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Monday, February 28

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index -  plus 6 to 1,251. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) Wen Pledges to Curb Graft, Income Inequality as Police Head Off Protests // North Korea Warns of Military Response Against South Over Leaflet Air Drop // China's Bank Share Slide Seen Persisting With Inflation Undermining Growth // Mukherjee Seeks to Ease India Tax Burden, Cut Deficit as Inflation Gains // Asian Stocks Advance, Reversing Loss, After Report of Libya Oil Shipments // Oil Trades Near Highest in Two Years as Unrest Spreads to Oman // Glencore Said to Plan Talks With IPO Investors, Analysts // U.S. Offers Aid to Libya Opposition as Unrest Spreads to Oman // Euro Pares Losses Against Yen, U.S. Dollar as Asian Shares Erase Decline // European Stocks Advance; Siemens Gains on Osram Share Sale, Syngenta Rises // Berkshire Posts $1 Billion Writedown as Bonds Fail to Recover // Pent-up Demand Boosts U.S. GDP Outlook, Business Economists Say // Capitulating Bears Push Short Sales to Lowest in Three Years // U.S. Consumer Spending Cools as Food, Fuel Costs Climb // Stocks Rise on Buffett, Takeovers; Treasuries Erase Losses
  • The Euro is now trading 3/10 of 1% higher against US Dollar. NYMEX crude is slightly lower and trading at $97.83/barrel. Gold is up nearly 1/4 of 1% and silver is 1-2/3% higher. Base metals ended the session higher. Indicator chart show nickel made a big bounce right before our morning update and then gained a little more over the rest of the session. In the end, Dow Jones reports three month nickel closed at $13.15/lb , its third attempt to break thru the $13/lb mark and hold. Stockpiles of nickel stored in LME approved warehouses fell on Friday and now total just under 130,100 tonnes. Sucden's day old chart shows nickel trading thru Friday (chart here). Cancelled warrants has read over 7% the last two days, which is about double what it has been since the new year began. The week began quietly for the metals world, with metals wanting to return to their bull run.

  Reports

  Commodity/Economic Articles and Comments

  • (TF) Samuel, Son & Co. Ltd., parent company of Associated Tube Group, has announced plans to close its only remaining U.S. stainless steel tube manufacturing facility, located in Elizabethtown, Ky., by June 30.
  • Warren Buffett’s 2010 Report: The New Beige Book Guide to the U.S. Economy - more
  • Number of the Week: Gasoline Prices Bite - more
  • Hawk And Dove Signal Vigilance On Commodity Prices - more
  • Kohn: Commodity Prices Have Complicated Inflation, Policy Picture - more
  • G-20 Interim Study Faults Short Supply For Rise in Commodity Prices - more
  • Commodity Shock - more
  • It’s Still Not Looking So Hot Out There, Kids- more
  • Could Gas Drive a Double-Dip? Of Course it Can - more
  • Last U.S. World War I veteran Frank W. Buckles dies at 11 - more

  Russia's young flock to work in Arctic mine town - Lung-blackening pollution and Arctic isolation have not stopped Russian mining giant Norilsk Nickel from attracting graduates to work  in its mines. - more

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

  • Indicators at 7:10 am CST show 3 month nickel trading around  $.25/lb higher, with other London traded base metals mostly higher. The Euro is trading over 1/2 of 1% higher against the US Dollar at the moment. NYMEX crude is almost 2/10 of 1% higher and trading at $98.05/barrel. Gold is up 1/3 of 1% and silver is nearly 6/10 of 1% higher. In overnight trading, Asian markets closed higher, with China up 1.3%. European markets are trading higher this morning, and US futures are higher ahead of numerous economic reports. Nickel inventories fell on Friday.  
  • Reuters morning - Copper rises after Chile quake - more
  • LME Morning - Cooper advances above $9,850/t as optimism returns - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Copper posted its biggest daily advance in three months on Friday, as investors seemed to conclude that the upside breakout in energy seems to have run its course for the time being. This view was supported by reports that Saudi Arabia had stepped up its oil production to over 9 million barrels a day, an increase of some 700,000 barrels/day since the Libyan crisis began. Also supporting metals, was a decent rally in the US equity markets, as well as the fact that the dollar weakened against the Euro, getting to a low of $1.3840 at one point on Friday after a US macro release showed fourth-quarter US GDP growing much less than initially estimated, rising by 2.8% versus the 3.2% initially projected. However, consumer sentiment rose to its highest in three years in February, although March sentiment data will likely show a noticeable dip given the steep rise in gasoline prices of late. Metals opened lower in Asian trading earlier today after oil prices shot up by $1.50 at the opening, but prices began to recover once the oil gains started to fade, and we are now pretty much higher across the board. Brent oil prices are now down by about $.25, while WTI prices are off by about $.50 a barrel. This understated tone belies the tensions that continued to reverberate throughout the Middle East over the weekend. In Libya, the UN security council met late on Friday to discuss a number of punitive measures and by Saturday, it voted 15-0 to impose financial, travel, and arms sanctions on the regime and its supporters although it did stop short of imposing a no-fly zone (now apparently being considered). The resolution also refers the Libyan leadership and other individuals to the International Criminal Court. Although the Security Council's action was laudable, it will do little to change the immediate situation on the ground, where things seem to be growing more desperate, at least for the citizens of Tripoli. This is largely due to the fact that the Libyan leader is obviously ready to go down fighting, and to this end, he has been reportedly been arming many of his civilian supporters who are now patrolling the capital and attempting to quash any sign of dissent. However, this does not mean his supporters will necessarily stay and fight; CNN reported on Sunday that Gaddafi's security forces in another town close to the capital have already defected to the opposition. In Tripoli itself, there were chaotic scenes as people rushed to banks to withdraw money and long lines formed at bakeries. Pharmacies in Tripoli were running out of medicines, and people continued to stream out of the city. The Tunisian government reported Saturday that 40,000 people had crossed its borders since February 20, while Egypt reported 55,000 had crossed over since February 19. One of those leaving was none other than Gaddafi's private nurse, described as the "voluptuous blonde" in a US Embassy cable earlier this year, and who will presumably be tending to someone less controversial now that she is safely back in her native Ukraine. In Oman, thousands of youths clashed with police in the port city of Sohar, and witnesses say two protesters were killed in the fighting. In addition, Bahrain's opposition demanded the resignation of prime minister, but a Shiite leader who returned from exile this week went further by asking that the entire monarchy be abolished under a campaign of civil disobedience. For his part, the King announced that government housing loans will be reduced by 25% and sacked three ministers late on Friday, although surprisingly, the country's Prime Minister, who was been in his post for 41 years, is still in place. We doubt these relatively timid moves will do much to head off the resistance, and we would not be surprised to see more conflagrations flare up in Bahrain in the days ahead. In Iraq, Prime Minister Nuri al-Maliki gave government ministers 100 days to "deliver results" or be fired, the government announced after an emergency cabinet meeting Sunday. The announcement follows weeks of demonstrations across the country by protesters angry about unemployment, poor services, corruption, and a lack of freedom. At least 13 people died in protests Friday. Militants also attacked Iraq's largest oil refinery on Saturday, killing four workers and detonating bombs that shut down the plant in northern Iraq. Mid-East tremors are even extending halfway around the world to China, where police blanketed Beijing and Shanghai over the weekend to head off planned protests. More than government 100 vehicles were said to be patrolling one of Beijing’s busiest shopping streets and the purported site of a planned rally. Several journalists were forcibly removed from the area, while in Shanghai, at least seven people were taken into custody at one of at least 27 planned protest sites nominated around the country. The government also said that the leadership is “determined” to punish corruption, address growing income inequality, head off rising inflation, and address soaring home prices. In an online chat on these issues, the Chinese Premier Wen Jiabao said that his government will aim for lower average gross domestic product growth of 7% during the 2011-2015 period, thus underscoring his intention to address long neglected social issues. Mr. Wen admitted that restructuring won't be easy, but that the government will try to adopt new performance evaluation criteria for local governments, who will be evaluated on their ability to deliver efficiency, environmental protection, and to raise living standards.  .... Nickel is at $28,790, up $600, and we seem to be getting ready for another attempt to take out the recent highs. Nickel’s short-term uptrend line seems to be intact, as we note from our chart below. (read Ed Meir's complete morning base metals report here)
  • (BNA) Iron ore prices are expected to increase 20% in the second quarter of the year compared to Q1, Brazilian miner Vale's (NYSE: VALE) sales and strategy director Jose Carlos Martins said during a press conference
  • (TI) Eramet, a France-based mining company, is interested in investing US$ 4-5 billion in nickel mining and smelting on Halmahera Island, Maluku. For the investment, Eramet is seeking a 50-year investment guarantee. However, according to Coordinating Economic Minister Hatta Rajasa, the policy in Indonesia only allows a 30-year investment. “There is an additional mechanism of 10 years. That is no longer a problem,” he said.
  • (MBN) PT Inco nickel output falls 10% in Q4
  • (SBB) Yusco to hike 300-series export prices by up to $350/t
  • EUROFER:"EU Low Carbon Roadmap 2050 unacceptable" - more
  • Arab League Index of Unrest - chart
  • FDIC US Bank failures to Date - chart
  • Premier Wen sets 7% growth target - more

  Brazil's Vale Expects Commercial Nickel Output At VNC In 2011 - Brazilian miner Vale SA, the world's second-biggest nickel producer, said Friday it expects this year to start commercial nickel metal production at its Vale New Caledonia nickel plant, which was formerly named Goro. - more

  Glencore: The biggest company you never heard of - A powerful and secretive Swiss trader is likely to list this year. Can the Goldman Sachs of commodity trading survive going public?  - more

  MMC Norilsk Nickel makes clarifications with respect to Rusal’s announcement regarding Glass Lewis report - OJSC «MMC «Norilsk Nickel» ) is informing that the Company has taken note of the report of Glass Lewis & Co. (Glass Lewis), an international consultancy company providing proxy advisory services to institutional shareholders, which was partially cited in the press release of UC Rusal Pls (Rusal) dated February 24, 2011. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 25

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - plus 3 to 1,245. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) World’s Biggest Pension Fund ‘Will Likely’ Sell Japan Bonds // India Says Economy May Grow as Much as 9.25% Next Year Amid Inflation Risk // China, U.S. Teams Arrive in Christchurch as Quake Death Toll Reaches 113  // Asian Stocks Climb for First Time This Week on Oil Price; Hynix Advances // Lloyds Tumbles as Rising Funding Costs Threaten 2011 Profit // LSE Opens Four Hours Late Two Weeks After Technology Switch // Russian Central Bank Unexpectedly Raises Main Rates, Reserve Requirements // Qaddafi Bolsters Defenses in Tripoli While UN Mulls Libya Sanctions // U.K. Economy Shrank More Than Estimated in Fourth Quarter // European Stocks Climb as Volkswagen, Saint-Gobain, Telecom Italia Advance // Constitution Is Only Way to Cut U.S. Deficit: David M. Primo // Boeing Tanker Win Keeps 767 Alive, Eases Sting From Delays // Vale Sees 4-Year `Tightness' in Iron Ore Market on Rising Chinese Demand // U.S. Economy: Consumer Sentiment Climbs to Three-Year High // Stocks Gain as Consumer Confidence Beats Forecasts
  • The Euro continues to trade 1/4 of 1% lower against the US Dollar. NYMEX crude is up 1/4 of 1% and trading at $97.51/barrel. Gold is up 4/10% and silver is up nearly 2-3/4%. Base metals ended the session higher as oil fell back under $100/barrel and equity markets breathed a sigh of relief. Indicator charts show nickel fell early, recovered, and then gained in the last few hours of the session. For the day and week, three month nickel ended at $12.79/lb . Stockpiles of nickel stored in LME approved warehouses rose Thursday and ow sit just over the 130,400 tonne level. First time nickel figures have been over 130,000 tonnes since last Wednesday. Sucden's updates of their day old nickel chart have been erratic the last few weeks and spotty. After dropping all week, the Baltic Dry Index snuck in a gainer to end the week. It was another week dominated by news out of North Africa, and this week that news had a negative impact on world markets. As Saudi Arabia reassured consumers that they would pick up any oil production lost by Libya's civil war, nervous markets calmed a little and NYMEX crude dipped back below the psychologically important $100/barrel mark. Rex Nutting classified the opinions on what impact higher oil prices might have as "Some say it’ll barely be a bump in the road, while others are setting their hair on fire about the looming disaster. ".
  • We keep those in the southern Pacific in our thoughts this weekend after a very rough few months. Have a safe and relaxing weekend.  

  Reports

  Commodity/Economic Articles and Comments

  • (Macquarie Research) Latest data from New Caledonia shows that nickel production at Vale New Caledonia (Goro) was virtually non-existent in January at 194t of nickel contained in intermediate product (NHC). We hope Vale will update on the progress of this 60,000tpa HPAL facility when it reports its results (Thursday evening US time). The New Caledonian data also showed a collapse in nickel ore production in January to only 278,000t, down 39% YoY and the lowest figure in well over 10 years, presumably due to bad weather conditions. There were no reported exports of limonite ore to Australia.
  • Oil prices will slow — but not halt — growth - more
  • Fed’s Bullard Would Adjust Bond-Buying Program In Response To Economy - more

  US Trade-STATS-January Steel Imports By Country - U.S. import for consumption of steel products from selected countries and areas. Not seasonally adjusted on census basis. - more

  Somalia, Sudan, Afghanistan and DRC top global risks ranking while South Korea demonstrates resilience - The important growth economies of India, Indonesia, Nigeria, the Philippines and Russia are all rated ‘high risk’ in a ranking of 175 countries that evaluates the key strategic, operational and reputational risks for business. - more

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

  • Indicators at 7:15 am CST show 3 month nickel trading around $.10/lb higher,  with most base metals trading higher as well. The Euro is trading 1/4 of 1% lower against the US Dollar. NYMEX crude is up 1/2 of 1% and trading at $97.80/barrel. Gold is up slightly and silver is higher by 1-1/2%. In overnight trading, Asian markets closed higher, with China up 2/10 of 1%. European markets are higher this morning, as are US futures, on lower oil prices. Nickel inventories rose strongly yesterday.   
  • Reuters morning - Copper firms on U.S. data, growth worries remain - more
  • LME Morning - Metals snap losing streak as crude prices fall - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Copper snapped a three-day losing streak yesterday and ended slightly higher, as a sizable retreat in oil prices off their intraday high of $119.70 (on Brent) stabilized both metals and US stocks to a sizable extent. In fact, for most of this week, we have seen a noticeable decoupling between metals and energy; as energy prices moved higher, the latter pulled back as implications of higher inflation and interest rates were perceived to be a negative for metals demand. On the other hand, oil price pullbacks have had the opposite effect, and we are seeing more evidence of this today; with oil prices now down, a decent rally has set in over the copper complex, while the rest of the group is also seeing modest gains. In other markets, the dollar is slightly stronger today, and back under the $1.38 mark against the euro, while gold prices are steady. US stocks are expected to open slightly higher. The situation in Libya seems to be careening towards some sort of climax, although in fits and starts. The Libyan leader finds himself increasingly isolated, (and was even rumored to have been shot yesterday) as more members of his regime desert him and as more cities fall to the rebels. In addition, the rebels are much better organized now, relatively well armed, and apparently plotting to take over Tripoli. By early next week, the game could be up for the clearly deranged Muammar Ghaddafi. On the oil side, the Saudis have ring-fenced the potential damage emanating from this crisis by taking clear steps to step up production. Part of the problem here is that Libyan oil is of the "sweet" variety and not compatible with most Saudi grades, but the Saudis have reassured European refiners that they would be able to offer an equivalent amount of “Arab Extra Light”, which is close in composition, or failing that, blend some of other grades to get the desired purities. In terms of the latest on Libyan oil flows, assessments vary depending on the source. The IEA says for example, that anywhere between 500,000-750,000 barrels/day of oil is not flowing out, while Italy’s ENI, one of Libya's largest customers, says about 1.2 million barrels/day-- practically all of the country’s exports-- is shut down. We assume the higher number is more accurate, given that ports and terminals in the country are not operational as well, although most are in rebel hands. Going into next week, we suspect that downward pressure on oil markets will likely continue, particularly as investors start to discount the likely fall of the Libyan leader. This, as we mentioned earlier, should provide a measure of support to both the metals and US equity markets, at least until the next flashpoint appears on the radar.  ... Nickel is at $27,770, up $265, and recovering some of this week’s earlier losses. (read Ed Meir's complete morning base metals report here)
  • (MB) Jinchuan Group has slashed its benchmark nickel price by over 2% as London Metal Exchange prices plunge and domestic sales weaken
  • ENRC to Get Part of $2 Billion Chinese Loan to Kazakhstan Fund - more
  • (AAR) The Association of American Railroads (AAR) today reported freight traffic continues to register gains with U.S. railroads originating 296,980 carloads, up 8.2 percent compared with the same week last year, for the week ending Feb. 19, 2011. Intermodal volume for the week was also up, totaling 233,993 trailers and containers, up 16.9 percent compared with the same week in 2010.
  • The Mad Hedge Fund Trader - Each $1 increase in the price of oil jumps gasoline prices by 2.5 cents. Each one cent rise in the cost of gasoline takes $1 billion out of the pockets of consumers.
  • (China) Industry contributed 49% to economic growth in 2010 - more

  China's refined lead and tin imports fall in 2010 - China's refined lead and tin and imports tumbled in January, while refined zinc and nickel imports saw healthy increases, according to Feb. 25 figures from the General Administration of Customs (GAC). - more

  World Consumption Of Ferro-Chrome In CY 2011 Is Anticipated To Come Up To 9.50 Million Tons= A Forecast By Yildirim CEO And President Of Eti Krom / Turkey - According to a forecast of the world demand for ferro-chrome in 2011 said on the 18th of February by Mr. Robert Yuksel Yildirim, CEO and President of Eti Krom Inc., which is a major producer of chrome ore and ferro-chrome in Turkey, the total quantity of ferro-chrome to be consumed in the world in the calender year (January - December) of 2011 is expected to come up to 9.50 million tons on material base, having a considerable increase compared to that (8.4 million tons) recorded in 2008. - more

  Paliudju Governor Gives Ultimatum to PT Inco - TEMPO Interactive, PALU:Central Sulawesi Governor H.B. Paliudju has given an ultimatum to PT International Nickel Corporation (Inco) to conduct mining activities in Morowali regency, especially in the Bahodopi and Kolonodale blocks. - more

  Sherritt expects production declines in Cuba for ‘11 - In a pessimistic outlook for its Cuban operations this year, Canadian energy and mining concern Sherritt International expects production declines in all its business areas for 2011. - more

  Universal Stainless Announces Bar Base Price Increases - Universal Stainless & Alloy Products, Inc. today announced a base price increase of 5% on all stainless and low alloy grade bar products manufactured at its Bridgeville and Dunkirk facilities. The increase will be effective for all new orders entered March 1, 2011. Current material and energy surcharges will remain in effect. - more

  Vale Profit Quadruples, Tops Estimates on Higher Iron-Ore Prices - Vale SA, the world’s largest iron- ore producer, said its fourth-quarter profit almost quadrupled, beating analysts’ estimates, because of surging prices for the raw material used to make steel. - more

  Severe weather, forecasting could prompt force majeure rethink - Worsening weather and better forecasting methods could push the mining sector to change force majeure provisions in supply contracts and sharpen how blame is allotted when storms or floods disrupt regular business. - more

  Steel makers feel the pain - China's 77 large- and medium-sized steel mills reported lower than expected profit margins last year, mostly due to high raw material costs, according to a report from the China Iron and Steel Association released Thursday. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 24

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - minus 11 to 1,242. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) Exxon, Shell, BP Said to Have Been Hacked Through Chinese Internet Servers // Food-Price Threat Worsened by Government Mistrust of Business, Olam Says // China Wage Gains Undermine Global Bond Investors as Inflation Accelerates // Swiss Franc, Yen Climb as Deepening Libya Violence Spurs Demand for Safety // Surging Prices From Singapore to Vietnam Herald Higher Rates, Currencies // India's Sensex Falls Most Since November 2009 on Inflation, Oil Concerns // Christchurch Quake Death Toll Will Climb, Authorities Say // Wheat Resumes Plunge as African Unrest Drives Away Speculators // Europe Economic Confidence Reaches Highest Since Late 2007 on German Boom // Saudi Arabia's Social Programs, Popular King May Hold Off Mideast Tumult //  Saudi Arabia Pledges OPEC Supplies to Replace Lost Libya Oil // Economy: Jobless Claims Fall, Consumer Confidence Climbs // Hedge Funds Borrow the Most Since 2007 to Purchase U.S. Stocks // U.S. Government Shutdown Looms as Lawmakers Deadlock Over Budget Proposal // U.S. Stocks Retreat on Concern Oil Rally Will Hurt Economy
  • The Euro is currently trading 3/10 of 1% higher against the US Dollar. NYMEX crude has traded choppy this morning, flirting with $100, and is presently trading at $99.62/barrel. Gold is up nearly 2/10 of 1% and silver is down 1.1%. Base metals for the most part, had a rather uneventful day, most ending slightly lower. Except for nickel. Nickel fell hard early and never was able to recover. For the day, Dow Jones reports three month nickel ended at $12.48/lb  . Stockpiles of nickel stored in LME approved warehouses rose yesterday and now stand over the 126,600 tonne level. This was nickel's third simultaneous price drop, but the first day the metal actually appeared weak in trading. The Commerce Department noted durable good orders rose 2.7% in January, but as MarketWatch noted "Excluding a 27.6% increase from the transportation sector, orders were down 3.6% last month, the weakest showing since January 2009." And our 'oh crap' graph for the day is here. In case you were wondering why everyone is nervous about what the price of gas might do to the economic recovery.

  Reports

  Commodity/Economic Articles and Comments

  • (MB) Credit Suisse has raised its forecast for nickel on better market fundamentals, as increased consumption from the stainless steel sector and constraints on nickel pig iron production have seen prices trade above $28,000 per tonne in February. Nickel will trade between $29,000 and $30,000 per tonne by the end of the second quarter, Credit Suisse said.
  • (MarketWatch) - At current levels, claims appear to be consistent with a modest pace of hiring. The economy’s gained an average of 83,000 jobs a month over the past three months. Still, that falls well short of the job growth required to drive down the nation’s unemployment rate — 9% in January. Companies have to hire about 125,000 new workers a month just to keep up with the natural growth of the labor force - more
  • (Dow Jones) Facing rising materials costs, Nippon Steel Corp. will ask auto makers and other major customers to accept a price increase of roughly Y20,000 a ton for steel products starting in April, The Nikkei reported in its Friday morning edition.
  • Fed’s Hoenig: Easy Money And Too-Big-To-Fail Must End - more
  • Fourth Annual Saving Assessment Indicates Many Americans Still Struggling - more
  • Fed’s Plosser: Would Consider Early QE2 End If Economy Accelerates More - more
  • Median Duration of Unemployment - more
  • Existing Homes Sales - more

  Deripaska Fails in Bid To Swing Norilsk Nickel Shareholders Vote in US, Europe - Oleg Deripaska will fail to swing Norilsk Nickel’s international shareholders into voting for his slate of candidates for the new board of directors at Norilsk, according to a report and proxy vote recommendation by Institutional Shareholder Services/Risk Metrics, a Washington, D.C.-based advisory specialist. - more

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

  • Indicators at 7:10 am CST show 3 month nickel trading around $.45/lb lower, with other London traded base metals much quieter and mostly lower. The Euro is trading 1/4 of 1% higher against the US Dollar. NYMEX crude is up 3-3/4% and trading at $101.78/barrel.  Gold is up nearly 4/10 of 1% and silver is off slightly. In overnight trading, Asian markets ended lower, with China up 1/2 of 1%. European markets are trading lower this morning and US futures are also lower as oil continues to climb. Nickel inventories jumped yesterday.
  • Reuters morning - Copper falls on economy worries, high supply - more
  • LME Morning - Metals hammered as risk aversion remains high - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Copper prices fell to their lowest level in nearly a month today, as the energy-induced price rise continues to take its toll on metals. In today’s action, although metals opened sharply higher in Asian trading, the gains were short-lived, with prices down as European trading got underway. We are now mostly lower, although copper has regained earlier losses and is now slightly higher. Of course, all eyes remain on the energy markets, where $5-$8 up moves now seems to be a daily occurrence. The market's explosive tone is attributable to fears that Libyan export levels are steadily decreasing, something that the markets were unsure about at the end of last week. This is not surprising given the chaos engulfing the country and the fact that most of Libya's ports are not operational. It is very hard to get exact readings as to how much of the country's approximately 1.1-1.5 million barrels a day are bottled up. The Financial Times says that about half the country's exports have been impacted, but we would not be surprised to see Libya's entire export flow stop in the days ahead. What is also making matters worse, is the fact that neither the Saudis, OPEC, nor the IEA, are seriously hinting that extra barrels will be on offer any time soon. The IEA seems to want to follow OPEC's reluctant lead, while the Saudi's excuse is that they will provide oil if it is needed. This argument is sounding increasingly hollow, especially now that there are real disruptions on hand. This may explain why reports have surfaced in the last 30 minutes or so that the Saudis have indeed initiated talks with the Europeans about releasing extra barrels. As these entities mull their next move, Brent soared to just under $120 earlier in the day, before receding to around $115 as of this writing. Gold is now at a seven week high, while US stocks are expected to open lower once again. Out of Libya, anti-government protesters reportedly have seized control of the country's third-largest city, as well as another town. The eastern part of the country has now all but broken off, and the opposition is vowing to "liberate" Tripoli shortly. Apparently, there are no police in Tripoli, so people have formed committees to guard their houses, reminiscent of what was happening in Cairo. Reports of casualties continue to mount; an army unit loyal to Gaddafi attacked protesters congregating in a Tripoli mosque today, blasting a minaret with anti-aircraft missiles. Yesterday, President Obama said the bloodshed in Libya "is outrageous and it is unacceptable," and he directed his administration to prepare a full range of options, including possible sanctions. French President Sarkozy raised the possibility of the EU cutting off economic ties, while another proposal envisions declaring a no-fly zone over Libya to prevent it from using warplanes. The UN Security Council also held an emergency meeting condemning the crackdown. None of this going to sway the clearly deranged Libyan leader, but if there is any good news in all this, it is that his increasingly macabre behavior should hasten his exit as supporters desert him. Either way, something will have to give over the next few days-- either the Libyan leader will be forced out, or extra barrels have to be released onto the market very quickly in order to stem the price rise and make the waiting period tolerable. With oil at $120 and threatening to move higher, the option of doing nothing is simply getting too dangerous for the world economy. A potential flashpoint to watch--and one that would suggest all bets are off—is the situation in Saudi Arabia. Apparently, hundreds of people have backed a Facebook page campaigning for a "day of rage" across the kingdom on March 11 demanding, among other things, an elected ruler, greater freedom for women, and the release of political prisoners. King Abdullah – just back from a three-month medical leave–announced a financial package worth an estimated $36bln yesterday that includes a 15% salary rise for public employees, reprieves for imprisoned debtors, and financial aid for students and the unemployed. It remains to be seen if this will be enough to placate a restless public, but we guess we will find out soon enough. .... Nickel is at $27,700, down $980, and getting hit more than most today. (read Ed Meir's complete morning base metals report here)
  • (PR) Universal Stainless & Alloy Products, Inc. today announced a base price increase of 5% on all stainless and low alloy grade bar products manufactured at its Bridgeville and Dunkirk facilities. The increase will be effective for all new orders entered March 1, 2011. Current material and energy surcharges will remain in effect.  
  • (PR) Effective with orders acknowledged on or after February 23, 2011, ATI Allegheny Ludlum is increasing base prices by 5 to 8% for nickel-based alloys and high nickel bearing stainless steels in the sheet, plate and Precision Rolled Strip® product forms including, but not limited to the following: - more
  • (SBB) Chinese stainless exporters have raised their grade 304 hot and cold rolled coil offer prices by $300-370/tonne in line with higher global nickel and Asian stainless prices.
  • (Yieh) China Steel Corp. (CSC) announced the latest prices for April and May delivery. The company has decided to raise its all product prices by 12.1% on average as same as the market’s forecast.
  • (China Daily) China's imports of iron ore stood at 618.64 million tons in 2010, down 9.13 million tons compared to the previous year, figures released Thursday by the China Iron and Steel Association showed.
  • (NM) European premiums for nickel briquettes held at seven-month highs this week, as traders said a cut in output by Vale this year would support prices, but upcoming projects due to bring supply online could cap gains.
  • (Interfax) Details concerning the latest pricing mechanisms to be used by global iron ore giants Vale, Rio Tinto, BHP Biliton and Fortescue Metals Group Ltd. (FMG) were released on Feb. 24 by Platts, the compiler of the index on which prices are to be based.
  • (ATA) The American Trucking Associations’ advance seasonally adjusted (SA) For-Hire Truck Tonnage Index increased 3.8 percent in January after rising a revised 2.5 percent in December 2010. The latest jump put the SA index at 117.1 (2000=100) in January, which was the highest level since January 2008. In December, the SA index equaled 112.7.

  An increase in nickel laterite shipments to China this month may signal a revival in the country's nickel pig iron production after a slump in the past few months on the back of constrained ore supply and Beijing's push to meet energy emission targets. - more

  Nisshin: consolidation key in Japan stainless sector - Consolidation is key for Japan's stainless steel industry to survive global competition, the president of Japan's fifth-biggest steelmaker Nisshin Steel said on Thursday. - more

  Domestic Price Of Ni-Based Stainless Scrap In Japan Rises Further To Yen 220,000 / Ton = High Scrap Price Since May 2010, Being Stimulated By A Further Rise Of LME Nickel Price - Reflecting a further and sharp rise of nickel price at LME, domestic price of nickel-based stainless steel scrap (new clippings) to be purchased by stainless steel companies in Kanto area of Japan has risen to a level of Yen 215,000 - 220,000 per metric ton delivered to mills, having had a rise of Yen 20,000 per ton compared with that prevailed on the end of January. - more

  -China to study iron ore, coal reserve plan -CISA - China will study plans to create reserves this year for iron ore and coal as national strategic resources, the China Iron & Steel Association (CISA) said on Thursday. - more

  Steel prices will continue to increase: Tata Steel - Tata Steel today said prices of steel will continue to show an upward trend in near future due to rise in cost of raw materials. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 23

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - minus 26 to 1,253. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) Deutsche Bank Banned From Derivatives Trading in South Korea // Chinese Consumer Confidence Slides on Inflation Concerns // BOJ Yamaguchi Cautious on Economic Outlook Due to Deflation // Asia Stocks Fluctuate as Oil Surges on Middle East; Airline Shares Decline // Merkel Says EU Leaders Weighing Extension of Greek Aid // Dubai Can’t Kick Building Habit as Property Glut Expands // Turkey Mounts Biggest Evacuation in Its History to Rescue 5,000 From Libya // Oil Rises to 28-Month High on Libya, Middle East Supply Concern // Libya Revolt Widens as Expatriates Flee, Qaddafi Vows to Fight // Oil Rises to 28-Month High on Libya, Middle East Supply Concern // European Stocks Extend Loss on Automakers, Resource Stocks, Libya Concern // Goldman's Blankfein Fought Raising Salaries Before His Tripled // Sales of U.S. Existing Homes Climb to Eight-Month High // Fed's Hoenig Says U.S. Should Break Up Largest Financial Firms // Oil Rallies, Stocks Retreat on Libya Revolt; Euro Gains
  • The Euro is now trading over 3/4 of 1% higher against the US Dollar. NYMEX crude is up 4-1/4% and trading at $99.47/barrel. Gold is up over 1%, while silver is up over 1.1%. Base metals ended the session mixed and quiet, after early morning losses were dented by the climbing Euro. Indicator charts show nickel opened lower, then spent the day in an erratic climb. For the day, Dow Jones reports three month nickel closed at $12.98/lb . Worldwide stockpiles of nickel stored in LME licensed warehouses slipped yesterday, giving back all of the prior days gains plus some, and now total just under the 129,200 tonne level.  Sucden finally updated their day old nickel trading chart (chart here). Technically speaking, from the SStoch and RSI readings, the nickel market is oversold. After two solid weeks of gains, the Baltic Dry Index has spent this week declining. NIckel may have lost ground the last few days but still looks remarkably strong considering the threat higher oil prices are to the economic recovery. Oil prices is having the most negative effect on worldwide equity markets. What is going on in Libya is beyond comprehension in this day and age and the ease with which these nations are melting down, has traders nervous about who could be next. But this is demonstration today is also concerning.
  • This wasn't in Libya, or Algeria, or Bahrain - this was in democratically controlled Greece. Maybe this isn't an African or Muslim nation problem. Maybe this is a Mediterranean problem. Someone needs to check what is in the water!

  Reports

  Commodity/Economic Articles and Comments

  • (MFG) European premiums for nickel briquettes held at seven-month highs this week, Reuters reports, with levels ranging from $350-800, their highest level since July 2010. Premiums for full-plate nickel were at $50-200, versus $50-$150 in late January. News that Vale will lose around 5% of its total 2011 nickel production due to a 16-week shutdown of a smelter furnace in Canada is viewed as supportive.
  • (ET) Jindal Stainless (JSL) is in talks to buy Ahmedabad-based Shah Alloys as part of lenders-initiated exercise to revive the ailing Mumbai-based steelmaker.
  • Economists React: ‘Growing Sympathy’ for BOE Rate Increase - more
  • Wintry Weather May Chill Economic Growth - more
  • Only Two Regional Fed Banks Vote To Raise Discount Rate - more
  • Mortgage Applications Increase in Latest MBA Weekly Survey - more
  • Soaring food and fuel prices in North Africa and the Middle East - more
  • Saudi King returns home amid Arab unrest - more
  • Billings at Architecture Firms Hold Steady in January - more
  • Brent-WTI spread - more
  • Canterbury Earthquake - more and Australian coverage here

  Eti Krom sees global stainless steel output exceeding 35 million tonnes in 2011 - Eti Krom foresees that China will boost stainless steel output to 15 million tonnes level in 2011 and that India will join the rapid growth path of China in Asia. - more

  Courtesy AISI - In the week ending February 19, 2011, domestic raw steel production was 1,820,000 net tons while the capability utilization rate was 75.3 percent. Production was 1,720,000 tons in the week ending February 19, 2010, while the capability utilization then was 71.1 percent. The current week production represents a 5.9 percent increase from the same period in the previous year. Production for the week ending February 19, 2011 is up 0.6 percent from the previous week ending February 12, 2011 when production was 1,809,000 tons and the rate of capability utilization was 74.8 percent.

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

  • Indicators at 7:10 am CST show 3 month nickel trading around $.17/lb lower, but off session lows, with other London traded base metals lower as well. The Euro is trading over 1/2 of 1% higher against the US Dollar at the moment. NYMEX crude is up nearly 1/2 of 1% and trading at $95.88/barrel. Gold is up 1/3% and silver is over 1/2 of 1% higher. In overnight trading, Asian markets ended lower, with China up 1/3 of 1%. European markets are trading lower this morning, but US futures show Wall Street should bounce back from yesterday's drop. Nickel inventories gave back all the gains from the prior day.
  • Bloomberg morning - Copper Drops for Third Day Amid Concern Mideast Unrest May Derail Recovery - more
  • LME Morning - Metals slip as traders adopt 'risk-off' approach - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Base metals fell sharply yesterday, with copper now at a three-week low, as worries about unrest in Libya revived fears of potential inflationary shocks to the system in the wake of further cutbacks in that country’s oil flows. As it now stands, at least three major oil companies have now halted production in Libya, with Italy's ENI and Spain's Repsol joining Germany's Wintershall in winding up operations. (A small Austrian operation also said it was curtailing production earlier today). In total, some 330,000 barrels per day are now offline, but the numbers could rise as we still do not have a clear idea how much oil is being impacted by striking Libyan workers deep inside the country. In addition, Libya's ports have been closed, and this will undoubtedly reduce exportable production even further. In the meantime, in a defiant speech on Tuesday, Libyan leader Muammar Gaddafi refused to step aside, and threatened tougher action against protesters. However, rebel troops are still in control in the east, while in Tripoli, the Interior Minister has resigned. The Financial Times reported yesterday that another speech by the Libyan leader is scheduled for later today, with Qaddafi apparently ready to devolve some power, but so far, there is no sign of that and we doubt this will even happen. Despite the stronger tone in the oil markets early on yesterday, some of the earlier price advances were rolled back on reassurances about supply made by Saudi Arabia and from IEA officials. Saudi Arabian Oil Minister Ali al-Naimi said OPEC would meet any real supply shortages, but so far, the Saudis seem to be content to respond to the crisis with words rather than extra barrels. At this point, it very well could be up to the IEA to act first, as its members hold 1.6 billion barrels of emergency oil stocks, last tapped in 2005 after Hurricane Katrina. Right now, metals are off once again, although the magnitude of the decline is not as sharp as of this time yesterday. Oil prices are higher as well, but the dollar is weaker against the Euro, never assuming its flight-to-safety role in this particular crisis, as might have been expected. Oil prices are up another $1.60 on Brent and by $.50 on WTI, although here too, the extent of the rise is not as sizable as yesterday's sharply higher opening. US stocks are called to open higher after yesterday’s steep sell-off. ... Nickel is at $28,250, down $400, but still holding up relatively well. (read Ed Meir's complete morning base metals report here)
  • (Yieh) Taiwan’s stainless steel market was caught in price war previously. Most buyers would stay in wait-and-see position rather than placing order at that moment.
  • (Interfax) - While crude steel production is expected to reach 660 million tons in 2011, and apparent consumption is set to increase 5 percent year-on-year to 632 million tons, China expects to see an iron ore surplus of 70 million tons this year, state media reported Feb. 23.
  • (JMB) Sumitomo Metal Mining announced on Tuesday the subsidiary, Sumitomo Metal Mining Philippine Holdings Corporation, which was established in 2010 as regional headquarters for nickel business, started the operation.
  • (Reuters) Nickel premiums hold strong, Vale output in focus
  • (SBB) Austenitic substitution looms in Asia as nickel soars
  • (MB) The trading value of cobalt and molybdenum contracts listed on the London Metal Exchange totaled more than $430 million for the year ended Feb. 21, the exchange said Tuesday.
  • (Reuters) Diversified miner Sherritt International reported an increase in quarterly earnings on Wednesday, citing higher nickel and coal prices.
  • David Kelly, chief market strategist at JPMorgan Funds - "If the price of a gallon of milk goes up the American consumer is poorer but the American farmer is richer. If the price of oil goes up, the American consumer is poorer and (Iranian President Mahmoud) Ahmadinejad is richer."
  • (SM) According to the American Forest & Paper Association's January 2011 U.S. Paperboard Report released today, total boxboard production increased by 8.3% compared to January 2010, and increased 5.5% from last month.
  • (China) Inflation drives China's consumer confidence down in last quarter - more

  Price, Availability Concerns Dominate DOM Market  - Distributors say reduced capacity and rising steel prices are the biggest threats to an otherwise healthy market for drawn-over-mandrel and other mechanical tube products. - more

  Industry steels itself for change in next 5 years - The China Iron and Steel Association (CISA), the nation's steel lobby said on Monday that steel mills in north and northeastern China should stop enlarging their production capacities during the 12th Five-Year-Period (2011-2015), as the industry prepares for large-scale changes. - more

  ThyssenKrupp plans hefty steel price hike - ThyssenKrupp, Germany's biggest steelmaker, said it planned a hefty increase of its flat carbon steel products in the next two quarters amidst a continuing positive trend in Europe. - more

  Deripaska Rebound From Near-Crash Stares Down Potanin - On a Sunday afternoon in January, Russian billionaire Oleg Deripaska gets ready to leave his sprawling mansion in Zhukovka, a wealthy suburb of Moscow where his neighbors include President Dmitry Medvedev and Prime Minister Vladimir Putin. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 22

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index -  minus 16 to 1,279. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) China Said to Order Banks to Assign Greater Risk to Local-Government Loans // Hong Kong's Tsang May Boost Budget Handouts to Give Relief From Inflation // Yuan Falls Most in Three Weeks as Tension in Libya Spurs Oil Price Gains // China's Stocks Decline on Concern Mideast Tensions to Boost Oil, Inflation // BHP to Buy Chesapeake Shale Assets for $4.75 Billion Cash // New Zealand Dollar Slumps to Year's Low After Christchurch Earthquake // Japan Debt Outlook Lowered by Moody’s on ‘Inexorable’ Debt // Mersch Says ECB May Warn of Upside Inflation Risks Next Week // Qaddafi Says He Hasn't Fled Libya as Regime Unravels // German Voter Disapproval of Greek Bailout Muddles Aid Talks: Euro Credit // Iran Warships Enter Suez Canal, Egypt's State-Run MENA Says // Wal-Mart Declines After U.S. Sales Miss Retailer's Forecast // Oil, Bonds Rally, Stocks Tumble as Mideast Unrest Intensifies
  • The Euro is presently trading over 2/10 of 1% lower against the US Dollar. Bloomberg is reporting NYMEX crude is up 6.3%, but it is trading at $91.42/barrel, which is actually lower than it was this time yesterday, so something is broke. Gold is down 6/10 of 1% and silver is off nearly 3.1%. Base metals ended the session lower on what could best be described as trader risk aversion. Nickel opened much lower and did a whole lot of nothing the entire day. Dow Jones reports three month nickel ended the day at $13.00/lb . Considering today's commodity meltdown, nickel holding onto $13/lb could speak volumes. Nickel stockpiles in LME approved warehouses rose for the first time in to weeks yesterday and now stand just over the 129,700 tonne level. Sucden hasn't updated its daily chart since the 17th. Metals news took a back seat to other world news. New Zealand was hit by a deadly earthquake overnight (chart here) and has one eye on an approaching tropical storm (chart here). Australia is watching two tropical storms of their own (chart here). Libya is on the verge of a civil war, Egypt announced Iran has two warships in the Suez Canal, and Somali pirates killed four American hostages this morning.  

  Reports

  Commodity/Economic Articles and Comments

  • Consumer confidence jumps in February - more
  • Libya oil ports disrupted,Italy ready to use gas stocks - more
  • New Zealand earthquake: 65 dead in Christchurch - more
  • ECB Ready to ‘Act as Appropriate’ on Inflation - more
  • E-Commerce Surge May Hit Tax Revenue - more
  • Farmers Can't Meet Demand as Corn Stocks Drop to 1974 Low - more
  • On the Underfunded Liabilities Problem - more
  • Wal-Mart US sales disappoint, shares fall - more
  • Fear of 'Catastrophic' Crash Rising Despite Bull Market - more

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

  • Indicators at 7:15 am CST show 3 month nickel trading around $.18/lb lower, with all London traded base metals suffering from "risk aversion" this morning. The Euro is currently trading nearly 1/10 of 1% lower against the US Dollar. NYMEX crude is up 7-1/3% this morning and trading at $92.55/barrel on Libya worries. Gold is down 2/3 of 1% and silver is lower by 2.6%. In overnight trading, Asian markets fell with China off 2.6%.  European markets are trading lower this morning and US futures show Wall Street will open lower. Nickel inventories broke a pattern yesterday and rose. As we stated yesterday, the increase in the price of oil is starting to worry investors on the impact it might have on the recovery. New Zealand is recovering from a deadly earthquake near Christchurch. Libya appears to be moving closer to a civil war as Qaddafi refuses to step down.
  • Bloomberg morning base metal news - Copper Drops for a Second Day as Oil Stokes Inflation Concerns - more
  • LME Morning - Metals plunge as investors seek out safer assets - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - We have a mixed session on Monday in the metals, as copper slipped slightly, while most of the others managed to carve out decent gains, with nickel and aluminum each hitting 34 and 29-month highs respectively. Markets were primarily focused on one thing only for much of the day yesterday, and that was the deteriorating situation in Libya, along with its potential impact on about 1 million barrels a day of crude oil exports. Brent hit $108.70 at one point yesterday, as investors braced for oil companies sending their staff out of the country (which most did) while reducing production as well (with only one doing so thus far). Another potentially serious supply bottleneck could be forming in Libya's Nafoora oilfield, which provides the bulk of the country's oil output, and where workers are apparently are on strike, this according to Al-Jazeera. Reuters could not immediately confirm the report, but that was apparently enough for oil traders to hear. In the meantime, the situation in the country seems to be deteriorating quickly. With nothing in the way of press reports coming out, information gleaned from private citizens reveals a government that is in considerable disarray, having apparently lost control of Benghazi, while struggling to survive in Tripoli. In the capital, reports surfaced of many civilian casualties, as soldiers, many of them mercenaries, fired on protesters and on groups of mourners from the back of pickup trucks and helicopter gunships. Libyan diplomats have started to defect (including the country's UN delegation) as did two fighter pilots, who flew their jets to Malta after refusing orders to fire on protesters. Libyan leader Muammar Gaddhafi was shown getting out of a car late on Monday, saying that he was in "Tripoli and not in Venezuela", but gave no further indication as to what his intentions were. We could be just at the start of a major move higher in energy prices, as the unrest in the Middle East will likely continue for many more weeks, if not months, to come. With so many key producers potentially vulnerable to varying degrees of turmoil, prices should be able to move higher much more effortlessly, while any corrections will likely prove short-lived. Indeed, flare-ups in countries like Kuwait and Saudi Arabia may be enough to send prices to their 2008 highs if anything remotely resembling the unrest we have seen thus far grips either of these countries. But for the short-term, all eyes will be on Libya, as unlike many other countries that have reported unrest so far, this the only one that has the potential to seriously disrupt the markets—and it has. In the meantime, metals are sharply lower today, reacting less to oil prices, which are up yet again, and more to the declines evident in a number of international equity markets. Zinc and lead are down hard, with the former losing about 6% alone in the Shanghai session, one of its sharpest declines in some three years. We suspect today’s selling in metals is largely attributable to the fear that the surge in oil prices, although quite justified, will inevitably lead to bouts of higher inflation and interest rates, resulting in slower growth down the road. This is certainly a legitimate concern, considering that inflation rates were already rising in a number of emerging markets, and the latest spike higher in oil will only exacerbate the problem. Focus in this regard is primarily on China, which has put through a number of interest rates and reserve requirement hikes of late, and will likely accelerate the schedule going forward as inflation readings ramp-up yet again. ....  Nickel is at $28,800, down $500, and holding up relatively well considering the performance in some of the other metals. (read Ed Meir's complete morning base metals report here)
  • (Yieh) BHP Billiton, the world’s mining giant has informed Japan’s major steel mills that the company planned to take monthly pricing system to replace the current quarterly pricing system from this April.
  • (Interfax) President Deng Qilin of the China Iron and Steel Association (CISA) said at the group's Annual General Meeting on Feb. 21 in Beijing that the country's steel industry will face a number of challenges throughout the 12th Five-Year Plan period, including increasing production costs and the domestic economy's slowing growth rate, according to a Feb. 22 report on the CISA Web site.
  • (MFG) China's crude steel demand is expected to grow by 2.6-4.6% annually over the next five years, the China Securities Journal reported on Tuesday, citing the China Iron & Steel Association as a source. CISA is forecasting China's annual crude steel demand will reach 670-750 million tons for the five years to 2015.
  • (MP) The European contract price of ferro-chrome for the second quarter of 2011 will settle at $1.40/lb, up from $1.25/lb in the current quarter, on increasing demand and production costs, according to Turkish ferro-chrome producer Eti Krom
  • (Interfax) Baosteel Resources Co. Ltd., a wholly-owned subsidiary of Baosteel Group, has signed a contract with Indonesia-based Modern Group concerning the exploration of lateritic nickel on the Indonesian Island of Sulawesi, Baosteel Group announced Feb. 21.
  • (China) China stocks slump 2.62% Tuesday - more

  Minara's Murrin mine returning after flood  - Minara Resources is focussed on returning the Murrin Murrin Nickel mine to full production after recent heavy rains and flooding affected operations. - more

  Baosteel Unit Inks Nickel Deal With Indonesian Modern Group - A unit of China's Baosteel Group has signed an agreement with Indonesian Modern Group to jointly develop nickel laterite deposits in southeast Sulawesi, China's State-Owned Assets Supervision and Administration Commission said Monday. - more

  Iron Ore - Spot prices ease; Hedland Port shuts ops - Spot iron ore prices edged down on Tuesday because of a lull in trading, but the closure of Australia's biggest iron ore terminal at Port Hedland is likely to give a boost to prices in the short term. - more

  • Australia iron ore exports near halt as cyclone approaches - A cyclone bearing down on Western Australia on Tuesday has brought iron ore shipments from the world's top exporter to a near standstill as ports shut ahead of the storm. - more

  ThyssenKrupp sees brighter carbon steel prospects - Prospects for the carbon steel industry in Europe have continued to improve in recent months, Germany's biggest steelmaker, ThyssenKrupp, said on Tuesday. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 21

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - minus 6 to 1,295. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) China Is Said to Tell Banks to Prepare Contingency Plans for Credit Crisis // Shanghai, Guangzhou Limit Home Purchases as Government Intensifies Curbs // HSBC Recommends Avoiding China Stocks Until Second Half 2011 // China Raises Fuel Prices After Crude Oil Climbs Above $100 // G-20 Overcomes China Opposition to Agree on Yardsticks to Gauge Imbalances // Nations May Expand Food Stockpiles, Subsidies, Traders Say // Qaddafi's Son Warns of Libya Civil War Risking Oil Wealth as Revolt Widens // BHP's Kloppers Considers Takeovers Even After $80 Billion Investment Plan // German Business Confidence Unexpectedly Rises to Record // Pimco Says Spain Is `Certainly Getting Better'; Greek Default Risk Remains // Europe Services, Manufacturing Index Hits 4-Year High // Maersk Orders Up to 30 of Biggest Container Ships on Oil, Trade // ECB Officials Signal They May Support Higher Rates on Inflation Concerns // European Stocks Fall as Libya Concern Escalates; Eni Drops, Merck Advances // Yen, Dollar Strengthen on Speculation Unrest in Middle East Will Intensify //
  • The Euro continues to trade lower against the US Dollar by just over 1/10 of 1%. NYMEX crude is now up nearly 6% and trading at $91.30/barrel. Gold is up nearly 1.2% and silver is higher by 3-2/3%. Base metals ended the session mostly higher.  Indicator charts show nickel opened higher, retreated early, then climbed back into the green. For the day, Dow Jones reports three month nickel ended the day at $13.29/lb  . We are trading at price levels not seen since May 2008. Nickel inventories stored in LME approved warehouses ended last week with its ninth consecutive drop and now stand just over 129,200 tonnes. After ten consecutive increases and an increase of 258 total points, the Baltic Dry Index fell back 6 points today. AK Steel announced a price increase for stainless steel late Friday, and you can just about bet other US producers will follow suit. Nickel is getting support primarily from the Vale shutdown announced on Friday. Australia has two tropical storms churning off its west coast causing mostly shipping problems at the moment. The revolution that started in Tunisia, then spread to Egypt, and is now causing a bloody uprising in Libya, as well as mass demonstrations in Algeria, Morocco, Iran, and Yemen is spreading thru the area so fast, that many are now fearful of what would happen if Saudi Arabia is next. Al Jazeera English is probably one of the best places to get updated news online (here) Oil is much higher today on concerns. They go too high, too fast, and the revolutions in North Africa and the Middle East could slow the world economic recovery down.   

  Reports

  Commodity/Economic Articles and Comments

  • (Dow Jones) Yuan appreciation will benefit Chinese steelmakers as the total value of their imports, including iron ore and coking coal, is larger than the value of steel exports, an executive with one of China's largest steelmakers said Sunday.
  • (SBB) World nickel market to be in balance this year - Norilsk
  • Economic Sentiment is Split - more
  • A Standard-of-Living Shock Is the Danger - more
  • Number of the Week: The Perils of Inequality - more
  • Research north of Sault points to global warming - more
  • A Full Frontal View of the World’s Uneven Monetary Policy - more
  • 18 Sobering Facts Which Prove That The Middle Class Is Not Being Included In This “Economic Recovery” - more

  Russia's Rusal drops objection of Norilsk Nickel's share buyback plan - Russia's aluminum producer Rusal said Monday it has withdrawn its earlier objection to Norilsk Nickel's plan to buy back common shares and American depositary shares through tender offers. - more

  • Norilsk: ISS Backs Early Termination Of Norilsk Directors - ISS Proxy Advisory Services, an independent advisor to institutions, has recommended that Russian miner OAO Norilsk Nickel shareholders vote for early termination of the existing Norilsk board of directors and support incumbent independent non-executive directors--Bradford Alan Mills and John Gerard Holden--Norilsk said Monday. - more

  BHP CEO sees high iron ore price for up to 2 years - Top global miner BHP Billiton's chief executive sees iron ore prices staying strong for as long as two years, and is confident the company's profit margins will remain robust, even as costs escalate. - more

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

  • Indicators at 7:20 am CST show 3 month nickel trading around $.04/lb lower and off earlier highs. Most London traded base metals are now trading lower. The Euro is trading a little over 1/10 of 1% lower against the US Dollar currently. NYMEX crude is up over 3% on Libya concerns, and trading at $88.90/barrel. Gold is up 8/10 of 1% and silver is over 2-3/4% higher. In overnight trading, Asian markets ended higher, with China up 1.4% and Hong Kong lower. European markets are trading lower this morning as well. Nickel inventories fell Friday. US markets are closed for holiday. Here are alerts on Tropical Storm Dianne (chart) and Carlos (chart) in Australia. Carlos appear to be the immediate threat.
  • Reuters morning base metal news - Copper steadies on Libya tensions - more
  • LME Morning - Pause in copper gives rest of complex chance to catch up - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Copper ended firmer on Friday, as investors brushed off Thursday's reserve requirement hike by the Chinese, and continued to pile into base metals. However, for a change, the main action outside of copper, with aluminum, lead, and zinc, all posting sharp advances. Nickel soared on the news that Brazil's Vale said it will lose around 5% of its total 2011 nickel production due to a 16-week shutdown of a furnace in Canada, resulting in a loss of an estimated 15,000 tons of refined nickel and equivalent to 5% of total planned production in 2011. The focus of most markets today, particularly in equity and energy, is squarely on the rapidly deteriorating situation in the Middle-East, where there were fierce clashes reported in Bahrain, Libya, and Yemen over the past 48 hours. The situation in Libya is the most confusing, since the press is not allowed in, phone connections are sporadic, and internet services have been cut off. However, from the accounts that have filtered in, there is heavy fighting in Benghazi, with some reports claiming that security has all but collapsed, and that protesters are now in control of the city. There are now reports that the fighting has now spread to the capital, Tripoli. In Bahrain, the unrest seems to be following the Egyptian pattern. A heavy-handed response by the military on Friday apparently backfired, with the government ordering troops to retreat, thus enabling protesters to regain control of Pearl Square. Bahrain's Crown Prince has now been charged with "initiating a dialogue" with the protesters and seven opposition groups met on Sunday to consider what their next steps will be. Across the Gulf in Iran, there were reports of large and violent demonstrations on Sunday, with posts on Twitter saying that some people are not backing down and fighting the police. As if all this were not enough, two Iranian navy ships are en route to Syria today, having been granted passage by the Egyptians. It remains to be seen to what the Israeli response will be towards these sailings, but we suspect that until the vessels return, the situation will likely remain tense. Even the Chinese seems to be jittery, with the authorities detaining activists, increasing the number of police on the streets, disconnecting mobile phone text messaging services, and censoring internet postings regarding a call to stage protests over the weekend. As far as we can tell, the campaign did not gain much traction. The "elephant in the room" that has the potential to really ignite the markets is Saudi Arabia. Thus far, there have not been any reports of protests, but we have to suspect that the Saudi government is watching the situation in Bahrain with some trepidation. The weekend developments have hit Middle-Eastern equity markets hard, while Asian stocks were also down. US stock futures are called to open lower after a sluggish performance in European equities, but actual markets will be closed here on account of the Presidents’ Day holiday. Oil prices are soaring, up around $3/brl, while gold is higher as well, with prices now over the $1400 mark. Surprisingly, the dollar is restrained, now trading at $1.3670 against the Euro. Base metals are not participating much on the upside so far, as earlier gains have faded, and we now see modest declines across the board, except for zinc and nickel. Nevertheless, with such large-scale unrest sweeping the Middle-East, we think most markets will be pulled higher over the days ahead, likely riding on energy’s coattails. ... Nickel is at $29,175, up $25, but had a very strong advance on Friday, and now is on the verge of hitting a three-high of just under $30,000. Charts look solid.(read Ed Meir's complete morning base metals report here)
  • (Reuters) LME nickel hits 34-month peak, chasing copper rally
  • (Interfax) Jinchuan Group Ltd. (Jinchuan Group), China's largest nickel producer, is conducting due diligence in advance of its acquisition of Philnico Industrial Corp.'s Nonoc nickel mine on the Philippine island of Mindanao, state media reported Feb. 21.
  • (Yieh) Hence, market participants estimated that the Taiwan stainless steel mills such as Yieh United Steel Corp. (Yusco) and Tang Eng would probably lift the prices by NT$7,000~NT$8,000/ton. However, dealers pointed out that even the nickel prices haves stayed in upward trend, the market demand is not as good as expectation. Thus, it may take time to see whether the market could accept the price hike.
  • (SO) According to a Friday statement from the Brazilian Steel Institute (IABr), Brazilian steelmakers produced 2.8 million metric tons of crude steel in January, an increase of 3.8 percent year-on-year, and 16.2 percent month-on-month.
  • (AMM) Stainless mills in China may raise March ex-works prices by up to 1,500 yuan ($227) per tonne as the traditional strong demand season for stainless steel begins in late March to early April.
  • (FSN) Chinese Moly Price Up while European Price Down
  • (JMB) Japan Crude Steel Output Increases by 5.3% in January
  • (SBB) Chinese stainless prices rise amid light trading
  • (Reuters) Tokyo Steel Manufacturing Co, Japan's biggest construction steelmaker, said on Monday it will raise prices of all its products in March to cover rising input costs.
  • International Ferro Metals Interim Financial Results for the half year to 31 December 2010 - more
  • China’s Iron Ore Imports May Fall for Second Year, Mysteel Says - more
  • German Business Confidence Unexpectedly Rises to Record - more
  • Cyclone Bears Down on Australia’s Ore, Oil Region, Shuts Ports - more
  • Rio Tinto sees Q1 iron ore shipments affected by Pilbara cyclones - more
  • (China) Fuel prices rise by 4.5% - more

  AK Steel Announces Stainless Steel Price Increase - AK Steel said today that it will increase base prices for all 200, 300 and 400 series flat rolled stainless steel products, effective with shipments on February 27, 2011. - more

  China To Revoke AD Duty On Stainless CR Sheets From Japan - There are prospects that China will revoke the existing antidumping duty on imports of stainless CR sheets from Japan in the wake of a third sunset review of the AD duty this year. The Chinese government started its review of the AD duty from late last year. - more

  RUSAL tells Norilsk minorities to demand buyback finish - Aluminium giant RUSAL , engaged in often-acrimonious negotiations over the sale of its stake in Norilsk Nickel , said on Monday it had dropped its opposition to the Arctic giant's share buyback. - more

  UK steel production soars at start of 2011 - Hopes for an industrial recovery in the UK steel industry will be buoyed today on the announcement that production bounced back in January on increased demand. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 18

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - plus 9 to 1,301. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) China Raises Bank Reserve Ratios to Counter Inflation // China Home Prices Rise in Most Cities, Defying Curbs // U.S. Geologist Jailed for Eight Years Loses China Appeal on Secrets Charge // Asian Stocks Rise on Taiwan Economic Growth, Billabong Forecast; HTC Gains // German Banks' Debt Downgraded By Moody's on Restructuring Act // Bahrainis Urge Democracy as Crowds Swell; Protests Spread // Saudi Arabia May Risk Shiite Unrest After Turmoil in Bahrain // European Stocks Slip as China Raises Reserve Requirements; Rentokil Falls // U.S. Apartment Construction Climbs as More Renters Crimp Supply // Campbell Cuts Full-Year Forecasts for Earnings, Sales // Buffett Says Pricing Power More Important Than Good Management //Treasuries Retreat on Inflation Concern as Stocks, Oil Advance
  • The Euro is presently trading over 4/10 of 1% higher against the Dollar. NYMEX crude is up 2/3 of 1% and trading at $86.92/barrel. Gold is up 3/10% and silver is higher by 2.9%. Base metals ended the session higher. Dow JOnes reports three month nickel ended the day and week at $13.22/lb . Inventories of nickel stored in LME approved warehouses fell for an eighth consecutive session Thursday, with worldwide totals now registering just under 129,400 tonnes. Sucden did not update their nickel trading chart for the day. Nickel fell early, as traders paused to analyse China's decision to raise reserve requirements for lenders just ten days after boosting interest rates in an attempt to bring inflation under control. But then news hit the wires that the number 2 furnace had been shut down at the Copper Cliff smelter in Sudbury due to a "failure of the tapping block on the northeast wall. That brought molten matte into contact with cool water, causing an explosion, ..." Vale announced a four month shut down, which will eliminate at least 5% of the refinery's annual production. With that - nickel was back trading in the black. For stainless steel users, this explosion could not have come at a worse time. There is a deep divide growing amongst analysts over what nickel prices will do over the next 12 to 24 months. On one side, you have those who believe new mega mines coming on stream will more than cover the acceleration in demand and the nickel market will remain in surplus. On the other side, you  have those who are not convinced the new supply will actually come on line as expected and the market will move into a serious deficit. For whatever it is worth, it doesn't appear that either side is expecting any serious drop in prices anytime soon. And unexpected supply problems, such as today's explosion at Copper cliff, or yesterday's announcement of a maintenance shutdown at Vale Indonesia, exacerbate the confusion. The Baltic Dry Index appears to be losing steam after hitting its tenth consecutive gain today. One of its sub-indexes was negative today but the BDI overall gained 9 points. Inn the articles about the Copper Cliff shu down below, read the comments in th Sudbury Star articles. This is where the workers from different shifts and areas talk to each other and you learn a little more about what is going on behind the scenes.
  • Have a safe and restful weekend!!.

  Reports

  Commodity/Economic Articles and Comments

  • E-Commerce Surge May Hit Tax Revenue - more
  • Philly Area Factories See Best Month Since 2004 - more
  • Changes in the Distribution of Workers’ Hourly Wages Between 1979 and 2009 - more

  Canada snag cuts Vale 2011 nickel output 5 pct - Brazilian miner Vale said on Friday it will lose around 5 percent of its total 2011 nickel production due to a 16-week shutdown of a smelter furnace in Canada. - more

  • Vale's No. 2 furnace down for 16 weeks - Vale's No. 2 furnace in its Copper Cliff smelter will be shut down for 16 weeks, the company announced in a release this morning. - more
  • Vale to announce layoffs or movement of employees due to #2 Furnace - With talking to Vale management (A.L.) today it is being said that there might be a possible layoff or movement of employees due to the #2 Furnace not being ready for up to 6 months. - more

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

  • Indicators at 7:10 am CST show 3 month nickel trading around  $.05/lb lower in choppy trading, with other base metals trading quietly higher this morning. The Euro is trading slightly higher against the US Dollar at the moment. NYMEX crud eis also slightly higher and trading at $86.40/barrel. Gold is higher by more than 1/10 of 1% and silver is higher by 2/10%. In overnight trading, Asian markets ended higher with China off 1%. European markets are trading lower this morning and US futures are quietly and slightly higher at the moment. Nickel inventories fell hard yesterday.  
  • Bloomberg morning base metal news - more
  • LME Morning - Metals seek directional cues, buyers lack stamina - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Copper prices hit a three-week low yesterday, but bounced back to finish with a modest gain, as prolonged congestion around the $10,000 mark is leading to more frequent bouts of light selling. LME data also showed that exchange open interest in copper and aluminum have both risen over the past two days as prices have fallen, indicating that new short positions have been established. On the fundamental side, inflation-based worries continue to weigh on the markets, with yesterday's US CPI numbers coming out slightly higher than expected. Other macro indicators were mixed; the index of leading economic indicators for January came in less than expected, but the Philadelphia Fed manufacturing reading more than made up for it, rising to its highest level in seven years. Right now, metals are mixed again, with copper, tin, and nickel all down slightly, while the rest of the group is sporting modest gains. The big news of the day is coming out of China, where reserve requirements have been hiked by another 50 basis points, taking effect next week. The central bank said it may also use other means “including rates and currency” to tackle inflation if measures taken to date are not sufficient. Nomura estimates that the new reserve move will lock up about $54 billion in potential loans after banks have already made $158 billion of new loans in January, more than double December’s level and consistent with the pattern of front-loading credit at the start of each year. So far, Chinese measures to cool the economy off do not seem to have had much effect, which is why metal markets have brushed off each successive rate or reserve hike. However, we believe the slower pace of activity is a matter of when, not if, and a more significant downside move in metals will eventually come our way once Chinese macro data starts to reflect the impact of these moves whose impact on the economy will only grow after each round higher.  ... Nickel is at $28,350, down $140; prices seem to have stalled just under the $30,000 mark. (read Ed Meir's complete morning base metals report here)
  • (Reuters) China's top nickel producer Jinchuan Group Ltd plans to produce 130,000-140,000 tonnes of nickel in 2011 as well as 500,000 tonnes of copper, Jinchuan Chairman Yang Zhiqiang told reporters in Hong Kong on Friday.
  • (Interfax) Imported iron ore prices are expected to decline in March, with imports of the raw material expected to follow the same trend into April, industry analysts told Interfax Feb. 15.
  • (SKRIN) Rusal rejects revised Norilsk buyout offer
  • (IT) Brazilian Vale Inc. subsidiary, PT International Nickel Indonesia Tbk (Inco) intends to make annual maintenance at its machines at Soroako, Southeast Sulawesi next August 2010. The maintenance will take around two months, and will
  • Trading in steel derivatives has soared in 2010 and is likely to keep on increasing, despite opposition from the big steelmakers as the futures market eats into their control over pricing. - more
  • China Jinchuan seeks A-share listing for unit, ups metal output - more
  • Anglo American net profit boosted by higher commodity prices, productivity improvements - more
  • Minara jumps as FY profit up 21% - more
  • How the middle class became the underclass - more

  Baosteel signs ferrochrome supply pact with India Farco - Baosteel Group, China's second-largest steelmaker by output, said Friday it had signed an agreement with India's Ferro Alloys Corporation (Farco) to secure ferrochrome supply to support stainless steel production. - more

  China steel prices seen rising in near term - CISA - Steel prices in the Chinese domestic market will continue rising in the near term thanks to recovering demand and rising raw materials costs, the China Iron & Steel Association (CISA) said on Friday. - more

  Aperam CEO Would Consider Stainless Steel Mergers - Aperam, the stainless-steel producer spun off by ArcelorMittal, would consider mergers in an industry that’s beset by overcapacity and surging costs. - more

  Iron Ore-Rally stalls as China buying slows; India state seeks ban - Spot iron ore prices eased on Friday, as top buyer China stepped back after a recent surge in raw material costs and steel prices recoiled on slow end-user demand. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 17

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index -  plus 21 to 1,292. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) China May Ease Deposit Controls in Step Toward Markets, Deutsche Bank Says // China's Foreign Direct Investment Rises 23.4%, Adding to Overheating Risks  // Singapore Raises 2011 Inflation Forecast
  • Singapore Increases 2011 Inflation Forecast After Record 14.5% Expansion // No Iranian Warships Scheduled to Cross Suez Canal, Egyptian Official Says // Asia Stocks, Commodities, Oil Gain on Outlook for Global Growth, Earnings // Sentance Says BOE Can't Be `Relaxed' on Pound Value // Mideast Protests Spread to Libya Amid Bahrain Apologies, Clashes in Yemen // Bahrain Leads Surge in Mideast Debt Risk as Unrest Escalates // European Stocks Rise for Fifth Day; Cap Gemini, PPR Lead Gains on Earnings // Fed Tells Banks to Stress-Test Capital for Recession With 11% Unemployment// Consumer Prices in U.S. Climb More Than Forecast on Food, Fuel // U.S. Initial Jobless Claims Rose More Than Estimated to 410,000 Last Week // Stocks Advance on Economic Data, Earnings Beating Estimates
  • The Euro is currently trading nearly 2/10 of 1% higher against the US Dollar. NYMEX crude is still trading over 1/2 of 1% higher and at $85.44/barrel. Gold is up over 1/2 of 1% and silver is up over 2-1/2%. Base metals ended the session mixed and mostly higher. Indicator charts show nickel fell hard early, tried a recovery, and fell again, but bounced hard at teh end of the session. Dow Jones reports three month nickel ended the session at $12.92/lb , but went positive in after market trading. Stockpiles of nickel stored worldwide in LME licensed warehouses slipped yet again yesterday, slipping under the 130,000 tonne level for the first time since June 2010. Totals now sit just over the 129,900 tonne level. Sucden's day old chart shows nickel trading thru yesterday (chart here). The Baltic Dry Index continues to rebound, adding another 21 points today. Copper, and a possible large correction coming, is getting a lot of attention lately. Whether you buy into it or not, it is worth watching copper in coming weeks as nickel has been playing follow the leader for awhile now, and if copper does begin to correct, nickel may break free of this bond, but it will have a psychological affect on nickel trading, at the very least. For now, the bull market remains entrenched. Bloomberg quote of the day - "The Federal Reserve ordered the 19 largest U.S. banks to test their capital levels against a scenario of renewed recession with unemployment rising above 11 percent, said two people with knowledge of the review."  

  Reports

  Commodity/Economic Articles and Comments

  • (Dow Jones) Briggs's view holds with that of metal research company Gold Fields Mineral Services, which forecasts nickel averaging $24,000/ton this year, followed by $19,500/ton in 2012, on the basis of a weakening fundamental outlook.
  • (Dow Jones) The World Trade Organization Friday will issue a preliminary report concluding that China has no legal right to impose export restrictions on nine raw materials, said trade diplomats and lawyers familiar with the case. The quotas, license requirements and other measures on industrial ingredients such as zinc and coke, many vital for making steel, have been a key irritant in China's simmering trade tensions with trading partners.
  • (Citi) Recent comments from coal producers in Queensland are that it is going to take many months before shipments are restored to normal. Indeed some producers estimate it will be 2012 before the force majeure backlog is cleared and new contracts can be signed. A critical issue is the waiver of restrictions on the discharge of water from flooded pits into rivers. This has replaced disruptions to rail as the main constraint. We expect prices to remain elevated through 2011.
  • In Paris, Talk of U.S. Budget - more
  • Geithner: Chinese Inflation Helping U.S. Compete - more
  • The return of structural unemployment concerns - more
  • New Hacking Tools Pose Bigger Threats to Wi-Fi Users - more
  • Budget Baloney (1): Why Social Security Isn’t a Problem for 26 Years, and the Best Way to Fix It Permanently - more

  DJ Nickel Set For Sharp Price Rise As Fundamentals Improve- Eramet - The outlook for the nickel market is "very positive" with potentially sharp price increases likely through 2011, the chairman and chief executive of French mining group Eramet said Thursday. - more

  Nickel: Where To, and How Fast? - How should stainless consumers plan their product design and view material purchasing options strategically in the face of such a strong nickel price? - more

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

  • Indicators at 7:10 am CST show 3 month nickel trading around $.12/lb lower, with all London traded base metals lower this morning. The Euro is trading only slightly higher against the US Dollar at the moment. NYMEX crud eis up over 1/10 of 1% and trading at $85.09/barrel. Gold is up 1/4% and silver is trading less than 1/10% higher. In overnight trading, Asian markets ended higher, with China off slightly. European markets are slightly higher, and US futures show Wall Street is unchanged. Nickel inventories fell below 130,000 tonnes yesterday.   
  • Bloomberg morning base metal news - Copper Falls to Two-Week Low; Tin Slides Most Since November - more
  • LME Morning - Metals undergo overdue correction at last - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Copper ended down for a second straight session yesterday, as prices worked lower on lingering concern about Chinese inflation data released earlier in the week, coupled with similar worries surfacing here in the US. In this regard, we had reports out yesterday that underlying wholesale prices in the US climbed in January to their highest level in more than two years, as the index of producer prices rose 0.8%, slightly ahead of estimates. Core prices were up a more benign .5%, but there is little doubt that the commodity price spiral we have been witnessing over the past few months is finally starting to seep into the US (particularly if one disregards the controversial "core" rate reading, which excludes food and energy). Whether manufacturers are now able to pass these rising wholesale costs on to their customers is a different matter, and success will vary from industry to industry. Our take is that manufacturers will, by and large, struggle to pass the bulk of these costs on because of intense competition, guarded spending by US consumers, and still-high unemployment. Right now, metals are off again, although off their worst levels, with copper and tin down the most. The dollar is steady, holding at $1.3550 against the Euro, and not doing much over the last few days, while oil prices are down by about $.10 after spiking yet again yesterday on renewed tensions in the Middle-East. This came in the wake of a statement put out by the Israeli foreign minister claiming that two Iranian warships were planning to sail through the Suez canal en route to Syria on Wednesday, and went on to describe the move as a "provocation". ... Nickel is at $28,320, down $255; the uptrend still seems to be intact, but we think prices will have trouble getting past $30,000 resistance. (read Ed Meir's complete morning base metals report here)
  • (Interfax) Despite generating a total profit of RMB 9.87 billion ($1.36 billion) in 2010, China's large- and medium-sized steel mills averaged a profit margin of only 2.91 percent, some 3.29 percent below the average for all other industries across the country, according to an annual steel industry report from the Ministry of Industry and Information Technology (MIIT), released Feb. 16.
  • (MFG) Nickel prices will decrease during in the second half of this year to an average of $24,000 a ton and continue to fall in 2012 to an average of $19,500 as the market becomes oversupplied the chief nickel analyst at GFMS said. China will continue to lead nickel demand, which will likely grow by 12% to 620,000 tons in 2012 compared with 2010.
  • (DJ) Eramet Targets 2011 Nickel Output Of 57,000 Tons, +6% On Year
  • (MP) Ferro-chrome prices in the United States have nudged up as business activity shows some sign of improvement and the supply pipeline remains under pressure.
  • (WSS) Figures released by the International Molybdenum Association (IMOA) revealed that world-wide production of molybdenum continued to increase during the third quarter of 2010, although usage fell. In total, 132.2 million lbs of molybdenum was produced, an increase of over three million lbs from the previous quarter. Usage however, fell by five million lbs to 121.6 million lbs as a result of slower production in the steel making sector during Q3.
  • China unloads more US debt holdings - more

   ATI Allegheny Ludlum Releases Sheet and Plate Price Announcement - Effective with shipments Monday, February 28, 2011, ATI Allegheny Ludlum is increasing base prices by approximately 6% for stainless cold-rolled and hot-rolled sheet and strip, tubular quality sheet and strip, continuous-mill-plate products, and emission-control alloys. - pdf attached

  Russia's Solway confirms $3 bln nickel smelter investment in Indonesia - Russia's Solway Group on Thursday confirmed plans to build an Indonesian nickel smelter with the capacity to produce 50,000 tonnes of the metal a year. - more

  Poseidon nickel mine to re-open next year - West Australian mining company, Poseidon Nickel, hopes to have its Windarra nickel mine, near Laverton refurbished and back in production by 2012. - more

  Nickel May Swing to Deficit for First Time in 4 Years - The nickel market may swing into a deficit for the first time in four years as the global economy recovers from its worst postwar recession, fueling demand for stainless steel, said Sumitomo Metal Mining Co., the biggest producer in Japan. - more

  Turkey Increased Their Exports Of Chrome Ore For January 2011 Shipment = Exported 256,000 Tons As Increased By 62% Compared To That In Dec. / 10 - It was known that Turkey exported 256,728 tons of chrome ore for shipment in January of 2011, which had a considerable increase of 61.9% compared with that (158,549 tons) in the previous month of December of 2010. - more

  Norilsk Nickel considerably reduced emissions in 2010 - OJSC MMC Norilsk Nickel (hereinafter – MMC Norilsk Nickel or the Company) summarized results of its environmental activities in 2010 and presented them at “Experience and methods of increasing environmental safety of industrial facilities” round table. - more

  • Russians of the Caribbean - It is no surprise that the battle for control over the world’s largest nickel producer, Norilsk Nickel, is taking place in the Caribbean – some of the players evoke pirates as much as corporate executives. - more

  Talvivaara blames weather for missed mining targets - Finish miner Talvivaara was punished on Thursday for missing nickel and zinc production targets in 2010, even though it managed to narrow its losses for the year. - more

  Loss-making Outokumpu replaces CEO - Finnish stainless steel maker Outokumpu ousted Chief Executive Juha Rantanen after he failed to stop spiralling losses, replacing him with Mika Seitovirta from April 1. - more

  EU Steel Prices Soar in February - The MEPS - EU Average Hot Rolled Coil transaction price soared by almost €100 per tonne in February. Buyers are anticipating further increases in domestic values of flat products in the second quarter as steelmakers make large upward adjustments, in line with higher raw material costs. - more

  Global steel demand soars - The price of copper is breaking records. So is the price of tin. And we’re all well aware of gold’s 10-year run to record levels. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 16

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - plus 35 to 1,271. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) Beijing Limits Home Purchases After Government's Housing Curbs, CCTV Says // Rain May Be ‘Too Late’ for China Wheat Area, BWS Says // Citigroup's Pandit Says Emerging Markets at Risk of Overheating, Inflation // Gold Rises to Highest in Almost Four Weeks on Inflation Concern // China's Inflation Exceeds Target for Fourth Month, Adding Rates Pressure // BHP Damps M&A Talk, Spending $80 Billion on Mines // Asian Stocks Rise as Nomura Upgrades Japan Economy; Chin Steelmakers Climb // U.K. Unemployment Claims Unexpectedly Rose 2,400 in January // King Says Bank of England May Keep Rate at Record Low for Months to Come // European Stocks Climb to 2 1/2-Year High; Heineken, SocGen Surge // Borders Files Bankruptcy as Expense Cuts Don't Stem Losses // Farmland Boom Provides Bright Spot for U.S. Midwest Real Estate // Oil Climbs as Israel Says Iranian Warships Heading for Suez Canal // U.S. Mortgage Demand Falls to Two-Year Low as Refinancing Drops  // Stocks Rise on Economy, Earnings; Gulf Shares, Pound Decline
  • The Euro is now trading over 1/2 of 1% higher against the US Dollar. NYMEX crud eis up over 1% and trading at $85.19/barrel. Gold is up slightly and silver is lower by 1/3 of 1%. Base metals ended lower, with the complex apparently pulled down by copper for a second day. Indicator charts show nickel traded within a $400/tonne band today, opening lower, climbing higher, dipping, climbing, then dipping again. trading appeared to be confused, not following equity trading or the Euro value changes. Fo the day, Dow jones reports three month nickel ended the day at $12.96/lb . Stockpiles of nickel stored in LME warehouses now stand just under 130,100 tonnes after falling again yesterday. Sucden's day old chart is posted here (chart here). The Middle East appears to be in a melt down mood as protests spread, and now Iran is being accused by Israel of trying to send two warships thru the Suez enroute to Syria. Israel may react, which is obviously what Iran is after, and gold and oil are higher on investor concerns. Iran is fearful they may get caught up in the rush for regional democracy, and may hope military action taken by Israel in response to its provocation, will shift Muslim attention back on Israel and off other more immediate concerns.

  Reports

  Commodity/Economic Articles and Comments

  • (Dow Jones) -The global nickel market was in a small surplus of 3,000 metric tons in 2010, the World Bureau of Metal Statistics said Wednesday.
  • Slowing Labor Force Growth Means U.S. Needs Big Productivity Gains - more
  • Fed’s Lacker Warns More Easing Would Lead to Inflation - more
  • Fed’s Pianalto: Economy Recovering but Still Struggling - more
  • Brazil Finance Chief Renews Attack on Fed - more
  • Barking Up the Wrong Tree: Social Security is *Not* the Problem - more
  • Great Inflation Debate: Big Week for Inflationistas - more
  • From Prison, Madoff Says Banks ‘Had to Know’ of Fraud - more
  • All You Need to Know About Why Things Fell Apart: Michael Lewis - more
  • The Man Who Said No to Easy Money - more
  • Analysis - China the wild card for commodity prices - more
  • Asia's poor suffer as food prices soar, raising prospect of unrest - more
  • World Food Prices At Dangerous Levels, Warns World Bank - more
  • Israel Warns It Might Act on Iranian Warships Passing Through Suez Canal - more

  BHP Billiton 1st Half Net Gains 72% To $10.52 Billion - BHP Billiton Ltd. (BHP) said Wednesday net profit rose 72% to US$10.52 billion in its first half from US$6.14 billion a year ago as demand for industrial raw materials surged along with the recovery of the global economy. - more

  China daily steel output averaged 1.7 mln T in Jan - China produced a daily average of 1.703 million tonnes of crude steel in January, data from the China Iron and Steel Association (CISA) showed on Wednesday. - more

  Mining projects 22 000 new jobs - South Africa’s mining sector anticipates adding jobs to the economy but the extent of job creation is tempered by the uncertainty around the nationalisation debate and the legislative framework. - more

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

  • Indicators at 7:10 am CST show 3 month nickel trading around  $.08/lb lower, with other London traded base metals mixed and mostly lower. The Euro is trading nearly 2/10 of 1% higher against the US Dollar this morning. NYMEX crude is up 1/2% and trading at $84.76/barrel. Gold and silver are both up 1/10%. In overnight trading, Asian markets rose slightly , with China up nearly 1%. European markets are trading slightly higher this morning, and US futures show Wall Street may open higher. Nickel inventories fell yesterday.   
  • Bloomberg morning base metal news - Copper Falls for Second Day as Stockpiles Fuel Demand Concern - more
  • Reuters - Copper below $10,000; risk-averse on inflation, data fears - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - There was an intraday reversal in copper yesterday, a pattern that usually signifies a short-term top. This is typically when prices race to new highs, only to reverse course and finish at their lows. In copper's case, we got to a record high of $10,190 yesterday, but finished at just over $10,000 on the official close, only to sell off more decisively after that. However, it does not seem to us that this is the start of anything major on the downside, as the extent of yesterday's decline and the accompanying volume was light, two ingredients that need to be in place for a reversal to be deemed more credible. We suspect yesterday's jittery mood was likely more due to the lingering effects of the Chinese inflation figures released Tuesday, which suggest that more rate hikes are likely to be in the cards. Also somewhat of a negative, was the US retail sales number we got yesterday for January, which gained .3% on the month, coming somewhat short of the .5% gain expected. Right now, metals are mixed in largely quiet trading; copper is off once again, and now trading just above the $9900 mark on account of a 3300-ton rise in LME stocks, while the rest of the metals are mixed. The dollar is slightly weaker against the Euro, now trading at just over $1.35, while oil prices are up by about $.50 on account of continued Middle-Eastern unrest, this time from Libya, where there are reports of demonstrations in Benghazi. We suspect the metal markets will continue to drift in a sideways pattern for the balance of the week, as we are still not seeing any macro release that could trigger a more substantial correction and contribute to a change in the bullish mindset. ... Nickel is at $28,672, down $73, but we still seem to be on track for a test of $30,000 resistance, at which point we suspect prices will have much more difficulty moving higher. (read Ed Meir's complete morning base metals report here)
  • (Dow Jones) The nickel market was widely expected to see increasing mine supply this year, especially from nickel laterite projects but there are no signs of this happening yet, says Pinaki Rath, managing director at Gold Matrix Resources, a Singapore-based metals trading house. Metals consultancy VM Group tips nickel mine supply to expand by 11% to 1,613,000 tons in 2011 but Rath says his suppliers are not yet seeing any signs of this metal.
  • (XNA) China Jinchuan lifts nickel ex-factory price to 218,000 yuan/t
  • (UBS) Benchmark ferrochrome prices on the European spot market have jumped to their highest in more than 2yrs on strong demand. High carbon ferrochrome is trading at ~$1.35/lb this mth vs last month's $1.20/lb.
  • (MCP) East-Sayansky Nickel Company (VSNK) has announced plans to invest about $6.8m in geological exploration at the Iysk-Tagulsky field in Irkutsk region in 2011. The exploration is reportedly aimed at discovering nickel and platinoid deposits.
  • (China) Steelmakers raise prices again - more
  • La Niña event now passed its peak - more

  China 2011 crude steel output to hit record 660mln T-MIIT - China, the world's largest steel producer, is expected to generate a record of 660 million tonnes of crude steel this year, the Ministry of Industry and Information Technology (MITT) said on Wednesday. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 15

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - plus 30 to 1,236. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) Australia Blocked China Rare-Earth Takeover on Concern of Threat to Supply // China Grain Supply Balanced, Won’t Rely On Imports // China Accelerating Inflation Bolsters Forecasts for Higher Interest Rates // China's January Inflation Data Today Cuts Food Weighting, Newspaper Says // Russia Begins Anti-Dumping Probe Into Chinese Cold-Rolled Steel // China's January Lending Jumps by $182 Billion, Adding to Overheating Risks // Bank of Japan Raises Economic Assessment as Global Growth Bolsters Exports // Europe Economy Expands Less Than Economists Forecast // Euro May Weaken Versus Dollar on `Head and Shoulders': Technical Analysis // German Investor Confidence Rises for a Fourth Month as Economy Strengthens // EU's Foot-Dragging on Bailout Blueprint Poses Risk to Euro, Portugal Says // Berkshire Departs BofA `a Loser' on Stake After Three Years // Stocks Fall on U.S. Retail Sales; Oil Rises, Bahrain Bonds Drop
  • The Euro is now trading 2/10 of 1% higher against the US Dollar. NYMEX crud eis down 1/2 % and trading at $84.38/barrel. Gold is up 8/10 of 1% and silver is higher by 1/2 that. Base metals ended the session mostly lower after builder confidence showed no signs of recovery in the US dragged copper off earlier highs. Indicator charts show nickel in sharp climb early, pulling back a little after punching thru the $29,000/tonne level. Then after copper buckled in mid afternoon, the rest of the metals complex followed suit. Dow Jones reports three month nickel ended the day at $13.04/lb , lower but holding above $13/lb for a second day. Stockpiles of nickel stored in LME approved warehouses fell yet again yesterday and now total just under 130,250 tonnes. Sucden's day old chart shows nickel breaking above $13/lb yesterday (chart here). The Shanghai Metals Market reports enquiries from Chinese pig nickel producers to ports holding imported ore are up. Nickel prices retreated a little today but the forward momentum appears to be intact. Article below on spot ferrochrome prices from Platt's that is worth a read.

  Reports

  Commodity/Economic Articles and Comments

  • (PR) Fitch Ratings has placed Russia-based non-ferrous metals producer OJSC MMC Norilsk Nickel's Long-term foreign currency Issuer Default Rating (IDR) of 'BBB-', Short-term foreign currency IDR of 'F3 and Senior Unsecured rating of 'BBB-'on Rating Watch Negative (RWN).
  • Geovic Awarded New Caledonian Licenses to Explore Chromite Deposits - more
  • China Has Started Fining Companies That Dare To Hike Food Prices - more
  • Conference Board Changes Show Higher Consumer Confidence - more
  • Fed’s Dudley: Momentum Rising, but Situation Still ‘Unsatisfactory’- more
  • Fannie and Freddie: The Saga in Charts - more
  • Dealing With Higher Pension Costs - more
  • What Is the New Normal Unemployment Rate? - more
  • A week Wall Street won’t forget - more

  Spot ferrochrome in Europe hits highest since Nov 2008 - Benchmark ferrochrome prices on the European spot market have jumped to their highest in more than two years on strong demand for the material valued for its anti-corrosive properties. - more

  Russian Firm Pledges $3 Billion for Maluku Nickel Smelting Plant - A unit of Russia’s Solway Industries has committed to invest $3 billion to build a nickel smelting plant in Halmahera, North Maluku, senior officials said on Monday. - more

  S&P may downgrade Norilsk Nickel after new offer to RusAl - Standard & Poor's international rating agency left Norilsk Nickel's long-term BBB-rating and ruAA+ rating on a national scale on the CreditWatch list with a Negative outlook following its offer to aluminum giant RusAl to buy 20% of its shares for $12.8 billion, the agency said on Tuesday. - more (see Dow Jones comment above for update)

  Russian oligarchs regain their influence - After losing the fortune during the crisis, Russian oligarchs are regaining their influence with the help of the authorities, participating in the development of strategic projects. - more

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

  • Indicators at 7:10 am CST show 3 month nickel trading around $.03/lb higher, with other London traded base metals mixed, quiet and mostly higher. The Euro is trading 2/10 of 1% higher against the US Dollar. NYMEX crude is up over 1/2 of 1% and trading at $85.26/barrel. Gold and silver are both trading around 3/4 of 1% higher. In overnight trading, Asian markets ended lower, with China off slightly on inflation concerns. European markets are trading slightly higher at the moment, and US futures are not revealing much this morning. Nickel inventories slid again yesterday.
  • Bloomberg morning base metal news - Copper Falls as Demand May Slow on Prices, Leaving More Supply - more
  • LME Morning - Tin hits another record but most pause as data flow continues - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Metals pushed higher yesterday, with the main action concentrated in copper, which rallied to another record high after a surprise jump in January Chinese imports. There was a good analysis written by Andy Home of Reuters who attempted to explore what might be behind the recent rise in imports given the sluggish physical market, a consistent flow of metal into LME warehouses in South Korea, and an LME-Shanghai arbitrage that has been negative for almost six months now. Home argues that it is possible that Chinese copper buyers have collectively decided to shun the spot market this year by buying monthly tonnages directly from producers under annual contracts. "If a manufacturer has even moderate confidence in its order-book projections over the coming twelve months, it makes sense to cover anticipated metal requirements with producer tonnage", Home writes. "In such a scenario China's copper imports could remain strong and the spot market weak for an extended period of time". Home says that another explanation for the high imports may be due to government purchases of copper, as the metal is viewed as a strategic commodity by the authorities. A third possibility - and more bearish in its implication - is that China is importing metal, but that these units are "passing through the country's customs department, at which point it is classified as imported, but travelling no further than bonded warehouse in Shanghai. No VAT has been paid on such metal and it will only be paid at the time that the metal is sold on to a domestic buyer in China". Although there is no confirmation that such "limbo" stocks exist, Home writes that they could be as high as 500,000 tons. If such metal is indeed being collected in warehouses, the metal could be conceivably shipped out of the country when conditions warrant. One way of finding out, is to monitor refined copper export flows out of China. In this regard, Home notes that in December of 2010, refined copper exports were roughly 10,500 tons, the highest they have been in more than a year. Right now, metals are mostly mixed, with copper down slightly, while there are more modest increases in the rest of the complex. Markets are digesting the recent inflation numbers out of China, which exceeded the government’s 2011 target for a fourth straight month. Consumer prices were up 4.9% in January from a year earlier, while producer-price inflation accelerated to 6.6% from 5.9% in December. Although the CPI number came in somewhat lower than expected, we doubt this will change the rate-rising stance the authorities will seek to maintain, as there are few signs that the inflation picture will actually moderate going forward. (For what its worth, the Chinese inflation numbers, if anything, tend to understate the actual increases, and some Chinese economists suggest that the numbers are likely double what the official releases are showing. We came across an analysis of Chinese inflation pricing methodology, where, for example, apartment rents are included in the price index, but costs for soaring owner-occupied housing are excluded. In addition, garments qualify for inclusion only once they have been on sale continuously for at least six months, which frequently means that they are no longer in style, while many other items included in the index are based on an outdated list of consumer products). ...  Nickel is at $29,044, up $149, and now at a fresh 2011 high. We seem to be on track for a test of $30,000 resistance. (read Ed Meir's complete morning base metals report here)
  • (UBS) After the December rally in the met space that resulted from surging met coal pricing, met-sensitive valuation has largely moderated. Despite met coal pricing maintaining a position well above $300/t, investors seem hesitant to subscribe to the notion that the issues in Australia might persist beyond the short-term.
  • (Interfax) Jinchuan Group Ltd., China's largest nickel producer, has raised its ex-works refined nickel price for the fourth time this month by up to RMB 128,000 ($19,414.83) per ton, in line with international refined nickel prices, according to a Feb. 15 online announcement from the company.
  • (Interfax) Baoshan Iron & Steel Co. Ltd. (Baosteel) announced Feb. 15 it will raise ex-works prices for major steel products by RMB 300 ($45.50) per ton in March, after raising prices for two consecutive months.
  • (Reuters) China imported 1.64 million tonnes of steel products in January, up from 1.41 million tonnes in December. .... Steel exports from the world's largest steel producer rose 9 percent to 3.12 million tonnes in January from the previous month, the data showed...... China's iron ore imports reached a record 68.97 million tonnes in January, up 18.8 percent from 58.08 million tonnes in December, official data from the General Administration of Customs showed on Monday.
  • (Reuters) Shanghai steel futures rose to a record for a fifth day in a row on Friday as index-based spot iron-ore prices bolted to all-time highs on tight supplies and strong demand from top buyer China.
  • (MBN) Jinchuan Ni price higher for third time in Feb
  • (SriLankaDailyNews) Due to the current extreme weather conditions induced floods and crop failures including prolonged droughts in the countries across Asia, Pacific, Australia, Europe and the two American Continents and Africa, there is overwhelming, undeniable evidence that the world will run out of food during this year. - more
  • Mincor posts modest H1 loss - more
  • China's Jan CPI up 4.9%; PPI up 6.6% - more
  • Another Look at Copper Corrections - more

  General Review Of Ferro-Chrome In 2010 And Its Outlook For New Year = Even Thought Production Of Stainless Steel Increased, FeCr Producers Were Unable To Enjoy Its Fruits - The world output of crude stainless steel in the calender year (January - December) of 2010 came up to 32.00 millions tons, having had a substantial increase of 23% compared with that in the preceding year of 2009, when stainless steel industry had suffered from a serious depression, and shown a brilliant revival.  - more

  Japan's Sumitomo Metal to up nickel refinery capacity - Sumitomo Metal Mining Co said on Tuesday it would spend $168 million on its planned move to beef up capacity at a domestic nickel refinery to handle raw metal produced at a project in the Philippines. - more

  Poseidon to restart Mt Windarra - Poseidon Nickel says it will restart its Mt Windarra nickel mine after it entered an $8 million agreement with GSM Mining to complete the refurbishment of the underground project. - more

  Chinese steelmakers lift March prices on high cost - Two top Chinese steelmakers will raise their main product prices for the third month in a row in March, a widely-expected move to cope with surging raw material costs and to reflect a positive outlook for demand. - more

  Iron ore imports skyrocket to record - Chinese iron ore imports surged 48 percent to a record in January, compared with a year ago, as traders replenished stocks in expectation of rising ore prices. - more

  Courtesy AISI - In the week ending February 12, 2011, domestic raw steel production was 1,809,000 net tons while the capability utilization rate was 74.8 percent. Production was 1,720,000 tons in the week ending February 12, 2010, while the capability utilization then was 71.1 percent. The current week production represents a 5.2 percent increase from the same period in the previous year. Production for the week ending February 12, 2011 is up 1.1 percent from the previous week ending February 5, 2011 when production was 1,789,000 tons and the rate of capability utilization was 74.0 percent.

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 14

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - plus 28 to 1,206. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) Japan Economy Shrinks Less-Than-Estimated 1.1%, Surpassed by China in 2010 // China Profits From Solar Policy as Europe Backpedals // Wheat Surges to a Record in China on Drought, Rising Imports // China Reports Smaller-Than-Forecast $6.45 Billion Surplus // Emerging Market Stocks Rise, U.S. Futures Drop; Commodities Climb on China // Roubini’s Next Crisis Is Scary Food for Thought: William Pesek // Portugal’s GDP Falls 0.3% in First Decline in a Year // Egypt Army Suspends Constitution, Meets Protester Demand // Euro Weakens Before Finance Ministers Meeting; Kiwi Slides on Retail Sales // European Stocks Rise to Highest Since 2008; Credit Suisse, John Wood Gain // Geithner Quietly Tells Obama Debt Expense to Increase to Record // Echostar to Purchase Hughes Communications for $2 Billion, Including Debt // Gross Cuts Government Holdings to Lowest Since 2009 // Fed's Dudley Says QE Spurring Economy, Making Outlook for 2011 `Brighter'
  • The Euro is trading over 4/10 of 1% lower against the US Dollar, after trading at a 3 week low earlier in the day. NYMEX crud eis down nearly 1/10 of 1% and trading at $85.51/barrel. Gold is higher by over 1/2% and silver is up over 2.1%. Base metals ended the session higher, with tin setting another record high. Indicator charts show nickel bounced early and maintained its leap for the rest of the session. Dow Jones reports for the first time since early May 2008, three month nickel closed above $13/lb at $13.11/lb . Stockpiles of nickel stored in LME approved global warehouses slumped Friday and now sit just over the 130,400 tonne level. Sucden's day old chart shows nickel trading stalled last week (chart here). The Baltic Dry Index registered day 6 of gains, up 28 points. If inventories continue to fall and at a rate similar to last spring, we could see LME inventory numbers slip under the 100,000 tonne level as early as May. If Citigroup is right and China pig nickel producers are unable to respond in light of higher coal prices, the decline could happen faster. Chinese copper import numbers came out positive today - it will be interesting to see Chinese nickel import numbers when they are published later. February numbers will be more telling and we won't see them till late March.

  Reports

  Commodity/Economic Articles and Comments

  • (Citigroup quote thanks to reader) Floods in Queensland have pushed coking coal prices above $300/t, with further price rise likely. At these price levels, a huge share of the nickel pig iron industry may become un-economic, thus forcing closures. Prices now look well supported at $25,000/t. As upcoming PAL projects fail to live up to expectations, we believe prices closer to $30,000/t ($13.60/lb) could be achieved in 2011.
  • Study: Strict Derivatives Regulation Could Cost 130,000 Jobs - more
  • Number of the Week: Government’s Overwhelming Role in Mortgages - more
  • Consumers Turning Into Inflation Hawks - more
  • U.S. economy healthier, not yet well: Fed's Dudley - more
  • Farm insurance fraud is cheating taxpayers out of millions - more
  • Housing Crash Is Hitting Cities Once Thought to Be Stable - more
  • Industrial production drops in Europe - more
  • Clothing prices to rise 10 pct starting in spring - more
  • Most Americans think China is No. 1 economy; it isn't - more
  • When China goes hungry, the world shakes - more
  • Roubini’s Next Crisis Is Scary Food for Thought: William Pesek - more

  Indonesia says Russia to build $3 bln nickel smelter - Russian investors plan to build a $3 billion nickel smelter in Halmahera island in eastern Indonesia, a sign of growing interest to invest in the country's mineral processing industry. - more

  • DJ Solway Industries To Build Nickel Smelter In Indonesia - A unit of Russia's Solway Industries plans to invest up to $3 billion to build a nickel smelter with a 150,000 metric tons of annual capacity in Halmahera Island in Indonesia, an Indonesian senior official said Monday. - more

  Norilsk Nickel recommends shareholders re-elect existing board - The board of directors of Russia's largest nickel producer Norilsk Nickel has recommended its shareholders vote for its re-election at a meeting on March 11 initiated by one of Norilsk core shareholders, RusAl, Norilsk Nickel said on Monday. - more

  • Norilsk: Rusal Seeks To Ban Rivals From Voting At Norilsk EGM - Russian mining giant OAO Norilsk Nickel said Monday United Co. Rusal , which owns a 25% stake in the company, is seeking to ban Norilsk subsidiaries and two main shareholders in the miner from voting at Norilsk extraordinary shareholders meeting Mar. 11. - more

  Suspension of new mining applications met with mixed reactions - The government has started canceling non-moving mining applications, and while some mining executives welcome the cleansing process (which includes the government's move not to entertain new mining applications in the meantime), some fear it may be a double-edged sword for the industry. - more

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

  • Indicators at 7:15 am CST show 3 month nickel trading around $.18/lb higher, with other London traded base metals all higher this morning.  The Euro is trading 9/10 of 1% lower against the US Dollar, which would typically put pressure on commodity traders. NYMEX crude is quiet and trading at $85.56/barrel. Gold is up slightly and silver is up over 1/2 of 1%. In overnight trading, Asian markets ended higher, with China up over 3%. European markets are slightly higher this morning and US futures have yet to decide an opening direction. Nickel inventories fell on Friday.    
  • Bloomberg morning base metal news - more
  • LME Morning - Upbeat Chinese data gives a perk to base metals - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Copper prices recovered from a near two-week low on Friday to end slightly higher, pulling the rest of the group up along with it (with the notable exception of aluminum). Most other markets stabilized as well after the abrupt resignation of Egyptian President Hosni Mubarak lifted a good deal of the recent uncertainty over most markets. This morning, we are higher across the board, with tin in record territory and copper pushing past the $10,000 mark. Other markets are off to a quieter start. The dollar is somewhat stronger for a second day in a role, with the greenback now trading at around $1.3430 against the euro. US stocks are expected to open flat after marginal gains in overseas markets. Energy prices are higher, as investors assess the reverberations out of Egypt that could potentially sweep through other countries in the region. In this regard, security forces and protesters clashed in Yemen and Bahrain on Sunday, while thousands of Algerians flooded a central square in Algiers on Saturday calling for political reform. The Palestinian Authority in the West Bank also ordered the dismissal of its Cabinet and said it would hold long-delayed parliamentary and presidential elections by September. And in Iran, opposition leaders planned a demonstration on Monday in solidarity with the Egyptian and Tunisian revolts. Activists are calling for protests in Libya on Thursday. ...  Nickel is at $28,674, up $374, and nearing the 2011 highs. We seem to be on track for a test of $30,000 resistance. (read Ed Meir's complete morning base metals report here)
  • (Yieh) japan’s stainless steel mills have started the price negotiation with the Asian customers last week. Market participant predicted that Japan’s stainless steel mills might increase the export prices by US$200~US$300/ton.
  • (Interfax) Hongda Group Co. Ltd. is to build a 40,000-ton production line for molybdenum products in Chengdu, capital of Sichuan Province, state media reported Feb. 14.
  • (Interfax) China's steel product exports rose 9.47 percent month-on-month in January to 3.12 million tons, according to preliminary statistics released by the General Administration of Customs (GAC) on Feb. 14.
  • (Stahl) Applications to import steel products into the EU's 27 member countries in January totaled 2.4 million mt, up 29% from the previous month and 61% higher on a year earlier, according to internal European Commission data seen by Platts Thursday.
  • (MB) Stainless steel scrap prices increased this week on gains in the three month LME nickel market and increased demand from mills.
  • (MP) China’s imports of molybdenum roasted concentrates fell 50% in 2010, according to official customs data.  
  • (SBB) Asian stainless offer prices surge with nickel
  • (JMB) Daido Steel to Increase Ni Series Stainless Steel Bar Price by 10%
  • China's foreign trade jumps 44% in Jan - more

  Indonesia says Russia to build $3 bln nickel smelter - Russian investors plan to build a $3 billion nickel smelter in Halmahera island in eastern Indonesia, said chief economic minister Hatta Rajasa on Monday. - more

  Union grieves lack of nickel bonuses at Xstrata plant in Sudbury - A dispute over nickel bonuses has led to a grievance against Xstrata Nickel in Sudbury filed by Mine Mill Local 598/CAW. - more

  The Next Stainless Steel Powerhouse? - The Indian stainless steel melt production reached 2.9 million t in 2010 and finished products 2.6 million t respectively. - more

  Iron Ore-Indexes hit record on Chinese stockpiling - Index-based spot iron ore prices edged up to fresh record highs and looked set to sustain their momentum on Monday as top consumer China continues to build steel product stockpiles in anticipation of a recovery in demand. - more

  China's Wuhan Steel raises March prices - Wuhan Iron & Steel Co Ltd , China's third-largest steelmaker, will raise prices of its major products by 300 yuan ($45.50) per tonne for March bookings as part of efforts to pass on rising raw materials costs to end buyers. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 11

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - plus 42 to 1,178. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) Australian Coal Premium May Widen on China, India Growth: Energy Markets // U.S. Not `Satisfied' With China's Progress on Boosting Yuan, Brainard Says // China Alters Reserve Ratio Requirements for Some Banks, Securities Reports // Australian Stocks Retreat on Egypt Crisis, Snapping Longest Gain in a Year // Vietnam Devalues Dong by Record 7% as Officials Seek to Curb Trade Deficit // India's Industrial Production Increases at the Slowest Pace in 20 Months // Greece Joins Italy in Objecting to EU Debt-Cut Target // U.K. Output Prices Increase Twice as Much as Forecast // Dollar Strengthens as Egypt's Turmoil, Stock Losses Spur Demand for Haven // Crude Oil Falls to 10-Week Low After Egypt’s Mubarak Resigns // Russian Debt May Reach 585% of GDP on Demographic Woes // European Stocks Gain as Egyptian President Mubarak Resigns; Michelin Gains // Consumer Sentiment in U.S. Increases to Eight-Month High // Stocks Advance After Mubarak Resigns; Egyptian Debt-Default Swaps Decline
  • The Euro is now trading 6/10 fo 1% lower against the US Dollar. NYMEX crude is down 1.7% and trading at $85.25/barrel. Gold is down nearly 1/2% and silver is off 1.2%. Base metals ended mostly higher as traders decided metals had retreated enough and that the bull market was far from over. Indicator charts show nickel fell early, and when it neared the $12.50/lb level, the price began to climb hard for the rest of the session. While the Egyptian president' resignation was historic, it had no effect on nickel trading as prices were advancing well before the surprise announcement came. Dow Jones reports three month nickel ended the day and week at $12.84/lb , back to Monday's close. Nickel stockpiled in LME approved warehouses fell for a third straight day yesterday and now total just over 131,100 tonnes. Sucden updated its chart, but only thru Wednesday (chart here). The Baltic Dry Index rose for a fifth straight day, by 42 points, making it the first full week of gains in forever. Norilsk upped its offer to buy out Rusal and end that soap opera. At least for this season. Egyptian President Muhammad Hosni Sayyid Mubarak resigned today after nearly 2 weeks of demonstrations brought down his 30 year reign. This uprising, peaceful for the most part, and overthrow of the government without military force, has marveled the world and send a shock wave thru the Middle East. For those of us outside the borders of this nation, we are witnessing a historic event.
  • Have a safe and relaxing weekend!! 

  Reports

  Commodity/Economic Articles and Comments

  • (Dow Jones) U.S. nickel imports fell 6.3% in December from last month, and was down 11.5% from the previous year, the Commerce Department reported Friday.
  • (Dow Jones) U.S. nickel exports rose 12.4% in December from the previous month, but was down 67.8% from the previous year, the Commerce Department reported Friday.
  • Fed’s Lockhart Warns About Deficits - more
  • Inflation lessons from the Asian crisis - more
  • Corn’s rally feeds a ‘global food fight’ - more
  • Why U.S. farm policy caused Egypt crisis - more

  Norilsk offers $12.8 billion for RUSAL's 20 percent stake - Russian mining giant Norilsk Nickel made a new offer on Friday to buy out warring shareholder RUSAL , raising the price per share by 23 percent to offer an even heftier market premium. - more

  All you want to know about Iron Ore: Karvy Comtrade - Karvy Comtrade has come out with a report on Iron Ore. The research firm says, we continue to remain bullish on this commodity and recommend taking long at lower levels. - more

  Appetite for metals returns - The sheer number of suits attending the mining indaba this year makes one thing clear -- the world wants minerals, particularly those beneath African soil. - more

  Watch Out In Iron Ore, Coal, Copper When Easy Money Policies Are Done, Says Rio Tinto - While it appears a truism to state that commodity prices are set to continue their bull runs in the first half of 2011, a more precise look coming from one of the most interested parties in the game, Rio Tinto, provides additional support and key insight into risks facing prices for iron ore, coal, copper, and aluminum. - more

  Welders can breathe easier with chromium-free alloy - A new alloy promises to lessen welders' risk of breathing toxic fumes on the job. - more

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

  • Indicators at 7:10 am CST show 3 month nickel trading around $.01/lb higher, with other base metals mixed and quiet. The Euro is trading over 1/2 of 1% lower against the US Dollar. NYMEX crud eis up nearly 1/2 of 1% and trading at $87.12/barrel. Gold is down 1/10 of 1% and silver is off 1/3 of 1%. In overnight trading, Asian markets ended lower, with China ending over 1/2 of 1% higher. European markets are trading slightly lower this morning and US futures are slightly lower as well.  NIckel inventories fell yesterday.    
  • LME Morning - Firm dollar, macro uncertainties weigh on metals complex - more
  • Reuters - Copper drops on higher dollar, tin hits record - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Metals recovered most of their earlier losses yesterday, as "buy-the-dip" money returned to the markets. The advance was also somewhat impressive since it occurred despite a strengthening dollar, which gained ground on Portuguese debt concerns and on the abrupt withdrawal of the leading German banking nominee to succeed Jean-Claude Trichet. However, most of yesterday’s focus in a number of markets was on fast-paced developments coming out of Egypt, where the likelihood of a Mubarak resignation was raised after reports suggested that he was about to step down, and hand powers to his vice-president. This did not turn out to be the case, as in a rambling speech that followed, the Egyptian president said that although he was transferring his responsibilities to his designated vice president, he was not actually resigning. Later on, it became apparent just how hollow the handover was, as the transfer of responsibility excluded several important functions, such as the power to dissolve parliament, fire the cabinet, or submit amendments to the constitution. Needless to say, the speech has galvanized the opposition, where more protests are taking place, and has triggered a rally in crude oil prices. Brent recovered all of Thursday's early losses in late-day electronic trading yesterday, and is up again today. The dollar is also stronger, now trading at $1.3530 against the Euro and at 83.5 against the yen. Most global stocks are down for a third straight day, with Asian stocks on course for their biggest weekly loss in nine months. European shares have held up somewhat better this week, but are also lower as of this writing, prompting a slightly lower opening call for US equities as well. Right now, metals are off slightly and giving up earlier gains. It remains to be seen whether the group now follows the energy markets, which likely will stay firm throughout the day, or react more negatively to the strengthening dollar and the weaker tone seen in the equity markets. We suspect that these countervailing influences will likely keep the metals in a fairly sideways pattern for the next few days, but caution that this drift cannot continue for too much longer, as it is already leading to a noticeable deterioration in some of the chart patterns.  ... Nickel is at $27,860, up $10, and very quiet with a $200 trading range in place.  (read Ed Meir's complete morning base metals report here)
  • (Yieh) According to report, Japan’s largest stainless steel maker, Nippon Stainless Steel Corporation (NSSC), said it has raised its February export prices for 300 series stainless steel as nickel raw material price keeps rising.
  • CRU - Demand for ferrochrome has strengthened in February and the regional disparities that were so prevalent in January have started to disappear. Spot prices have consequently improved in all regions, generating hope among ferrochrome producers that contract prices for Q2 will also increase. The combination of strong demand and curbed output pushes molybdenum prices to higher levels in the first two months of 2011. Even though Chinese molybdenum units will soon be re-surfacing on the market, global demand growth is expected to outpace supply for the time being.
  • Copper May Drop Following China’s Rate Increase, Survey Shows - more
  • (SBB) Chinese stainless market quiet but cautiously optimistic
  • A BRIC Self Sufficiency Index - more
  • Cass - Although freight shipments got off to a slow start in the first half of January, volume increased substantially as the month progressed and ended 12.3 percent higher than for January 2010. This is a strong sign that the recovery is continuing forward.

  BHP Coal Mines Hit By Floods, Costs Rising - In the latest hit to Australia's mining industry from devastating floods in Queensland, BHP Billiton Ltd. (BHP) said Thursday that coking coal production from the state fell 30% quarter-on-quarter and warned of a longer term impact for operations this year that could push up prices for steelmakers across Asia. - more

  Steel prices rise as demand to increase - Reports of an expected 10 percent increase in steel demand in the United States this year sent some steel company stocks higher Thursday, the same day AK Steel announced a price increase. - more

  ThyssenKrupp sees rising losses at Americas plants - ThyssenKrupp said rising raw material prices and environmental issues would add several hundred million euros to the start-up costs at its $12 billion steel plants in Brazil and the United States. - more

  Shanghai rebar, iron ore prices at record - Shanghai steel futures rose to a record for a fifth day in a row on Friday as index-based spot iron ore prices bolted to all-time highs on tight supplies and strong demand from top buyer China. - more

   Russian court dismisses RusAl bid to invalidate Norilsk AGM decisions - A Siberian arbitration court said on Friday it had dismissed a suit filed by the world's largest aluminum producer RusAl against Russia's top nickel producer Norilsk Nickel to declare invalid the election of Norilsk's board at its latest shareholders' meeting. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 10

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - plus 44 to 1,136. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) China Developers Move Beyond Shanghai, Beijing to Poorer Cities Amid Curbs // Wheat Hoarding Likely to Be `Widespread,' Prompting Price Gains, UN Says // China Wheat Drought May Last to Spring, Minister Says // North Korea Walks Out of Talks With South After Denying Ship-Sinking Link // Japan’s Machinery Orders Rise for First Month in Four // Asian Stocks Decline for Third Day This Week on Commodities; ASX Advances // ECB Says Interest Rates Are `Still' Appropriate, Price Risks May Increase // Bank of England Maintains Aid as Inflation Accelerates // European Stocks Decline for Third Day; Air France, Credit Suisse Lead Drop // Bernanke Makes Sure Fed Reminds Congress Deficit Bigger Than QE2 // Homebuilders Undermined by Cost of Construction Boom's Flaws // U.S. Foreclosure Filings Decline for Fourth Consecutive Month // U.S. Initial Jobless Claims Fell 36,000 to 383,000 Last Week // Fed's Warsh Resigns; Bernanke Adviser Questioned Stimulus // U.S. Stocks Retreat on Concern Over Cisco's Margin, Inflation
  • The Euro continues to trade lower against the US Dollar, just over 3/4 of 1% at the moment. NYMEX crude is up 1/3 of 1% and trading at $87.01/barrel. Gold is down slightly, while silver is down 4/10 of 1%. Base metals ended the session lower as Chinese buying since their return from holiday remains tepid. Indicator chart show nickel began to slump at the outset and spent the last half of the day trying to gain a foothold. Dow Jones reports three month nickel ended the day at $12.63/lb . Stockpiles of nickel stored in LME warehouses fell again yesterday and now total just under the 131,900 tonne level. This is the first time we have seen numbers below 132,000 since December 17th of last year. Sucden's day old chart shows nickel stalling at $13/lb, much like it did at $12/lb (chart here). The Baltic Dry Index continues to pick up steam, adding another 44 points to its three day run. The drop in the Euro for a second day is putting pressure on commodities but there are no warning signs flashing yet that nickel is headed south.

  Reports

  Commodity/Economic Articles and Comments

  • Consumer Reports Trouble Tracker Climbs for Third Month to 58.7 - more
  • Q&A: Ken Rogoff Says Crises Are Like Heart Attacks, Predicting Timing Is Tough - more
  • Bernanke Presents Grim Metrics for Job Growth - more
  • Geithner: Debt Ceiling Will Be Raised - more

  Outlooks for Cobalt, Lithium & Ferrochrome - The global economic recovery does not favor all commodities equally. Cobalt and lithium, for example, are expected to remain amply supplied even as demand increases, while the ferrochrome market will remain relatively tight for the next several years despite shuttered capacity waiting in the wings. - more

   Costly good night for toxic US town - The pollute first, pay later model is catching up with America, now forced to finance ever-mounting clean-up jobs – like this one in the ghostly mining town of Picher. Kristi Eaton reports. - more

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

  • Indicators at 7:15 am CST show 3 month nickel trading around $.14/lb lower, with other base metals lower as well. The Euro is trading over 8/10 of 1% lower against the US Dollar, adding pressure on commodities. NYMEX crude is off over 1/4 of 1% and trading at $86.48/barrel. Gold is lower by nearly 1/2 of 15 and silver is lower by 1-1/4%. In overnight trading, Asian markets ended lower, with China up 2%. European markets are lower this morning and US futures show Wall Street may open lower as well. Nickel inventories continued to fall yesterday.  
  • Bloomberg morning base metal news - more
  • LME Morning - Bulls lose their grip on base metals - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Copper fell to a one-week low yesterday in rather choppy trading, as a substantial rise in LME copper stocks, coupled with nagging concern about Tuesday's rate increase by the Chinese, both weighed on the market. Other metals also fell in sympathy, with the price decline in zinc and lead being particularly pronounced. We were not surprised by the move lower, as we think China’s rate increase was a significant development, and one that will not easily fade away despite the nonplussed investor reaction that first greeted its news. Metals are lower right now, with lead and zinc once again showing the greatest percentage declines. NYMEX energy prices are also lower (by about $.26/brl), although the Brent contract is up, widening the differential between the two contracts to a record high. The dollar is stronger today, now trading at $1.3640, almost a full Euro higher than the yesterday on renewed Portuguese debt worries. US stocks are expected to open lower following lackluster sessions in both Europe and Asia. We expect to see sideways trading in most markets for the balance of the week, as a period of consolidation is long overdue. However, things may heat up once again this weekend in Egypt, (starting Friday), which is why we would not want to get too short here. In this regard, there is talk that protesters are now planning to move on to the state radio and television building on Friday, while, a variety of strikes and labor protests are also underway. In Cairo, hundreds of state electricity workers stood in front of the main building, demanding the ouster of its director, while public transport workers at five of the city's 17 garages vowed to bring bus operations to a halt this week. Strikes were also evident for a second day in Suez on Wednesday, as some 5,000 workers at various state companies held separate walkouts at their factories. Traffic at the Suez Canal was not affected, but clearly, the energy markets are worried, which explains the relative strength in the Brent contract. Also out of the Middle East, the Saudis denied rumors out earlier in the day that King Abdullah has died. There was some interesting news from the ETP side of the metals business when ETF securities reported yesterday that the amount of copper stock backing its product dropped by one third to around 720 tons so far in February. Physical nickel inventories dipped sharply to 78 tons from 402 times. The sole exception was tin, where stocks more than doubled from 405 tons to 180 tons seen at the end of January. None of these holdings are very significant, and should the tonnages not pick up, we would not be surprised to see these products pulled off the market altogether by the end of 2011, joining a heap of other failed ETF's that simply do not have enough money under management to generate adequate profits for their sponsors.  ... Nickel is at $28,100, down $275; charts still look solid and prices still have the potential to push higher once the other metals start to turn around. (read Ed Meir's complete morning base metals report here)
  • (MB) Jinchuan takes nickel price 5% higher
  • (SO) In its 11th five-year plan period (2011-2015), China eliminated a total of 110 million mt of iron-making capacity, 68 million mt of steel production capacity, 330 million mt of cement output capacity and 100 million mt of coke production capacity.
  • (MB) Bindura Nickel Corp is in the advanced stages of securing financing for the reopening the Trojan mine in Zimbabwe, parent company Mwana Africa .
  • (SBB) Stainless scrap imports surge in Korea, Japan
  • Chinese consumer confidence down in January - more
  • The Ceridian-UCLA Pulse of Commerce Index™ (PCI), issued by the UCLA Anderson School of Management and Ceridian Corporation fell 0.3% on a seasonally and monthly workday adjusted basis in January, giving up some of December’s exceptional 1.8% sequential gain. - more
  • Freight Transportation Services Index (TSI) Rose 1.5% in December from November - more
  • CR Index: Consumers feeling financial stress but retail is recovering - more
  • Commodities: back to square one? - more

  Japan' Exports Of Ferro-Nickel In CY 2010 Decreased Slightly Compared To That In 2009 = Exports For China Decreased To Half Of That In 2009, Exports For India Increased By 2 Times - The quantity of ferro-nickel exported by Japan in the calender year (January - December) of 2010 is estimated to be 31,313 tons on nickel content base, having had a slight decrease of 0.6% compared to that (31,501 tons) in the preceding year of 2009. - more

  Holguin, Nickel Industry in Moa Surpasses Production Plan - Workers of the nickel sector in the northeast of Holguin surpassed the expected production for January 2011 in a 4%. - more

  Mining output up 12% - South African mining production rose 12.2% year on year in December after a slight downwardly revised 9.5% (9.6%) rise in November, Statistics South Africa said on Thursday. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 9

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - plus 28 to 1,092. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) `Heavy Lifting' to Come as China Leaves Deposit Rate Below Inflation Pace // Yuan Seen Reaching 17-Year High on Rate Increase: China Credit // Copper Prices Drop From Record as China Raises Interest Rates  // China to Sign Deal to Mine North Korean Rare Earths, Yonhap Says // North Korea Ends Defense Talks With South Without Agreement on Resumption // Thailand's Abhisit to Call Election by June, Won't Complete His Full Term // Wiping Out Chronic Diseases May Add 10% to South Asia GDP, World Bank Says // Asian Stocks Decline, Led by China-Related Companies; Toyota Motor Climbs // German Exports Increased Second Month in December // Italian Prosecutor Requests Berlusconi Trial for Power Abuse, Prostitution // Inflation Surge Means BOE More Likely to Raise Rates, Industry Group Says // European Stocks Retreat; Sanofi, Statoil Decline, LSE Surges // Wall Street Boosts Borrowers as Real Estate Bond Market Returns // Two Fed Skeptics of QE Say Inflation Underscores Risks // Home-Price Drop Leaves 27% of U.S. Owners Underwater on Loans, Zillow Says // Bernanke Says Unemployment to `Remain Elevated' // Most Stocks Fall on Inflation Concern; Treasuries, Wheat Advance
  • The Euro is now trading over 6/10 of 1% higher against the US Dollar. NYMEX crude is down nearly a 1/4% and trading at $86.75/barrel. Gold is down slightly and silver is now lower, by  1/2%. Base metals ended the session lower as an afternoon sell-off hit most commodities, including all base metals. Indicator charts show nickel opened much lower, rose to $13/lb and then got caught up in the afternoon sell-off. But not as bad as the others. Dow Jones reports three month nickel ended the session at $12.87/lb , the only LME metal not to drop today. Stockpiles of nickel stored worldwide in LME approved warehouses fell yesterday and now sit just over the 132,300 tonne level. Totals are now 5,436 tonnes off the high we have seen so far this year back on January 17th. Sucden's chart was not updated today. The Baltic Dry Index is showing signs it has bottomed out and is coming back. Numbers gained 28 points overnight with all three sub indexes giving very positive numbers. Markets opened today much like yesterday, lower on China interest rate increases. While yesterday's morning nervousness was a reaction to the surprise announcement, today's initial hesitation was caused by China's return to the market and its negative reaction to the news. And while the market tried to cast the concerns aside like yesterday, the equities market falling, cast a chill over the metals market. Nickel is having the same problem with $13/lb that it did at $12/lb, but held up well today.

  Reports

  Commodity/Economic Articles and Comments

  • (ROS) UC Rusal's statement that no ban was imposed on the buyback of Norilsk Nickel's shares contradicts the court order and a supplemental letter sent by the aluminum giant's representative to Norilsk Nickel, the press office of Norilsk Nickel said today. "We recommend that the management of Rusal take advice of professional lawyers to have a correct understanding of the court ruling and not to mislead related parties," Norilsk Nickel's statement reads.
  • Consumer Reports Index: Sentiment Rises as Consumers Face Fewer Financial Woes at Start of 2011 - more
  • Manufacturer Points to Dichotomy in Consumer Spending - more
  • Why Aren’t Employers Hiring? - more
  • Fed’s Lockhart Plays Down Inflation Pressures - more
  • The Real Reason Corporate Profits are Rising - more
  • Rotten to the core - more
  • Remember why inflation expectations matter - more
  • Structural Unemployment: Does Anyone Care About Evidence? - more
  • Mortgage Applications Decrease as Rates Jump in Latest MBA Weekly Survey - more

  RUSAL has little chance of dropping Norilsk board-lawyer - Russia's UC RUSAL has little chance of dismissing the board of mining giant Norilsk Nickel because a favourable decision by a Caribbean court would not apply in Russia, an international lawyer said on Tuesday. - more

  Men accused of selling thousands’ worth of stolen metal - Scrap metal companies paid a man more than $10,700 when he turned in allegedly stolen metal. - more

  Subprime metals - Metals Markets Anomaly No.1 worth pondering, courtesy of Citigroup’s Metals and Mining team in a note published on Monday: - more

  Show them your mettle: commodities will offer rich rewards for courageous investors - more

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

  • Indicators at 7:15 am CST show 3 month nickel trading around  $.03/lb  lower but recovering, with other base metals trading lower this morning. The Euro is currently trading 2/10 of 1% higher against the US Dollar. NYMEX crude is up over 4/10 of 1% and trading at $87.31/barrel. Gold is 1/10% higher and silver is up over 3.1%. In overnight trading, Asian markets ended lower, with China returning and ending over 1% lower its first day back. European markets are presently trading lower, while US futures are lower as well. Nickel inventories fell yesterday.
  • Reuters morning base metal news - Copper falls on dollar, China rate hike - more
  • LME Morning - Metals traders on edge after Chinese rate rise - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Base metals sold off sharply early in the day yesterday, but recovered to finish with only a modest, this despite the news that China’s central bank raised interest rates by 25 basis points. In fact, the recovery in most markets was quite impressive, with the Reuters-Jefferies CRB index dropping nearly half a percent immediately after the announcement only to settle almost flat by the close. The Shanghai Composite equity index also dipped by as much as 0.9%, but retraced much of its decline by mid-morning, finishing down only 0.2%. The fact that the commodity markets shrugged off this rather significant announcement shows how resilient the complex really is, propped up by strong economic growth practically the world over, coupled with strong fund flows that are seeking out commodities as an asset class. However, despite the initial reaction, we suspect the markets may get somewhat sloppy over the days ahead, as the implication of this move has a chance to settle in. We should keep in mind that with each successive rate increase, the impact on Chinese growth grows almost exponentially, since the effect of interest rates at 6% is quite different than at 3%. We should also point out that China’s real interest rates are still in negative territory, meaning that further rises are likely. In fact, a Reuters survey of economists expects the Chinese to raise rates at least two more times this year, but we would not be surprised to see rates hiked even more than that given that rates are still well below the 7.47% level they were at before the financial crisis began. Government figures expected next week are forecast to show producer prices advancing at a faster pace than what was reported last month. Inflation worries are not limited to China alone. The Wall Street Journal’s front page story today has to do with inflation worries sweeping the globe, with the problem particularly acute in emerging markets. Here in the US, although the headline inflation readings are still tame, the yield on US 10-year treasuries hit 3.72% yesterday, its highest level since April. Right now, metals are off slightly, with copper trading just below the $10,000 mark, while we are seeing sharper declines in zinc and lead. Asian equity markets finished slightly lower, and US stocks are expected to open down as well. There has not been any significant macro announcements from the US so far this week, but of Europe, Germany reported an unexpected decline in industrial production in December on account of cold temperatures. However, German exports remain resilient, with reports out today showing that they have increased for a second month in December. The dollar remains fairly steady, now trading at $1.3640 against the Euro. ... Nickel is at $28,275, down $105, and looks to be on track for an eventual test of the $30,000 mark. (read Ed Meir's complete morning base metals report here)
  • (Yieh) South Korea’s Posco has announced to remain domestic prices of stainless steel products unchanged after Chinese Lunar New Year vacation. In fact, the company has already lifted stainless steel prices by US$181/ton for January delivery.
  • (Reuters) Russian state bank VTB sold all its shares in Norilsk Nickel in the miner's $3.5 billion buyback, Russian news agencies quoted the bank's Deputy Chief Executive Vasily Titov as saying on Wednesday.
  • (JMB) Japan Major Stainless Steel Makers Impacted by Material Cost Upsurge for Oct-Dec
  • Rate hike 'aims to help tame inflation' - more

  The China Crude Stainless Steel Production of 2010 is 11, 256 ,000 metric tons, increased by 27.84% compared with 2009. - more

  Indonesia launches monthly benchmark price for metals - Indonesia has launched monthly benchmark prices for key base and precious metals to be in line with international markets, as the resource-rich country seeks to boost revenue from the mining sector, the energy ministry said on Wednesday. - more

  Japan Plans To Produces 5,420,000 Tons Of Special Steels In Jan. - Mar. 2011 Quarter = To Increase By 4% From That In Q4 / 2010, Favorable Exports And Active Demand From Automobile Sector - The Ministry of Economy, Trade and Industry of Japan released on the 2nd of February a plan to produce special steel products (hot-rolled products) in January - March quarter of 2011. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 8

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - plus 19 to 1,064. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) China Raises Key Interest Rates to Counter Inflation // Chinese Steel-Pipe Makers to Face 86% U.S. Dumping Duties After ITC Ruling // Commodities to Beat Emerging Market Stocks in 2011, SocGen Says // Asian Stocks Fluctuate as Earnings Optimism Tempers Taiwan Tech Declines // German Industrial Output Drops on Construction Slump // Italy Seeks to Thwart German Efforts to Impose EU Debt-Reduction Targets // Most European Stocks Gain; Swedbank, Swatch Rise as Earnings Top Estimates // Gasoline Supply Rises to 21-Year High in Survey: Energy Markets // New-Home Recovery Seen as Post-Super Bowl Selling Season Starts // Pimco Says Municipal Debt Market Has Swung `Too Far Into Default Panic' // U.S. Stocks Gain as McDonald's Leads Rally in Consumer Shares
  • The Euro is now trading 6/10 of 1% higher against the US Dollar. NYMEX crude has reversed coarse and is now trading 2/10 of 1% higher and at $87.66/barrel. Gold is over 1.1% higher and silver is up nearly 2.9%. Base metals ended the session mostly higher as equity market bullishness overshadows Chinese rate increase concerns. Indicator charts show nickel prices plunged in the morning and recovered all of the morning losses by late afternoon, plus some. Dow Jones reports three month nickel ended the day at $12.87/lb . Stockpiles of nickel gained for a second consecutive day yesterday, the first time that has happened this year, and while the two day gains are small, the total now stands just over the 132,900 tonne level. Sucden's day old chart shows yesterday's late afternoon sell off after the market punched thru the $13/lb level (chart here). Technically, this large sell off put the RSI and SStoch into oversold territory. We have another two consecutive day first for 2011 to report. The Baltic Dry Index rose 19 points today, for only the third time it has increased this year. All three sub indexes were positive as well. Today;s trading session was a story of two halves. During the first half of the session, traders concentrated on the Chinese rate increase announcement and metals plunged. Then US equity markets opened higher and the markets worldwide seemed to sigh relief and markets recovered quickly. Closing $.03/lb higher does not reflect the nearly $900/tonne drop nickel took earlier.

  Reports

  Commodity/Economic Articles and Comments

  • NFIB Small Business Report: Mixed Bag - more
  • Small Businesses Grow More Confident - more
  • Are Jobless Claims Overstating Labor Pain? - more
  • Credit-Card Debt Up for First Time Since 2008 - more
  • Bankruptcy Filings Hit 2-Year Low in January - more
  • Consumer Credit increases in December - more
  • More people choosing to rent, not buy, their home - more

  Aperam Swings To Profit In 4Q, Expects Volume To Rise In 2011 - Stainless steel maker Aperam, a recently spun-off unit of steel giant ArcelorMittal (MT), Tuesday reported a fourth-quarter net profit of $2 million after a $12 million net loss a year ago, on sales of $1.43 billion. - more

  Steel as an economic indicator - High prices of iron ore and other raw materials have hurt the steel industry. But the world's largest steel maker is predicting a strong 2011. As Christopher Werth explains, growth in the steel industry could mean growth in the global economy. - more

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

  • Indicators at 7:15 am CST show 3 month nickel trading around $0 no change at the moment, but recovering from earlier lows, with other base metals quiet. The Euro is trading nearly 1/2 of 1% higher against the US Dollar this morning. NYMEX crude is off nearly 1-1/2% and trading at $86.19/barrel. Gold is down nearly 2/10% and silver is lower by 2/10%. In overnight trading, Asian markets that were open fell on news China was raising interest rates again this year. European markets are lower this morning, while US futures show Wall Street is trying to open in the positive. Nickel inventories rose again yesterday, albeit not by much.    
  • Bloomberg morning base metal news - more
  • LME Morning - Metals range at mixed price levels, breather continues - more
  • Reuters - Copper falls, China move brings demand concern - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - no report today (read Ed Meir's complete morning base metals report here)
  • (PT) Customs: Russia’s nickel exports down 1.8% on year in 2010
  • (JMB) Japan Stainless, Ti Makers Rush to Middle East Desalination Projects
  • (RB) Russian aluminum giant UC Rusal refuted today a statement of Norilsk Nickel's subsidiary that a court had prohibited the buyback of Norilsk Nickel's shares. According to UC Rusal's statement, the High Court of Justice of St. Christopher & Nevis issued an interim order restraining Norilsk Nickel's subsidiaries in voting with quasi-treasury shares of Norilsk Nickel and prohibiting them from transferring or disposing of such shares.
  • (SBB) Type 304 coil moves up 1.3% in US market
  • Indian Metals & Ferro Alloy Q3 FY11 results update - more
  • A Millionaire Steel Mogul With A Petting Zoo Refuses To Pay Child Support - more
  • After the Great Recession, the Great Regression - more
  • China hikes interest rates again to damp inflation - more

  Vale Nickel Furnace in Canada Shuts for Second Time This Year - A furnace at Vale SA’s Copper Cliff nickel smelter in Canada was shut for the second time this year because of a faulty wall, a company spokeswoman said. - more

  Ring of Fire ferrochrome successfully processed at Xstrata Process Support facility - The Extractive Metallurgy Group at Xstrata Process Support (XPS) has successfully produced the first metallic product from Canadian chromite, according to a Feb. 2 press release. - more

  Xstrata reports sharply higher earnings - Resources group Xstrata reported on Tuesday that it had generated a 544% rise in earnings per share to US$1.61 for the year ended December 2010 from US$0.25 a year ago. - more

  Courtesy AISI - In the week ending February 5, 2011, domestic raw steel production was 1,789,000 net tons while the capability utilization rate was 74.0 percent. Production was 1,552,000 tons in the week ending February 5, 2010, while the capability utilization then was 64.2 percent. The current week production represents a 15.3 percent increase from the same period in the previous year. Production for the week ending February 5, 2011 is up 0.4 percent from the previous week ending January 29, 2011 when production was 1,782,000 tons and the rate of capability utilization was 73.7 percent.

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 7

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - plus 2 to 1,045. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) HSBC in Talks With Qatar to Clarify Order Shutting Islamic Banking Units // Sugar Shortage Looms as Storm Ruins Australian Crop // Australia Must Cut Programs to Pay for Rebuilding After Cyclone, Swan Says // Asian Stocks Fluctuate as Higher Earnings Temper Lower Oil Prices on Egypt // Euro Buys Merkel Time as Bond-Treasury Spread Widens // Gruebel's Rebuilt UBS Trails Credit Suisse in Money From Rich // Egypt's Opposition Agree With Suleiman on First Steps // European Stocks Rise to September 2008 High; SolarWorld, Adidas Increase // Fed Spending 40% on Benchmark Treasuries as Newest Bonds Proving Cheapest // Stocks Rise on Takeovers, Economy; Egyptian Bonds, Copper Rally
  • The Euro is now trading 1/4 of 1% lower against the US Dollar. NYMEX crude is off more than 1.4% and trading at $87.77/barrel. Gold is up slightly while silver is up over 8/10 of 1%. Base metals ended the session slightly lower, and well off earlier highs. Indicator charts show nickel opened higher, trading over $13/lb much of the morning, then collapsed late in the day. For the day, Dow Jones reports three month nickel closed at $12.84/lb . Stockpiles of nickel stored in LME approved warehouses rose slightly on Friday and now total just over the 132,800 tonne level. Sucden's day old chart shows nickel still entrenched in an uptrend (chart here). As we predicted on Friday, the Baltic Dry Index finally put in a positive reading today, but brother, is it ever a weak positive. Reuters is quoting some analyst as saying technicals point to nickel trading at $15.00/lb within 4 weeks, while Ed from MF Global states he feels nickel is getting ready to stall as it approaches the $13.60/lb mark. Will be interesting to see who is right, if either.

  Reports

  Commodity/Economic Articles and Comments

  • (FF) Iron Ore prices remain steady near record highs today as volumes drop with the Chinese New Year. Market reopens on Wednesday and expectations are that prices will soar as the market remains tight over the coming months.
  • Economists React: ‘Ton of Noise’ in Jobs Report - more
  • Number of the Week: Businesses’ Unemployment Taxes Rise - more
  • Canada Labor Market Mocks America’s - more
  • Messy New Estimates Complicate Explanation for Unemployment Rate Drop - more
  • Droughts, Floods and Food - more
  • Acceleration Alert - more
  • Cumulative FDIC Bank Failures - chart here
  • Investors' $102 Billion Metals Wager Shows Bull Market Intact - more
  • It's Official, the Credit Markets Are Going Berserk Again - more

  Cuba says nickel industry recovering from bad year - Cuba's production of unrefined nickel plus cobalt bounced back in January, official media reported Monday, after perhaps the industry's worst performance in a decade last year when, Reuters estimated, output fell to well below 70,000 tonnes. - more

  S. Africa 2010 Ferrochrome Output Was 3.8 Million Tons, Core Says -  South African ferrochrome producers probably produced an estimated 3.8 million metric tons of the stainless steel raw material last year, Lara Smith, the managing director of Core Consultants, told the Mining Indaba conference in Cape Town, South Africa today. - more

  Rio Tinto ready to reveal a record profit – and this time, investors want less of it spent - Rio Tinto, the Anglo-Australian mining company, will this week reveal it made record profits of about $14bn (£8.7bn) last year, thanks to soaring commodity prices as a result of strong demand from Asia. - more

  AK Steel Drives for More Pricing Power - AK Steel reported earnings January 25. The news was good enough to send the stock up 7.7% and back above its 200-day moving average (DMA). - more

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

  • Indicators at 7:20 am CST show 3 month nickel trading around $.16/lb higher, with all London traded base metals higher this morning. The Euro continues to trade lower against the US Dollar, down over 1/10 of 1% so far today, but what is typically a roadblock to higher metals prices, is not adding much resistance. NYMEX crude is up nearly 3/10% and trading at $89.28/barrel. Gold is down slightly and silver is up nearly 3/10%.  In overnight trading, with most Asian markets close until Wednesday, those open closed mixed and mostly higher. European markets are trading higher this morning and US futures show Wall Street should start the week in a good mood. Nickel inventories rose ever so slightly on Friday.    
  • Reuters morning base metal news - more
  • LME Morning - Follow-through buying propels metals to fresh highs - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Copper pushed well above $10,000 a ton on Friday and also managed to close above this key psychological mark for the first time, as the buying in metals shows no sign of ebbing. Copper in particular was boosted by a report (first out last Thursday) that Chile may face an energy squeeze by mid-year on account of drought and high energy demand. In fact, Chile’s Energy and Mining Minister said that if things did not improve in this regard, the government could start power rationing. The stronger dollar did not impact metals much on Friday, although it did take its toll on both energy and precious metals, both of which ended lower. The dollar moved higher despite the fact that the January US nonfarm payroll report came in much lighter than expected. We suspect that investors were more impressed by the sharp decline in the unemployment rate (to 9%), while attributing the anemic nonfarm payroll increase mainly to weather conditions that may have hampered applicants from starting new jobs. We will have to see how next month's labor report shapes up, but the modest increase reported last month does not seem to conform with the strong readings we are seeing in other hiring gauges, notably the ADP's private payroll report. As of this writing, metals are up again, with copper starting to pull away from the $10,000 mark, while the rest of the metals are showing more modest gains, although tin is the exception, and now in record territory once again. For a second day in a row, the metals complex is defying the impact of the stronger dollar, with the Euro now at $1.3540, (a two-week low), this time pressured by a report of a bigger-than-expected fall in German industrial orders data. Jean-Claude Trichet's comments on Friday that the ECB may not move on interest rates started the most recent slide in the Euro.  ....  Nickel is at $28,725, up $375, and on track for an eventual test of the $30,000 mark, where we think the current advance could finally stall.  (read Ed Meir's complete morning base metals report here)
  • (Reuters) Technicals-LME nickel to rise to $33,110/T in four weeks
  • (MP) US ferro-chrome rangebound as tightness offsets demand slowdown
  • EU manufacturing rebound solidly entrenched - more
  • Bernanke Bets Commodities Won't Fan Inflation Concern - more

  East Asia's Ni-Based Stainless Export Market Shooting Up - The stainless steel export market for Ni-based CR sheets is shooting up in East Asia before the lunar New Year holidays in China and elsewhere, a complete change of the environment. For an indicator, the export market has advanced by US$200-300/ton since the beginning of this week. - more

  Mwana Africa's Bindura in off-take deal with Glencore - Zimbabwe's Bindura Nickel Corp (BNC), majority owned by multi-commodity resources firm Mwana Africa, signed a nickel off-take agreement with Glencore International AG , the world's biggest commodities trader. - more

  Norilsk Nickel suspends share buyback on court order - Norilsk Nickel, the world's largest nickel and palladium producer, said on Monday that it had suspended a buyback offer for more than 7 percent of its shares following a court order. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 4

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - minus 2 to 1,043. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) Japanese Steel Takeover Driven by ‘Radical’ Shift // Indonesia Raises Main Rate for First Time Since 2008 // Asian Earnings Swell From U.S. Consumer Spending, China's Economic Growth // Asian Stocks Advance to Two-Week High on Steel Takeover, Improving Profits // Egyptians Mass After Friday Prayer to Force Out Mubarak // Merkel Turns Crisis into Opportunity to Reshape Euro Zone // ECB's Nowotny Lets `Cat Out of Bag' With 2012 Inflation Forecast // Franco-German Divide on Debt Crisis May Mark Europe Summit // European Stocks Gain as U.S. Jobless Rate Drops; YIT, Enel Rise on Profits // U.S. Commercial Property Recovery Spares Economy Another Blow // U.S. Jobless Rate Falls to 9%; Payrolls Rise by Only 36,000 // Treasuries Fall, Dollar Gains, Stocks Fluctuate After Jobs Data
  • The Euro continues to trade lower against the US Dollar, by 1/3 of 1% at the moment. NYMEX crude is lower by over 1-1/2% and trading at $89.14/barrel. Gold is down 6/10% , while silver is slightly higher. Base metals ended the session higher. Indicator chart show nickel began to rise at the beginning and while hesitation once after breaking thru $28,000/tonne, it recovered and continued to climb. Dow Jones reports three month nickel ended the day at $12.86/lb . While putting up some resistance over the last three days, the $28,000 tonne threshold was easily taken out today. Stockpiles of nickel stored in LME approved warehouses fell yet again yesterday, and now stand just under the 132,800 tonne level. Sucden day old chart shows nickel trading over the past week (chart here). Notice the morning started with technicals showing the bull had room to run. Cancelled warrants fell below the 4% threshold for the first time since mid January. The Baltic Dry Index dropped another two points today but two of the three sub indexes have gone positive, so we may see a positive number on Monday. It will be interesting to see if this spring is setting up to be a repeat of 2010 as far as nickel pricing goes. On January 12, 2010, we closed at $8.03/lb. By April 20th of that year, the market saw nickel close at $12.38/lb, It then fell to a low close on June 4th, 2010 of $8.14/lb, where it has been climbing ever since.

  Reports

  Commodity/Economic Articles and Comments

  • (Stahleisen) EUROFER’s Q1-2011 steel market outlook signals that despite slowing growth in the 2nd half of last year, the EU economy is on track for further recovery in 2011-2012.
  • Bernanke: Default would be 'catastrophic' - more
  • Bernanke Lays Out Evidence QE2 Is Working - more
  • The United States of Shame - more
  • Global food prices hit record high - more
  • The battle of ‘copper versus wheat’ - more

  Cliffs says Sudbury, Ont., is possible site for new ferrochrome processing plant - Cliffs Natural Resources Inc. says it’s considering the city of Sudbury in northern Ontario as the site for a new plant to process ore from a proposed chromite mine. - more

  Nickel Asia CEO: Unfair to blame Palawan journo death on mining industry - In an interview with Business Nightly on Feb. 3, Gerry Brimo, president and CEO of Nickel Asia Corp, said it is "sad" and "very unfair" to blame the entire mining industry for the recent violent death of Gerry Ortega, an environmentalist and a journalist. - more

  Norilsk sees boost in Arctic output from 2016 - Russia's Norilsk Nickel, the world's biggest nickel and palladium producer, said on Friday it hopes to increase nickel, palladium and copper extraction from its Russian Arctic assets from 2016. - more

  European steel sees Q2 promise after lean turn of year - Rising iron ore and coal costs set the stage for a weak final quarter for Europe's steelmakers, and a recent surge in steel prices will have come too late to spare them from a lean start to the year. - more

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

  • Indicators at 7:20 am CST show 3 month nickel trading around  $.05/lb higher, with other London traded base metals higher as well. The Euro is trading slightly lower against the US Dollar so far this morning. NYMEX crude is up nearly 1/2% and trading at $90.95/barrel. Gold is Down over 1/2% and silver is off by 3/10%. In overnight trading, Asian markets ended higher, with China closed for holiday. European markets are trading higher this morning, while US futures show Wall Street may open higher. Nickel inventories fell yesterday.  
  • Bloomberg morning base metal news - more
  • LME Morning - Metals inch higher, poised to extend upside again - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - no report Friday
  • (Keith Goode) Nickel was seen as dependent on the success of the new nickel laterite plants and the allowed production from nickel pig-iron. So far, the only new nickel HPAL (high pressure acid leach) laterite plant in continuous operation is Minara's. Ramu is stuck trying to get approval for its plan to discharge tailings into the sea, Ambatovy has pumping issues with its 250km long pipe-line between parts of the plant, Goro blew up its acid plant and is apparently on hold to mid-2011, Ravensthorpe is an unknown, and Koniambo was ~90% complete as far as construction was concerned with commissioning expected in 2011. - more
  • (Yieh) Base metal prices on the LME were impacted by the issue of Egypt crisis. This unrest of regime makes the prices up in the trade market. The prices of Copper and Nickel had hit the peak and an intra-day high yesterday.
  • How U.S. Income Groups Get Squeezed By Food Prices - more
  • Food and metals markets calm after the storm - more

  Australia nickel, zinc units restart after cyclone - Australia's second-biggest nickel refinery and largest zinc mine are set to reopen by the weekend, after both were shut down along with other metal producers ahead of Cyclone Yasi this week. - more

  A Centenary of Stainless Steel - Planning is underway to celebrate A Centenary of Stainless Steel. On 20th August 1913, local metallurgist Harry Brearley made his first arc furnace cast of stainless steel in Sheffield. - more

  China Produced 11.30 Million Tons Of Crude Stainless Steel In CY 2010 = Increased By 28% From That In 2009, Transformed To Country To Export Stainless Steel With Net Quantity - According to the data released in last week by China Special Steel Enterprise Association, the output of crude stainless steel by China in the calender year (January - December) of 2010 came up to 11.30 million tons, having had a substantial increase of 28% compared with that in the preceding year of 2009. - more

  Japan's Nippon Steel, Sumitomo Metal to merge in 2012 - Japan's largest steelmaker Nippon Steel Corp and Sumitomo Metal Industries Ltd said Thursday they had agreed to merge in October 2012 to survive fierce global competition. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 3

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - minus 19 to 1,045. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg)  Japanese Stocks Fall on Earnings, Egypt Unrest; Australia Rises // Cyclone Yasi, Stronger Than Katrina, Hits Australia // Food Inflation Quickens to One-Month High, Boosting Interest-Rate Pressure // Cyclone Yasi Hits Australian Sugar Crops, Price Advances to 30-Year High // Trichet Keeps Rate on Hold, Balances Inflation Concern Against Debt Crisis // Trichet Says Prices Warrant `Very Close Monitoring' // France Pushes for Buybacks to Stem Financial Crisis in Split With Germany // Oil Climbs on Egypt as Stocks Decline; Copper Hits $10,000 // Roach Says U.S. Faces Dollar Decline as China Becomes Importer // Euro Slides as Trichet Damps Rate Speculation; U.S. Stocks Slip //
  • The Euro is now down nearly 1.2% against the US Dollar. NYMEX crude is down over 1/10 of 1% and trading at $90.75/barrel. Gold is up over 1/4% and silver is higher by over 1.6%. Base metals ended lower, but considering the drop the Euro took, the prices held rather well. Indicator chart show nickel opened higher, fell hard, then recovered some late. Dow Jones reports three month nickel ended the session at $12.67/lb , the Euro is helping the $28,000 tonne level put up a third day of resistance. Stockpiles of nickel stored in LME approved warehouses slipped yesterday and now stands at the 133,500 tonne level. Sucden's day old chart shows nickel trading thru yesterday (chart here). Markets are unusually quiet today, with Australia and the US recovering for huge storms, much of Asia on holiday, and the rest watching events in Egypt warily as a telling Friday is fast approaching.

  Reports

  Commodity/Economic Articles and Comments

  • NY Fed Moves Forward With Exit Strategy Preparation - more
  • Some 43 Million Use Food Stamps - more
  • 4 Reasons To Worry About The Economy - more

  No Need To Flip A Coin: Nickel Looks Poised For Another Good Year - Often lost in the shuffle in the conversation about base metals is nickel. - more

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

  • Indicators at 7:10 am CST show 3 month nickel trading around $.08/lb lower, with other London traded base metals quiet and mixed. The Euro is trading 4/10 of 1% lower against the US Dollar presently. NYMEX crude is up 3/4 of 1% and trading at $91.52/barrel. Gold is down over 1/2% and silver is off 1/3%. In overnight trading, Asian markets were quiet, with many Asian markets closed for Lunar New Years festivities until the 9th. European markets are slightly lower this morning, and US futures show Wall Street may open lower. NIckel stockpiles fell yesterday.
  • Bloomberg morning base metal news - more
  • LME Morning - Sky-high copper comes with a few strings attached - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments -  Copper prices ended unchanged on Wednesday in very quiet trading, unable to break through the psychologically significant $10,000 mark, and snapping a five-day winning streak in the process. There were modest gains in the rest of the metals, except for aluminum, which retreated from the mid-$2500 resistance to finish lower. Indeed, there was a subdued feel to most markets yesterday, with energy ending with a modest gain, as did the euro and the US stock market. The restrained performances were somewhat surprising given that the situation in Egypt started to deteriorate immediately following President Mubarak's defiant address on Tuesday. Fierce clashes broke out between supporters and opponents of the regime on Wednesday, leaving one person dead and roughly 850 injured. We suspect the crisis is now moving into yet another critical phase where the uptick in the violence will either generate a more heavy-handed response by the government and elements of the army, or failing that, an outright capitulation by the Egyptian president. In the meantime, the commodity markets will likely hold at relatively steady levels while waiting for the drama to play out. As of this writing, we are seeing a rather mixed tone in the LME metals in very quiet trading, but a more spirited advance is taking place in energy, where crude oil prices are up almost $1 a barrel on account of the continuing unrest in Egypt. The dollar is slightly stronger today, now trading at $1.3750, but has not been doing much at all for much of this week. US stocks are expected to open lower, while waiting for macro data out later today that could provide further direction. Yesterday, the ADP employment report out of the US showed private-sector job growth rising by 187,000 this past month, well ahead of estimates, although last month’s giant gain was revised to 247,000 compared to an earlier estimate of 297,000. Later today, we get Q4 productivity (expected at 2.2%), initial claims (expected at 425,000), December factory orders (expected at -.7%), and ISM services (expected at 57).On Friday, the government will report on January’s nonfarm payrolls, where a gain of 140,000 is expected. ....  Nickel is at $27,830, down $170, and basically where we were at this time yesterday. We are still looking for a test of the $30,000 mark.  (read Ed Meir's complete morning base metals report here)
  • (Reuters) The 30,000-tonnes-per-year QNI nickel refinery remained shut after the brunt of the cyclone slammed into the coastline overnight packing winds forecast up to 300 km (186 miles) an hour near its core, a spokesman for the refinery said. "It is not yet safe to conduct an inspection of the site," the spokesman said.
  • (JMB) NSSC to Increase Ni Stainless Steel Price by 10,000 yen/t in February
  • (AMM) The blizzard that slammed the Midwest on Tuesday and lingered for nearly 24 hours temporarily shut down or altered operations across a wide swath of steel mills, scrapyards, service centers and major end-users.
  • Commodities Reach Two-Year High as Global Growth Drives Demand - more
  • Strong La Niña event persists in the Pacific - more

  Soaring LME nickel prices dampen consumer interest in molybdenum - London Metal Exchange nickel settlement levels hitting $27,725/mt on Wednesday has dampened Japanese consumer interest in molybdenum products, market sources said Thursday.  - more

  Balance On Exports And Imports Of Molybdenum By China In CY 2010 = Main Three Items Were Exports Of 30 Million Lbs. And Imports Of 35 Million Lbs On Mo Content Base - According to the customs-statistics released in last week in China, the quantities (on Mo content base) of main three items (molybdenum oxide, molybdenum sulfide and ferro-molybdenum) traded by China in the calender year (January - December) of 2010 were <> exports : 30.1 million lbs and <> imports : 35.0 million lbs. as per the table attached hereto. As far as these three molybdenum products are concerned, the imports still exceeded by 16% in comparison with the exports. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 2

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - minus 20 to 1,064. (chart)
  • Headlines & leaders - (Bloomberg) China's Wen Pledges to Curb Property Speculation, Add More Low-Cost Homes // Shipping Rates Seen Bottoming on Demolitions: Freight Markets // Copper Rises to Record, Aluminum, Nickel Climb as China Grows // BOJ’s Kamezaki Says Economic Slowdown Is Temporary // Asian Stocks Climb the Most in Two Months on Earnings, U.S. Manufacturing // EU Leaders Plan Euro Pledge as Investors Bet on Debt Strategy // Greece Is `Confident' on EU Debt Crisis Agreement, Papaconstantinou Says // Most European Stocks Drop as Electrolux, Scania Fall; BHP Billiton Rises // ADP Estimates Companies in U.S. Added 187,000 Jobs // VIX Retreating to Three-Year Low Is Fastest-Growing Options Bet // Snow, Freezing Rain Cancel Flights, Trains, School Across U.S.// U.S. Stocks Decline on Egypt Riot, Valuations; Broadcom, Aflac Shares Fall
  • The Euro is currently trading 1/3 of 1% lower against the US Dollar. NYMEX crude is down over 1/2 of 1% and trading at $90.29/barrel. Gold is down over 9/10 of 1% and silver is off silver is lower by 1.3%. Base metals ended mixed and mostly higher. Indicator charts show nickel rose early and fell late. Dow Jones reports three month nickel ended the second trading day of February at $12.70/lb , unchanged from yesterday. Stockpiles of nickel stored worldwide in LME approved warehouses fell yesterday and now stands just over the 134,150 tonne level.  Sucden's day old chart shows nickel has clearly resumed its uptrend (chart here). The Baltic Dry Index fell 23 points to 1,084. Not a whole lot of news in the nickel or stainless industry but weather and strife wise, it almost seems like the world has tilted out of control recently. Egyptians protests turned violent today when pro-Mubarak protesters clashed violently with pro-Democracy protesters. A massive blizzard is blowing thru the US Northeast today, after shutting down the midwest US. And Queensland, Australia, already pounded this year by severe and deadly floods, is now being pounded by Cyclone Yasi. You can watch ABC News live reports (here) or listen to ABC radio reports (here).

  Reports

  Record world stainless steel output in 2010 - another expected in 2011 - MEPS expects global crude stainless steel output for 2010 to have reached an all-time high total of 30.45 million tonnes, 7.4 percent more than the previous record figure from 2006. - more

  Dominican Republic nickel mine on the brink of bonanza - The day when Xstrata Nickel (formerly Falconbridge) resumes the extraction of nickel approaches and it expects to produce around 14,000 tons, or 50% of its capacity estimated at 29,000 tons per year. - more

  Global Steel Prices Continue Their Upward Surge - Transaction prices are moving relentlessly upwards worldwide as steelmakers address their escalating raw material costs. - more

  New report on Norilsk Nickel: More pollution, less information - A new Bellona report on Russia’s Norilsk Nickel shows that harmful pollution will continue to come from the mining company based in Russia’s north, and that it could become worse. - more

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

  • Indicators at 7:00 am CST show 3 month nickel trading around $.01/lb lower, with other London traded base metals mixed and mostly lower. The Euro is currently trading about 2/10 of 1% lower against the US Dollar. NYMEX crude is off 1/10 of 1% and trading at $90.67/barrel. Gold is off 4/10 of 1% and silver is 3/4 of 1% lower. In overnight trading, Asian markets ended higher, with China up slightly as many countries begin their Lunar New Year Holiday. European markets are up slightly and US market futures are slightly higher as well. Nickel inventories fell yesterday. Asian markets are closed today for Lunar New Year and will return on February 9th. In the US, a major blizzard has shut down much of the midwest and is heading into the northeast. And in Australia, Cyclone Yasi has come ashore. Cyclone Yasi live blog - here   Live video streams from Townsville - here
  • Bloomberg morning base metal news - more
  • LME Morning - Metals consolidate- more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Copper prices rallied to a new record high yesterday, as positive macro data fueled the advance, as did a slightly weaker dollar and a roaring US equity market. Other metals were lifted in copper's wake, with tin hitting a new record high, while nickel and ali both hit 28 month-peaks. Macro data was instrumental in sparking the surge; in addition to the constructive purchasing index numbers we got from both China and Europe yesterday, it was reported that US manufacturing activity also expanded at its strongest pace since May 2004. Sub-components in the report showed that the new orders index for January hit 67.8 from 62.0 seen in the month before, while hiring had its best showing since May 2004, with the employment index at 61.7 from 58.9. However, pricing pressures were notable, expanding by their widest margin since July 2008. A separate report showed continued weakness in the housing sector, with US construction spending falling for a second consecutive month in December. Later today, we get ADP employment data out of the US (expected at 150,000). Right now, metals are slightly lower, as copper seems to be backing off from the $10,000 mark it neared earlier today, and which now seems to be the next psychological barrier. However, given the strong momentum evident in the markets, we suspect a successful attempt will be made to take this level out. The dollar opened the day much weaker, getting to a low of $1.3860, but has strengthened right now to around $1.3790. Oil markets are flat after a mixed session yesterday, while US stocks are called to open slightly higher. In Egyptian developments, President Mubarak said late yesterday that he will not be seeking reelection, but that he will stay in power until September to oversee a transition. Opposition leaders were roundly critical of the decision and are unlikely to heed the military’s instruction to call off their demonstrations. President Obama followed with an announcement of his own, calling for a political transition to begin "now", clearly a signal to the Egyptian president that he is overstaying his welcome. We suspect that the yet unresolved political standoff in Egypt will likely keep oil prices fairly well bid, and this will likely feed through to the rest of the commodity group. The dollar obviously does not seem to be assuming its usual “safe-haven” role in the wake of the unrest, and so cannot be viewed as a source of potential downward pressure on metals. Finally, remember the giant sucking sound that was supposed to accompany the launch of the much-feared, metal-scooping ETF’s launched last December? After two months of trading, the amount of metal held to back up the copper product is only about 2,070 tons, while total holdings in physical nickel are at 402 tons. Tin holdings are at 180 tons, and all this is in a bull market. More products are on the way later this quarter. We won’t hold our breath. .... Nickel is at $27,820, down $175. Nickel has taken out its previous resistance on the charts, and we are now looking for a test of the $30,000 mark.  (read Ed Meir's complete morning base metals report here)
  • (MFG) World stainless steel output hit a record high of 30.45 million tons in 2010 and will rise further to more than 31.0 million tons in 2011, British-based steel consultancy MEPS said. Top producer, China, saw a 2010 total output of over 11 million tons, over double the level seen in 2006. Total US stainless steel output was estimated to have grown almost 40% from 2009, but it was still lower than the 2006 peak.
  • Reuters - Nickel production from Australia's 30,000 tonnes-per-year Yabulu refinery has been suspended as a precaution, a spokesman for the refinery's owner, QNI Ltd, said.
  • (PR) ScotiaMocatta, the precious and base metals division of Scotiabank, today announced that their base metals platform is now live. With four people in London, four in New York and one in Hong Kong, ScotiaMocatta's base metals team is managing transactions in copper, aluminum, lead, nickel, tin and zinc.
  • (OC) Workers at Vale Inc.'s Voisey's Bay nickel producer in Newfoundland and Labrador have voted 88 per cent in favour of ratifying last week's five-year contract settlement to end a 17-month-long strike, but it will be more than seven weeks before concentrates start flowing for smelting in Sudbury, Ont., again.

  Stainless steel production seen up 7% in 2011 -SMR - Stainless steel production is likely to grow by 7 percent in 2011 after touching a record in 2010, according to stainless and special steel consulting firm Steel & Metals Market Research (SMR). - more

  Mines Close, Ships Flee as Cyclone Yasi Nears Australian Coast - Coal and zinc mines are shut and at least 32 coal ships are steaming out to sea, as sugarcane and banana farmers in northeastern Australia brace for the forecast landfall today of Tropical Cyclone Yasi. - more

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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, February 1

  Daily Nickel/Stainless Steel Wrap-up
  • Baltic Dry Index - minus 23 to 1,084. (chart)
  • Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
  • Headlines & leaders - (Bloomberg) China’s Manufacturing Growth Maintains Rate Pressure // China's Housing Market Nears U.S., Japan Bubble Levels: Chart of the Day // Commodities Overtake Stocks, Bonds After Two-Day Gain on Egypt // Stocks Advance, Copper Climbs to Record on Growth Outlook; Dollar Weakens // German Unemployment Falls to Lowest Since 1992; Jobless Rate Drops to 7.4% // EU Nears Agreement on Bailout Fund Buying New Bonds // European Stocks Surge Most in Two Months; BHP, Infineon Advance // U.S. Manufacturing Rose More Than Expected in January // US Stocks Rise on Economy as Dollar Weakens; Copper Jumps to Record
  • The Euro is now trading nearly 9/10 of 1% higher against the US Dollar. NYMEX crude is down over 4/10 of 1% and trading at $91.79/barrel. Gold i sup nearly 2/10 of 1% and silver is up 1%. Base metals all ended the first trading day of February solidly higher. Indicator charts show nickel started off trading higher and did nothing but climb for most of the day. Dow Jones reports three month nickel ended the day at $12.70/lb . Stockpiles of nickel stored in LME approved warehouses rose yesterday and now sit just over the 134,400 tonne level. Sucden's day old chart was not updated today, but nickel has clearly broke out of its recent trend to the upside. Ed Meir is warning that $30,000 is the next target, and today's movement makes that more likely than yesterday. We have updated our PMI page where we follow 4 of the world's most watched manufacturing indexes (here).

  Reports

  Commodity/Economic Articles and Comments

  • (Bloomberg) More than 500 workers at the Brits operations of Hernic Ferrochrome (Pty) Ltd. started a strike over pay yesterday, South Africa’s National Union of Mineworkers said in an e-mailed statement today.

  Vale wants N.L. mine workers back on the job - The owners of a northern Labrador nickel mine hope to have all employees back to work near Voisey's Bay within seven weeks. - more

  PH No. 7 in world nickel in 2 years - By late 2012 or early the following year, Nickel Asia would be the No. 7 top producer of refined nickel in the world. - more

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

  • Indicators at 7:00 am CST show 3 month nickel trading around $.16/lb higher, with most base metals trading higher this morning. The Euro is trading 1/3 of 1% higher against the US Dollar at the moment. NYMEX crude is down 3/4 of 1% and trading at $91.51/barrel. Gold is up 1/4 of 1% and silver is up 34 of 1%. In overnight trading Asian markets ended higher, with China up 3/4 of 1%. European markets are trading higher and US futures show Wall Street should open higher. According to Bloomberg, nickel is trading this morning at a level last seen in May of 2008. Mines all over northeast Australia are closing as Cyclone YASI approaches (more). We are in the Midwest US and under a blizzard warning for today, so update timing is questionable.
  • Bloomberg morning base metal news - more
  • LME Morning - Metals extend gains on bullish sentiment - more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments - Copper came very close to its record high of $9781 yesterday, as the buying that has gripped the commodity complex post the Egyptian unrest, continues into a second week. There were good advances in the rest of the metals as well, with tin prices hitting a record high north of $30,000, while nickel also picked up steam, hitting two-year highs. For a second day in a row, oil prices continued to race higher, with Brent passing the psychologically important $100 mark. Macro data out of the US was generally supportive; December personal income and spending reports both came in just about in line with estimates, and the Chicago PMI rose to 68.8 in December, its best reading since 1988. This morning, copper is comfortably in record territory, while aluminum has pushed through the $2500 mark, and is on track retest its 2011 high of $2541. The dollar is slightly weaker today, now trading at $1.3750 against the Euro and at a two-month low, and may be a contributing factor to the rally, as is strong Chinese manufacturing data that came out earlier in the day. In this regard, a reading on the country’s manufacturing base came in at 52.9, solidly in growth territory, while a PMI reading from HSBC Holdings and Markit Economics rose to 54.5 from 54.4. However, both indices continue to point underlying pricing pressures in terms of input costs. Some China-watchers are interpreting the strong numbers to mean that we could see another interest rate move after the Chinese Lunar New Year holiday. Out of Europe, a gauge of manufacturing in the region rose to 57.3 this month from 57.1 in December, Markit Economics said. This is the highest reading since April and is above the initially reported 56.9. A separate report showed German unemployment falling to an 18-year low last month. Less of a positive, was the fact that inflation in the euro region has now accelerated to a 2.4% annual rate in January, the fastest since October 2008.  .... Nickel is at $27,691, up $341. Another close above $27,250 today (likely) will set the market up to test the $30,000 mark.  (read Ed Meir's complete morning base metals report here)
  • (Dow Jones) Merafe Resources Ltd. said Tuesday its full-year ferrochrome production increased by 48% on the year, after the miner restarted most of its furnaces due to improved demand.
  • (Yieh) The spot prices of high carbon ferro-chrome in South Africa has soared by US$10 cents to US$110 cent/lb., enlarging the price gap between base prices and spot prices.
  • (Yieh) Reportedly, Taiwan’s Walsin and Yieh Hisng have announced the new price policy for February delivery. The two companies have increase the prices of 304 series stainless steel wire rod by NT$4,000/ton averagely; at the same time, that for 316 series has hiked by NT$1,000~NT$2,000/ton.
  • (Dow Jones) European Nickel PLC, a firm company engaged in the identification, acquisition, development and exploitation of nickel deposits, said Tuesday Chairman, David Whitehead, will be stepping down from the Board by the next annual meeting, which is expected to be held in August.
  • (NR) S'tomo Metal Mining To Double Output Of Nickel Concentrate
  • Food-cost shocks ripple worldwide from Iowa - more
  • China's PMI drops to 5-month low of 52.9% in January - more

  Labrador nickel miners vote to end strike - Workers at the Voisey's Bay nickel mine in northern Labrador voted overwhelmingly Monday to accept a new contract that ends a strike that dragged on for almost a year and half. - more

  Domestic Price Of Ni-Based Stainless Scrap In Japan Rises To Yen 200,000 / Ton From This Week = Anticipated Reduction In Production Of Ni-Contained Pig Iron In China May Influence On Price OF S/S Scrap - The domestic price of nickel-based stainless steel scrap (new clippings) to be purchased by stainless steel companies of Japan is strengthening a tendency to rise further and has risen to a level of Yen 200,000 per metric ton delivered to mills from this week as forecasted. - more

  US Steel Imports Jumped 47.2 Percent in 2010 - U.S. steel imports last year rose 47.2 percent from recession levels in 2009 and signs point to further improvement this year, said David Phelps, president of the American Institute for International Steel. - more

  Courtesy AISI - In the week ending January 29, 2011, domestic raw steel production was 1,782,000 net tons while the capability utilization rate was 73.7 percent. Production was 1,552,000 tons in the week ending January 29, 2010, while the capability utilization then was 64.2 percent. The current week production represents a 14.8 percent increase from the same period in the previous year. Production for the week ending January 29, 2011 is up 0.9 percent from the previous week ending January 22, 2011 when production was 1,766,000 tons and the rate of capability utilization was 73.0 percent.

  Morning Nickel Inventory and Price Statistics & Figures

  • London Metal Exchange inventory figures/changes - (for today's figures see MF Global report above)
  • Today's almost official prices here  /  Yesterday's actual LME official prices here or here (chart)
  • Shanghai Jinchuan nickel price - available here  
  • 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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