannesburg-based mining publication, suffered a meltdown in asset valuation. Then, in July 2008, it incurred the worst cash loss in the publication’s history. - 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)
• India Metals Prices - Delhi - Dec 29 - 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

Weekend Briefing, December 28

  Toledo Mining lays off 90% of workforce - Toledo Mining Corp. said it had laid off some 600 workers and contractors while some directors took pay cuts as dampened demand took its toll on nickel operations in the Philippines.- more

• Mines sector braces for layoffs - Carmen Copper Corp. (CCC) is preparing to lay off several thousands of workers at the start of 2009 as the rehabilitation of its pits in Toledo City in Cebu nears completion, while London-based Toledo Mining Corp. (TMC), the owner of mines in Palawan, has already laid off 600 employees and contractors at its Berong nickel project after prices slumped. - more

  LME Ring Ends For Holidays On Subdued Note - Predictably illiquid trading conditions characterized London Metal Exchange trade Wednesday, with the ring now closed for the holidays and traders expecting activity to remain subdued when it reopens Monday. - more

• Nickel, Zinc, Copper Fall as Slumping Demand Boosts Inventories - Nickel, zinc and copper fell as a global economic slowdown weakened demand for industrial metals used in manufacturing and construction. - more
• Baltic Dry Index was down 10 to 774 on Wednesday, and did not publish on Thursday and Friday. Dow Jones reports three month nickel ended Wednesday at $4.35/lb . Not much is expected in the coming week, with negative expectations for early 2009 giving traders no reason to cover short bets, or make long bets. In the coming week, the London Metal Exchange is closed on Thursday only, and will trade on Friday to start the new year. Sucden's nickel trading chart thru Tuesday, shows a seriously oversold market based on RSI and SStoch, but the market appears to have found a comfort trading level between $4.25/lb and $4.75/lb (chart).

  Umetal, in an article posted by Steel Guru, is reporting that there will be no wide adjustment in Chinese stainless steel market before the Spring Festival and the price for 304/2B grade 2.0mm coil might be stabilized at CNY 17000 to CNY 18000 per tonne. However, some other traders guess there will be a temporary rebound considering recently tight supply and less possibility of short term in-filling. So they plan to pile up some materials in January 2009, preparing for next year. Here are some viewpoints from those holding a grim future outlook. (1.) Short supply in the market is mainly attributed to mills' perfect control of outputs and deliveries. And mills are likely to increase deliveries while traders on vocation, easing the short supply. As a result, the price would stay still even there is a small rise of downstream demands. (2.) It remains unclear whether nickel, as an important stainless steel making element deciding the metal's price, be able to arrest the current price downward spiral (3.) 2009 stainless steel export will be largely slashed in light of the serious recession in the EU an America markets under worsening global economic crisis. According to main stainless steel producers in China, the 4Q export volume for stainless steel sheet and coil has halved from the Q 1 level with poor orders and mixed quotations. Under such infection, it's hard for overseas demand to rally after the festival. In downstream sectors, the ratio of production is decreasing, and domestic demand hard to present evident increase in short term. As a result, the market tends to be stable fore and after the festival when mills produce and supply products for the sake of market stabilization.

  Commodity/Economic Comments

• (JMB) Nippon Steel and JFE Holdings have announced plans to cut production to one million tonnes and 500,000 tonnes, respectively, but both will now be forced to reduce output more quickly.
• (SG) Emirates Business reported that steel prices in Abu Dhabi plunged by up to 35% in November to maintain a steady decline for the fourth straight month after surging by at least 90% in the H1 of this year.
• (SBB) US stainless imports fall, led by 33% decline in CR sheet
• Bloomberg reported that Sumitomo Metal Mining Co will cut production of ferronickel in January 2009 as the global financial crisis reduces demand. Per the report, Sumitomo Metal will close one of two lines at the Hyuga ferronickel smelter in Miyazaki Prefecture, bringing forward 35 day maintenance scheduled to start in February 2009. The company will extend the suspension of the line and later decide the size of the output cuts.
• Global economy to shrink for first time since the Second World War - more
• Guinean junta warns mining sector - more
• Wealth of UK's super-rich halves; Mittal tops losers' list - more
• Japan factory output has biggest fall on record - more
• (SBB) Big US output cuts continue, now threatening to take weekly raw steel production below 1m short tons - down from nearly 2.2m s.t/week in August.
• (IHT) Venezuela will seize several gold mining concessions that previous governments granted private operators, in a bid to supplement falling oil prices with proceeds from state-controlled gold, President Hugo Chavez said Saturday.
• (AP) Bolivian miners are threatening to take over several mines to protest their firing. Union leader Roberto Chavez says mining companies made huge profits as metal prices soared, and shouldn't punish workers as prices now sink. Chavez says 700 miners at Sinchi Wayra, a subsidiary of Swiss miner Glencore International, may occupy and work its mines in cooperation with Bolivia's government.
• Commissioning of the Barro Alto nickel project is to be delayed by 12 months as Anglo American reins in its capital expenditure. First production at the mine is now expected in the first quarter of 2011.
• Tex - India's Ministry of Commerce & Industry has announced its decision to initiate an antidumping investigation into imports of stainless CR sheet products from Japan, China, South Korea, the EU, South Africa, Taiwan, Thailand, and the USA, according to information collected by the Japan Iron & Steel Federation. The decision relates to the AD case filed by Jindal Stainless Ltd against imports of stainless CR sheets 600mm wide or wider from Japan and the seven other sources.
• (MF) Yildirim, Turkey's greatest chrome ore producer, controlled by Eti Krom, expected that Turkey would export chrome ore down to 1 million tons/year in 2009 with a decrease of 50% compared with exports in 08. Yildirim concluded export decreases related to a sharp fall in China??s. Its export price to China is steady at USD200 cent/dmt. (Cr2O3, 42% Cr, CFR) When season factor is concerned, Turkey's most chrome ore producers would suspend production till May, 2009. At the same time, because of financial turmoil, EtiKrom postponed new project investment till 2011, and has already but production by 50%.

  CISA warns domestic steel mills to avoid index pricing on next year iron ore supply deals  - China Iron and Steel Association (CISA) warned the country's steel mills to stay away from index pricing in next year's iron ore supply deals, the Shanghai Securities News reported on Thursday. - more

• Mysteel update on Chinese stainless steel industry - Mr Shao Lei analyst of Mysteel has presented some suggestions to promote healthy development of the sector by analyzing the problems and forecast of the future trend on China's weakening stainless steel market plagued by the economic recession as for other steel varieties. - more
• Output Of Crude Stainless Steel In China For CY2008 Is Supposed To Come To 7.10 Million Tons = A Forecast By China Metal Materials Trade Association, To Decrease By 6% - here
• The Chinese metals industry - a roundup of 2008 and the outlook for 2009 - The year has been a roller coaster ride for most industrial metals, culminating in sharp price drops as the global financial crisis gripped major economies. As the world's largest consumer and producer of metals, China's demand was the main factor behind skyrocketing metals prices over the past few years through to the beginning of 2008. - more
• China Steel Mills To Raise Prices - China's major steel mills are raising steel prices by up to CNY350 a metric ton from the next two months, in an apparent race to return to profitability even at the cost of weakening their position at iron ore price negotiations with miners. - more

  Nickel - Former chief of the Kremlin administration was elected Norilsk Nickel chairman - Shareholders of Norilsk Nickel, Russia’s biggest palladium and nickel producer, gathered for a special general meeting to elect a new board of directors of 13 members. - more

• Voloshin to Chair Norilsk Nickel Board - Former head of the Presidential administration, Aleksandr Voloshin, will chair Norilsk Nickel’s board after shareholders approved his candidacy at a meeting on Friday. - more

  Nickel - The cost of doing business in the Philippines - Foreign investors can face daunting obstacles when they do business in the Philippines. - more

  Iron Ore - Ore exports double in Nov on Chinese demand - Thanks to demand from China, iron ore exports from India have regained momentum. Low prices of Indian ore in the spot market have prompted Chinese steel makers to source the raw material from the country instead of depending on long-term agreements with Australian and Brazilian mining firms.. - more

• Steel - Steel to pick up by June quarter - Though international steel prices have dropped by 60 per cent and domestic by 25 per cent from their peaks, margins for the next financial year are likely to be at the same levels as that in the current year, which has also seen prices move north. - more
• India Metals Prices - Delhi - Dec 26 - more
• Morning Bell 12/27 - pdf here
• Morning Bell 12/26 - pdf here
• Metals Commentary 12/26 - pdf here
• Sarda Energy & Minerals has revealed that it has shut down its iron ore mines operations temporarily. According to sources, the conglomerate has taken this step due to non-conducive atmosphere created by outside miscreants, at the iron ore mines of Sarda Energy & Minerals.

  Scrap/Steel - Steel Prices Fall as Steelmakers Reduce Output - Japan’s weekly scrap iron and steel prices fell for a second week, dropping 3.4 percent, as JFE Holdings Inc., Nippon Steel Corp. and rivals deepen output cuts in response to weakening demand. - more

• Japan's JFE Steel says shutting furnace - Japan's second-largest steelmaker said Thursday it will shut down one of its blast furnaces from next month as global demand for steel plummets with the economic downturn. - more

  Scrap - Economic downturn hits metal dealers and scavengers where it hurts. - On a cold, wet morning at Atlas Iron and Metal yard south of downtown, scrap peddler Charlie Anderson was not happy about the cash he was handed in exchange for a truckload of junk. - more

  Certain Welded Stainless Steel Pipes from the Republic of Korea: Preliminary Results of Antidumping Duty Administrative Review - more

Wednesday, December 24

• Indicators at 6:50 am CST show 3 month nickel selling around  $.02/lb  higher. US dollar is trading lower against the Euro, while crude oil is trading down 5.5%. Nickel is getting a minor boost from the Dollar, and news that the Tati Nickel Mine in Botswana will take a nearly two week vacation shutdown, due to low nickel prices. But any possibility of an advance should be kept in check by another large overnight gain (over 1000 tonnes) into LME warehouse stock. Overnight, Asian markets ended slightly lower, while European markets are trading slightly higher. US futures show a quiet opening. Also, we found it interesting, when we read in a report from China that at least one Chinese pig nickel producer has re-opened in the last few weeks. News from China is difficult to get, so we have been unable to verify this information with a reliable second source.
• We want to take this last opportunity to wish you all a very Merry Christmas!!
• Bloomberg morning metal news - more

  Reports

• Daily Market Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - "Copper prices continued to plummet yesterday, shedding another 4% to hit fresh four-year lows, as investors lightened up on positions heading into a holiday-shortened week. Other metals were hit along with copper, although ali continued to prove immune to the selling by holding up fairly well. The US macro news that came out over the course of the day yesterday did not help matters much. In this regard, we saw sales of single-family homes drop in November by the most in two decades, (off by a stunning 8.6%) while resale prices fell at a pace not seen since the Great Depression. The number of previously owned unsold homes at the end of November soared to 11.2 months of supply, up from 10.3 months seen at the end of October. Far from stabilizing, the housing sector seems to be moving from bad to worse and remains a persistent drag on overall economic activity. Less of a surprise, were final US GDP readings for Q3, which came out in line with estimates, falling by -.5% ... This morning we are off to a very quiet start on the LME.  ... We are currently at $9,700, down $50, as LME stocks continue to move higher, while buying remains light. (read Ed Meir's complete morning base metals report here)
• (Barclay's) China’s net refined nickel imports fell again in November, by 34% y/y and 22% m/m to 5.9Kt. Meanwhile, imports of low-nickel concentrates fell sharply – at 483Kt, imports were lower by 59% y/y and 31% m/m, and at their lowest levels since December 2006. This fall in low-nickel concentrate imports is not surprising in our view, reflecting the effect of a combination of sharply lower nickel prices, coupled with high costs of coke and power that have reduced the profitability of Chinese nickel pig iron production.
• (WSJ) Brazil crude steel output slumped in November owing to slowing demand, along with scheduled mill maintenance shutdowns, the Brazilian Steel Institute, or IBS, said Tuesday. Brazilian steelmakers produced 2.324 million metric tons of crude steel in November, down 19.1% from 2.871 million tons in November 2007.
• Rio, Alcoa May Face Extortion After Coup Attempt, Eurasia Says - Rio Tinto Group, Alcoa Inc. and other mining companies operating in Guinea will likely face extortion after an army faction attempted a coup, political research firm Eurasia Group said. - more
• (Dow Jones) Commissioning of the Barro Alto nickel project is to be delayed by 12 months, diversified global miner Anglo American PLC (AAUK) said Wednesday, as the company reins in its capital expenditure. First production at the mine is now expected in the first quarter of 2011.
• (ACNB) Nickel sector weakens below Moving Average (MA), with 50-day MA trailing its 200-day MA, drops 0.1%
• (SG) Mr Wang deputy director of China Metals Materials Trade Association said that China's domestic stainless steel market is currently quite confusing due to the continuing downward drift of nickel prices in the global market. He added that, on the other hand, some stainless steel producers are focusing on substitutions of other stainless steel products to meet their needs. For example, the modern technology and processing craftwork and art decoration with development and application of nickel free as ferrite stainless steel is much better. Meanwhile, chrome manganese nickel stainless can use ferronickel instead of pure nickel in order to offset the high prices of nickel. Mr Wang also predicted that the global nickel consumption goes up by around 66% in 2008 along with 69% up in China's consumption.

  Nickel premiums steady as Christmas looms, stocks pile higher - Platts assessments for European physical nickel premiums remained static this week as futures trade slowed in the lead-up to Christmas, with the metal's physical market showing little or no signs of activity - more

  Norilsk halts Botswana unit for 12 days - The world's top nickel producer, Russia's Norilsk Nickel, said on Wednesday it will halt for 12 days its Tati Nickel mine and concentrator in Botswana due to a furnace breakdown at a smelter that processes its concentrate. - more

  Losing Rio Tinto No Comfort for BHP Battered by Nickel Debacle - Foreign investors can face daunting obstacles when they do business in the Philippines. - more

  Toledo cuts back as nickel price slumps - Philippines-focused miner Toledo Mining saw pre-tax profits more than halve in the six months to 30 September, reflecting the slump in the price of nickel over the reporting period. - more

  Metal thefts lose their luster - Over the summer, metal thefts were so rampant, thieves were stealing the heavy-steel sewer grates and manhole covers. - 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)
• India Metals Prices - Delhi - Dec 24 - 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

Tuesday, December 23

• Baltic Dry Index - minus 17 to 784. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) U.S. Housing Prices Collapse at Near-Depression Pace After Purchases Slide Sales of single-family houses in the U.S. dropped in November by the most in two decades and resale prices collapsed at a pace reminiscent of the Great Depression, dashing speculation the market was close to a bottom. // Stocks in U.S. Fall on Auto-Industry Concerns, Record Drop in Home Values //   (Market Watch) U.S Nov. new home sales down 2.9% to 407,000 // U.S. Nov. existing home sales fall 8.6% to 4.49 mln units
• Indicator charts show nickel traders were in a sour mood today, and nickel spent the day in a slide. Dow Jones reports three month nickel ended the day at $4.42/lb . Crude oil ended lower after a morning attempt to breech the $40/barrel level, and the Euro ended slightly higher against the Dollar.

  Commodity/Economic Comments

• Moody's revises Xstrata outlook to negative - more
• Commodities look cheap, but investors wary - more
• Raw materials shed luster - In recent years, many investors have taken out low-interest bearing yen loans to bet on a jump in commodity prices and an advance in high- yielding currencies versus the US dollar. - more
• Investor morale at record low, State Street reports - more
• (CM) Supply of iron and steel products will exceed demands next year in China despite the positive fiscal policy support, said analysts with the South China metal Materials Trading Center. Production capacity of Chinese steel makers, in particular that of mid- and small-sized plants, will further expand next year, but oversupply is bound to occur next year, held Liu Yuanrui, expert for steel industry from Changjiang Securities.
• Moody's issues negative steel industry outlook - Moody's Investors Service issued a negative outlook Tuesday on credit conditions in the U.S. steel industry in the next year to 18 months, citing forecasts for weak demand for steel next year. - more
• Ten Worst Performers of 2008 - more

  Metals take a beating, but stay in shape - Outlook for base metals remains bearish in medium to long term due to demand concerns despite some pull back in prices early of this week. Analysts feel that prices will be under pressure till there are signs of restoration of consumer confidence and revival of economic situation across the major economies like the US, Europe, Japan and China. - more

  Booming Baosteel stands as model for China's industrial reform effort - If there is any single company that fully reflects China's progress in economic reform over the past 30 years, Baosteel Group Corp would probably be at the top of the list. - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 6:40 am CST show 3 month nickel selling around $.16/lb lower .  Metals are mostly lower this morning, and indicator charts show nickel has taken a recent dip in its trading cost. US Dollar is trading lower against th Euro, while crude oil is slightly higher this morning. Asian markets ended overnight trading mostly lower,  while European markets are trading slightly higher. US futures show a quiet opening. LME nickel inventories rose by over 1000 tonnes last night. Not many reports this morning but we posted quite a few last evening.
• Bloomberg morning metal news - more

  Reports

• Numerous reports posted last evening below
• Daily Market Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments -  "In Chinese markets, metal prices were down overnight in line with weaker equities. The Chinese stock market fell a steep 4.5% despite the government’s moves yesterday to lower interest rates. Clearly, the expectations were for far more aggressive cuts. On the LME side of things, we are mostly down as of this writing .... Some macro numbers out of the US later today could provide further direction. In this regard, we get final US GDP readings for the third quarter, (expected at -.5%), as well as existing home sales for November, (expected at 4.93 million units), new home sales (expected at 420,000 units), and December Michigan sentiment readings (expected at 58.6). The dollar is slightly weaker today, and crude oil prices are off following yesterday’s very weak session. Elsewhere, the macro news remains bleak; an item we missed yesterday on Japan had the country reporting its biggest ever drop in exports in November, with business sentiment also falling sharply on the month. In addition, Toyota forecast its first ever group operating loss of some $1.7 billion due to a collapse in global automobile demand and a surge in the yen. This morning, we have reports out of the UK that the economy shrank by its greatest amount since 1990 in Q3, (off by .6%) with mortgage lending dropping to its lowest level in 14 years .... We are currently at $9,985, down $315, and on the defensive in light of rising LME stock levels(read Ed Meir's complete morning base metals report here)
• Forecasters share predictions for economy's outlook in 2009 - more
• Commodities outlook for 2009 - more
• Dark outlook for commodities - more
• Not Your Grandfather's Depression - more

  Stainless Steel Output Will Decline by Almost 1 Million Tonnes in 2008 - In the first three quarters of this year, global stainless steel production was approximately one percent up on the 2007 out turn. In our September issue we predicted a modest decline in output for the full year. Now we believe that the reduction could be approaching one million tonnes - over 3 percent. - more

  Thainox to halt production for 1 month due to weak demand - Thainox Stainless, Thailand's largest stainless steel producer, said on Tuesday it planned to stop its production for one month due to weak global demand. - more

  China's average local HRC price up, rebar down as at Dec 19: CISA - China's average domestic steel price for hot-rolled coil was higher in the middle of December, while rebar was lower, China Iron and Steel Association, also known as CISA, said in its latest survey on domestic prices. - more

• China steelmakers raise Jan hot-rolled prices-paper - Several Chinese steelmakers have raised their January prices for hot-rolled steel products, the official Shanghai Securities News reported on Tuesday. - more

  Directors at Norilsk Nickel Rescind Bids - Norilsk Nickel independent directors Heinz Schimmelbusch and Guy de Sellier have withdrawn their candidacies for re-election to the board, Norilsk said Friday in an e-mailed statement, as sentiment appears to be growing around other names. - more

  Vale Inco employees collect record amount of food - Vale Inco employee Edgar Burton, a machine operator for 30 years, has once again organized one of Canada's biggest food drives. - 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)
• India Metals Prices - Delhi - Dec 23 - 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

Monday, December 22

• Baltic Dry Index - minus 17 to  801. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Dow Jones reports three month nickel ended the day unchanged at $4.65/lb.

  Reports

• Metals & Mining Monthly - pdf here
• BMO Monthly - Commodity Slide Continues - pdf here
• Markets Data review - here
• Canada Commodity Price update - pdf here
• Weekly Commodity Price Update - pdf here
• Fortis metals monthly - pdf here
• Canada's Minerals Monthly - pdf here
• Global Mining News - pdf here
• SteelWorld Articles - Indian Industry Ferro Alloys - pdf here   Steel Demand Seen Gloomy Until Mid-2009 - pdf here  Ferro Alloy Conservation For Long Term Use - pdf here
• Metal World - pdf here
• Weekly Forecast by SMM Specialist - here

  Commodity/Economic Comments

• Scotiabank Commodities Expert Provides a Year-End Review and Outlook for Commodity Prices in 2009 - more
• (Dow Jones) "Many analysts expect to see a volatile, but sideways market in the lead-up to the new year," says major market participant, who asked not to be named. "Underlying demand concerns remain an issue and will put a natural cap on prices in the near term."
• (Dow Jones) LME nickel fundamentals continue to weaken, with production cuts expected amid rising inventories and a market surplus, says a broker. Notes the market was showing a 15,000 metric tons supply-demand surplus in October, with reported stocks up over 25,000 tons since June. LME nickel stocks are +1,122 tons Monday to 75,366 tons.

  China's Jan-Nov electrolytic nickel output up 11% to 124,086 mt - China's total electrolytic nickel output over January-November 2008 reached 124,086 mt, up 11% from the corresponding period a year ago, an official with Beijing Antaike, the state-owned nonferrous metals information provider said Monday. - more

  Metal meltdown to persist - As the curtain draws on one of the most tumultuous years for the WA mining sector, analysts have flagged more doom and gloom for 2009 after forecasting the prices of key metals, including nickel and copper, to struggle in their recovery. - more

  Couretesy AISI - In the week ending December 20, 2008, domestic raw steel production was 1,022,000 net tons while the capability utilization rate was 42.9 percent. Production was 2,102,000 tons in the week ending December 20, 2007, while the capability utilization then was 88.1 percent. The current week production represents a 51.4 percent decrease from the same period in the previous year. Production for the week ending December 20, 2008 is down 12.5 percent from the previous week ending December 13, 2008 when production was 1,168,000 tons and the rate of capability utilization was 49.0 percent.

  Norilsk Nickel unlikely to change hands, experts say - The transfer of part of Russian businessman Vladimir Potanin's stake in Norilsk Nickel shares as collateral to a state-controlled bank does not mean a change of ownership, analysts told RB - more

  Early Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 6:50 am CST show 3 month nickel selling around $.05/lb   lower and recovering from an early morning dip. Dow Jones reports three month nickel ended the day Friday at $4.65/lb , slightly higher than Thursday's close. Metals took an afternoon bounce Friday after the Bush administration granted the US automotive industry $17 billion dollars in emergency loans. Traders hope this move will give the steel industry a boost. Not much is expected this short holiday week, although US economic reports issued are not expected to be good.  The London Metal Exchange will be closed this Thursday and Friday. Nickel inventories took another large jump Friday, by over 1300 tonnes, and last night, by another 1100 tonnes plus. Asian markets ended mostly lower overnight and this morning, European markets are mostly lower, while US futures are slightly higher. Crude oil is trading slightly higher this morning, and the Euro is trading slightly higher against the Dollar. It appears now we will not be able to resume our normal two day updates, in a timely fashion, until after the holidays.
• Bloomberg morning metal news - more

  Reports

• Crude Steel statistics 2008 - graph here
• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here
• Daily Briefing - pdf here
• Weekly Scoreboard - pdf here
• Metals Report - pdf here
• Metals Insight - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Ed's daily commentary arrives to us just in time to post on a normal day. With this early posting, we will be unable to post today's comments. For your convenience, here is a back up link directly to MF Europe's office that updates sometime during the day (here)
• Declining productivity "a major drag", says report  - While the mining industry has contributed to Australia's recent prosperity, the sector's productivity is falling - more
• (Interfax) Chinese imports of lead and zinc in both refined and concentrate forms, as well as refined nickel, all exhibited year-on-year growth over the first 11 months of 2008, while the country's exports of refined lead, zinc, nickel and tin over the same period plummeted on an annual basis, according to figures released by the General Administration of Customs on Dec. 22.
• Reuters - Japan's exports fell by a record 26.7 percent from a year earlier, the Ministry of Finance said on Monday, as the global economic downturn hammers demand for Japanese goods.
• Greek Shipping Billionaire Sues Fortescue on Iron Ore - more
• (Reuters) Toyota Motor Corp forecast a first-ever annual operating loss, blaming a relentless sales slide and a crippling rise in the yen in what it said was an emergency unprecedented in its 70-year history.
• (China Daily) China announced Monday that the benchmark interest rate will be cut by 27 basis points along with the reserve requirement ratio.
• (JMB) Japanese raw steel output decreased by 12.9% to 8.881 million tonnes in November from a year earlier, which decreased for 2 months in a row, announced by Japan Iron and Steel Federation on Friday.

  Article says nickel miners reportedly in danger in Zimbabwe - Poor international prices and the difficult mining conditions in the country are taking their toll on Bindura Nickel Corporation Limited (BNC), the principal asset in Mwana Africa Plc's portfolio, with results for the six months ending September 30 2008 showing a loss after tax of US$18,8 million. - more

  China's Jan-Nov electrolytic nickel output up 11% to 124,086 mt - China's total electrolytic nickel output over January-November 2008 reached 124,086 mt, up 11% from the corresponding period a year ago, an official with Beijing Antaike, the state-owned nonferrous metals information provider said Monday. - more

• China Nov Base Metals Table Of Trade Data - more

  Export of stainless steel scrap causing havoc for the surgical sector - Daily Times reported that the leakage of production technology, rise in production cost of surgical instruments and the export of steel scrap are causing havoc for the surgical sector as scrap is the major source of locally produced stainless steel, which fulfills approximately 30% of the requirement. - more

  Half of Canada's mining companies could go bankrupt after dismal year: analyst - Few Canadian resource industries fared well in what turned out to be a dismal year for commodities, but base metal miners were hit particularly hard as credit markets tightened, global demand slumped and prices for everything from zinc and copper to iron ore and aluminum plummeted - more

  Rio says to close 11 iron ore mines for two weeks - World No 2 iron ore miner Rio Tinto Ltd/Plc is in the process of shutting down all its iron ore mines in Australia's Pilbara region for two weeks to cut production by 10 percent by year-end in the face of declining demand from steel mills. - more

• Shutdowns will axe 5000 mine jobs - Nearly 5000 Australians employed in the mining industry have lost their jobs as growth in the previously booming resources sector grinds to a halt and up to $40 billion worth of new projects are put on the back burner. - more
• Heavy Rains, Strong Winds Head Toward Australian Mining Region - Destructive winds and heavy rainfall are heading toward mines in the northwest of Western Australia, potentially halting operations, the weather bureau said - more
• One third of miners to disappear - More than a third of Australia's 800-odd publicly-listed mining and exploration companies may not survive the crash in commodities markets. - more
• Mining towns told to brace for more hardship - The Mount Isa Chamber of Commerce, in north-west Queensland, says mining towns need to be prepared for more tough times as the resources slump continues.- more
• Metal meltdown to persist - As the curtain draws on one of the most tumultuous years for the WA mining sector, analysts have flagged more doom and gloom for 2009 after forecasting the prices of key metals, including nickel and copper, to struggle in their recovery. - more

  Turkey Has Cautious Outlook For Chrome Exports In 2009 = A Major Producer, Cr-Ore Exports In 2009 Are Anticipated To Decrease By 50% Compared To That In 2008 - Reflecting a substantial expansion of the markets to export chrome ore, Turkey was successful in having developed largely its production of chrome ore in 2007 and 2008 but, as for the exports of chrome ore in 2009, a major producer in Turkey has a cautious outlook. The Yildirim Group (Eti Krom), which is the largest producer of chrome ore and ferro-chrome in Turkey, has foreseen that the quantity of chrome ore to be exported from Turkey in 2009 will shrink to a scale of 1,000,000 tons per annum with a decrease of 50% from that in 2008 -  more

  Oligarchs Seek $78 Billion as Credit Seizure Empowers Putin - Russian oligarchs are lining up for $78 billion of Kremlin loans to survive the credit squeeze, handing Prime Minister Vladimir Putin the opportunity to increase government control of the nation’s biggest companies. - more

• DJ Russian State Controls 50% Of Norilsk Nickel - Report - The Russian state now controls about 50% of shares in mining giant Norilsk Nickel, after co-owner Vladimir Potanin used some of the company's shares as loan collateral to a state bank, Vedomosti daily reports Monday citing unnamed sources close to the company. - 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)
• India Metals Prices - Delhi - Dec 22 - 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

Friday, December 19

• Indicators at 6:40 am CST show 3 month nickel selling around  $.07/lb higher, but appears to be having a problem holding onto its higher opening. Other metals are mixed and quiet. Worldwide equity markets either closed dow overnight, are trading lower at present, or futures show lower openings. US Dollar is trading nearly 2% higher against the Euro, and traders have shrugged off OPEC's production cut of 10% as not enough, and crude oil is struggling to get back above $40/barrel.   
• Bloomberg morning metal news - more

  (Dow Jones) Base metals were slightly higher Friday in an extremely quiet session. Profit-taking by shorts contributed to the rebound, which came despite a stronger dollar and lower crude oil prices. But volumes were low, reflecting volatility in currency markets and the lack of business as the year-end nears, traders said.

  Reports

• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here
• Metals Insight - pdf here
• Metals Insider:  - more
• Metals Commentary - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Ed's daily commentary arrives to us just in time to post on a normal day. With this early posting, we will be unable to post today's comments. For your convenience, here is a back up link directly to MF Europe's office that updates sometime during the day (here)
• (MetalTorq) The demand for cotton to the rolls of class 304 will likely fall till 2010. Then the situation will improve, said the report, Director of United Stainless Steel Co, Peter Vayldbora at the 12th Middle East conference on steel industry in Dubai.
• (Rusmet) Most Brazilian distributors of stainless steel looks forward to next month's significant decline in the price of a single manufacturer, ArcelorMittal Inox Brasil. Prices for steel stamps 304 may go down in January by about 15% and 316 marks for the reduction could reach 26%.
• (Interfax) China's tariffs and tax rebates on metal product exports will remain unchanged early next year according to a government tax policy announcement on Dec. 17, despite hints to the contrary from a senior government official earlier this month.
• (Interfax) China's steel product prices are expected to further stabilize as market confidence builds in response to the central government's recently announced economic stimulus policies, according to a monthly report released by the China Iron and Steel Association (CISA) on Dec. 16.
• (Xinhua) Chinese steel demand in 2009 will be around 500 million tons, forecast Yang Jianlong, chief of the Economy Research Office of South China Metal Transaction Center in Guangzhou.
• After shock, Madoff fraud victims struggle to cope - more // Bernie Madoff, anti-Claus, scars markets for years - more
• (Anglo American) The Barro Alto nickel project in Brazil will be delayed by 12 months, with first output in early 2011.
• ThyssenKrupp may slash steel output, cuts work time - more

  OZ Minerals Shuts Avebury Nickel Mine on Prices - OZ Minerals Ltd., the world’s second- largest zinc mining company, shut the Avebury nickel mine in Australia because of declining prices. - more

  Chinese 304 stainless prices still in downtrend - Chinese domestic stainless 304 prices have continued their decline on weak demand. Hot rolled coil prices fell by RMB 1,400/tonne ($205/t) and cold rolled coil prices by RMB 700/t ($102/t) over the past month. - more

  New laws halt Rio's $US2bn Indonesian nickel project - Rio Tinto's $US2 billion ($A2.9 billion) La Sampala nickel project in Indonesia is on hold for at least six months after the nation's parliament cleared tough new mining laws.- more

  Market Tendency On Imports Of Ferro-Alloys At 15th December 2008 = In China, Prices Of Manganese Ferro-Alloys See Bright Tone - more

  Global Steel Price Plummet Despite Significant Output Cuts - Despite substantial mill output cuts, with capacity utilisation down below 50 percent in early December, US transaction values continue to drop. - more

 Greek Shipping Billionaire Sues Fortescue on Iron Ore - Greek shipping billionaire John Angelicoussis is suing Fortescue Metals Group Ltd. for $130 million as a collapse in vessel-rental rates triggers an increase in industry lawsuits. - more

• (Bloomberg) Atlas Iron Ltd., an Australian iron ore producer, signed a long-term sales accord with a “medium- sized” Chinese steel mill for 30 percent of production from its Pardoo project. The accord will run until March 31, 2012, with the first shipment expected to be completed by the end of March, the Perth- based company said today in a statement to the Australian stock exchange.
• China may have its way in fixing ore prices - China never took it well that the world’s three big miners extracted hefty price rises for iron ore in the past few years. Now, it is going to give it back to Brazil’s Vale and Anglo-Australian BHP Billiton and Rio Tinto. - more

  WBMS - The Nickel market remained in surplus of during January to October 2008 with output exceeding demand by almost 39.7 kt. Reported stocks, held mainly in the LME, were 7.2 kt higher. Refined production for the ten months totalled 1135.9 kt and demand was 1096.2 kt. The supply and demand data include low grade ferro nickel produced in China from imported ores which had previously been excluded from the WBMS data. The quantity of this material produced in the last few months has fallen due to lower availability of imported feed materials. Mine production in January to October 2008 was, at 1272.2 kt, 2.7 per cent below the comparable 2007 total. Refined production was 6.4 per cent below the 2007 total with output reductions in China and Japan accounting for the decline. World demand was 2.9 per cent lower than the previous year. No allowance is made in the consumption calculation for unreported stock changes. In October nickel smelter production was 107.5 kt and consumption was 99.3 kt.

  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)
• India Metals Prices - Delhi - Dec 19 - 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, December 18

  Abridged Daily Nickel/Stainless Wrap-up

• Baltic Dry Index - minus 7 to 829. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Indicator charts show nickel fell in the first half of the trading day, and regained most of its earlier losses, during the latter part of the day. Dow Jones reports three month nickel ended the day at $4.43/lb

  Commodity/Economic Comments

• (Dow Jones) OZ Minerals Ltd. said Friday it will shut its Avebury nickel mine in Tasmania because it has become unprofitable due to the drop in nickel prices.
• China Daily - China will cancel export license management for steel products in order to boost exports, effective Jan 1, 2009, sources said. The move will be the latest measure after China abolished export tax on steel products, amid efforts to increase China's steel exports.
• China Daily - China's crude steel production dropped 12.4 percent in November from a year earlier to 35.19 million tons, the lowest monthly output since April, 2006, according to figures released by the National Bureau of Statistics (NBS) on Monday.
• Ralph Preston, a commodity analyst at Heritage West Futures Inc. in San Diego - “The Fed’s actions show just how dire the credit crisis is and how desperate they are... The metals smell the fear. Market psychology is beginning to view gold as a safe haven.”
• Graham Birch, BlackRock Investment Management in London - "It will be the biggest cutback in the history of the resources sector, an emergency stop. Any project that is not under way is going to be stopped.”
• John Clemmow, an executive director at UBS AG to Bloomberg - "Until we see Asia really picking up again, and I don’t think that’s going to happen in the next couple of years, then it’s the end of the supercycle.”

  Posco cuts crude steel output for first time - POSCO, Asia's third-biggest steel maker, will cut crude steel production for the first time in its 40-year history because the global economic slowdown slashed demand from customers, including auto makers. - more

  World crude steel production down 10.3% in November -- Worldsteel - World crude steel production dropped to 89 million mt in November 2008. This is down 10.3% versus the previous month, and a fall of 19% compared to the same time last year, the World Steel Association wrote in a report Thursday. - more

  10,000 tons/year seen from nickel mine - Canadian firm Mindoro Resources Ltd. said its Agata North nickel laterite mine was expected to produce as much as 10,000 tons of nickel yearly over a 25-year period. - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 6:50 am CST show 3 month nickel selling around $.07/lb lower. The Dollar is down against the Euro today, trading nearly 2% lower. Crude oil is trading higher on OPEC's promised cuts, by over 11%. Metals are quiet so far today, with precious trading mostly higher, and base all trading lower.  Nickel is not getting the boost as you might expect from the recent collapse of the US Dollar. With numerous mines already shut down, and more expected to close, inventories of nickel arriving into LME warehouses, gives the appearance of increasing - not decreasing. The day after the WBMS reported the world market for nickel was running at a 39,700 tonne surplus thru October, LME nickel inventories have risen by nearly 3000 tonnes - in just two days. Overnight, Asian markets mostly rose, but as of 7:45 am EST, European markets were trading lower. US futures show a quiet opening, slightly in the green. US markets will be guided by three reports coming out today, jobless claims, leading indicators, and the Philadelphia Fed Survey. Oil is rebounding on an announced OPEC cut, which will give a sentimental boost to metals trading today, but besides this and a falling dollar, nothing much else is giving metals a favorable signal. We are seeing reports that orders are picking up for steel in China, but the Chinese analysts believe this is just a temporary bump thanks to some large railroad orders and lowered spot iron ore prices. The BDI, which will be reported after we post today, is showing signs of slowing again.  
• Bloomberg morning 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
• Morning Bell - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Ed's daily commentary arrives to us just in time to post on a normal day. With this early posting, we will be unable to post today's comments. For your convenience, here is a back up link directly to MF Europe's office that updates sometime during the day (here)
• Following is a timeline of steel companies' announcements of output cuts in recent weeks: - more
• (Tex) The negotiations with steel companies of Japan on price of low carbon ferro-chrome for shipments in the first quarter (January - March) of 2009 have been taken place from last week. Reflecting a steep fall of price for low carbon ferro-chrome in Europe, it will be inevitable to reduce price of low carbon ferro-chrome for import into Japan under the quarterly contracts. Such regular suppliers as Russian producers proposed steel companies of Japan the price for carbon 0.1% max. material on a level of 240 US-Cents per lb. of Cr CIF.
• Japanese stainless steel output reached 268,509 tons in October, decreasing by 1% from 274,429 tons during the same period last year.

  POSCO trims steel output 10 pct, its first ever cut - POSCO plans to trim steel production by around 10 percent temporarily, its first ever output cut, as inventories rise and demand from auto and home appliance makers tumbles. - more

  BHP cuts jobs at nickel project - BHP Billiton has cut jobs at a nickel project in Mati City, Davao Oriental, a move seen by local observers as a sign of the Australian miner’s supposed plan to get out of the controversial project. - 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)
• India Metals Prices - Delhi - Dec 18 - 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

Wednesday, December 17

• Baltic Dry Index - plus 8 to 836. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Indicator charts show nickel traded within an approximate $500/tone range, but showed no clear direction, bouncing throughout the day. Dow Jones reports three month nickel ended the days trading at $4.45/lb .
• Due to an unpredictable internet service we are experiencing after a recent move, we are at a complete loss to advise when we will be able to update this site over the next few days. Technicians are working on the problems, but at best we can not offer you anything more than apologies for the recent unpredictability of the site. It will be rectified, one way or another, but may take us another few days to rectify the problem. Our most sincere apologies. Our next update will be early morning tomorrow.

  Commodity/Economic Comments

• The world refined nickel market was in a surplus of 39,700 tons in January-October, despite a large drop in production, the World Bureau of Metal Statistics said Wednesday.... In October, refined nickel production at 107,500 tons outpaced consumption which was at 99,300 tons.

  from press release - Mindoro Resources Ltd.While sulphide nickel deposits have dominated historical nickel production, the future belongs to nickel laterite deposits. Once regarded as too difficult to process, more recent advances and technological refinements, still in their relative infancy, are leading to a new generation of nickel production centers from laterite deposits. Much of the Surigao District nickel laterite production to date has been as DSO to processing plants in Japan and Australia, with lower grade material going to China for nickel pig iron production (feedstock for stainless steel mills). A recent slump in nickel prices has ended the shipping of low-grade nickel laterite to China for nickel-pig iron production. DSO production of higher grade material continues. However, there is now an increasing trend towards advancing on-site, value-added processing of nickel laterite within the Philippines itself, rather then just shipping out low-value product. The prolifically mineralized Surigao District will be an important part of this evolution.  (source)

  courtesy Steel Guru - Nickel consumption in stainless steel challenged - Mr Wang Weil deputy director of the stainless steel branch under China Metals Materials Trade Association said that "Nickel is going more and more estranged from the stainless steel market." He said that as the modern metallurgical technology and processing craftwork advance, development and application of nickel free stainless steel ferrite is better acknowledged, which may suggest less use of nickel in stainless steel production in future. Mr Wang said that in US, Japan, South Korea and other developed countries have all accelerated research, production and application of ferrite stainless steel, and the ratio of this stainless steel variety may reach 50% to 60% from current 30%. On the other hand, nickel is also being replaced in austenitic stainless steel. When the nickel price is over USD 20,000 per tonne, it'll be quite economic to use manganese as a substitute. Meanwhile, chrome manganese nickel stainless can use ferronickel instead of pure nickel, so as to reduce demand for the latter. He said that "As the largest nickel consumer, stainless steel makes up 66% of the global nickel consumption in 2008, or 69% in China. In this case, nickel use reduction in stainless making may hurt the nickel demand badly. This year, stainless steel output is predicted at 7.1 million tonnes, down 6.6% from the year before, consuming nickel of some 214,000 tonnes, in line with last year's."

  Reports

• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - (read Ed Meir's complete morning base metals report here)

  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)
• 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

Tuesday, December 16

• Baltic Dry Index - plus 25 to 828. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (MarketWatch) CPI hints at risk of deflation (Bloomberg) U.S. Stocks Advance on Rate-Cut Speculation; GE, Goldman Gain  // U.S. Economy: Consumer Prices, Housing Starts Post Record Slide // China’s Zhou Sees More Rate Cuts as Investment, Economy Weaken // Russian Industrial Production Shrinks Most Since 1998 // European Stocks Rise on Rate Cut Speculation; Siemens Rallies // (Reuters) Rate cut expected as Fed mulls emergency tools // Consumer prices and housing fan new economic fears // Treasury yields near historic lows after record CPI drop
• Crude oil continues to baffle traders, who agree OPEC will cut production to stop the price freefall. It is currently trading down a little over 1% to $44/barrel. The Dollar is sliding again today, down nearly a percent against the Euro. Typically, when the dollar is lower and equity markets are higher, metals do well. Not today, at least for base metals. Save precious metals and aluminum, the rest ended lower. Indicator charts show nickel dropped early, climbed back to nearly where it had started in quiet trading, then fell hard in late trading. Dow Jones reports three month nickel ended the day at $4.40/lb , and was sliding when trading closed. Sucden's day old chart reflects the beginning of the end of last Thursday's mini bull run (here). Tomorrow's chart will reflect all of the gains made late last week, evaporated in today's trading. European steel mills, already hurt by the economic recession, got a double dose of more bad news yesterday (see below). The Australia Financial Review is reporting today that BHP is willing to negotiate an early price decrease with China if steel producers are willing to purchase iron ore under a 'new spot market-based, indexed pricing mechanism'. Na Liu of Scotia Capital in his weekly China Update, makes an interesting observation "Moreover, anecdotal evidence indicated to us that steel output has actually recovered quickly in China since mid-November, as small steel mills reverted back to profitability, due to sharply lower spot coke and iron ore prices." And amongst the headlines about lay-off's lately, this one caught our attention today - "Goldman Sachs Cuts Jobs, Slashes Average Pay 45% to $363,654".  

  Reports

• Steel Weekly - pdf here
• ISSF - Stainless steel production strong in third quarter, but trend is unlikely to continue - more
• PMPA Material Impacts Report - December 2008 - pdf here

  Commodity/Economic Comments

• (Dow Jones) Nickel tumbled 5.2%, wiping out all of last week's rally. A London-based trader said producers sold into last week's rally, which may have disappointed those hoping for a recovery.
• (AFR) BHP Billiton has attempted to break the stalemate in iron ore price talks, telling Chinese customers it will reprice contracts three months early if they accept its plans to overhaul the pricing system.
• (Scotia Capital) We reiterate our view that the iron ore contract price for 2009 might be lowered by 30%, and the hard coking coal contract price might drop to as low as US$130/tonne.

  Chinese iron ore market 'recovering' - Sinosteel, China's biggest iron ore importer and trader, says the Chinese ore market is recovering and it wants to "accelerate" shipments from Australia. - more

  11 steel firms fined 575 mln euros by French competition watchdog - Global steel giant Arcelor Mittal and 10 other steel firms were fined 575 million euros (789 million U.S. dollars) Tuesday by the French competition council for price fixing, French media reported.  - more

  EU court rejects steel's challenge to carbon market - The European Union's carbon emissions trading scheme, Europe's key tool for fighting climate change, does not discriminate against steelmakers, the EU's top court said on Tuesday. - more

  New low-cost nickel-based fuel cell could prove revolutionary  - A new form of non-alkali membrane used in fuel cells could allow expensive and rare platinum to be replaced with nickel. If true, the market could soon be filled with much less inexpensive fuel cells and a changing attitude toward fuel economy in automobiles as fuel cells can be more efficient than internal combustion engines. - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 7:50 am CST show 3 month nickel trading around $.13/lb lower, but indicator charts show trading off earlier lows. All metals are trading lower this morning,  with the Euro trading 1/5 of 1% higher against the Dollar. Crude oil is trading 2% higher. Overnight, Asian markets closed mostly higher, while European markets are trading higher in anticipation of a US Fed rate cut. US futures show a slightly higher opening on the same Fed expectations, even though MarketWatch is reporting "U.S. residential groundbreakings slump nearly 19% in November — an all-time basement." BDI continues to edge up, as do nickel inventories.    
• Bloomberg morning 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
• Morning Bell - pdf here
• Metals Insight - pdf here
• Weekly Commodity Price Report - pdf here
• Canada Commodity Price Update - pdf here
• Global Mining News - pdf here
• World Crude Steel Production as of October 2008 - pdf here
• North American Steel Industry NAFTA Region Update - presentation here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments -  "Metal prices reversed earlier gains yesterday and finished largely mixed, with copper, ali, and nickel being the day's biggest laggards. ... Despite the grim macro news, one variable that has kept commodity prices relatively steady of late, particularly more so on the energy side as opposed to metals, has been the softening dollar. The weaker dollar should theoretically invigorate commodity prices, as it provides non-US consumers with extra purchasing power. However, with most economies outside of the US also sinking into recession, we cannot make much of a case for a foreign-driven demand boost that a weaker dollar would theoretically bring about. Instead, we expect weaker macro readings to prevail, and in effect blunt the impact of any currency-induced rallies in commodities.  ... We are currently at $9,858, down $792, and looking very weak on the charts. We are waiting to see if trading range support at $9500 will hold." (read Ed Meir's complete morning base metals report here)
• (AC) Nickel sector weakens below Moving Average (MA), with 50-day MA trailing its 200-day MA, plummets 2.6% December 16, 2008 16:00:00 AEST
• (Dow Jones) Global stainless steel production rose 6.8% on the year to 6.3 million metric tons in the third quarter, but the trend is unlikely to continue, the International Stainless Steel Forum said Tuesday.  
• (MySteel) Annual benchmark ore talks are to kick off soon and global leading institutes have made forecasts for fiscal 2009 contract ore prices. Most expects price decline, but varies in the falling magnitude. And based on overall analysis, Mr Zen Jiesheng a senior Mysteel senior analyst believes that a 30% to 50% ore price cut is rational and he presented a brief analysis to support his viewpoint.
• (China Daily) Rising unemployment and a widening pay gap are the two issues of most concern to Chinese, said a report released by the country's top think tank.
• (Interfax) It is likely that increased iron ore imports from Australia by medium-sized Chinese steel mills, which recently resumed operations, led to a rebound over the past week of the BDI (Baltic Dry Index), a major indicator of the global raw materials shipping market, industry analysts told Interfax on Dec. 15.
• The International Metalworkers' Federation released its 2008 edition of the "Purchasing Power of Working Time" report - here
• Weekly Forecast by SMM Specialist - here
• Opalesque Exclusive: As commodity ETFs see an inflow of assets and hedge funds look for the next place to allocate, will the commodity bubble surface again? - more

  China's steel product output rises by 4.3 pct year-on-year in first 11months - China produced 530.75 million tons of steel products during the first 11 months of this year, up 4.3 percent year-on-year, while steel product output in November alone reached 42.3 million tons, down 1.46 percent from October, according to figures released by Shanghai-based Mysteel. - more

• China's crude steel output tumbles to lowest level in two years - China's crude steel production dropped 12.4 percent in November from a year earlier to 35.19 million tons, the lowest monthly output since April, 2006, according to figures released by the National Bureau of Statistics (NBS) on Monday. - more
• Price Of Low Carbon FeCr Is Being Pulled Down By Increased Exports Of Chinese Product = China Exported 75,000 Tons In Jan. - Oct. 2008 - more
• Steelmakers To Demand Deep Iron Ore Price Cuts - China's steel industry has opened annual iron ore price talks with the mineral's big-three producers, calling for deep cuts to yearly prices and an early start to the next contract period. - more

  German steel group cuts 2008 output forecast again - German steel group says now sees output down 5 pct in 2008 - more

  Indonesia Passes Comprehensive New Mining Law - Indonesia's parliament Tuesday passed a new mining law, significantly replacing the existing contract system with a licensing system wherein mining companies will need to get a permit from local or regional governments for each stage of development of a mine rather than sign a long- term, umbrella contract with the central government, and requiring mining companies to pay 10% of their profits to the local authorities. - more

• Regional Autonomy: Morowali boasts of mineral wealth - Morowali, which spans 45,453 square kilometers, is promoting itself as the richest regency in Central Sulawesi in terms of natural reserves, from marble to mineral oil. - more

  Courtesy AISI - In the week ending December 13, 2008, domestic raw steel production was 1,168,000 net tons while the capability utilization rate was 49.0 percent. Production was 2,102,000 tons in the week ending December 13, 2007, while the capability utilization then was 88.1 percent. The current week production represents a 44.5 percent decrease from the same period in the previous year. Production for the week ending December 13, 2008 is down 1.2 percent from the previous week ending December 6, 2008 when production was 1,182,000 tons and the rate of capability utilization was 49.5 percent.

  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)
• India Metals Prices - Delhi - Dec 16 - 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

Monday, December 15

• Baltic Dry Index -  plus 39 to 803. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• While the Dollar and Euro split hairs today, ending little change, crude oil fell a little over 3%. Zinc couldn't cut a break last week, it seemed, with other metals higher, and it floundering. Today, the show was on the other foot. While the other base metals ended lower, zinc ended like the precious metals, higher. Indicator charts show nickel opened lower, spent much of the day quiet, then dropped again in the afternoon. Dow Jones reports three month nickel ended the day at $4.58/lb .
• We apologize for the late and brief updates the last few days. Hopefully, we are in a position to resume normal service tomorrow.

• Copper gives up day's gains - Copper reversed its gains together with European equities and eased on Monday after earlier rising more than 3 per cent, buoyed by optimism over the Chinese economy and a weaker dollar. - more

  Brazil's Vale: China Ore Spot Prices Fall Halted - Estado - Chinese spot prices for iron ore and steel have stopped falling, according to Brazilian mining giant Companhia Vale do Rio Doce (RIO), the local Estado news agency reported Monday - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 6:50 am CST show 3 month nickel selling around $.16/lb lower. Indicator charts imply profit taking may be hitting nickel trading this morning. Other metals are mixed, with precious mostly higher, and base mostly lower. The Dollar is trading 1/4 of 1% lower against the Euro, while crude oil is trading up 4-1/2% on OPEC production cut threats. Nickel inventories in LME warehouses gained again overnight, and now stand just a few tonnes short of the 70,000 tonne mark. We most likely will be unable to post our afternoon update until later this evening. We have not received MF Global's report yet this morning, so if interested, please try this link (here). It is MF's European website and is "usually" updated daily.  
• Bloomberg morning 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
• Morning Bell - pdf here
• Chart Store Weekly Scoreboard - pdf here
• Metals & Mining Weekly - pdf here

  Commodity/Economic Comments

• ANZ senior commodities analyst Mark Pervan - "The pain has already been felt by the pure-play juniors and the next level to be hit will be the big diversified miners."
• Angel Commodities - The coming week is expected to be volatile as markets may enter a profit-booking phase after a bout of buying which was seen in this week. Though metals received some support during the week, poor macroeconomic prospects continue to dominate the market.
• PricewaterhouseCoopers Tim Goldsmith - "The longer this goes on, the more projects will be delayed or taken off stream, so when it does turn around there will be an even bigger boom."
• Fat Prophets analyst Gavin Wendt - "The fundamentals are still in place to support an ongoing boom but it has obviously been whacked by the credit situation. When the doom and gloom ends, the market will recover and demand will pick up.... But new projects by the top miners will not be commissioned for another five or six years because companies will want to wait for commodity prices to rise substantially before they spend any money."
• China must focus on domestic demand -c.bank's Zhou - more
• Gossip – the only commodity worth digging up - more
• Commodity Boom Is So Over - more
• World markets eye recovery - more
• (Interfax) China produced a total of 35.19 million tons of crude steel in November, declining by 1.98 percent month-on-month and 11.34 percent year-on-year, according to figures released by China's National Bureau of Statistics (NBS) on Dec. 15.
• Baltic Dry Index shows signs of revival - more
• IMF chief warns financial crisis is set to worsen in 2009 - more

  As China slams on brakes, commodity countries left reeling - When China hits the brakes, commodities exporters half a world away have to shift to a lower gear, as the rapidly deteriorating fortunes of the copper sector shows. - more

• Chinese molybdenum concentrate prices firm up on tight supply - China's domestic molybdenum concentrate prices appear to have firmed up this week as supply continues to tighten, industry sources said. - more

  Outokumpu puts Rs 300-crore India investment plan on hold - The India business of European stainless-steel giant Outokumpu has become the latest victim of the global slowdown and the resultant demand of Indian industry for protection from imports. - more

  Brazil's Vale asks gov't to help avoid layoffs - The president of the world's largest iron ore producer is asking the government to ease up on its tough labor laws as a way to avoid laying off workers amid the global economic crisis, a newspaper reported Sunday. - more

 Norway firm delays Philippine mine plan - Norway-based Intex Resources said it had deferred the completion of a definitive feasibility study for its nickel mining project in Mindoro Island, south of Manila, including a $2.9-billion plant, from early next year to the fourth quarter of 2009, citing as reason the global financial crisis. - more

  Freight slump closes wharfs - Cargo wharfs in South Africa's biggest harbours will shut for the first time in years on Christmas day and New Year's Day, owing to reduced demand for their services in the economic downturn. - more

  Poseidon Nickel in talks to acquire nickel project in WA - Andrew Forrest-led Poseidon Nickel Ltd has entered into exclusive talks to acquire a "significant" nickel project in Western Australia. - more

  Gulf Residents Go for Appeal of Stainless Steel - Stainless steel appliances of every size, shape, and price range will soon be seen in Gulf kitchens from Kuwait City to Muscat, say industry vendors, such is its widespread appeal. - more

  China may have its way in fixing ore prices - China never took it well that the world’s three big miners extracted hefty price rises for iron ore in the past few years. - 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)
• India Metals Prices - Delhi - Dec 15 - 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

Friday, December 12

• Baltic Dry Index - plus 53 to 764. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) GM, Chrysler May Win Reprieve With TARP Aid After Senate Declines to Help // Retail Sales in U.S. Fall for a Fifth Month on Autos; Producer Prices Drop // Dollar Rises From 13-Year Low on Speculation Bush Will Rescue GM, Chrysler // India's Industrial Production Dropped in October for First Time Since 1993 // China's Economic Slump Deepening as Industry Struggles, Two Officials Say // U.K. Treasury Said to Consider Lowering Bank Guarantee Fee to Spur Lending
• Indicator charts show three month nickel opened lower, and after a downward trend in the morning, regained some of the earlier losses in the afternoon. Dow Jones reports three month nickel ended the day at $4.83/lb .
• One of the difficulties we face as technology makes our life easier and more convenient, is the dependency we tend to give these technological convenience's. Thus, when the tiny artery that allows us access to the world wide web is somehow disrupted, we suddenly feel the world has denied access and shut us out. Our afternoon update was delayed because of this loss of access, and we fear it may last a few more days. Today's human caused disruption, may be followed by those caused by Mother Nature, as a large storm system is on the way. We apologize for the delay's and will make update's as soon as possible. We leave you a short film for the weekend. Many of you are feverishly trying to find that appropriate gift for your loved one. And while we do not want to add any undo pressure to your journey, we want to caution you to "choice wisely". Video here  Have a safe and relaxing weekend!!  

  Commodity/Economic Comments

• Reuters - Norilsk Nickel, the world's biggest producer of nickel and palladium, said on Friday it had appointed the self proclaimed heir to Russia's imperial throne as an advisor. Grand Duke George Mikhailovich Romanov will advise the company on matters including a contest against a European Commission decision to classify some nickel compounds as hazardous substances, Norilsk said in a statement. - more
• (The Times) Anglo American is expected to announce a $4 billion (£2.7 billion) cut in capital expenditure next year as it lowers production to cope with a drop in demand for metals.  .. The expansion of the Barro Alto nickel mine in Brazil is expected to be delayed by up to a year, while the Los Bronces copper mine in Chile is also likely to see cutbacks.

  Jindal Stainless reworks deals to gain from input price fall - Jindal Stainless, a leading manufacturer and exporter of the alloy, has renegotiated all its long-term contracts with suppliers as part of a series of measures aimed at countering plunging raw material prices and slowing demand. - more

  Indonesian MPs agree to pass mining law - Indonesia moved ahead on Thursday with plans to ease the path of international mining companies to exploit its mineral wealth. - more

• Mining bill nears House approval - After more than three years of deliberation, the mining bill is on the verge of becoming law, with a House of Representatives special committee agreeing Thursday to eliminate a crucial article on contract of works (CoW). - more
• Key points in Indonesia's new mining law - An Indonesian parliamentary working committee has agreed to pass a long-delayed bill on mining and coal. - more

  Miner's razor signals commodities boom's doom - The alarming rate of shock announcements from struggling miners reached a crescendo this week when global leader Rio Tinto took the axe to its staff and growth plans, stunning the market into the realisation that the resources boom is over. - more

  Contractors affected by Vale Inco cutbacks - Local contractors will be affected by recent Vale Inco cutbacks announcements. - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 7:45 am CST show 3 month nickel trading around $.32/lb lower. The failure of the US Congress to pass a bail-out plan for the Big Three last evening has taken world traders by complete surprise, and markets are reacting accordingly. Metals, precious and base, all trading lower. Dollar down 1/3 of 1% against the Euro. Crude oil - trading nearly 7-1/2% lower. Asian markets - mostly lower. European markets - mostly lower. US futures - much lower.  US Commerce Dept has also announced this morning that retail sales fell 1.8% in November, for the 5th straight monthly decline. This was slightly better than analyst expectations. And the BDI gained 53 points overnight, its best day in a very long time. Nickel inventories also grew overnight, raising the total amount of nickel stored in LME warehouses to over 69,000 tonnes.    
• Bloomberg morning metal news - more

  LME nickel falls 5 pct after US automaker deal fails - Nickel prices on the London Metal Exchange fell 5 percent on Friday after a proposal to rescue embattled U.S. automakers hit a roadblock with U.S. lawmakers. - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here
• Metals Insight - pdf here
• SSINA Releases Market Data for September 2008 - pdf here
• World Bank - Commodity Markets Review - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments -  "Most metals enjoyed a decent bounce yesterday, as a weakening dollar revived commodities, which for change, managed to decouple from a struggling US equity market. Crude oil prices gained about 10% to finish at just under $48, and were instrumental in pulling many of the metals higher. However, it was the weakness in the dollar that was most influential, with the greenback hitting two-month lows against the Euro on perceptions that year-end funding in dollars will not be as strong. In this regard, the LIBOR rate fell to its lowest level in more than four years, and is now around 2%. Hopes that this week’s budding metals rally could take some root have been mercilessly dashed today. ...  We are currently at $10,400, down $720."  (read Ed Meir's complete morning base metals report here)
• (Dow Jones) U.S. nickel exports rose 27.7% in October from the previous month, and was up 101.1% from the previous year, the Commerce Department reported Thursday.
• (Dow Jones) U.S. nickel imports rose 9.1% in October from last month, and was up 12.8% from the previous year, the Commerce Department reported Thursday.
• Brian Hicks, co-manager of the $2 billion Global Resources Fund at U.S. Global Investors Inc. in San Antonio - “You can make a strong case that we’ve seen a near-term bottom in commodities, and a lot of these things are at quite compelling values, bringing a lot of buying across the board ... .We’re seeing a strong potential for inflation, which will boost commodities.”
• (SBB) Asian stainless 304 prices slipped another $50/tonne this week on weak demand. Prices of 304 2mm 2B CR sheet for one-to-two-month delivery are at $2,050-2,200/tonne CFR China, down from $2,100-2,200/t CFR China last week.
• (JMB) Tokyo Steel Manufacturing studies to expand the production cut to 50% in January-March from same period of 2008 compared with original plan of 20-30% cut.
• Vietnam - Steel consumption may fall by 14 percent this year - more
• Commodities "horribly" hit, not killed: Rogers - more
• Commodities: No longer just a one-way bet - more

  Slowdown hurts China‘s scrap metal dealers - A worker at a waste recycling center. The global downturn affected scrap dealers in China, with weak consumption demand and falling raw material prices. - more

  Rolls-Royce wins Trent 60 contract to power Nickel mine in New Caledonia - Two Rolls-Royce Trent 60 electrical generating sets have been selected to provide power for a new nickel mine in the North Province of New Caledonia in the South Pacific. - more

• Construction underway in New Caledonia’s north - Looking down from the mountains onto the Vavouto construction site, it’s like a children’s sandpit filled with toy trucks. - more

  Asia Steel-China spot prices down 5 pct, reverse brief gain - Asian steel prices fell 5 percent this week, reversing their first weekly rise in more than five months on poor demand that was underlined by a 31-month low for Chinese steel exports. - more

• Chinese molybdenum concentrate prices firm up on tight supply - China's domestic molybdenum concentrate prices appear to have firmed up this week as supply continues to tighten, industry sources said.  - more

  Poseidon in talks for big nickel buy - Poseidon Nickel, led by Fortescue's Andrew Forrest, has entered into exclusive talks to acquire a "significant" nickel project in Western Australia. - more

  Steelworkers boss says mining layoffs escalating - Mining layoffs are escalating in Greater Sudbury, according to Jim Kmit, area supervisor United Steelworkers northeastern Ontario.- more

  Goldman cuts 2009 base metal price forecasts - U.S. bank Goldman Sachs said on Friday it has cut its forecasts for base metals because of the sharp deterioration in global industrial output and the worsening demand outlook in 2009. - more

  Negotiations With Japanese Mills On Price Of FeCr For Shipments In Q1 / 09 Are Taken Place = Possibility To Settle The Price Earlier Than Europe, Inevitable To Reduce Its Price To Large Extent - 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)
• India Metals Prices - Delhi - Dec 12 - 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, December 11

• Baltic Dry Index - plus 20 to 711. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) Trade Deficit in U.S. Unexpectedly Widens; Jobless Claims Hit 26-Year High // Treasury Market Bubble Talk Grows Louder as Investors Give U.S. Free Money // China's Inflation Cools to Weakest in 22 Months as Economic Growth Slows // Russian Devaluation Gathers Pace as Central Bank Loosens Control of Ruble // Pound Drops to Record Low Against Euro for Fourth Day as Sentiment Worsens (Globe and Mail) Canada - New home prices fall, first drop in 10 years (US Dept of Labor) The advance number of actual initial claims under state programs, unadjusted, totaled 757,481 in the week ending Dec. 6, an increase of 221,735 from the previous week. (MarketWatch) U.S. households pay down debts for first time - Net worth plunges at 18% annualized rate in third quarter, Fed data show // Dollar falls sharply amid grim economic data
• The dollar is having a bad day, trading nearly 3% lower against the Euro. On the other hand, what is bad for the dollar is usually good news for commodities. Crude oil, for example, is trading over 11% higher and closing in on $49/barrel. Metals all ended higher, although zinc just barely squeezed it out. The big gainer of the day? After registering an overnight gain of nearly 2500 tonnes of new inventory, nickel had another big day. Indicator charts show nickel traded in a range of around $1300 from its daily low to daily high, and it closed much higher to the latter. Dow Jones reports three month nickel ended the day at $5.05/lb . This is the first time three month nickel has closed over $5/lb since November 11th. On that date we had 57,000+ tonnes of LME stored inventory, today we have over 68,000. We also had more mines operating 30 days ago. Sucden's day old chart shows yesterday's spike (here). It is also interesting to note that today's trading session opened with nickel showing an RSI of 85.05, according to Sucden, implying an overbought situation. MF Global had RSI at 49 , but added "Despite the better tone we are seeing in metals, more robust and sustainable moves to the upside will be hard to justify.". The decline in the Dollar is having an effect, and is trading about where it was back in mid October (live java chart here), a month that saw nickel trade anywhere from mid $4/lb to $7/lb. So why is nickel that was worth $4.21/lb last Thursday, worth over $5/lb today? Who knows? But we can assure you, based on past reliable sources, that speculation is playing no part in this process (Wow! Milk can come out your nose if you laugh too hard). 

  Nickel Rises to Four-Week High on Outlook for Supply Reductions - Nickel rose to a four-week high in London on prospects mining companies will accelerate production cuts in line with declining demand. Copper also gained. - more

  Commodity/Economic Comments

• Haywood - "The current over-supply of nickel is likely to continue as larger projects (Ravensthorpe-50,000 tpa) will continue to operate along with new projects coming on-line (Onca Puma-58,000 tpa) and Goro (60,000 tpa) in 2009 despite potentially losing money on a case basis."
• Barclays Capital - "Prices across the complex have firmed further this morning but rather than continuing to ascend we expect them to consolidate following their recent steep declines."
• (AP) The world's second-largest stainless steel maker (Finnish metals group Outokumpu Oyj) says markets "deteriorated much faster than anticipated" and that it expects no improvement in 2009.
• Risky times ahead - Baby boomers face three new risks in coming decades, but there are answers - more  (report mentioned in article here)

  Outokumpu warns of poor 4Q demand, layoffs - Finnish metals group Outokumpu Oyj says it will post a fourth-quarter loss because of poor demand for stainless steel and will lay off personnel and postpone investments. - more

• Outokumpu Forecasts Loss After Collapse in Demand - Outokumpu Oyj, the world’s fourth- biggest stainless-steel maker, predicted a fourth-quarter loss, postponed spending and pledged job cuts after a faster-than- expected decline in demand. - more

  POSCO shrugs off steel woes with record 2009 spend - No. 4 steel maker POSCO will nearly double domestic investment to a record $4.3 billion next year, in a bold contrarian bet that it can grab market share from shrinking rivals once the world economy begins growing again. - more

  Indonesian MPs agree to pass mining law - Indonesia moved ahead on Thursday with plans to ease the path of international mining companies to exploit its mineral wealth. - more

  People’s nod for ferrochrome plant - Locals and people’s representatives have given their consent for opening of a ferrochrome plant by AK Das Associates Ltd in Kamakshyanagar. - more

  State economy under threat as mining boom ends - Queensland's economy is under siege and the jobs of thousands of workers are in jeopardy as the state comes to grips with the end of the mining boom. - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 7:40 am CST show 3 month nickel trading around $.16/lb higher and holding its recent gains. While some analysts are dismissing this as nothing more than 'short covering', we think the trader quoted by Dow Jones this morning has given a more thorough reason. Dow Jones is reporting this morning "LME nickel is extending the gains it made Wednesday as a fund bullish on the metal is "trying to ramp it up," says a London-based trader. Says the rise is forcing buy stops to be hit and sparking further short-covering." And if you are wondering if the fundamentals have changed in the last few days, the quick answer is no. A few more mines have shut down, but nickel inventories in LME warehouses soared again overnight, adding nearly 2500 tonnes in one day. We are fast approaching the 70,000 tonne mark, so in our opinion, we chalk this up to more than traders driving the market in an opposite direction so they can make some money. We have seen it more than a few times over the past months, price spikes on some wish and a prayer, only to fall back when reality returns. This little bounce doesn't even seem to come with a supposed supply/demand reason to cast an accusing finger at. Maybe it was just time. Metals are all trading in the green this morning, except for zinc. The dollar is trading nearly 2% lower against the Euro, which is helping metals, and crude oil us up nearly 4%. Asian markets closed mostly lower overnight, with European markets trading mostly lower this morning. US futures imply a slightly weak opening on Wall Street.
• Bloomberg morning metal news - more

  Nickel Rises to Two-Week High on Outlook for Supply Reductions - Nickel rose to a two-week high in London on prospects mining companies will accelerate production cuts in line with declining demand. - more

  Nickel prices at five-year low as demand from stainless steel mills collapses - There's plenty of cheap nickel available to buyers and no sign that trend will change anytime soon. - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here
• Metals Insight - pdf here
• Australian Mineral Statistics Sept 2008 - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - "Metals ended modestly higher yesterday, supported by both a weaker dollar and on increased optimism that a limited bailout for the Detroit is in the works. The best performer was nickel, which tacked almost $1000 a ton in what seemed to us to be a short-covering bounce. ... We are off to a mixed start as of this writing, as earlier across-the-board gains have faded. Copper and zinc are both slightly lower right now, but the rest of the group is holding on to modest gains, with nickel again the best performer in the group, following up on yesterday’s bounce. .. We are currently at $10,700, up $400 and looking steady, as we build on yesterday’s gains.(read Ed Meir's complete morning base metals report here)
• (Outokumpu) - The stainless steel demand is currently very weak. All end-user segments have reduced their purchases as companies postpone their investments and the construction activity is low. Distributors seek to minimize cash use and reduce their inventories. Due to further decline in raw material prices distributors are still postponing their purchases in expectation of lower prices. ... The company is taking actions to prepare for a period of possible prolonged demand weakness and will now prioritise profitability improvement and cash generation in the short term."
• (Bloomberg) Albidon Ltd., an Australian metals explorer, cut 110 of its 260 workforce at its Munali nickel mine in Zambia after prices for the metal used in steelmaking slumped.
• (Xinhua) Korea's POSCO, the world's fourth biggest steelmaker, said it will nearly double domestic investment to a record $4.3 billion next year in a contrarian bet it can grab market share from shrinking rivals once the world economy begins growing again.
• (Rusmet) Nippon Steel & Sumikin Stainless (NSSC) is clipping ¥50,000/tonne ($540/t) from its ‘miseuri’ or spot sales prices for austenitic CRC for December contracts. But as the leading Japanese stainless maker has also decided to continue refusing all austenitic CRC orders for December – making for the fifth straight month it will have ignored spot order requests – NSSC’s price cut is largely symbolic.
• (JMB) Nippon Steel & Sumikin Stainless Steel (NSSC) announced on Wednesday the firm revises the alloy link price mechanism for nickel ingot. The firm sets floor price for nickel ingot at US$ 5.18 per pound, which is averaged price in October-November, while the floor price was US$ 3 before.
• (Yieh) Data from national Ministry of Commerce (MOFCOM) indicate that, Chinese steel prices have ascended after a long-term down for 19 weeks.
• (Yieh) In the first ten months of 2008, China's export volume of stainless steel products totaled 843,000 tons, dramatically down by nearly 27 percent from a year ago.
• (GFMS) Despite the low nickel prices, we have not yet seen a pick up in the amount of austenitic grades being used. In fact, demand for ferritic and non-stainless grades has been on an upward trajectory. It is believed that they will continue growing at strong rates of 6.1% and 9.5% y-o-y, respectively over the next few years.
• (Comtex) Taiwan's largest steelmaker, has denied reports that deliveries in the first quarter of 2009 will be about 30 pct of "normal" levels.
• (Shanghai Daily) Panzhihua Iron and Steel Group, China's biggest producer of railway steel, and China Railway Materials Commercial Corp have signed an agreement to jointly expand production capacity to meet Chinese construction demand.
• Commodity Bull Back On? - more
• Commodity crash tests faith in supercycle - more
• China sets first 8-day holiday for next year - more

  Vale Inco gets new boss - Murilo Ferreira is stepping down as boss of Vale Inco at the end of the month. - more

  Production cuts by major global steel firms - Following is a timeline of announcements of output reductions made by steel companies in recent weeks: - more

  European Steel prices Plummet as the Market Descends Into Chaos - We are witnessing unprecedented steel market conditions. As mill order books collapsed, the steel makers were left with substantial amounts of part and fully-finished products. - 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)
• India Metals Prices - Delhi - Dec 11 - 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

Wednesday, December 10

• Baltic Dry Index - plus 12 to 691. (chart) (different chart, old one went behind password requirement)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) Worsening Spending Slump Paces ‘Scary’ U.S. Recession // U.S. Wholesale Inventories Drop Most in 7 Years  // Brazil Bank May Keep Rate Unchanged, Ignoring Pressure for Cut  // Brazil’s Bovespa Index Rises to Highest in Month; Bolsa Gains  // Rio Cuts 14,000 Jobs, Spending as Demand Falters // China’s Exports Decline for First Time in 7 Years  // Most European Stocks Rise, Led by Rio Tinto, BMW; Vivendi Drops  (MarketWatch) Bailout bets bolstering bulls (Reuters) "Conceptual agreement" reached on auto aid
• The Euro is trading higher against the Dollar by 6/10 of 1%, and crude oil is trading higher by 8-1/2% and climbing, going back over the $45/barrel line. For the most part, metals trading was rather unexciting, although all ended higher. Well, that is except for nickel and zinc. While zinc ended even, nickel ended higher much higher, and after a very quite morning and afternoon, took a huge leap in late kerb trading. We can't explain why, as we are not seeing anything on the newswires that would account for such a knee jerk reaction. Dow Jones reports three month nickel ended the day at $4.65/lb . LME inventories rose again overnight, as did the BDI reading. It is unbelievable to us the announcements being made daily around the world of large lay-off's. Every day it seems it can't possibly get any worse,  but the next day, a fresh new batch of workers are given a pink slip. Not dozens, not hundreds, but thousands - and these are just the ones that make the newswires. How many more are being let go from smaller business'? The number is likely staggering. And the repercussions to this could be devastating. From the economic point of view, without jobs, people do not have disposable income. And in some cases, they will not have the income necessary to cover the basics. Without money, many will go deeper into debt. More foreclosures, more bankruptcies. Less money spent, fewer taxes collected. More retail and wholesales sales hurt, and up the chain the hurt goes to the manufacturer again. And possibly even more crippling to the individuals involved, is the sudden loss of security that a paying job provides. Divorce numbers will probably rise, as will reported incidents of family abuse. Even a bad job helps give a person their dignity and self respect. How did we get here so fast? Earlier this year, we were covering stories about miners who couldn't find enough qualified people to hire, now they are letting the ones they have go. Earlier, shippers couldn't find enough cargo ships to carry freight, now empty ships are being used as floating warehouses. You couldn't dig enough nickel last year, now you can't close mines fast enough. Last year, all you needed was a pulse to get a house loan; now wealthy individuals are having a hard time getting a car loan. We truly live in deeply troubling and disturbing times. And its going to be a lousy Christmas for many families around the world.         

  Reports

• Commodities Daily - pdf here

  FNX Mining Suspends Nickel Ore Production and Reduces Workforce in Sudbury  - FNX Mining Company Inc. announces plans to extend the suspension of nickel ore production at its Levack Mine (see October 21, 2008 News Release) and to also suspend production of nickel ore from its adjoining McCreedy West Mine, effective immediately. - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 7:40 am CST show 3 month nickel trading around $.07/lb higher and choppy. Except for zinc, which is even, the rest of metals complex is trading higher. The Dollar is lower against the Euro, by about 1/4 of 1%, and crude oil is trading 5% higher on speculation Russia and OPEC may agree to a joint cut in production. Except for New Zealand and Vietnam, Asian and Pacific Rim nations traded higher overnight, with European markets mixed, but mostly lower this morning. US futures show a potential opening on the positive side, as the media reports Congress could vote as early as today on a $15 billion bailout of the Big Three. Rio Tinto announced it would cut 14,000 jobs worldwide, overshadowing news that another nickel mine in Australia would be shut down after Christmas.    
• Bloomberg morning 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
• Morning Bell - pdf here
• Metals Insight - pdf here
• ABARE new release - links here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - "Copper prices finished sharply lower on Tuesday, although the rest of the group did not fall as much. A weaker energy complex, as well as a wobbly equity market, did not lend much support. More importantly, metals are unable to put together a string of gains, with rallies being consistently undermined by reminders of weak industrial demand. This is not only discouraging new buyers from coming in, but encouraging funds to sell into the rallies.  ... The poor demand outlook is also offsetting the spate of almost daily announcements by producers who are cutting back output.  .. We are currently at $9,600, up $200 and quiet." (read Ed Meir's complete morning base metals report here)
• (Interfax) Spot nickel prices on the domestic market will remain weak between RMB 41,100 ($6,000) and RMB 68,500 ($10,000) per ton in 2009, as downstream stainless steel output is expected to slide next year, a nickel trader told Interfax on Dec. 9.
• Xinhua China Jan.-Nov. steel imports at 15.54 mln t, down 6.7 pct y-o-y, Customs
• China Daily - China's November PPI drops to 31-month low
• Molybdenum's Applications in the World of Energy - more
• Death of commodities greatly exaggerated - more
• Historic commodity price boom ends with slowing global growth - more

  Mincor Plans to Suspend Miitel Mine; May Post Loss  - Mincor Resources NL, Australia’s fourth-largest nickel producer, said it will probably post a first-half loss and will suspend mining operations at its Miitel project from Christmas after metal prices plunged. - more

• Australian Nickel Exports Slump; Coal, Iron Ore Shipments Gain - Nickel shipments from Australia, the world’s fourth-biggest exporter, slumped 37 percent in the September quarter as demand and prices plunged. - more
• BlueScope cancels iron ore shipments - Australia's largest steel maker BlueScope Steel is rattling its tin, cancelling iron ore shipments and reportedly cutting jobs ahead of a difficult second half. - more

  Nickel Production By Norilsk Nickel In Jul. - Sep. 2008 = Produced 75,000 Tons As Increased By 9% From That In Q2 / 08, Owing To Increases In Russia And Finland - more

  Steel prices have bottomed: Tata - Tata Group holding company Tata Sons on Wednesday said it anticipates steel demand picking up only next year and does not expect the price of the commodity to fall further, amid steel makers resorting to production cuts. - 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)
• India Metals Prices - Delhi - Dec 10 - 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

Tuesday, December 9

• Baltic Dry Index - plus 8 to 679. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) Asian Stocks Gain for Third Day, Led by Commodities, Cosco // Japan Pledges More to Prevent Economy From ‘Falling Apart’ // Stocks in Europe Gain for Second Day; PPR, Daimler, Yara Climb // U.K Manufacturing Slides, Housing Sales at Lowest Since 1978 // Bernanke ‘War Powers’ Undermine Fed Bank Presidents // U.S. Stocks Drop on Profit Outlook; FedEx Shares Retreat  (MarketWatch) Pending home sales index down 0.7% in October
• Market was rather quiet today, with traders not finding any clear direction. The Dollar and Euro have flip-flopped since the morning update, and the Euro is now trading higher by 1/2 of 1%. Crude oil is trading lower by the same percent. Metals started lower, but the stronger European equities market and dollar taking a dip helped push a few higher, while most ended softer. Indicator charts show nickel held on to its mid-day recovery, and climbed into positive territory late. Dow Jones reports three month nickel ended the day at $4.26/lb . The Baltic Dry Index took another small step forward overnight, up 8 to 679. We have read two articles in the last few days about events that may help the BDI, but really won't help give us any clear signals of the overall market. First, the possibility that China may demand the Big Three re-negotiate iron ore prices sooner than expected, is seen as a possible sign of future shipments resuming sooner. Second, with the price of oil so low and very few expecting it stay so low for very long, tankers are seen as possibly being rented to store oil for those investing for later deliveries. This isn't our arena so the reports may be out of left field, but apparently it is being said that there are those willing to bet oil will rise in the near future and storing oil on tankers is economical at this point. Unless, of course, you choice to park off Somalia. That can be a little risky these days. If the story is true, it could help bring the BDI up some, but without reflecting any actual increase in global shipments.  

  Commodity/Economic Comments

• Societe Generale analyst Alain William points to the $3.8 billion Koniambo nickel project as a likely target to be delayed as Xstrata looks to lower 2009 expenditures.
• Ukraine Journal - Ukraine’s steel sector, the backbone of the country’s economy, has been gradually increasing production after receiving more orders over the past four weeks, a state-owned steel industry analysis group reported Friday.
• China's GDP set for first fall in seven years - more

  Eramet press release - In 2008, the nickel delivery forecast has been revised to about 51,000 tonnes. Production has been adjusted accordingly. In view of the current sales outlook, nickel output will be adjusted from the start of 2009 to an annualized level of about 50,000 tonnes, for a period which will be dictated by changes in demand. At the same time, Eramet Nickel is also studying the steps it needs to take to reduce production costs. - more

  BHP, Rio Tinto face $2bn iron ore threat - BHP and Rio stand to lose up to $2 billion if Chinese steel companies terminate 2008 iron ore contracts three months early. - more

  Brazil Steel Co CSN Sees Positive Market Signs - Estado - Brazilian integrated steelmaker Companhia Siderurgica Nacional (SID) sees signs of an improving world market, and has yet to reduce domestic output, despite weak demand, the Estado de Sao Paulo newspaper reported Tuesday. - more

  US steel mills operating at less than 50% of capacity: AISI - Raw steel production in the US declined for the 16th consecutive week and dropped to levels not seen in the past 25 years, according to data reported Monday by the Washington DC-based American Iron and Steel Institute. - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 7:50 am CST show 3 month nickel trading around  $.03/lb  lower but choppy. Indicator charts show nickel opened lower this morning, fell hard in early morning trading, but has since recovered. Except for copper, which is off by 5%, other precious and base metals are near where they began this morning, some dipping in and out of the green. The dollar is trading higher against the Euro, up 3/4 of 1% so far today, while crude oil is trading ever so slightly higher. China, Hong Kong, and Australia markets ended lower overnight, while other Pacific rim/Asian countries ended higher. European markets are mostly higher this morning, but no records are being broken. US futures show Wall Street should also open quietly. LME nickel inventory totals went over the 66,000 tonne mark overnight, which is keeping pressure on pricing.
• Bloomberg morning metal news - more

  Reports

• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Daily Resource Plus - here
• Morning Montra - pdf here
• Global Mining News - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - "t remains to be seen whether Monday’s rally in metals, led primarily by copper, has any legs to it. For our money, we would like to see a string of gains i before we can conclude that we are at the start of something more sustainable. At the time of this writing, initial signs are not that good-- copper is already off by about $165, giving up more than half of Monday’s gains, while ali broke back below the $1500 mark earlier today after a fourth limit-down session in Shanghai. LME stocks levels are also not giving the bulls much to cheer about either, as they were broadly higher once again today. ... We are currently at $9,250, down $75 and quiet; stocks continue to push higher, now over the 66,000-ton mark on the LME."  (read Ed Meir's complete morning base metals report here)
• Peter Chandler, senior vice-president at Canaccord Capital in Waterloo, Ontario  to Reuters, reference equities market - "We're in the process of putting in a bottom in this market, but bottoms don't get put in in a day or a week or a month. It often can take three to six months to put a bottom in and there can be several retests of the lows during that process. That's what we're going through."
• (Dow Jones) Merrill Lynch says too early to be exposed to base metals, tips to reassess in mid 2009; "we have not been positive base metals equities as a sector strategy for more than a year. The current financial train wreck only pushes out the timeline for exposure to base metals."
• (CM) Coal prices at Qinhuangdao Port, China's largest coal port, started to dive again on dwindling market demand after coming to a brief halt last week, Shanghai Securities News reports.
• (Reuters) Australia's Pegasus Metals Ltd will discontinue its option over the Eden nickel mining project in Ontario, Canada, effective Dec. 10, the company said on Tuesday, citing its cash position and spending plans for 2009.

  Chinese coke producers to get support late in Q1 2009 - analyst - Chinese coke producers may get support from rebounding demand from the domestic steel industry and falling coking coal prices late in the first quarter of 2009, industry insiders told Interfax on Dec. 9. - more

• MEPS Forecasts World Crude Steel Output This Year Below The 2007 Outturn - Preliminary data from MEPS (International) Ltd's investigation for its, soon to be published, reports "World Steel Outlook" and "Global Iron and Steel Production to 2013" indicate a modest reduction in global crude steel production in 2008 at 1.34 billion tonnes. - more

• S Korean crude steel output to dip 1.6% next year: industry group - Combined crude steel production in South Korea is expected to fall next year for the first time in 11 years due to a global economic slowdown, the country's industry association said Tuesday. - more

  Courtesy AISI - In the week ending December 6, 2008, domestic raw steel production was 1,182,000 net tons while the capability utilization rate was 49.5 percent. Production was 2,102,000 tons in the week ending December 6, 2007, while the capability utilization then was 88.1 percent. The current week production represents a 43.8 percent decrease from the same period in the previous year. Production for the week ending December 6, 2008 is down 1.3 percent from the previous week ending November 29, 2008 when production was 1,197,000 tons and the rate of capability utilization was 50.2 percent.

  BHP Australian Iron Ore Exports Drop to 9-Month Low  - BHP Billiton Ltd., the world’s biggest mining company, shipped the least amount of iron ore from Australia in nine months amid plunging demand from China. - 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)
• 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

Monday, December 8

• Baltic Dry Index - plus 8 to 671. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) Stocks Rally Worldwide, S&P 500 Hits 1-Month High on Obama Plan // Congress, White House ‘Moving Toward’ Auto Aid Accord // Majority of Modified Loans Fail Again, Regulator Says // U.K. November Producer Prices Drop for a Fourth Month  (MarketWatch) Stocks shoot for ninth gain in 10 (Reuters) Wall Street braced for grim views from industrials
• While the dollar is taking a beating against the Euro today, down 1-1/2%, commodities had a bull day. Crude oil is 6-1/2% higher after OPEC President Chakib Khelil stated the cartel would cut oil output when it meets on Dec 17th. Metals, both precious and industrial, also traded higher. Copper had an especially good day, on the back of the Obama infrastructure stimulus plan. Indicator charts show nickel opened higher, fell in late morning trading, then took a serious bounce in late kerb trading, before retreating to a level lower than it opened. Dow Jones reports three month nickel ended the first day of this week's trading at $4.22/lb . So was today's metals trading anything more than a "Bama Bounce" short covering scenario, or does it have some stick? The analysts don't think so. Barclays Capital suggested "We would view this as a temporary bounce supported by stronger equity markets and a weaker dollar rather than the start of a sustained shift higher." MF Global was more emphatic, explaining Wall Street's recent rallies as "Stock market theory suggests that equities tend to stabilize and push higher 3 to 6 months before the economy starts to recover, and some equity analysts are suggesting that we might be at the start of such a phase. However, in our view, there still is a long way to go before we are out of the woods, meaning that most markets should remain sloppy for most of 2009. For metals, this suggests a prolonged sideways drift once a bottom has been reached, retested, and shows that it can hold. In the case of metals, two of the six metals we follow never retested their late October lows (tin and nickel), while the balance in the group established new lows, so it seems the evidence at this stage suggests that we are still groping for a bottom in most of the group." Inventories of nickel into LME warehouses gained overnight, and the BDI continues to drift, up 8 points. Ferrochrome furnaces are being shut down on a near daily basis, joining closed nickel and molybdenum mines, with iron ore mines now joining the growing list. Stainless steel producers continue to lay off steel workers, as do their customers. Munali Nickel in Zambia laid off nearly 300 workers today, and BBC announced the steel firm SSAB was laying off another 1300. And in another strange twist, the calls for a homeowner bail-out package to stop the foreclosures that started this crisis, might become somewhat muted after this report (courtesy Bloomberg) "Most U.S. mortgages modified by lenders to help keep struggling borrowers in their homes fell back into delinquency within six months, the chief regulator of national banks said. Almost 53 percent of borrowers whose loans were modified in the first quarter of this year re-defaulted by being more than 30 days overdue, John Dugan, head of the Treasury Department’s Office of the Comptroller of the Currency, said today at a housing conference in Washington."(more) Might keep this story in mind over the next few months, as there will be those in Washington who will want you, the taxpayer, to guarantee these overdue loans.... with a less than 50% chance you'll actually help a struggling family.    

  Reports

• Canada Commodity Price Update - pdf here
• Weekly Commodity Price Report - pdf here

  Commodity/Economic Comments

• Jim Rogers to Bloomberg  on 12/5 - "Commodities will be the place to be if and when we come out of the recession."
• (Dow Jones) Russia exported in January-October 210,200 metric tons of nickel, 3.2% more than in January-October 2007, the federal customs service reported Monday.
• Stainless Tubular Products (STP), a leading metal service center in the U.S. specializing in welded stainless  steel tubing, pipe, fitting's and bar, was acquired by TW Metals, Inc., a member of the O'Neal Steel family of companies.
• (SBB) German steel output drops 18.5% in November
• Weekly Forecast by SMM Specialist - more

  China's steel prices to recover in 2009, iron ore in oversupply - China's steelmaking industry is expected to continue to benefit from low manufacturing costs in the long run, said Liu Haimin, a research fellow at the China Metallurgical Industry Economic Development and Research Center. Liu was speaking at the 2009 China Steel Market Outlook Annual Conference in Shanghai on December 6-7. - more

  Vale suspends ore pellet production at 2 plants – Brazil's Vale mining company says it has suspended production of iron ore pellets at two of its plants in the southeastern state of Espirito Santo. - more

  In Hard Times, Russia Moves In to Reclaim Private Industries - In late October, one of Vladimir V. Putin’s top lieutenants abruptly summoned a billionaire mining oligarch to a private meeting. - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 7:50 am CST show 3 month nickel trading around  $.13/lb higher, but indicator charts reflect nickel is off earlier high's, and trending lower.  The Dollar is trading 1-1/4% lower against the Euro, which is helping give all metals a boost this morning, and crude oil is trading 7-1/2% higher. In overnight markets, only New Zealand and Indonesian markets ended lower, most of the other Asian and Pacific Rim markets, ended substantially higher. European markets are nearly all trading ni the green, while US futures show Wall Street will have a strong opening. President-elect Obama held an unusual Sunday press conference, and traders like what they heard.  Here is a Bloomberg leader this morning explaining "President-elect Barack Obama is focusing his economic recovery strategy on making the biggest investment in the nation’s infrastructure since President Dwight D. Eisenhower created the interstate highway system a half- century ago."  
• Bloomberg morning 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
• Morning Bell - pdf here
• Metals Insight - pdf here
• The Chart Store Weekly Scoreboard - pdf here
• Metals & Mining Weekly - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - "Metals got thrashed once again on Friday, with copper briefly sinking to a low of $2,991, its lowest close since May 2005, while aluminum fell to its lowest level in more than five years. There seems to be no end to the relentless barrage of poor macroeconomic numbers coming out of the US, most of which are coming out worse than expected. ... As of this writing, metal prices are higher on account of a short-covering bounce from extremely oversold conditions and on positive sentiment emanating from weekend news that a deal with Detroit’s automakers might be imminent. ... We are currently at $9,300, up $250. Nickel is one of two metals, (the other being tin), that did not break below its late October lows on Friday. For now, prices seem to be drifting along in a sideways fashion, although the fact that LME stocks continue to rise, makes us somewhat nervous that we will not be able to hold up."  (read Ed Meir's complete morning base metals report here)
• (Dow Jones) Zambia's sole nickel mine, Munali Nickel Mine has laid off 271 workers citing dropping global metal prices, a union official told Dow Jones Newswires Monday.
• (Dow Jones) China's steel exports will likely drop sharply next year as global demand weakens amid the financial crisis, Qi Xiangdong, vice secretary of the China Iron and Steel Association, said Saturday..... China's monthly exports of steel products fell to 4.62 million tons in October, a drop of more than 2 million tons from September, the latest customs data show.
• (Dow Jones) Mining giant Rio Tinto PLC will postpone billions of pounds of capital expenditure and cut thousands of jobs in response to the global economic slowdown, U.K. newspaper The Mail On Sunday reports.
• (Dow Jones) Mining company Anglo American PLC will this week slash billions of pounds from its 2009 capital spending plan in response the global economic problems, U.K. newspaper The Sunday Telegraph reports.
• (Steel Guru) US ferrochromium prices still tumbling - euromoney.com reported that ferroalloy traders in the USA said that the price of ferrochromium has fallen steadily over the past month and demand is virtually non existent as stainless steel mills concentrate on reducing their stockpiles of ferrochromium. Traders do not expect the ferrochromium market to pick up until the end of the first quarter of 2009 at the earliest. High carbon ferrochromium is trading at USD 1.40 to USD 1.55 per pound. Low carbon ferrochromium is trading at USD 3.95 to USD 4 per pound for 0.05% C material, USD 3.65 to USD 3.75 per pound for 0.10% C and USD 3.60 to USD 3.70 per pound for 0.15% C material.
• (SG) Platts reported that Chinese ferromolybdenum exports stalled this week as domestic prices were much higher. Local traders and producers said that domestic ferromolybdenum prices were around CNY 135,000 to CNY 145,000 per tonne and this is equivalent to around USD 40 per kilogram for export. ... Ferromolybdenum prices hovered around CNY 120,000 to CNY 130,000 per tonne a week ago.
• (SBB) The US scrap market remains quiet with prices sitting at the same levels reported nearly two weeks ago in Steel Business Briefing. Sources indicate the market may have hit bottom last month.
• (Interfax) Customs: Russia's nickel exports up 3.2% on year in Jan-Oct
• (SG) It is reported that Chinese cold rolled steel coil price continues to go up in both domestic and export market. Most traders are doubting its sustainability of it taking into account weak demand both home and abroad.
• Comparing China and the Dry Baltic Index - more

  Assmang Cuts 45,000 Tons of Ferrochrome Capacity  - Assmang Ltd. will shut a 45,000 metric ton-per-year ferrochrome furnace at Machadodorp because of a “deterioration in the stainless steel market.” - more

  China's steel industry enters hard time: steel association official - China's steel industry has entered a hard time after seven years of rapid expansion, and a turnaround is unlikely until the second quarter next year, said Qi Xiangdong, deputy secretary with China Iron and Steel Association. - more

• China's steel industry faces oversupply pressure, Baosteel boss - The production capacity of China's steel industry has surpassed demand and steels price will swing at low level in the long run, said Xu Lejiang, chairman of Baosteel Group Co. at the recent 2008 Global Management Forum. - more
• China Wants Iron Ore Producers To Accept '94 Prices -Official - Informal negotiations on iron ore contract prices have begun between the government and major producers, and China is pressing iron ore producers to accept 1994-level prices commensurate with the extent steel prices have dropped, a top industry official said Monday. - more

  Canadian nickel rush halted by China's slump - Hard times have arrived in Sudbury, the Canadian town that is the world capital of nickel, as a collapse in demand puts an end to hopes of riches in a gritty Ontario mining community. - more

  Miners face deeper cuts as prices slide - The collapse in demand for base metals is by far the biggest anyone can recall, say analysts.  - more

  BHP May Cut Ore Output 25% on Demand, Merrill Says  - BHP Billiton Ltd., the world’s largest mining company, may need to cut iron ore production by about a quarter next year as a slump in global steel output curbs demand for the raw material, Merrill Lynch & Co. said. - more

• Industrial Commodities to Sag Through 2010, Tiberius’ Eibl Says - Investors should avoid industrial commodities through 2010 because the global recession will sap demand for copper and energy, said Tiberius Asset Management. - more
• Barclays Turns More Bearish On Metals - With the flow of economic data remaining decidedly negative, Barclays Capital thinks investors are pricing into commodity markets a greater deterioration in conditions than was experienced during the Great Depression of the 1930s.  - 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)
• India Metals Prices - Delhi - Dec 8 - 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

Friday, December 5

• Baltic Dry Index - minus 3 to 663. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) U.S. Payrolls Decline by 533,000, Most Since 1974 // Most Asian Stocks Gain on Speculation Oil Slump Will Cut Costs  // China November Car Sales Drop 10% as Slump Spreads // German Factory Orders Drop; European Demand Collapses // European Stocks Fall as U.S. Job Losses Top Forecast; BHP Drops // U.S. Stocks Retreat as Job Cuts Top Economists’ Forecasts (MarketWatch) Joblessness at 15-year high // Nearly 10% of U.S. mortgages are delinquent or in foreclosure
• At present the US Dollar is trading nearly a full percentage point higher against the Euro, while crude oil has just slipped under $41/barrel, down 6-1/2%. Metals, both precious and base, are either still trading or have ended trading in the red for the week. Indicator charts show nickel was choppy in pre and early morning trading, took a dive when the US announced employment figures, and remained choppy in later trading. For the day and week, three month nickel ended at $4.08/lb . This compares to nickel closing last week at $4.62/lb. Nickel inventories actually dropped overnight for the first time since November 10th, but only fell by an amount equivalent to 25% of yesterday's gain. The Baltic Dry Index is back to drifting again, only down 3 points today and down 9 for the last two. At least we are off that 666 figure. After a week of economists telling us the jobs report out today wouldn't just be bad, it would be really, really bad, even they were staggered by the number the government released. Wall Street has apparently dismissed the news as already priced into the market, or they are in denial. Just a few months ago, there was a big argument going on between the bulls and the bears on whether the US was actually "in" a recession. Earlier this week, we got the official word that we had actually been in one since last December. Today, MarketWatch reported "U.S. companies slashed payrolls at the fastest pace in 34 years as the economy headed for its deepest and longest recession since World War II." Amongst all the economic doom and gloom in the media today, we actually found a piece of good news. But, as if Murphy's Law was in complete control, we can't open the story now. Hopefully it is a temporary server problem, and the author didn't realize after posting the story, that he had switched the numbers. The headline from a Vietnam newspaper -"Steel consumption sharply increases in November." And if the link ever works again, here it is (here).
• Have a safe and restful weekend.    

  Commodity/Economic Comments

• (RTT) While the report also showed that the unemployment rate rose to a fifteen-year high of 6.7 percent in November after coming in at 6.5 percent in the previous month, the rate came in below economist estimates of 6.8 percent. The smaller than expected increase in the unemployment rate was partly due to a decrease in the size of the labor force, which came as some people stopped looking for work
• (MySteel) China Business News cited Mr Qi Xiangdong deputy secretary general of China Iron & Steel Association as saying that China is still in the mid of urbanization and industrialization, and has large demand for steel products. Mr Qi suggests a difficult path for the sector in the last quarter this year and the first quarter next year, but expects the market recovery to come in the second quarter with conditions in the second half better than the first half.
• In this podcast, Platts Steel Markets Daily editors, Julien Hall and Maya Thatcher, discuss the steel markets' response to sharply weaker demand, focusing on the announcement by significant market players of redundancies and production cuts; examine the stabilization of prices in the Chinese and Turkish domestic hot-rolled coil and rebar markets; and analyze events in Dubai, where rebar and billet has been stockpiled. - here

  Fundamentals of Commodities Are ‘Unimpaired,’ Jim Rogers Says - The fundamentals of commodities are “unimpaired” and prices will rebound when a lack of new supply leads to shortages, said Jim Rogers, chairman of Rogers Holdings. - more

• More cuts seen as metals prices fall - While the mining industry is scaling back production all over the world, experts think there is still a lot more to come. - more

  Chinese ferromoly export trade stalls as domestic prices spike - Chinese ferromolybdenum exports stalled this week as domestic prices were much higher, industry sources said. - more

• China's steel industry suffered losses in October - In October China's steel industry suffered its first net monthly losses since 1998. Of the country's 71 large and medium-sized steel mills, 42 closed October in the red, according to statistics by the China Iron and Steel Association.  - more
• China scouting for bargain mining deals - Chinese mining firms are gearing up to take advantage of the global downturn and seek M&A mining deals at bargain prices next year, atop official at South Africa's Standard Bank said on Tuesday. - more

  Russia abolishes state monopoly on PGM exports - Russian President Dmitry Medvedev has signed into law a bill abolishing state firm Almazjuvelir export's monopoly on exporting platinum group metals (PGM), the Kremlin press office said on Friday. - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 7:45 am CST show 3 month nickel trading around $.04/lb lower, showing a distinct downturn after US employment report being released (see below).  Base and precious metals are all trading lower this morning.  The US Dollar is trading 3/4 of 1% lower against the Euro, and crude oil is trading lower by 2-1/2% and nearing $42/barrel. Overnight trading saw mixed results. China, Hong Kong, and South Korea ended higher, while the rest of the Asia/Pacific rim saw negative totals. European markets are solidly in the red this morning, and US futures imply the Dow will open moderately lower. While it remains to be seen whether the market has priced in this mornings bad news, it is bad. Market Watch reports "U.S. nonfarm payrolls plunged by an astonishing 533,000 in November, the worst job loss in 34 years, the Labor Department reported Friday.... The employment report was much worse than expected. Economists expected job losses of around 350,000 in November."    
• Bloomberg morning metal news - more

  Reports

• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here
• Metals Insight - pdf here
• Maritime Econometrics - pdf here
• Damstahl Stainless Steel Report - pdf here
• Commodity Monthly - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - "More selling hit the LME markets yesterday, although this time around, it was concentrated primarily in copper and ali. The rest of the group closed with only modest changes.  ... Things are looking very “sellerish” in base metals as of this writing; copper is off, down for its seventh consecutive session, while ali closed limit down in Shanghai. ... Outside of the US, manufacturing orders in Germany slumped by more than economists expected in October, falling 6.1% from September levels, where they had dropped by 8.3%. “Germany’s industry is drowning,” an economist at ING Group told Bloomberg. “November [manufacturing] is unlikely to be any better because no matter how good German products are, if people don’t want to buy, they don’t want to buy. It’s not going to get better any time soon.” ... We are currently at $9,230, down $20. Just like zinc, nickel has yet to test its 2008 intraday low of $8850, and for now, prices seem to have been spared the brunt of the selloff. Producers are scrambling to cut production, as we note below.(read Ed Meir's complete morning base metals report here)
• (Bloomberg) “There’s no point having production if there is no demand,” Vale Chief Executive Officer Roger Agnelli said today at an event in Sao Paulo. “In Sudbury, there are deeper mines that have a higher cost.” The company is prepared to cut output at “all” higher-cost and deeper mines worldwide, he said.
• The Falconbridge Dominicana (Falcondo) nickel mine and plant will not resume operations, and will be placed on care-and-maintenance, Xstrata Resources said on Thursday. - (this confirms our report on Tuesday) - more
• (Dow Jones) Rio Tinto Ltd. said Friday that it will shut its iron ore mines in Western Australia state for nearly two weeks over Christmas as part of its commitment to cut production of the steel making ingredient.
• (Dow Jones) China Iron and Steel Association has informed iron ore producers Companhia Vale do Rio Doce (RIO), BHP Billiton Ltd. (BHP) and Rio Tinto PLC that it wants to end their 2008 contract three months ahead of schedule, from Jan. 1 instead of April 1, a Steel Business Briefing report said Friday.
• (Interfax) Falling production costs has prompted Taiyuan Iron and Steel (Group) Co. Ltd. (TISCO), China's largest stainless steel mill, to partially resume operations of capacity it previously suspended, a nickel trader told Interfax at a conference on Dec. 4.
• (JMB) Hit by decline in stainless steel demand/ Raw materials ferrochromium/ Samancor, world's second-largest manufacturer/ To suspend production entirely for 2 months
• (Dow Jones) Chinese steelmaking giant Shanghai Baosteel Group Corporation might invite Australia's third-largest iron ore company Fortescue Metals Group Ltd. to take part in negotiations to set iron ore prices for the 2009 long-term supply contracts, said informed people.
• (RTT) Friday, the Federal Statistical Office said German raw steel production declined 18.5% year-on-year in November suggesting that the economic downturn had affected the steel industry. Raw steel production decreased by calendar and seasonally adjusted 15.4% in November from the previous month.
• (SINA) Steel companies in China recorded their first month-on-month loss in six years as the global financial crisis hit domestic exporters, manufacturers and construction firms, state media reported Friday. Seventy-one large and medium-sized steel companies posted a combined loss of 5.84 billion yuan (853 million dollars) in October, the first monthly loss since 2002, the China Securities Journal reported, citing an industry association.

  Base metals supply overestimated, Octagon says - Forecasters may be overestimating the global supply of base metals, particularly zinc, Octagon Research said on Thursday, suggesting that hard-hit metal prices may rebound sooner than expected. - more

• Mining production to fall further, experts say - While the mining industry is scaling back production all over the world, experts think there is still a lot more to come. - more

  Stainless steel importers oppose anti-dumping probe - Stainless steel importers have opposed the Commerce Ministry's move to initiate probe into alleged dumping of the alloy from foreign countries, saying the facts furnished by a leading domestic manufacturer for investigations are "misleading". - more

  Talvivaara drops 2009 nickel production estimate on low prices - Finnish nickel and zinc mining company Talvivaara Mining has cut its 2009 production estimates on the back of declining base metal prices, the company said in a statement Thursday. - more

  Fox to reactivate Radio Hill nickel mine - Australian miner, Fox Resources, is to reactivate its Radio Hill nickel mine confident that nickel price will have to rise as major cutbacks elsewhere bring supply and demand into equilibrium. - more

  RP nickel ore output drops 12 pct in Jan-Sept - Nickel ore output in the Philippines dropped 12 percent in the first nine months of the year from the same period in 2007 amid flagging world prices, government data showed. - more

  China Valin Signs Iron Ore Deal With Fortescue Metals -Xinhua -Australia's third-largest iron ore supplier, Fortescue Metals Group Ltd., has inked a deal with Chinese steelmaker Hunan Valin Steel Co. to develop iron ore mines and to process ores in Changsha, Hunan province, Xinhua News Agency reported Thursday. - more

  Closed mines, broken dreams in the town that nickel built - When John Rodriguez became Mayor of Sudbury in November, 2006, things had never looked better for the city whose economic fortunes have always been inextricably linked to the price of nickel. - more

• Thompson to weather nickel downturn well - Nickel giant Vale Inco Ltd. is cutting production at its Canadian operations in Sudbury and Newfoundland and Labrador to help the miner deal with a worldwide slide in commodity prices as economies falter. - more
• Voisey's Bay to shut down for month of July print this article - Vale Inco, owners of the Voisey's Bay mine, announced Thursday that it would be shutting down the nickel mine for the month of July in response to the global recession and low commodity prices - 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)
• India Metals Prices - Delhi - Dec 5 - 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, December 4

  Daily Nickel/Stainless Wrap-up

• Baltic Dry Index - minus 6 to 666. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (MarketWatch) Thursday brings 30,000 more job cuts (Bloomberg) Jobless-Benefit Rolls in U.S. Climb to 26-Year High // China Urges U.S. to Counter Crisis, Prepares for ‘Worst Case’ // Asian Stocks Drop on GM, Chrysler Bankruptcy Concern; Rio Falls // ECB’s Trichet Says Euro-Region Economy Will Contract  (AP) U.S. factory orders plummet in October (Reuters) Europeans make big rate cuts to fight recession // European shares end lower; rate cuts fail to cheer
• The US Dollar is trading 7/10 of 1% higher against the Euro, after Europena rate cuts. Crude oil is trading 5% lower, and now under the $45/barrel mark. Precious metals are trading lower, and base metals ended mixed, with copper losing 5%, and the rest gaining/losing less than 1%.  Indicator charts show nickel started out choppy in pre and early trading on rumors about Vale closures. It has settled down in early afternoon trading, when Vale confirmed the rumors. This sent the market higher, but by late afternoon, most of the optimism had fizzled. Dow Jones reports three month nickel ended the trading session at $4.20/lb . So what happened? Since Reuters published the 'top secret' numbers in the article below, we will just go ahead and quote them. LME warehouses recorded an overnight gain in nickel inventory of 810 tonnes. That's just a few tonnes short of the last 4 days of gains - combined. It also means we are just 56 tonnes shy of having 65,000 tonnes total LME nickel inventory. The BDI dropped to 666 overnight, and as one investor put it, the devil will be in the details. Sucden's day old chart shows nickel trading thru yesterday (here). The news that Vale was shutting down the Copper Cliff South mine indefinitely did little more than stabilize trading for a day. Not sure why Vale picked July for a Voisey's Bay one month shut-down. Their last ore carrier for this year left on the 2nd, and their next shipping season typically starts at the end of January (photo of the MV Umiak 1 pdf here).

  Nickel Erases Gain in London as Inventories Signal Oversupply - Nickel erased gains in London as inventories at a nine-year high signaled demand led by stainless-steel makers is lagging production even after mining cutbacks. - more

  Commodity/Economic Comments

• According to Sucden, the LME trading low for 3 month nickel so far this year was $8850/tonne ($4.01/lb) on Oct 24th. The official cash price for that day was $3.99/lb.
• Dow Jones reports the board of directors at Albidon is undertaking a review of the Munali Nickel Mine in Zambia, in light of forecast nickel prices, and delays in the mine start up.  A shareholders meeting is scheduled for December 18th.
• (Dow Jones) The London Metal Exchange Thursday listed 16 new warehouses in Europe and the U.S. and traders said that reinforces the poor demand prospects as the exchange prepares to house a flood of material that is expected.
• Only hot air in Chinese base metals purchase programme rumours - more
• World Bank China Quarterly Update - pdf here (this site goes up and down but worth reading when you can)

  Vale to cut nickel output at Copper Cliff South, Voisey's Bay - Brazilian mining giant Vale's wholly owned subsidiary Vale Inco is to halt production, cut jobs and delay development at its nickel and copper mining operations in Sudbury, Canada, as nickel prices continue to tumble below $10,000/mt. - more

• Vale cuts Canada nickel production due to crisis - Brazil's Vale, the world's largest iron ore miner, said on Thursday it would close indefinitely a mine in Canada that yields 8,000 tonnes of finished nickel a year as the global economic slowdown hits demand for raw materials. - more

  NMDC announces 25% price cut on iron ore - National Mineral Development Corporation (NMDC) on Thursday announced slashing of its long-term iron ore prices by a flat 25 per cent from December 1. - more

  (earlier rumors confirmed by Vale) Vale to close indefinitely nickel mine in Canada - Vale, the world's largest iron ore miner, will close indefinitely from January its nickel Copper Cliff South mine in Ontario, Canada, as it scales back operations amid the global economic slowdown. - more (LME nickel trading prices go green on confirmation - up $.07/lb at 9:30 EST)

  Questions linger in Arrowhead about proposed sulfide-metals mining and potential effects - "There are two kinds of mining companies," Pete Pastika said in a thick Iron Ranger brogue. "There are those with the experience and the money to do it, and there are the speculators." - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 7:45 am CST show 3 month nickel trading even but falling . Indicator charts show any optimism that the rumored Vale output cut might have had this morning, has since evaporated. Metals are mixed this morning, with none setting any records in movement. US Dollar is trading 6/10 of 1% higher against the Euro, and crude oil is trading 2% lower, and is threatening to fall under $45/barrel. In overnight markets,  Asian/Pacific equity markets were either higher, to slightly lower. European markets are trading lower, and US futures show Wall Street should open lower. Lot of bad news expected out of the US today, although much, if not all, has been priced into the market. So much doom and gloom has been forecast on the unemployment report out today, that anything less than catastrophic could be seen as positive by the market.     

  Nickel Climbs on Report of Possible Cuts at Vale in Canada - Nickel climbed for the first day in a week in London on a report that Cia. Vale do Rio Doce is preparing to lower production at its Sudbury mine in Canada. - more

  Reports

• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here
• Metals Insight - pdf here
• World Bank Commodity Price Update - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments -  "LME metals continued to weaken on Wednesday, with ali touching a 4-1/2 year low and copper hitting a 3-1/2 year trough. Lead also finished at 2-1/2 year lows. In terms of news, it was more of the same: lingering concern over weakening demand, now increasingly focused on China, coupled with a backdrop of rising LME stocks, are both combining to pressure metal prices. The stock variable suggests that production is still not being cut fast enough to offset the weakness in demand. ... We are sporting modest losses as of this writing, (except for lead and nickel), but given weaker energy markets (down another 80c on crude) and an unchanged opening for US stocks, metals could find themselves deeper on the defensive later today.  ... Out over the last thirty minutes, we got a series of interest rate cuts out of Europe--Sweden lowered its rates by a record 175 basis points earlier, and the Bank of England lowered its rates by 100 basis points to 2%. The European Central Bank cut rate by 75 basis points to 2.50%, exceeding expectations for a 50 basis point cut. The dollar is pushing higher in light of these cuts and is another reason to be cautious about the short-term upside potential in metals.
•  ... We are currently at $9,200, down $5, and quiet. Nickel has yet to test its 2008 intraday low of $8850. LME stock levels have been on a recent uptick, and this could result in impending price pressure going forward." (read Ed Meir's complete morning base metals report here)
• Standard Bank - "The short-term outlook for stainless steel continues to deteriorate faster than expected. For the current quarter and into the start of next year, we would not be surprised if stainless production globally was experiencing an overall cut of 20-30%. However, nickel production is falling fast too. Following more announcements of cutbacks, we now put total losses for next year at 245,000 tonnes, which amounts to a 17% cut in global production."
• Investors bet on commodities bounce - more
• The First Global Recession: Counting Our Blessings - pdf here
• BNP - No stabilisation of the cycle before the second half of 2009 - pdf here
• (JMB) Sumitomo Metal Industries reduces the raw steel output by around 500,000 tonnes in second half year of fiscal 2008 ending March 2009 compared with original plan under slower demand for automobile.
• (MFG) "There has been the most abrupt and sudden collapse of prices that the steel industry has ever seen," so said the chairman of Stemcor yesterday in an interview with Reuters. He added that orders have fallen by 70-80% in the last four months. Despite the brief upturn in demand for scrap-related products, he does not expect a sustained recovery until late 2009. Although short-term lending is still available, longer term structured loans are harder to come by.
• (AISI) Steel Import Permit Applications Decline vs. Prior Month - more
• Albidon board of directors has placed the Munali Nickel Mine under review due to low nickel prices.

  Vale to Cut Nickel Production, Globe and Mail Says  - Cia. Vale do Rio Doce, the world’s second-biggest nickel miner, is preparing to cut production at Sudbury in Canada, the Globe and Mail reported, citing people it didn’t identify. - more

• Vale Inco set to cut Sudbury output - Expected move by city's largest employer follows layoffs and mine closings by rivals as nickel prices plummet - more

  Stainless steel sheet prices on the verge of collapse - Base prices and surcharges both heading for a big fall - more

  Xstrata Nickel: Falcondo to continue shutdown - Xstrata Nickel’s Falcondo operation (Falconbridge Dominicana C por A), a nickel mining and processing operation in the Dominican Republic, will continue the shut down of its nickel production operations that began in August 2008 and place the operations under care and maintenance. - more

  DJ Eramet Gets Recommendation For New Caledonia Nickel Deposit - Societe Metallurgique Le Nickel-SLN, a subsidiary of French metal producer Eramet S.A., Thursday said it has received a local government's recommendation for an exploration license for the Prony and Creek Pernod nickel deposits in New Caledonia, a key expansion project for its nickel business. - more

  Steel Price Downturn Extending Into All Developing Countries - Turkish long product producers are now seeking a higher price for reinforcing bar and merchant bar to reflect rising production costs. - more

  Chinese group sues Vale Inco - A large Chinese battery manufacturer is suing two units of Vale, one of the world’s largest mining companies, in a patent infringement case that highlights the growing number of Chinese companies using local courts to protect their interests - more

  Market Tendency On Imports Of Ferro-Alloys At 28th November 2008 -= Price Of Chinese Manganese Metal Bottomed Out And Rebounded - 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)
• India Metals Prices - Delhi - Dec 4 - 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

Wednesday, December 3

• Baltic Dry Index -  minus 12 to 672. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) Asian Stocks Gain on Central Bank Actions, Crude Oil Prices; Qantas Rises // Toyota's U.S. Sales Plunge Most in 28 Years as Recession Trumps Incentives // GM May Not Survive Unless Sales Rise, Analyst Says // U.S. Stocks Climb, Erasing Earlier Drop, as Stores, Banks Rise  // Most Brazil Stocks Fall on Tim, Metals Outlook; Bolsa Gains // Europe’s Benchmark 10-Year Bond Yield Near Lowest Since 1989 (Reuters) European stocks stage late rally ahead of rate cuts (MarketWatch) Private-sector jobs fall by 250,000, ADP says //  Crude erases losses after data show inventories fall // U.S. Nov. ISM services falls to all-time-low 37.3%
• At our update time, the US Dollar is now trading higher against the Euro, by about 4/10 of 1%. Crude oil is remarkable docile after US inventory reports came in lower than expected, and is currently trading 3/4 of 1% higher. Precious metals are trading mixed, while base metals ended all lower. Indicator charts show nickel slid most of the day, taking a sharp dip in late afternoon, before recovering some. Dow Jones reports three month nickel ended the day at $4.17/lb . Reuters reported in an article posted by Forbes earlier (here) that nickel prices traded on the London Metal Exchange fell to their lowest since mid 2006 at $9285/tonne today. This is incorrect and is already being repeated by other news services. On October 24th of this year, the official price of cash nickel was $3.99/lb ($8805/tonne), and 3 month ended that day at $4.08/lb (9000/tonne). This is the current low point of the year, and while history tells us this might be beaten this month, it did not happen today. On the backdrop of more dismal economic news, the Dow is currently higher, as the bulls refuse to give up on this most recent bear market rally. In the beginning of this dismal year, we noted many analysts were predicting the "bottom was in" every time the market rebounded. With each rebound collapse, came a new bottom, and new predictions. Recently, these kind of predictions have been more subdued, even as this most recent rally shows more holding power than past runs. Sucden's day old chart shows the RSI and SStoch on nickel still reflect an oversold market (here) but the trendline's tell of unsympathetic traders. LME stored nickel inventories went over the 64,000/tonne mark overnight, and the BDI slipped another 12 points to 672. We have read that 577 is the BDI's all time record low, but we have yet to confirm this figure. We've added a new page that keeps a running tally on nickel mine and smelter closures, but as Deutsche Bank analyst Michael Lewis said today "Supply-side issues are taking a backseat." Until demand returns, it doesn't really matter how much nickel is or is not being produced. This applies to ferrochrome, molybdenum, and iron ore also. And while there are a few metals analysts trying to dig up some good news to prove their forecast of a recovery is right around the corner, the fact remains, evidence shows the market is deteriorating. We are watching the BDI closely. It could prove to be the canary in the coal mine, that gives us the best evidence of the overall metals market future by monitoring raw material global trade daily. Until then, the daily barrage of more steel mill closures and lay-off's reflect the difficult holiday many of those in our industry have in store.

  Ongoing and up to date list of mine and refinery/smelter closures, delays, and deferments - here

  Reports

• Commodities Daily - pdf here
• Nickel Smelting and Refining - pdf here (contains good basic info)

  Commodity/Economic Comments

• Ed Meir, MF Global - "It is very hard to say where the bottom is for many of these commodities -- it is still very very dicey."
• John Meyer, Fairfax analyst - "There is a lot of momentum on the downside ... I see metals coming off until policymakers announce further stimulus packages to stimulate consumer as well as financial activity."
• (SBB) Half of India's FeCr capacity now shut
• (MB) Yildirim sees chrome markets bottoming out in Q1 '09
• Mad About Options: Stainless Steel? - more
• (CM) If China's steel output returns to the previous level spurred by the economic stimulus plan, the global iron ore market would face a supply shortage in 2012, according to Credit Suisse.
• How The Recession Compares To Other Downturns - audio here

  China "To Lead Revival In Commodities" - Commodity prices should rebound from their low levels as China leads the world out of recession in the second half of next year, Investec Asset Management strategist Michael Power said yesterday. - more

  Brazil's Vale lays off 1,300 workers - Brazilian miner Vale said on Wednesday it is laying off 1,300 workers and will put 5,500 more on paid leave as the world's largest iron ore producer grapples with plunging demand from steel mills. - more

• Vale: Market To Decide Fate Of Iron Ore Benchmark System -  The benchmark system for setting annual iron-ore prices through negotiations with steelmakers and iron ore producers has a future but customers have to decide how they want to price their iron ore, a senior executive at Brazilian iron ore miner Companhia Vale do Rio Doce (RIO) said Wednesday. - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 7:50 am CST show 3 month nickel selling around $.08/lb lower. Except for platinum, all precious and base metals are trading lower this morning.  US Dollar is trading about 1/2 of 1% lower against the Euro, while crude oil is trading about even at the moment. Asian and Pacific markets ended higher overnight, while European markets are mostly lower this morning. US futures show Wall Street may open lower. A group of US reports to be issued today, including two that already have. MarketWatch reports " The U.S. private sector shed 250,000 jobs in November, the biggest job loss in seven years, according to the ADP national employment index released Wednesday. The loss was in line with estimates of analysts surveyed by MarketWatch. U.S. productivity was 1.3% in the nonfarm business sector during the third quarter, the Labor Department said."    
• Bloomberg morning metal news - more

  Metal prices fall further than during Great Depression - The price of key industrial metals has fallen further over the last four months than occurred during the worst years of Great Depression between 1929 and 1933, according to research by Barclays Capital. - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - "Metal prices continued to drift lower yesterday, as a rebound in the US equity markets did little to steady the complex. Perhaps the erratic trading pattern evident for most of the day in stocks did little to inspire confidence. ... This morning, we are seeing another assault on metals, with ali and lead again driving things lower. Rising stocks are also weighing on prices. Shanghai markets are under much pressure, with ali prices dropped to 15-year lows despite a story out saying that, the government may consider buying all types of base metals as reserves to help boost domestic demand ... We are currently at $9,400, down $100." (read Ed Meir's complete morning base metals report here)
• (ET) BNP Paribas noted that coke and iron-ore prices stopped declining, and have risen by 19% and 12% in the past two weeks, indicating the   steel production cut is coming to an end. In addition, the house noted that inventory level at traders and users has collapsed in  the past three months, due to fragile sentiment over steel demand in China. BNP believes low production and low inventory have paved the way for a seasonal rebound in the steel market.
• (SG) The Shire of Ravensthorpe has dismissed speculation BHP's local nickel mine may be mothballed, saying it has been reassured by the company that the operation will continue.
• Will December break Dow's losing streak? - more
• Tough Outlook For Commodity Indexes - more
• Commodities traders feel the bonus pinch - more

  North American Stainless Steel Prices - Latest Forecast from MEPS - Transaction prices for grade 304 products are forecast to decline further in the short term due to falling raw material costs. - more

• World Average Stainless Steel Prices - Latest Forecast from MEPS - Transaction prices for grade 304 products are forecast to decline further in the short term due to falling raw material costs. - more
• All Products Carbon Steel Price Forecast - Latest Forecast from MEPS - World All Products Average transaction price dropped in November by over $US140 per tonne as mills in all regions struggled to secure orders. - more

  Turkish chrome ore export hit by downturn - Turkey exported 81,559 tonnes of chrome ore in November - a 23% increase on October’s 66,150 tonnes. However in November 2007, exports were 159,591 t, Steel Business Briefing understands from the data released by Istanbul Mineral and Metals Exporters’ Association (IMMIB). - more

  Growth of chrome ore import by China slows down - China imported 5.678 million tonnes of chrome ore in the first nine months up by 25% YoY and down by 11.5% YoY lower than that in a year earlier. Chrome ore imports eyed a negative growth in August. - more

  Botswana: Tati Nickel Mine to Review Operations - The recent fall in global metal prices has forced the world's largest nickel miner, Norilsk Nickel International, to urgently consider an operational review of Tati Nickel Mine operations. - more

  Opposition wants nickel report made public - The Western Australian Opposition wants a report on the bulk export of nickel through the Esperance Port made public. - more

• Barnett orders Esperance port to ship nickel - The Premier has ordered the Esperance port to allow nickel shipments. (Shire of Esperance) - more

  Samancor, Hernic to slash ferrochrome output -report - South Africa's Samancor Chrome, the world's second-largest ferrochrome producer, will shut down all its mining and smelting operations from mid-December until the end of February, an online media report said. - more

  Vale does not see raw material prices soaring - Brazil's Vale, the world's largest iron ore miner, said on Wednesday it does not expect raw material prices to soar next year because of the global slowdown. - more

  Steel demand looks grim until late 2009-Stemcor - The world's largest independent steel trader Stemcor does not expect a recovery in steel demand growth until the last quarter of next year, its chairman said. - more

• Global metal demand to drop, BRIC nations key -- Standard Bank - No short-term pickup in demand is in sight for the global metal industry, but supply-side reductions and the long-term of development of the BRIC nations (Brazil, Russia, India and China) could bolster the industry in the long run, according to Standard Bank's metal chief, speaking at a conference Tuesday. - more
• Steel price could recover by March - analyst - Steel prices, which have collapsed more than 50% in the last couple of months, could rebound by the end of the first quarter of 2009, a leading German steel and metals trader told Reuters. - more

  EU body approves import duties on Chinese screws - A European Union anti-dumping committee voted on Wednesday to adopt import duties of up to 87 percent on screws and bolts from China, EU diplomats said, in a move likely to worsen fragile ties between Brussels and Beijing. - more

  Steel Mill Closure Headlines from just "this morning"

• ArcelorMittal's South Carolina Steel Mill Extends Shutdown Into January
• US Steel to idle 3 plants affecting 3500 workers - MarketWatch
• Gerdau to halt Riograndense plant for maintenance on December 15
• TATA Corus to cut work hours in Netherlands
• Japan steel firms may shutter furnaces -paper
• Mexican steelmaker to cut 12000 jobs
• Saarstahl reduces production by 30%

  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)
• India Metals Prices - Delhi - Dec 3 - 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

Tuesday, December 2

• Baltic Dry Index - minus 16 to 684. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) U.S. Stocks Advance, Rebounding From Worst Drop Since October // Ford, Toyota Say November Sales Tumbled More Than 30% // Asian Stocks Slump, Extending Global Rout, as Recession Deepens; JFE Drops // European Stocks Advance, Led by Allianz, Tesco; BMW, British Airways Climb (Reuters) Wall St leaps on bargain hunting, auto hopes // Bargain-hunters fail to save retail sales // Oil retreats below $49 as brief rally fades
• Markets in the West are rebounding today after yesterday's hit. At present the US dollar is trading .85% lower against the Euro, and crude oil is 1% lower and under $49/barrel. Base metals ended lower, while precious are trading mostly higher. Indicator charts show nickel opened lower, regained yesterday's close, spent much of the day quiet, then in late trading fell again, only to recover slightly before the close. Dow Jones reports three month nickel ended the day at $4.31/lb .  Sucden's day old chart shows nickel trading thru yesterday - here. The RSI (Relative Strength Index) and the SStoch (Slow Stochastic) show the market is oversold, but traders were not in the mood to buy today. Here are your January 2009 surcharge sheets from Allegheny Ludlum (here) and AK Steel (pdf here). USing AK Steel's numbers, we find that the average price of chrome fell from $1.828/lb in October to $1.54/lb in November. Nickel fell from $5.5065/lb to $4.8541/lb, molybdenum fell from $26.12/lb to $10.00/lb, and iron fell from $245/GT to $145.00/GT. This helped begin 304 stainless steel surcharges from AK Steel down from December's $.6872/lb to $.5348/lb, and the surcharge on 316 stainless steel down from $1.2999/lb to $.7428/lb in January. You can see how this compares over time here. AISI reports "domestic raw steel production was 1,197,000 net tons" last week, which Metal Bulletin reports is a 24 year low. Found an interesting article for those of you who wonder why we post the Baltic Dry Index (BDI) each day - "The best economic indicator you've never heard of" - here.

  Reports

• Canada Commodity Price Update - pdf here

  Commodity/Economic Comments

• 8th Bear Market Rally Since October 2007 - more

  Steel price could recover by March 2009-Kloeckner - Steel prices, which have collapsed more than 50 percent in the last couple of months, could rebound by the end of the first quarter of 2009, a leading German steel and metals trader told Reuters. - more

  Russian steel demand to fall in H1 '09 - Severstal - Russian steel demand could fall by up to 10 percent in the first half of 2009 due to a global slowdown, but may see a "significant recovery" in the second half, Russia's biggest steelmaker Severstal said. - more

  Golden Ocean Says 20% of World Capesize Fleet Idle - Golden Ocean Group Ltd., the shipper chaired by Norwegian billionaire John Fredriksen, said more than a fifth of the global capesize vessel fleet is idle after fees collapsed. - more

  Christmas star made of ThyssenKrupp Nirosta stainless steel shines over New York - The Rockefeller Plaza Christmas tree is one of New York’s best-known images. For the past few years, this tradition has featured a contribution from Germany. - more

  China bids to avert EU duty on screws, fasteners - China has offered to impose stricter pricing on Chinese-made screws and steel fasteners in a last-ditch bid to avert the imposition of anti-dumping duties of up to 87 percent by Brussels, diplomats said on Tuesday. - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 7:45 am CST show 3 month nickel selling around $.02/lb higher. Base metals are mostly quiet this morning, with nickel the only one actually trading in the green at the moment, but none of the metals are trading far from their daily starting point. Precious metals are trading in the green. US dollar is trading over 1% lower against the Euro this morning, and crude oil is also quiet, up 1/2 of 1%. Yesterday's hit taken on Wall Street by the Dow which ended lower by 679 points, or 7.7%, was the 4th largest point drop ever recorded. Overnight Asian markets were mostly down, while China was mostly quiet. European markets are mixed but mostly in the green this morning, and US futures show a bounce off yesterday's plunge.   
• Bloomberg morning metal news - more

  Reports

• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here
• Weekly Commodity Price Report - pdf here
• Global Mining News - pdf here
• Market Economic Outlook - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments -  "Metals sold off yesterday, but given the carnage we saw in other markets, the relatively modest declines were reassuring. ... Conventional stock market theory says that equity markets tend to rally several months before a recession actually ends, but the fact that we are still mired in a slump suggests that markets are not seeing much light at the end of the tunnel. ... We are seeing fresh 2008 lows being made today on ali and lead, but the balance of the metals are still holding above their yearly lows."(read Ed Meir's complete morning base metals report here)
• Weekly Forecast by SMM Specialist - more
• Flemming Nielsen, Danske Bank, Senior Analyst - "Both of China's manufacturing PMIs again dropped markedly in November, indicating that exports and industrial activity are likely to decelerate significantly in the coming month."
• (MW) South African ferrochrome producer Hernic Ferrochrome has cut back production by about 70%, and was operating only one of its four furnaces at its facility in Brits, a company spokesperson said on Monday.
• (Bloomberg) Cash prices of iron ore imported by China, the world's biggest buyer of the steelmaking ingredient, rose for a fourth week, gaining 1.7 percent after the government announced a 4 trillion yuan ($586 billion) stimulus package.
• (MB) Norilsk Nickel will close the $496.2 million Activox refinery technology at its 85% owned Tati nickel mine in Botswana “for good” on December 31
• Six executives from the Italian unit of German steel maker ThyssenKrupp were indicted on charges ranging from manslaughter to murder for their involvement in the December 2007 steel plant fire that killed seven workers. - more
• (Reuters) Tata Steel unit Corus has applied to the Dutch Government to part-fund temporary cuts in the work hours of 4,600 staff, a Dutch trade union said on Tuesday, as the global slowdown eats into production levels.
• (SBB) Yusco cuts Dec stainless export prices by up to $200/t
• BHP, Rio May Have to Cut Coking Coal Prices 33%, Analysts Say - more
• (Bloomberg) Sumitomo Metal Mining Co., the country’s second-largest copper smelter, has no plans to change production, spokesman Hitoshi Ito said by phone. Still, it may need to reduce ferro- nickel output to match cuts by stainless steelmakers, he said. - more

  China to embark on $3bn metals spree - China said on Monday it would spend about $3bn buying 1m tonnes of base metals, from aluminium to tin, in an effort to cushion its mining and smelting industry from plummeting demand and prices. - more (no nickel)

• China's Guangxi mulls metal purchase plan - China's minerals-rich border region of Guangxi will consider purchasing metals to help support prices, but has not yet decided, its party secretary Guo Shengkun said on Tuesday. - more

  Labor chief wants Falconbridge mine-workers to agree on severance - Labor Minister Max Puig met in his office with the members of the Falconbridge Dominicana workers union, led by Jose Aybar, aimed at mediating between management and employers to reach an agreement on severance pay, after the mine ceased operations 12 August. - more

  Xstrata says New Caledonia’s Koniambo project on track - The Swiss miner Xstrata has confirmed that despite the global financial crisis New Caledonia’s Koniambo project will go ahead as planned. - more

  Courtesy AISI - In the week ending November 29, 2008, domestic raw steel production was 1,197,000 net tons while the capability utilization rate was 50.2 percent. Production was 2,110,000 tons in the week ending November 29, 2007, while the capability utilization then was 88.5 percent. The current week production represents a 43.3 percent decrease from the same period in the previous year. Production for the week ending November 29, 2008 is down 11.2 percent from the previous week ending November 22, 2008 when production was 1,348,000 tons and the rate of capability utilization was 56.5 percent.

  Rio Tinto and Indonesian Regions Agree Nickel Mine Conditions - Rio Tinto Group, the world’s third- largest mining company, has reached an agreement with regional administrations in Indonesia for a $2 billion nickel mine, moving closer to a final contract with the central government. - more

  Russia Norilsk to cut nickel, palladium output - The world's top producer of nickel and platinum group metal palladium, Norilsk Nickel , will cut output of the metals this and next year, Norilsk said on Monday, as demand falls amid the global financial crisis. - more

• Norilsk Nickel cuts 1500 jobs in foreign subsidiaries - Norilsk Nickel is set to cut investments in foreign assets by 48% as well as lay off up to 1500 employees working for the company’s subsidiaries abroad, reports the Vedomosti newspaper. - more

  Liberals/Nationals at odds over nickel shipments -  The Nationals Upper House MP Wendy Duncan has criticised the Premier's plan to allow the bulk export of nickel through the Esperance port. - more

• Stand-off looms after Barnett backs Esperance nickel exports - Colin Barnett has set himself on a collision course with the Esperance Port Authority, the local shire, community groups and his Government departments, saying yesterday he supported the bulk export of nickel through Esperance. - more

  Nippon Steel seeks to cancel shipments on lower production - Nippon Steel Corp. is asking mining companies to cancel some deliveries of iron ore and coking coal as it reduces production, Bloomberg reported citing people familiar with the matter. - more

  Outlook For Ferrochrome Market By Dr. Konchar, Chairman Of Kermas = Standby On Recovery Of Economy By Balancing Supply / Demand Of Fe-Cr Through Reduced Production Etc. - 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)
• India Metals Prices - Delhi - Dec 2 - 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

Monday, December 1

• Baltic Dry Index -  minus 15 to 700. (chart) (article)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Reuters) FTSE down 2.3 pct as commods fall, data adds gloom  // European shares fall 6 pct; banks, commods weigh (Bloomberg) China’s Manufacturing Contracts by Record on Exports // U.S. Treasury Yields Drop to Record Lows on Recession Concern  // Oil Falls Below $50 After OPEC Delays Decision to Curb Output // Asian Stocks Decline on Signs Global Recession Is Deepening // U.K. Manufacturing Shrinks Most Since 1992, Home Prices Slide (MarketWatch) Global manufacturing gauges collapse in November (AP) National Bureau of Economic Research panel says US recession began in December 2007
• December has started on a sour note, with world equity markets and commodity markets lower. US dollar was up today, currently trading higher against the Euro, but not by much. Crude oil is now down nearly 8% and hovering above and below the $50/barrel line. Metals, both precious and base, ended in the red. Nickel slid below the $10,000/tonne level early, and then went quiet. Dow Jones reports three month nickel ended the day at $4.45/lb . Three month traders have been treating the $10,000/tonne level like the Holy Grail lately, so we don't expect them to surrender the market below that level easily. Just a correction to a news story we posted earlier this morning. The all time record high for nickel inventories is 151,254 tonnes reached on 11/24/1994. With current growing numbers nearing 64,000 tonnes, we have a long way to go before we see that record ever repeated. Sucden shows the average price of cash nickel fell from $12,140/tonne in October to $9,705/tonne in November. US stainless steel surcharges for January should be lower than December, with molybdenum, ferrochrome, and spot iron ore prices all falling during November. Posted an interesting piece of history below. Different circumstances, but very similar situation in 1998 with supply/demand of stainless steel and its effect on nickel prices and stock. The Baltic Dry Index now stands at 700, implying shipments of raw materials around the world continue to slide.
• Another new free service for US readers - Goggle 411 

  Reports

• November 2008 Manufacturing ISM Report On Business - here

  Commodity/Economic Comments

• (Dow Jones) South Africa's Samancor Chrome, one of the world's largest ferrochrome producers, said Monday it will be shutting its mining and smelting operations for a fixed period from mid-December until the end of February 2009. The company, which had already announced a production cutback of 500,000 metric tons, attributed the shutdown to a slump in stainless steel demand.
• (WSJ) The China Federation of Logistics and Purchasing said Monday its Purchasing Managers Index for China fell to the lowest level since the index started in 2005. The November PMI was 38.8, down from 44.6 in October.
• Nickel in 1998 - (10 years ago) - pdf here

  Russia Norilsk cuts nickel, palladium output - The world's top producer of nickel and platinum group metal palladium Norilsk Nickel will cut output of the metals this and next year, Norilsk said on Monday as demand is falling amid the global financial crisis. - more

  Xstrata, Merafe to Cut Ferrochrome Production by Half (Update4)  - Xstrata Plc and Merafe Resources Ltd., joint operators of the world’s largest ferrochrome producer, extended output cuts to more than half of total capacity after demand for the steelmaking ingredient slumped. - more

• Xstrata-Merafe responds to weak market - Mining group Xstrata and joint venture partner Merafe Resources have suspended more ferrochrome production due to weak market conditions, with total shut furnaces now accounting for half of annual capacity, the firms said on Monday. - more
• Sector movers: Xstrata furnace closures rock miners - Miners’ share prices have been knocked by news that the diversified giant Xstrata is to close five ferrochrome furnaces in South Africa. The closures mean the firm’s production of the commodity will now be running at less than half its full capacity, demonstrating the extent the weak global economy is having on demand for raw materials. - more
• Xstrata Dulls Steel Outlook - The miner's annual production of ferrochrome has nearly halved, an indicator of where the steel market is heading. - more
• Xstrata suspends furnaces - The Xstrata-Merafe Chrome Venture on Monday announced that a total 906,000 tonnes, or 52 percent, of its annual capacity is to be temporarily suspended in response to the short-term weakness in demand. - more

  Tati Nickel Mine To Review Operations - The recent fall in global metal prices has forced the world's largest nickel miner, Norilsk Nickel International, to urgently consider an operational review of Tati Nickel Mine operations. - more

  Vale to set up a port JV for iron ore transfer at Rizhao Port - Brazilian miner Vale has teamed up with China's Shandong Landbridge Group for an iron ore wharf project at Rizhao Port, a source at the port told Platts. - more

  Morning Briefing (8:00 AM CST is 2 PM in London)

• Indicators at 7:50 am CST show 3 month nickel selling around $.11/lb   lower. Except for tin, all other metals are trading in the red this morning. US dollar is trading about 1/3 0f 1% higher against the Euro, while crude oil is trading 3% lower. While markets in China and Hong Kong ended higher, most of the other Asian/Western Pacific countries ended lower.  European markets are mostly lower, and US futures show a negative opening.    
• Bloomberg morning metal news - more

  Reports

• Metals & Mining Weekly - pdf here
• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Daily Resource Plus - here
• Metals Fundamental Report - pdf here
• Morning Montra - pdf here
• Morning Bell - pdf here
• Commodity Price Index - pdf here
• BNP Markets Data - here
• The Chart Store Weekly Scoreboard - pdf here
• The Chart Store Monthly Scoreboard - pdf here
• Metals Despatch - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments -  "Metal prices eased on Friday as gloomy macro data kept the complex on the defensive. A buoyant US stock market prevented prices from finishing at their worst levels of the day, but the move higher in US equities was not enough to lift metals into the black. ... Metals have opened modestly mixed as we start the new week. So far, the markets are not being impacted by lower equity markets or the battering crude oil prices are taking, down about $2.30/barrel after OPEC decided not to cut production at its weekend meeting, preferring instead, to pass the decision on to senior ministers who will be meeting in Algiers in about 2 1/2 weeks time ... It remains to be seen what LME metals will do over the course of the day as they hover above their 2008 lows. So far, the complex is holding up fairly well considering the weakness in oil and equities and a stronger dollar, but all these factors may ultimately prove to be too powerful a combination to ignore as the day goes on. ... We are currently at $10,000, down $200; LME stocks were up again today, pressuring values lower. Our charts show that a trading range of sorts has set in since mid-October, with $8850 providing something of a floor. We are neutral on the complex for the moment." (read Ed Meir's complete morning base metals report here)
• (News Bites) The Chinese steel industry is considering quarterly pricing of iron ore. The China Iron & Steel Association held a meeting in late November 2008 at which members discussed the proposal to price iron ore quarterly, rather than annually, after spot prices fell sharply
• (Novosti) Russia's Norilsk Nickel cut nickel production by 0.5% in January-September 2008 to 218,000 tons on the same period last year, and increased copper production by 1.3% to 316,000 tons, the company said Friday
• (BHP) Chief Executive Marius Kloppers said Thursday the miner won't hesitate to shut down any mines that become unprofitable due to lower commodity prices.
• (Rosbusiness) UC RUSAL has withdrawn its claim asking the Krasnoyarsk region's arbitration court to declare the decision of Norilsk Nickel's board of directors to buy back the nickel company's own shares void, UC RUSAL's press office said in a statement today. The court received UC RUSAL's request to cancel its claim on November 27, the statement reads.
• (CISA)  If China's steel output returns to the previous level spurred by the economic stimulus plan, the global iron ore market would face a supply shortage in 2012, according to Credit Suisse. The iron ore market is currently keeping balanced after miners in Australia and Brazil announced plans to cut output.  
• (Bloomberg) Cash prices of iron ore imported by China, the world's biggest buyer of the steelmaking ingredient, rose for a fourth week, gaining 1.7 percent after the government announced a 4 trillion yuan ($586 billion) stimulus package.
• (Dow Jones) China Metallurgical Group Corp. is still going ahead with its US$1.37 billion Ramu nickel project in Papua New Guinea, hoping for a recovery in nickel prices sitting near five-year lows, but a prolonged depression in prices could change its plans, the project's deputy general manager said Monday.
• (JMB) Kobe Steel will expand the raw steel output reduction to more than 600,000 tonnes in the second half year to March 2009 from the first half to meet slower demand for high valued steel including automotive applications while the firm announced 200,000 tonnes of production cut before.
• Market chart - here

  Xstrata suspends furnaces - The Xstrata-Merafe Chrome Venture on Monday announced that a total 906 000 tonnes, or 52 percent, of its annual capacity is to be temporarily suspended in response to the short-term weakness in demand. - more

• Xstrata Plc and Merafe Resources Ltd., joint operators of the world’s largest ferrochrome producer, extended output cuts to more than half of total capacity after demand for the steelmaking ingredient slumped.  - more

  Anti-dumping investigation provides more armour to steel products cos - The domestic steel industry struggling against falling international prices and cheap imports from China is all set to get more help from the government. The Centre, which already imposed import restrictions on a number of steel products, has now initiated anti-dumping investigations on imports of a wide range of stainless steel and steel items from countries including China, Japan, South Korea, the US and the EU.  - more

  Gov’t to review Palawan’s mining ban - The Mines and Geosciences Bureau and the Chamber of Mines of the Philippines (CMP) will meet Palawan officials this week to clarify the 25-year mining moratorium. - more

  Rusal Nominates Prokhorov - Rusal has nominated Onexim Group president Mikhail Prokhorov to the board of Norilsk Nickel, RusAl said in an e-mailed statement Friday. - more

  China fastener makers ask for trade action against EU - Chinese screw and fastener makers, stung by the possibility of a European anti-dumping ruling, are asking China’s Ministry of Commerce to bring a similar case, arguing European imports prevent them from moving up the value chain, industry officials said yesterday. - 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)
• India Metals Prices - Delhi - Dec 1 - 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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