This page is archived news covering the period of November 2007
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Stainless Steel Prices and Nickel News

Free comprehensive information on worldwide nickel market pricing, stainless steel prices and metals market analysis and forecasts


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

Friday, November 30
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $11.98/lb 3 month buyer - $12.13/lb (19.7% lower than 1/1/07)
  • Baltic Dry Index - plus 118 to 10,210.
  • LME nickel inventories - plus 192 tonnes into Rotterdam, Netherlands warehouse, minus 96tonnes from Rotterdam warehouse, minus 24 tonnes from Singapore warehouse, minus 162 tonnes from Busan, South Korea warehouse, minus 12 tonnes from Baltimore, MD, USA warehouse, and plus 60 tonnes into Gothenburg, Sweden warehouse
  • Cancelled warrants backed off a tad, but warehouse activity picked up a bunch yesterday. Inventories dropped. Looks bullish, but in fact, considering the dip in cancelled warrants, the net amount actually grew. But it appears the slight drop in the gross figures gave traders pause today, and for much of the trading day, that is exactly what they did. By the end of the day, week and month, three month nickel closed at $12.29/lb ($27,090/tonne)  For the week, three month nickel fell by 6.2% and for the month, it ended down 15.4%. With one month of trading left in 2007, nickel is down 18.6% for the year - so far.
  • Closing Metals Report - more
  • Have a safe and restful weekend. Here is a short funny video clip for you - video here

  China may become a net exporter of stainless steel next year despite current nickel ore shortages, though restrictive export policies will prevent large-scale exports, industry insiders told Interfax at the 2007 International Seminar on Nickel & Ferro Nickel Alloys with Stainless Steel Market in Qingdao on Friday. - more

  Steel Founders' Society of America November 2007 Casteel Reporter - pdf here  Industry business numbers and graphs - pdf here

  Rusina Mining NL said the saprolite drilling at Acoje mines in Philippines has been completed and that it has shipped 1,000 tonnes of bulk sample of saprolite ore in November for 98,000 usd. - more

  The board of the Philippine Stock Exchange has approved the P894-million initial public offering of local mining firm Oriental Peninsula Resources Corp. - more

  (few weeks old) Value of the ore in one bronze medal at the Olympic Games next summer in Beijing? Just $1. A silver medal? $76. Gold? $230. Value of being the first company designated "Official Diversified Minerals and Medals Sponsor of the Games?" - more

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

  • Indications at 7:57 am CST show 3 month nickel selling down by $.10/lb . We monitor numerous indicators to get an idea of what is going on with daily LME trading and this morning, these indicators are all over the map. Some show a slight gain, while others show steep losses. As we are posting this, nickel is in AM kerb trading, which can be quite volatile on someday's. We will update if we see any major price changes.
  • Bloomberg - more

  Copyright/courtesy Dow Jones - "LME nickel likely to hold above support at $25,000/ton if momentum selling resumes in London trade, says Tokyo-based LME broker. ....Broker says nickel's failure to break above $35,000 in mid-November disappointed longs, triggering selling toward $31,000, and fresh shorting by funds drove it to current level. But as $25,000 support held on Aug. 16 when nickel touched 2007 low, that level appears to be psychological bottom, broker says"

  Metals investors are poised for a bumpy ride next year, caught between a slowdown in the United States and uncertainty whether China can take up the slack. - more

  Taiwan’s stainless steel mills including Yieh United Steel Corp. (YUSCO) and Tang Eng Iron Works have announced to reduce their domestic stainless prices on stainless steel hot rolled product (No.1) prices by NT$2,000/ton, effective from December. - more

  (excerpt) "Hassey predicted the U.S. stainless steel market will have a "full recovery" in the first quarter of 2008 after slumping demand for the metal caused the company to cut its profit forecast for the second half of 2007. " - more here

  (comment - interesting article about Xin Mining in China and their comments about pig nickel - $1 = 7.44 yuan) (excerpt) "But the red soil nickel ore technical barrier and the production cost is higher, according to our understanding, at present uses the red soil nickel ore the production cost approximately in 180,000 Yuan/ton levels, (contains tax) by the present domestic 270,000/ton nickel price to calculate, only the profit margin approximately in 10-15% level, considered the red soil nickel ore higher development risk, we thought present the nickel price is insufficient to stimulate red native ores large-scale mining the enthusiasm." - translated article here (red soil nickel ore is laterite ore. This could simply be another nickel miner down playing the overall impact of pig nickel.)

  (excerpt) The company is not currently a producer of nickel but Rio Tinto copper chief executive Bret Clayton said the group could potentially become a top ten producer of the commodity. - more

  Companhia Vale do Rio Doce, the world's No. 2 mining company by market capitalization, simplified Thursday its name to Vale and launched a new logo that will be used for all units of the company. Chinese media is also reporting Vale is looking for buyers for ferro-nickel from its Onca Puma mine, on track to begin production in November of 2008.  Onca Puma is projected to produce 57,000 tonnes of nickel per year.

  (comment - it's a little hard to figure out what exactly is going in China when producers announce production cuts and then we find stuff like this in Chinese media) Translated article titled ' Nickel-smuggling "new favorite" - more here (and maybe this doesn't seem odd to you, but here in the States, smugglers usually get caught with illegal drugs strapped to their bodies. In the Middle East, it is somewhat fashionable to strap bombs to one's self. But nickel?)

  Japanese trading houses and steelmakers stayed away from spot ferromoly trade this week to avoid the risk of increased export taxes in China, market sources said Thursday. - more

  Black snow. Coal dust. Sulfuric air. Welcome to life in the world's most polluted places. - more

  Vladimir Potanin, the co-owner of MMC Norilsk Nickel, is trying to raise $15 billion from London investment banks to take control of the world's biggest palladium and nickel producer, The Times reported, quoting unnamed sources. - more (if you are interested to learn more about how Potanin came to control Norilsk - here are a few video excerpts from a PBS series - video here)

  Stopping stainless steel from becoming stainless steal - more

  The world's largest iron ore producer, Brazil's Companhia Vale do Rio Doce (CVRD), has begun talks with clients over ore price increases for the coming term, company president Roger Agnelli said on Thursday. - more

  South Korea's UBS Hana Asset Management, majority owned by the world's largest wealth manager, said on Tuesday it will start a 260 billion won ($278.5 million) fund in December that will invest in a Madagascar nickel mine. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - minus 42 tons = 44,862 tonnes (4.68% - 2100 tonnes cancelled warrants/ 42,762 net stock level)
  •   Shanghai Jinchuan nickel - 248500-251000 RMB/t, minus 4000
Thursday, November 29
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $12.59/lb 3 month buyer - $12.77/lb (15.4% lower than 1/1/07)
  • Baltic Dry Index - plus 170 to 10,092.
  • LME nickel inventories - plus 546 tonnes into Rotterdam, Netherlands warehouse, minus 54 tonnes from Rotterdam warehouse, minus 12 tonnes from Baltimore, MD, USA warehouse
  • For those looking for stainless steel prices to follow nickel's fall proportionally, keep a couple of things in the back of your mind. First, ferrochrome is up - way up, with expectations it will go even higher in the first quarter of 2008. Second, iron ore prices are heading up. By how much exactly, has yet to be negotiated, but most analysts seem to feel a 50% increase is very likely. Third, the freight to move raw material around the world has gone astronomical this year. Remember that report we posted a few months back where it actually costs more to ship iron ore from Brazil, than the iron ore in the ship was worth? For a stainless steel producer, freight costs are no longer something you can dismiss as a cost of doing business. And unlike stainless steel end users, who can pick and chose a vendor based on their proximity and the potential savings in freight cost, stainless steel producers can only get nickel, ferrochrome, iron ore, and molybdenum from certain mining locations in the world. That means cargo ships, not UPS or FedEx. With nickel costs determining up to 60% of the cost of 300 series stainless, any drop in the price nickel will certainly help stainless steel users, but an overall decrease in stainless steel prices will not come nearly as fast as the increase was. Interfax confirmed our report on Tuesday that China's TISCO was cutting back on December stainless production. Why do we care? Because they are the largest producer of stainless in China. Interfax also reported "Other major domestic stainless steelmakers, namely Zhangjiagang POSCO and Guangzhou Lianzhong Stainless Steel, also plan to cut production of series-200 and series-300 stainless steel in December". Market slowdown? Or glut of production in China? Keep in mind that Hao Peigang, senior economist with TISCO's policy research office, also told Interfax, that even with the reduction, "this year's production will increase 950,000 tonnes from last year".
  • So, what happened to nickel prices today? They were actually up this morning, but in afternoon trading, lost any tweak of bullish momentum they had mustered and took another nose dive. Nearly 5% lower for the day, and around 20% lower from just three weeks ago. Cancelled warrants continue to climb, but outbound nickel shipments dried up yesterday. Not much for the bullish trader to hang onto. With only one trading day remaining in November, three month nickel ended today's trading at $12.22/lb ($26,950/tonne)       
  • Closing Metals Report - more
  • Christmas cards will soon be arriving in your mailbox, so please accept ours online - here (sound required)

  ScotiaBank Commodity Price Index - pdf here

  Copyright/courtesy Platts - "Nickel I think will stay in the $25,000-30,000 range for the medium term," said the trader. "The stocks are quite plentiful now, and are much higher than, say, six months back, but that can all change very quickly. There's a good supply of scrap in the US from what I hear, but the situation is a bit tighter in China."

  Taiyuan Iron and Steel (Group) Co. Ltd (TISCO), China's largest stainless steel maker, will cut stainless steel production in December in an attempt to invigorate the current sluggish market, a company official told Interfax today at 2007 International Seminar on Nickel & Ferro Alloys With Stainless Steel Market in Qingdao. - more (this is the formal announcement which confirms our report on Tuesday)

  China has produced more than 408 million tons of steel in the first 10 months this year, up 18.14% over the same period last months, according the statistics of China Steel & Iron Association.

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

  • Indications at 7:55am CST show 3 month nickel selling up by $.05/lb. Cancelled warrants up over 5% - is it inventory actually bought by producers for use - or just investors playing the market? The former is bullish, the latter, with inventories still increasing, would be bearish.
  • Bloomberg - more

  Standard Bank: Weekly Commodity Research - pdf here

  Copyright/courtesy Dow Jones - "LME nickel has come under technical selling pressure after failing to break above $30,000/ton for two days running, says one London-based trader. Sees support at $26250/ton, then $25,000/ton. Rising nickel stocks are adding to concerns of diminished demand, he says."  "LME nickel inventories have reached their highest level since January 2000 this week at almost 44,500 metric tons although prices have remained relatively high, says analyst Eugen Weinberg of Commerzbank. "We are happy with our forecast of $30,000/ton for nickel in the fourth quarter; we remain pessimistic for the coming quarters on the back of the high supply of laterites at the moment," he says.

  Courtesy Bloomberg - "``As stocks continue to hit LME warehouses, the market seems to get more comfortable with'' betting against nickel, traders at RBC Capital Markets, led by Alex Heath in London, wrote today in a daily report."

  Asia's largest nickel producer China Jinchuan Group cropped its ex-plant price by 8,000 yuan/ton on Wednesday, as a result of weak international nickel market. - more

  South Korean Posco is going to run for 200 series stainless steel production before the end of November. - more

  According to the statistic record for October, Taiwan’s import of stainless steel hot rolled was about 20,272 tons, which is up by 26 percent compared with the last month. - more

  The non-ferrous metal sector dominated by aluminium, zinc and copper has not been able to show encouraging results in quarter ended September 2007.  - more

  It is reported that the first cold rolled stainless steel production line in West China came on stream on November 26th 2007 in Jiuquan Iron & Steel Co Ltd. The line can yield high grade 300 series and 400 series CR stainless strip steel with annual capacity of 530,000 tonnes. - more

  China will see steel product oversupply in the domestic market next year due to restrictive steel product export measures, the National Development and Reform Commission announced in a report released yesterday. - more

  Commodity prices and the Canadian dollar are bouncing around in a way that's taking a lot of the fun out of investing in commodity stocks.- more

  It is reported that 26 Indonesian sailors are feared dead after their Panamanian registered 27,000 tonne iron ore freighter MV Mezzanine hit rough seas off Taiwan's north coast. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 480 tons = 44,904 tonnes (5.16% - 2,316 tonnes cancelled warrants/ 42,588 net stock level)
  •   Shanghai Jinchuan nickel - 252500-255000 RMB/t, minus 4500  
Wednesday, November 28
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $12.52/lb 3 month buyer - $12.58/lb (16.7% lower than 1/1/07)
  • Baltic Dry Index - plus 25 to 9,922.
  • LME nickel inventories - plus 324 tonnes into Rotterdam, Netherlands warehouse, minus 78 tonnes from Rotterdam warehouse, minus 66 tonnes from Busan, South Korea warehouse, and plus 216 tonnes into Vlissingen, Netherlands warehouse (just down the coast from Rotterdam)
  • MF Global reported in their daily report this morning that nickel prices could be heading down to test the new support level of $12.00/lb. We can not find any legitimate reasons to disagree with them. In an environment of bearish news, only cancelled warrants give the fundamentals a tweak of bullishness. Traders are facing the INSG's recent report of a 120,000 tonne surplus this year, which may slip to 100,000 tonnes next year 'IF' the stainless steel market rebounds with some vigor. And while this report may have been initially pooh-poohed by some, the constant daily gain in LME inventories does give a repetitive reminder of that forecast. Realistically, a person would be hard pressed to justify the increase in the price of nickel over the past few months. Traders gambled that the stainless steel market would recover more quickly than it appears to have, and while most would tell you it hasn't recovered, we tend to believe it is doing better than most will admit, and nickel supply is easily handling the demand. We could be wrong, but we are seeing a lot of little clues floating around that tell us the stainless steel market isn't in as bad a shape as some would have us believe, and that the real problem the stainless steel market is facing, is not current under-production, but future over-production. Much the same as we believe the nickel market could be facing very soon. If this proves true, nickel prices could be in for a rough ride. But...as we remind ourselves daily, these are different times we live in and market 'facts' and market 'fundamentals' don't always travel on the same road. Nickel prices headed lower this morning, with a downward curve until the end of the day, when a small portion of the days losses were recovered. For today, three month nickel ended trading at $12.75/lb ($28,100/tonne)
  • Closing Metals Report - more

  Dainan, China employs 50,000 people in nearly 1,000 stainless steel production and processing enterprises (source)

  The "red-hot M&A" environment is "molding and moving" Europe's metals and mining sector, but hidden risks include lack of attention to debt reduction, in an atmosphere of rising costs and slowing US growth, according to a report published Tuesday by ratings agency Standard & Poor's. - more

  Low grade laterite ore imports into China (pig nickel) - Imports of nickel ore to China for the first ten months 2007 grew 4.6 times in comparison to the same period in 2006 and amounted to 13.14 million tons. The Philippines led the group, with shipments growing 2.6 fold and totalling 6.75 million tons thru October. Indonesia came in second, where ten month shipments of 5.22 million tons of nickel ore were 29.4 times more than a year ago. New Caledonia has shipped 3.92 million tons of nickel ore thru October, 18.08 times higher than a year ago. According to China customs, China imports of nickel ore increased 64.5% in October compared with October of 2006.

  I am not a big fan of hedge funds. In my opinion, one of the main reasons why the original Inco/Falconbridge merger was not successful was a result of these “predatory financial carnivores.” - more

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

  • Indications at 7:50 am CST show 3 month nickel selling down by $.36/lb . Regardless of your situation, either as a benefactor or victim of higher nickel prices, a bull or a market bear, you'll have to admit, nickel prices have gotten beat up pretty badly the last few weeks.  
  • Bloomberg - more
  • CNN - more

  MF Global's Market Watch Monthly - pdf here

  INSG Outlook for Global Nickel Market in 2007-2008 by INSG Chief Statistician Sven Tollin - pdf here

  QuantumDirect Commodities Insight - pdf here

  US Imports of Stainless Steel Products Preliminary Data for October revised - here

  In order to rush domestic nickel-based stainless steel scrap resources, Japanese distributors have raised their purchasing price to JPY 316,000 per ton (pt) comparing to early July, when the price has hiked by around JPY 100,000pt. - more

  Russian oligarch Vladimir Potanin is struggling to raise over $15 billion from London investment banks to mount a takeover bid for OAO Norilsk Nickel, U.K. newspaper The Times reports Wednesday.- more

  It is reported that the first production line of cold rolled stainless steel in west of china had been put into production at Jiugang’s stainless plant on November 26th 2007. - more

  For its 100 candles on the cake in 2010, the factory site of the SLN launches a contest of architects and urban integration. A clean Doniambo program for less harmful effects, more modernity, of creativity, pride. - translated article here

  European steelmakers launched a new anti-dumping complaint over surging imports of steel from China on Tuesday, a day before a China-European Union summit dominated by growing trade friction. - more

  BHP Billiton, the world's largest mining company, is losing the support of investors and steelmakers for its proposed US$128 billion ($170 billion) takeover of Rio Tinto. - more    THE Chinese Government says it is closely watching the bid by BHP Billiton for Rio Tinto, amid concerns iron ore prices will remain stable if the two giant resources companies merge. - more

  Monument of glass and stainless steel - here

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 396 tons = 44,424 tonnes (4.88% - 2166 tonnes cancelled warrants/ 42,258 net stock level)
  •   Shanghai Jinchuan nickel - 257000-259500RMB/t, minus 5500
Tuesday, November 27
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $12.84/lb 3 month buyer - $13.04/lb (13.6% lower than 1/1/07)
  • Baltic Dry Index - minus 106 to 9,890.
  • LME nickel inventories - plus 342 tonnes into Rotterdam, Netherlands warehouse, minus 175 tonnes from Rotterdam warehouse, minus 12 tonnes from Busan, South Korea warehouse, minus 18 tonnes from Chicago, IL, USA warehouse, minus 66 tonnes from Singapore warehouse
  • Taiyuan Iron and Steel, while yet to formally announce, appears to be getting ready to announce further cuts in stainless steel production in December, due to "depressed" market conditions. That's the news for the bears - another tidbit in the Chinese article might give the bulls something to hang onto. Quote from the article "on the one hand is the steel mill does not have the resources to be allowed to emit". Another translator put it this way..."but the volume of stock of the nickel steel is not abundant either in the steel factory at present, it is reported, there is no nickel steel supply of stock in November." This report is contrary to other Chinese media reports we have seen where the situation of stainless steel in China was defined as "a glut". This report tells us that inventories of stainless, at least at the factory level, are very low, and producers are still hesitant to fire back up, when customers (primarily distributors if like most producers) aren't willing to gamble nickel won't drop further and once again, make stainless steel inventory over-priced. It's all a big catch-22. Nickel traders don't make money unless the price goes up, or down. That kind of volatility, and uncertainty of which way the trend might turn on a week to week basis, has the stainless steel industry sitting on its hands, fearful of how low the next dip might turn out to be. Cancelled warrants rose again today, and nickel shipments from LME warehouses outpaced receipts, although not enough to offset the volume. Considering cancelled warrants, the LME net inventory of nickel actually retreated today, although gross volume showed a slight gain. This tells us a few buyers got off their hands, and are either timing their buys right, or couldn't hold off any longer and got lucky. Then again, with the official cash nickel falling $.40/lb today, and purchases made by the tonne, maybe they weren't so lucky. It's a total crap shoot, more so these days than in years past, and anyone who would 'want' to be a nickel buyer for a stainless steel producer in these times, is either crazy, or a masochist. Nickel had another down day, spending much of the trading day in the red. For the day, three month nickel ended trading at $13.02/lb ($ 28,700/tone) 
  • Closing Metals Report - more

  Market analysis: Nickel and Stainless, November 2007 - pdf here

  The global scramble to lock up critical energy and industrial commodity assets is fast, furious, and unlikely to abate anytime soon. - more

  European Union regulators will probably examine a complaint by steelmakers ArcelorMittal and ThyssenKrupp AG about cheap steel imports from China, a step that could lead to punitive duties, the EU's trade chief said. - more

  German steelmakers urged Brussels on Tuesday to block miner BHP Billiton's planned takeover of rival Rio Tinto that would create a $350 billion-plus industry giant. - more

  China's iron and steel production growth slowed from September to October this year, the National Development and Reform Commission (NDRC) reported yesterday. - more

  Iceland has overtaken Norway as the world's most desirable country to live in, according to an annual U.N. table published on Tuesday that again puts AIDS-afflicted sub-Saharan African states at the bottom. - more and complete list here

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

  • Indications at 7:50 am CST show 3 month nickel selling down by $.05/lb . Nickel price has spent most of the early trading hours in the red, although there was an earlier push into the green that failed. Prices have traded within a $500/tonne range so far today. As of 7:50 am CST, indicators show only aluminum and tin in the green, while all other LME traded metals were in the red.
  • Bloomberg - more

  Canada Commodity Report Update - pdf here

  Behre Dolbear Global Mining News - pdf here

  TD Bank Weekly Commodity Price Report - pdf here

  Reuters Metal Weekly - pdf here

  Copyright/courtesy Scotia Captial - "In October, China imported 9,257 tonnes of refined nickel, up 33.3% MOM and 17.7% YOY. In the same month, China imported 1,062,226 tonnes of nickel ore, down 6% MOM. The breakdown on China’s nickel ore imports by origin are: 484,342 tonnes from the Philippines, 431,658 tonnes from Indonesia, and 104,612 tonnes from New Caledonia.".."We are now bullish on the coking coal, iron ore, copper, zinc, aluminum, molybdenum, oil, methanol, and hardwood pulp sectors. We are neutral on grains, ethylene, potash, DAP, urea, and nickel. We are cautious on steel and paper products on a relative basis from a China perspective."

  When the quantities of molybdenum in molybdenum concentrates produced by major companies of the western world in January - September of 2007 have been traced, the total output of molybdenum in the first 9 months of 2007 has decreased compared with that in the same period of 2006. - more

  China’s Ningbo Baoxin Stainless Steel plans to reduce its production output in December. - more

  China Import Statistics - from Top 10 import countries/regions and 5 major products report (xl here) from Australia - HS Code 7502 Unwrought nickel Jan-Oct 2007 1,035,798,887 Jan-Oct 2006 297,083,873 / HS Code 7501 Nickel mattes, nickel oxide sinters & other intermediate products of nickel metal-lurgy Jan-Oct 2007 847,014,198 Jan-Oct 2006 318,112,757  ....from Philippines - HS Code 2604 Nickel ores and concentrates Jan-Oct 2007 678,824,593 Jan-Oct 2006 102,460,543

  South Korea's UBS Hana Asset Management, majority owned by the world's largest wealth manager, said on Tuesday it will start a 260 billion won fund in December that will invest in a Madagascar nickel mine. - more

  If UC Rusal buys a 25 percent plus one share in Norilsk Nickel from Oneksim, the new diversified metal company would have a capitalization of about $90 billion, RBC Daily has reported. - more

  Courtesy AISI - "In the week ending November 24, 2007, domestic raw steel production was 2,044,000 net tons while the capability utilization rate was 85.7 percent. Production was 1,887,000 tons in the week ending November 24, 2006, while the capability utilization then was 81.5 percent. The current week production represents an 8.3 percent increase from the same period in the previous year. Production for the week ending November 24, 2007 is down 0.4 percent from the previous week ending November 17, 2007 when production was 2,054,000 tons and the rate of capability utilization was 86.1 percent. Adjusted year-to-date production through November 24, 2007 was 96,206,000 tons, at a capability utilization rate of 86.1 percent. That is a 3.2 percent decrease from the 99,456,000 tons during the same period last year, when the capability utilization rate was 89.0 percent."

  When spotlight has been put on the production activities of manganese ore at major mines in January - September of 2007, it is known that the world production of manganese ore in this period had slowed down as a whole. - more

  A little bit of history courtesy of 'American Metal Market' magazine (source) (all copyright Cahners Business Information and Gale Group) We reviewed the issues of 11/1/01 thur 11/5/01 because nickel fell to an official low of $4465/tonne for 3 month on November 2nd, 2001, and has been, for the most part, bullish ever since. Others may argue the point, but this could be pegged as the unofficial beginning of the nickel bull market we now find ourselves in . Here are some article quotes from these issue's, that you might get a kick out of, or raise an eyebrow or two. "Nickel prices continued to test support at $2 per pound last week. Nickel hit $2 midweek on the LME but short covering by speculators and some consumer buying pushed prices back up to $2.06 per pound ($4,540 per tonne) late in the week....Some analysts were calling for production cuts to reduce the surplus in 2002. A large stock accumulation could push prices below the $2 per pound mark, they said."(LME nickel inventory on 11/1 - 17,820 tonnes) - "Gloom pervaded the market forecasts offered by scrap traders at the Bureau of International Recycling's nonferrous division meetings here. Marc Natan of Malco, a Paris scrap trading firm and the nonferrous division's new president, pleaded with fellow members to deliver some optimism about the markets. Unfortunately, no one could provide any news to brighten up the session." - Article title "Reduce moly glut, trader urges China"..."Spot market price - Ferromolybdenum Lump, per lb of Mo $ 3.00-$3.20 Estimated market prices per lb of contained Molybdic oxide, canned Producer $2.45-$2.50 Merchant $2.30-$2.35"- "Delegates gathering at this year's Ryan's Notes conference in Orlando, Fla., could all agree on one thing: Business remains tough and all bets on the long-awaited recovery are now off.....What can George Bush do to help our industry? First, he needs to explain to Americans that every effort is being made to secure their safety and way of life. Second, he should recall the fate of his father, the 41st U.S. president, who won the Gulf War but lost the next election because the United States was mired in recession. Once again, "it's the economy, stupid."..."French stainless mill Ugine SA has confirmed a substantial cut in output due to depressed markets. The move by the Usinor SA subsidiary comes after AvestaPolarit and ALZ NV said they are also cutting back. Of the remaining two stainless mills out of Europe's big five, Acerinox SA has declined to comment and Krupp Thyssen Nirosta GmbH said it is maintaining output"...."Finland's Outokumpu Oyj said Thursday it will exit base metals mining and focus on metals production, fabrication and technology." - "The stainless steel market is set to remain tough for at least another six months and possibly for another year, according to Christopher Plummer, managing director of Metal Strategies Inc., West Chester, Pa. Slowing world economic activity had accelerated in recent weeks, he told delegates at Ryan's Notes Ferroalloys Conference here. Excess supplies at mills and service centers, particularly in the United States and parts of Asia, tough conditions in Asia, nickel prices off 40 percent from recent highs, a decline in local currencies against the dollar and high energy prices last year had all taken their toll on the industry.... Raw stainless steel production will decline this year to reflect past overproduction. In North America, it will fall to 2.1 million tonnes from 2.4 million tonnes last year before rising to 2.2 million tonnes in 2002; in Europe it will stay even with last year at 8 million tonnes; while output in Asia (excluding Japan) will fall to 3.3 million tonnes from 3.9 million tonnes last year and remain at that level in 2002. Still, producers around the world were continuing to add capacity, Plummer said, with an additional 3.75 million tonnes coming on-stream between 2000 and 2005." ........comment -  These were days that no one was very happy.

  THE two-tier nature of the commodity market is becoming ever more apparent. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 72 tons = 44,028 tonnes (4.21% - 1854 tonnes cancelled warrants/ 42,174 net stock level)
  •   Shanghai Jinchuan nickel - 262500-265000 RMB/t, plus 750
Monday, November 26
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $13.24/lb 3 month buyer - $13.33/lb (11.3% lower than 1/1/07)
  • Baltic Dry Index - minus 145 to 10,003.
  • LME nickel inventories - plus 210 tonnes into Rotterdam, Netherlands warehouse, minus 90 tonnes from Rotterdam warehouse, minus 6 tonnes from Busan, South Korea warehouse, plus 60 tonnes into Gothenburg, Sweden warehouse, and plus 222 into Hamburg, Germany warehouse
  • Cancelled warrants jumped as buyers of nickel gambled prices had bottomed Friday, which in light of official prices moving back up a little today, was, at least for the moment, a good buy. Nickel drifted today, and traders acted like they were trying to find a floor. Market was up and down, but never far from where it began. Trading appears to be very nervous about economic conditions, with the ever present situation of growing LME inventories. While in years past, the market would be seen as setting itself up for a serious correction in price, we live in different days. With the 'China syndrome' and the ever present unknown of what is really going on in that country, the rules have apparently changed. For the first day of the last trading week of November, three month nickel ended trading at  $13.09/lb ($28,850/tonne)  
  • Closing Metals Report - more

  Copyright/courtesy Dow Jones - "The LME base metals are firmer but it's still too early to tell whether this is the end to the marekts' recent downturn, says a London trader. Notes that any further bearish financial news would renew the downward pressure on LME prices, while equally any potential fresh production disruption would "turn the tide." Given the large number of market shorts, an upwards move would be swift and dramatic, he notes."

  Stainless Steel Price Trend in China (courtesy hme01.com)

  Presentation given by Rio Tinto this morning - nothing for nickel but gives good overall mining/metals market info - pdf here

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

  • Indications at 7:55 am CST show 3 month nickel selling down by $.03/lb. Base metals trading, as a whole, seems to be quiet so far, with most metals trading where they started. Reading some reports from China that more stainless producers may be considering, or are cutting back on stainless steel production again, this time related more to over supply, than a falling nickel price. Since this doesn't appear to be a media campaign to influence the nickel market, we feel these are legitimate reports.
  • Bloomberg - more

  Weekly Forecast by SMM Specialist - Of 29 analysts responding, 5 (17%) felt the price of nickel would rise this week, 8 (27%) felt the price would stay the same, while the remaining 16 (55%) felt the price would fall.

  Haywood Metals & mining Weekly - pdf here

  Some participants expressed in a stainless steel industry meeting in China that Chinese stainless steel output would reach 9 million tons in 2015. - more

  Hundreds of workers of the country's largest nickel producer, PT Inco, in Soroako, South Sulawesi, ended their 11-day strike Sunday afternoon. - more

  When the quantities of molybdenum in molybdenum concentrates produced by major companies of the western world in January - September of 2007 have been traced, the total output of molybdenum in the first 9 months of 2007 has decreased compared with that in the same period of 2006. - more

  According to the Vietnam Steel Association, the information that China may raise the export ingot steel tax to 25% from the current rate of 15% in early December 2007, has heated up the regional steel market. - more

  It is reported that annual iron ore contract talks between global steel mills and iron ore majors may not be settled until the second quarter of next year after a jump in cash prices. - more

  Mining group Rio Tinto expects buoyant demand for commodities to last for decades, Chief Executive Tom Albanese said on Monday. - more

  Cia. Vale do Rio Doce, the world's largest iron-ore producer, said China will use a bigger share of the world's metals as consumer spending climbs. - more

  Chinese steelmakers and the country's huge new government investment fund rejected reports saying they were planning to team up in a bid for mining giant Rio Tinto. - more

  China produced 408.52 million tons of steel in the first 10 months of this year, rising 18.14 percent year on year and posting an increase e of 62.73 million tons of crude steel, according to a report released by the National Development and Reform Commission on Nov. 26. - more

  Shares in Norilsk Nickel rose on Monday as the market welcomed news it had another potential buyer. Russia's aluminium major Rusal has offered to buy a 25% stake in the metals company. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 396 tons = 43,956 tonnes (3.36% - 1476 tonnes cancelled warrants/ 42,480 net stock level)
  •   Shanghai Jinchuan nickel - 262000-264000 RMB/t, minus 500  
Weekend Review, Saturday and Sunday, November 24 & 25
  Faith in the ability of Chinese demand to mitigate the effects of a US slowdown has supported equities and commodities through the credit squeeze. This week that faith was dented. - more

  Local bloggers announce the strike at PT Inco on Sulawesi Island has ended.

  It is reported that China's top stainless steel maker Taigang has first taped TTS443 material, which boasts outstanding comprehensive performance to replace 304 in wide applications. - more

  China will join the bidding for Rio Tinto with an initial offer of about 200 bln usd, Beijing-based weekly China Business reported over the weekend. - more  (while this has little to do with current nickel production, it looks the like seeds of the first major mining story of 2008 are being spread. BHP started this with an offer for Tinto that was rejected, and will not be keen to see their merger plans trumped by a third party. China could be in for a difficult time getting approval, if they do bid.) 

  The recent but consistent growth in world GDP has seen higher consumption of ferrous and non-ferrous base metals, leading to an increase in investment focus in these commodities. - more

  The mining sector's value, while hit by fears of a global economic slowdown, has a bright future thanks to strong Chinese demand for metals and the difficulty of unearthing resources in Africa, analysts say. - more

  The sky is the limit for automation in the Australian mining industry. Fully automated mines may seem daunting now, says Australian Centre for Automation and Field Robotics (ACAFR) chief executive Olga Sawtell, but mines can achieve full automation in the near future. - more

  Week in Review - Bullish nickel traders experienced a bruising week, with prices in retreat nearly the entire trading period. Having ended the prior week at $14.17/lb, its lowest close since September 14th, three month nickel ended this weeks trading at $13.20, down 6.8%. This puts nickel down 3.8% for the month, and down 12.6% on the year. MF Global's $13.60/lb support crumpled and by the end of the week, $12.00/lb was given as the new support level. Nickel inventories grew by another 5% over the last five days, and have grown to a point that is getting more and more attention from traders. A strike at an Inco Indonesia mine is either having an effect on nickel production there, although depending on whether you listen to local bloggers and media, or the company, it is unknown exactly to what degree of an effect the strike is having. Ferrochrome prices went over the $2/lb mark on Friday, while the Baltic Dry Index fell most of the week. Nickel buyers will now return to the sidelines and wait for traders to establish a new pricing floor. Less buyers, and LME inventories will continue to grow. The U.S. markets are giving more evidence that the economic pains from the sub-prime scandal are not going to disappear anytime soon, and are starting to affect the confidence in the overall market. China continued to take measures to bring its red hot economy under control, Australia ended the week by electing a new Prime Minister, while the U.S. dollar lost yet more value to overseas currencies.    

  October presentations by David Humphreys, Chief Economist, Norilsk Nickel

  • "Global Commodity Demand Trends:The Emergence of China and India" - pdf here
  • "How has investment interest in metals affected producers?" - pdf here

  The mood at this week’s biggest ever Mines and Money event organised by the Mining Journal in London was cautiously upbeat; more subdued than last year, but definitely underpinned by a view that the mining boom is alive, well and kicking. - more

  CVRD-Inco is considering a C$750 million ($760 million) investment that would boost production at its Thompson, Manitoba, nickel mining, smelting and refining facilities by about 36 percent, the company said on Friday. - more

  Brazil's mining giant CVRD said on Friday it agreed to raise the salaries of its Brazilian employees by 14.49 percent over a period of two years starting from November. - more

  AIM's Regency Mines has signed a Memorandum of Investment and Co-operation with an Asia-based investment group which could leading to "a substantial investment" in the public company and its various mining exploration projects including Regency's nickel project in Papua New Guinea. - more

  Institute for Supply Management Steel Buyers Survey Report - pdf here

  Various sources - (from International Ferro Metals Ltd website) "The principal use of ferrochrome is in the stainless steel industry, which accounts for around 90% of the 4.5 million tonnes of ferrochrome currently produced annually. Ferrochrome is added to stainless steel for its corrosion and oxidation resistance properties. Stainless steel typically contains between 10 to 30% chromium and, unlike nickel and molybdenum which can also be added to further enhance particular properties of stainless steel, there are no direct substitutes for ferrochrome. Ferrochrome is also used in the production of alloy steels to improve hardness and toughness. As the stainless steel sector consumes approximately 90% of total ferrochrome production..." (from Reuters 11-12) "Ferro chrome prices have doubled over the last couple of years to $1.65 a pound because labour, transport and energy costs have all jumped for major producers in countries such as South Africa and Kazakhstan..."It's indisputable that the costs of production have risen substantially over the last couple of years," said Kevin Fowkes, analyst at Hatch Consultants, adding that he expected costs to rise further over coming months....(note - the price traded over $2/lb Friday).....That, coupled with strong demand from stainless steel makers, especially in emerging markets such as China and India over coming years, mean demand and supply will at the least be balanced."

  GFMS Rhona O'Connell named Commodities Analyst of the Year by London's Association of Mining Analysts at this weeks Mines & Money event.ng to GFMS' website, "Rhona is the managing director of GFMS Analytics and ROC Consultancy, an independent market analysis specialising in metals markets analysis and comment. The specialist areas constitute gold, silver, platinum and palladium, looking at the markets themselves in the context of the economic, political and financial environments while considering also the performance of other asset classes and related mining equities." (ok, maybe its not nickel related but we are always taking swipes at analysts, so we need to give cuddo's to those who deserve it)

Friday, November 23
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $12.91/lb 3 month buyer - $13.05/lb (13.6% lower than 1/1/07)
  • Baltic Dry Index - minus 180 to 10,148.
  • LME nickel inventories - plus 60 tonnes into Rotterdam, Netherlands warehouse, minus 54 tonnes from Rotterdam warehouse, minus 18 tonnes from Singapore warehouse, plus 330 tonnes into Hamburg, Germany warehouse, and minus 108 tonnes in Busan, South Korea, warehouse
  • MFG Global drops support level for nickel trading to $12/lb, ($26,500/tonne). BDI lost again today, and is now in danger of slumping below the 10,000 mark. Cancelled warrants slipped back again, showing that as long as nickel prices are sliding, buyers will return to the sideline, only buying what they must. No one wants to get burnt like the did in the summer, when prices plummeted from record highs. Trading was in the red most of the day, until a late rally put the price in the green, where it ended. Three month nickel ended the day and week at $13.20/lb ($29,100/tonne)
  • Closing Metals Report - more

  Citi Group Commodity Heap - Nickel: Look Before You Leap - pdf here (thanks to a reader)

  Damstahl Stainless Steel Report - November 2007 - pdf here

  Fortis Asian Metals Monthly - pdf here

  Gloom and doom is hitting Canada's base metal mining companies as they react to the recent plunge in commodity prices, but is it a signal that the global growth story is over or just part of a general stock market correction? - more

  China's unwrought nickel exports in October 2007 was 612 mt, which is a 15.5% increase compared with the 530 mt exported in September, the latest figures from the General Administration of Customs of China showed. Nickel exports in January-October totaled 15,644 mt.  - more

  The chairman of Xstrata yesterday, that of Eramet a few days ago... New Caledonia will have to be accustomed to the visits of the business leaders of nickel. - translated article here

  According to newspaper Vedomosti, Mr. Prokhorov in the interview for the first time opens up for a company merger with Rusal. Norilsk Nickel is the biggest nickel producer in the world, and a merger with Rusal would create an unprecedented Russian industrial company. - more

  Ufaleinikel, a division of Industrial Metallurgical Holding, produced 10,469 tonnes of nickel in the first nine months of 2007, 0.6% more than in the same period last year. - more

  BNamericas reports the following today "Brazilian antitrust authority Cade has approved the acquisition of Canadian nickel miner Inco by Rio de Janeiro-based mining and metals group CVRD, Brazilian and international press reported. CVRD acquired Inco last year in a deal worth US$18bn." (Makes you wonder what would have happened if they said no this late in the game. Make them give it back? And if so, to whom?)

  We have no idea what they are saying but the title of this Chinese tv report is "Chinese nickel all" turning hostile"  (video) IE only

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

  • Indications at 7:55 am CST show 3 month nickel selling down by $.07/lb . Nickel was the only metal in the red this morning, as we post the morning update.
  • Bloomberg - more
  • Reuters - more

  John Kemp of Sempra Metals says: “We’ve seen a general darkening of the macroeconomic outlook, a deterioration in risk appetite, a broad repricing of assets and increases in metals supplies, and this has left the base metals complex dancing in thin air.”

  It has been a rollercoaster ride for nickel prices this year, and with global demand expected to rise 10% in 2008, one analyst sees a recovery for the metal. - more

  China's hunger for oil and minerals will continue to drive up commodity prices for years to come and be a key factor in global demand for Canadian resources, suggests a Bank of Canada report published Thursday. - more

  Copper, zinc and nickel metal prices have been see-sawing all through 2007. Currently, metal prices are moving lower with many funds that invested in these metals booking profits before the year-end. - more

  China's hefty appetite for raw materials may wane after next year’s Olympics as social and inflationary pressures curb investment, London Metal Exchange official Phillip Crowson said.  - more

   The global credit crisis has hit Asia with a vengeance for the first time, triggering a massive flight to safety as investors across the region pull out of risky assets. - more

  Courtesy RongPhui - The Russian tube industry development fund has appealed to the Russian ministry for economic development and trade to impose quotas on imports of stainless steel pipes into Russia.

  Copyright/courtesy RTT News - "China's October Purchasing Managers Index declined to 53.2 from 56.1 in September, according to data released Thursday by the China Federation of Logistics and Purchasing, marking the third straight month that the index has fallen. A gauge of nationwide manufacturing activity, a PMI reading of above 50 indicates expansion, while a reading below 50 means contraction."

  Berong Nickel Corp., company partly owned by Atlas Consolidated Mining and Development Corp. that operates a nickel mine site in Palawan, plans to buy an integrated steel plant in China. - more  (not hearing of any possible damage to nickel mines on Palawan from yesterday's typhoon yet)

  Nickel miner PT International Nickel Indonesia (INCO.JK), or Inco, expects 2007 nickel matte output to remain at 165 million pounds despite the ongoing strike at its main nickel plant, a senior executive told reporters Friday. - more

  Copyright/courtesy Ujungpandang Ekspres (poorly translated excerpt) "The employee's action PT Inco apparently continues to drag on. Pangaruh this action is currently beginning to spread. The support for the employee continues to flow. Thousands of Sorowako residents from three groups descended and held the solidarity action. Was based on the letter of delivery of action delivery that was received  from District Police Lutim, in Malili, on Tuesday (20/11), the community's three Sorowako components, Kerukunan Wawania Asli Sorowako (KWAS), the Forum for Pemuda Asli Communication Sorowako (FK-PAS), and the Forum for the Young Man the Sorowako Bersatu Village (FPDSB) that the amount will be around 3,000 people descend held the demonstration, on Thursday (22/11) tomorrow. This action is to support and gave the moral spirit towards the struggle for the Inco employee's that was stalling the work. The action plan for thousands of residents will be mediated by KWAS, FK-PAS, and FPDSB, to PT Inco Sorowako, tomorrow, it was confirmed by District Police Chief Luwu Timur AKBP Drs HR Umar Faroq SH....."Therefore, the District Police side asked for help" of the "security." Regional Police South Sulawesi sent 110 Brimob personnel from Parepare as well as two Platon Brimob Baebunta to back up the security unit....Director Corporate Communication PT Inco, Janus T Siahaan, when contacted on Tuesday (20/11), acknowledged that. "Indeed had the decline" in the "production because of most employees from the mine part and prosesing as well as the processing carried out the demonstration." But the activity of our export stayed proceeding although his capacity was low enough, he explained. However Janus was reluctant to say how big the percentage of the decline in the production, including the loss that was experienced since the occurrence of this demonstration action. "I did not know how many losses and the percentage" of the "decline" in the "production capacity, including the number of employees who carried out the demonstration," he explained." (source) (It is becoming increasingly apparent that local media is making more of this than PT Inco is. )

  Bloomberg reported that Cia Vale do Rio Doce will postpone about 20 iron ore shipments in December 2007 causing shipping rates to slump today. - more

  It is reported that Chinese steelmakers, which are likely to embark on the benchmark ore price negotiations with leading global ore miners in late November, would be helped by declining iron ore spot prices and shipping cost, both of which have shown weakening sign in recent days. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 210 tons = 43,560 tonnes (2.55% - 1110 tonnes cancelled warrants/ 42,440 net stock level)
  •   Shanghai Jinchuan nickel - 262000-265000 RMB/t,  minus 3000
Thursday, November 22  (Happy Thanksgiving US readers)
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $13.33/lb 3 month buyer - $13.43/lb (11.1% lower than 1/1/07)
  • Baltic Dry Index - minus 189 to 10,328.
  • LME nickel inventories - plus 510 tonnes into Rotterdam, Netherlands warehouse, minus 72 tonnes from Rotterdam warehouse, minus 36 tonnes from Chicago, IL, USA warehouse, and plus 318 tonnes into Hamburg, Germany warehouse
  • Obviously, the $30,000 tonne support level has failed, and nickel prices continue to slump. Buyers who may have jumped in a few days ago, may now back off again, waiting to see where nickel's current stumble will end. Having been burnt badly earlier in the year, few will want to buy high again, with evidence clearly showing further reduction in prices are very likely. Three month nickel ended the day at $13.06/lb ($28,800/tonne)
  • Closing Metals Report - more
  • BN Americas - more

  A "agreement of project" was voted unanimously by the Congress. If the text were validated, there does not remain about it less some reserves as for the lawful constraints which will frame really the factory. - more

  Courtesy/copyright China Stainless Steel Association - Guangzhou Together stainless steel company said that in order to revitalize the sluggish domestic stainless steel market, it will stop selling 201 hot-rolled stainless steel in November.... In recent weeks, the domestic 200 series stainless steel market is sluggish, and transaction prices have fallen.

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

  • Indications at 7:50 am CST show 3 month nickel selling down by $.01/lb . Not much happening with nickel this morning, and news is light with US markets closed for Thanksgiving. Interfax is reporting that nickel imports into China soared last month. Considering this, and with LME inventories bulging, have we entered the surplus phase of the supply/demand equation, or is the stock coming into LME warehouses a reflection of slower European and American stainless steel markets?
  • Bloomberg - done

  Standard Bank: Weekly Commodity Research - pdf here

  Base metals were the target of an early commodities sell-off on Thursday as Shanghai zinc futures plunged 11 percent and copper fell by its 4 percent daily limit, on rising fears of a U.S. economic slowdown. - more

   courtesy Interfax - "China imported 9,257 tons of refined nickel in October this year, 33.3 percent more than the previous month and 17.7 percent more from the same period last year, according to statistics released by the General Administration of Customs today."

  In order to rush domestic nickel based stainless steel scrap resources, Japanese distributors have raised their purchasing price to ?316,000/ton. - more

  It is reported that China's top steelmaker Baosteel, which announced increase in prices for Q1 of 2008 is likely to steer China's steel price trend next year. - more

  Another battle may be shaping up between China and Japan. This time, it's over iron ore. - more

  BHP Billiton Ltd, the Australian mining company bidding to buy Rio Tinto Group, may fail to convince customers concerned about a duopoly of the iron ore trade that the combined company will be able to overcome labor and port constraints hindering production, analysts said. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 720 tons = 43,350 tonnes (2.92% - 1266 tonnes cancelled warrants/ 42,084 net stock level)
  •   Shanghai Jinchuan nickel - 265500-267500 RMB/t,  minus 2500
Wednesday, November 21
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $13.43/lb 3 month buyer - $13.56/lb (10.2% lower than 1/1/07)
  • Baltic Dry Index - minus 130 to 10,517.
  • LME nickel inventories - plus 60 tonnes into Rotterdam, Netherlands warehouse, minus 48 tonnes from Rotterdam warehouse, minus 36 tonnes from Chicago, IL, USA warehouse, plus 96 tonnes into Baltimore, MD, USA warehouse, and plus 234 tonnes into Hamburg, Germany warehouse
  • The U.S. dollar hits record low against Euro for second day in a row today. This is typically good for metals, but you couldn't tell that today.  The recession talk is getting louder in the U.S. What a possible recession in the States might mean to the rest of the world is not nearly as clear as it might have been in years past, but it is having a psychological effect on world traders. LME traded base metals spent the day in the red, across the board. From a traders point of view, looking at the nickel chart today, you might have thought the market was looking at $30,000 tonne as a resistance point, and not the support point it was. Spending much of the day below support, nickel peaked above it a few times, only to recoil. Typically, those who play the charts, might say it usually takes a couple of days for a metal to close below support, before new support levels are established. With nickel trading solidly below that level for most of today, they may not wait to establish a lower one. While nickel had another down day, it fared better than some other base metals. For the day, three month nickel ended the day at $13.47/lb  ($29,695/tonne)
  • Closing Metals Report - more
  • Forbes - more
  • U.S markets will be closed Thursday for Thanksgiving. We will post a morning update at the regular time, and an evening report.

  Nickel buyers are expected to return strongly to the market early next year, an executive at Russian producer Norilsk Nickel said Wednesday. - more

  The subprime debacle may well be the precursor to massive liquidation in the metals and other commodity markets, according to David Threlkeld, president of U.S.-based Resolved Metals. - more

  Rusmet reports that the "wave of reduction" in stainless steel production in Europe has stopped and that distributors are "carefully" replenishing their stocks. The current market for stainless steel in Europe is rated as "satisfactory, rather than good".

  Photo's taken of strike and operations at PT Inco in Soroako, Sulawesi Island, Indonesia - here  Reports in western media are stating this strike involves about 100 workers. Bloggers in the area put the number much higher. Here is quote from one last Thursday (translated) "Thousands Of employees who were bundled into the Kimia Trade Union, Energi, and the Mining (SP KEP) PT International Nickel Indonesia (Inco) CVRD Soroako, Kabupaten Luwu Timur (Lutim) held the strike, on Thursday (15/11)." (source) (another - notice one English speaking reader warned the author of this blog to be careful what they reported)

  We are looking for a source that monitors low grade nickel ore "pig nickel" prices into China. At one time, we had three separate Chinese sources, two of which have discontinued posting the info, and the third, has gone subscription only. We don't charge for our service, and refuse to pay to read anyone else's. If anyone knows of a free source that posts regular updates of this info, please let us know. Thank you.

  Researchers from the Department of Legal Medicine, Toxicology and Psychiatry of the University of Granada (UGR) developed a new method to detect metal concentrations in iron and steel industry workers. - more

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

  • Indications at 7:50 am CST show 3 month nickel selling down by $.23/lb . Nickel trading has spent all morning in the red, most of that below the $30,000 tonne support. It does not appear that this support level is going to hold. Interesting to note that cancelled warrants are creeping back up. This implies that there are nickel buyers out there, but they are shopping for the best price and watching the market closely for dips.
  • Bloomberg - more
  • Reuters - more

  Behre Dolbear Global Mining News - pdf here

  Commonwealth Research - The HARD Line - pdf here

  Copyright/courtesy Dow Jones - "JP Morgan's Michael Jansen advises against being short LME nickel as stainless steel fundamentals have been so poor in recent months they are bound to improve, while market has been building up shorts, so short-covering is expected at some stage. Expects nickel to hold support at $29,000-$30,000 near-term, but notes demand from stainless steel sector needs to pick up..."

  The global nickel market was close to balance in the first nine months of the year, the World Bureau For Metal Statistics said Wednesday, although it didn't provide a figure. - more  WBMS press release here

  Most mills have started talking about rise in stainless steel prices, but there is no any mill will easier to up its prices and unlikely to agree any increase until the market is stable. However, it looks like the prices have reached bottom for now and downstream users are expected to replenish their inventory level at the moment. In short, this will depend a lot on nickel price - more

  A labor strike is continuing at the Sorowako nickel mine run by the Indonesian unit of Brazil's Companhia Vale do Rio Doce (RIO) and continuing to hurt production there, a company official said Wednesday - more

  IISI revision - October 2007 Crude Steel Production (Revised) - here

  World crude steel production for the 67 countries reporting to the International Iron and Steel Institute was 114.0 million tonnes in October 2007 up by 6.6% YoY as compared to October 2006. - more

  Copyright/courtesy Dow Jones - "South Korea's state procurement agency Wednesday bought 200 metric tons of nickel cathode, and has tendered for another 200 tons for Nov. 28, a senior official at the agency said Wednesday.  The winning bidder for Wednesday's tender was Korea Ores & Metals Co., which will receive a $487/ton premium over the London Metal Exchange cash contract, said Han Gunwo, director of the Public Procurement Service's raw material stockpiles division. "

  Production of Canada's Leading Minerals - Sept 2007 - pdf here

  Russia's Interros holding company said it has made an offer to acquire Mikhail Prokhorov's minority stake in OJSC MMC Norilsk Nickel, (Nachrichten) Interfax reported. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 306 tons = 42,630 tonnes (2.52% - 1074 tonnes cancelled warrants/ 41,556 net stock level)
  •   Shanghai Jinchuan nickel - 268000-270000 RMB/t, plus 1500
Tuesday, November 20
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $13.54/lb 3 month buyer - $13.56/lb (10.4% lower than 1/1/07)
  • Baltic Dry Index - minus 133 to 10,647.
  • LME nickel inventories - plus 126 tonnes into Rotterdam, Netherlands warehouse, minus 36 tonnes from Rotterdam warehouse, minus 36 tonnes from Singapore warehouse, and plus 276 tonnes into Hamburg, Germany warehouse.
  • It took a week for the news to digest, but steel associations around the world are now complaining about the possible merger between BHP and Tinto (we refer to Rio Tinto as Tinto as RIO is the stock symbol for CVRD and calling them RIO sometimes confuses readers). Yesterday, it was the Chinese, Japanese, and IISI. Today, the South Korean's, and Eurofer joined in (here) and (here). LME nickel trading took market watchers on a roller coaster ride today. At one point nickel had fallen nearly $900/tonne below the support level of $30,000. But from that low point of the day, the price rebounded, possibly on news out of the US that housing starts were slightly higher than previously forecast. New housing permits were lower than forecast, and U.S. housing starts play a tiny part of the overall nickel picture, but traders, starving for some positive news, grabbed on to it. While hesitating at a few points in the afternoon when it climbed back over $30,000, the market finally settled down to trade above that level in late day trading. At least for today, support has held. LME inventories continue to climb, with the Hamburg, Germany warehouse storing its first nickel stockpile since early this year. Trading bulls appear to be in a foul mood. The ever present credit problems in the U.S. have added a question mark to every forecast, metal inventories continue to increase, China is talking about even more measures to slow its economy growth, the novelty U.S. dollar toilet paper could soon be worth more than the currency, and stainless steel producers are keeping their cards close to their chests. All in all, it's harder to find bullish news for nickel these days. For Tuesday, three month nickel closed trading at  $13.74/lb ($30,300/tonne)
  • Closing Metals Report - more

  Copper and most other base metals continued to slide in Asia yesterday, as concerns of a credit freeze in China weighed on an already ailing US economy. - more

  Iron ore prices are expected to shoot up by 30 to 50 percent next year, as growing urbanisation in countries such as China and India is likely to boost demand for steel, a fund manager said on Tuesday. - more

  copyright/courtesy Scotia Capital - "China’s recycled metal production totalled 4.53 million tonnes in 2006, far more than the 2.39 million tonnes seen in 2002, according to China Metals. And of the country’s total consumption of major non-ferrous metals last year, recycled metal accounted for 23.8%. The Recycling Metal Branch predicted that the production of secondary metal would exceed 5.2 million tonnes this year, and recycled metal would account for over 25% of the country’s total metal consumption."

  (excerpt from Oct 31 report) "Whilst the price of nickel at one stage halved from its all-time highs of earlier this year, we believe this is all part of an elaborate game being played by Chinese metal buyers. They are well known for talking down their own future demand - we saw it last year with respect to both copper and zinc (before both metals bounced back firmly) - in an attempt to drive down metal prices. A few months they talked down nickel demand and the nickel price responded accordingly. We believe this is only temporary however and that prices will once again return to all-time highs over the next couple of years." - source  (comment - this author is either bullish or full of bull. Or both.) (thanks to a reader for bringing this to our attention)

  Growing demand from the stainless steel industry and static world production could lead to shortages of molybdenum in 2008, George Song of Shanxiang Minmetals told delegates at the MB Ferro-alloys conference in Monte Carlo. - more

  The Gateway Upgrade Project, to duplicate a motorway bridge across the Brisbane River in Australia’s Queensland, will use duplex LDX 2101® stainless steel reinforcement bar from Outokumpu in a ground-breaking move towards sustainable infrastructure development at competitive cost.  - more

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

  • Indications at 7:50 am CST show 3 month nickel selling down by $.23/lb . It appears that the $30,000/tonne support on nickel has possibly failed this morning. Too early to count it out yet, but the price has fallen thru it pretty hard, and although prices have recovered somewhat, it appears to be in serious trouble. This could mean further price declines. 
  • Bloomberg - more
  • Reuters - more

  Canada Commodity Price Update - pdf here

  TD Bank Weekly Commodity Price Report - pdf here

  Analysts at ABN Amro bank in London see nickel prices unwinding after a blistering rally that started in 2001, with the market staying in surplus around 100,000 metric tons. - more

  US based Specialty Steel Industry of North America (SSINA) has announced their statistics on year-on-year comparison of consumption and import penetration, referring to first 8 months in 2006 and 2007. - more

  Production figures released by the International Iron and Steel Institute (IISI) shows that global output increased in September this year. Most regions registered stable or slightly reduced output, except for EU 27, which increased by 2 million tons compared with August. - more

  OneSteel managing director Geoff Plummer on Monday forecast earnings before interest, taxes, depreciation and amortisation (EBITDA) for the steel market of up to $780 million in fiscal 2008. - more

  There’s really only one reason why we’re in a resources boom: Australia has iron ore – lots of it too – and China is buying it just as quickly as we’re digging it out of the ground. It’s the boom behind the boom. - more

  The negotiations with stainless steel mills in Japan on price of South African charge chrome for shipments in October - December quarter of 2007 became a marathon but has been at last settled by roll-over from that for the preceding quarter of July - September. - more

  ArcelorMittal, the world's largest steel maker, will raise prices for flat-steel products in North America and Europe due to higher raw material and energy costs.  - more

  The Indonesian unit of nickel producer Inco Ltd said on Tuesday it was still on track to produce 160-165 million pounds of nickel this year despite a strike by workers. - more

  Chinese newspaper Hainan Daily is reporting of a legal dispute between Wing Wang Stainless Steel Ltd and a shipping company over a shipment of 45,000 tons of laterite nickel ore. Apparently the carrier ran aground on November 9th, and dumped part of its ore cargo to free itself, and arrived shy about 9,600 tons. The ship has been seized at Yangpu Port by Haikou Maritime Court for further investigation. Article carries no other information.

  The head of the world's biggest mining group, BHP Billiton Ltd, pushed his case for a mega-merger with rival Rio Tinto on Tuesday in the face of growing opposition from big Asian customers. - more

  It digs for minerals in countries from Colombia to Kazakhstan, deals in exotic metals that keep planes airborne, and handles 3 percent of the world's oil. - more

  Courtesy AISI - "In the week ending November 17, 2007, domestic raw steel production was 2,054,000 net tons while the capability utilization rate was 86.1 percent. Production was 1,887,000 tons in the week ending November 17, 2006, while the capability utilization then was 81.5 percent. The current week production represents an 8.8 percent increase from the same period in the previous year. Production for the week ending November 17, 2007 is down 3.5 percent from the previous week ending November 10, 2007 when production was 2,130,000 tons and the rate of capability utilization was 89.3 percent."

  Mining investors - Ernst & Young’s Mining EYE 3rd quarter 2007 - pdf here  

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 330 tons = 42,324 tonnes (2.01% - 852 tonnes cancelled warrants/ 41,472 net stock level)
  •   Shanghai Jinchuan nickel - 266000-269000 RMB/t, minus 750
Monday, November 19
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $14.00/lb 3 month buyer - $14.22/lb (5.9% lower than 1/1/07)
  • Baltic Dry Index - minus 90 to 10,780.
  • LME nickel inventories - plus 126 tonnes into Rotterdam, Netherlands warehouse, plus 480 tonnes into Singapore warehouse
  • Chinese and Japanese officials, as well as the International Iron and Steel Institute, all expressed serious concerns this weekend, about the possibility of a BHP-Tinto merger and the implications on the iron ore market, this union might have. Somebody pulled the drain plug in the base metal boat this morning, and instead of bailing water, occupants were jumping overboard. Base metals in general, and nickel specifically, had an ugly day. Initially the day appeared to be floundering, drifting down to around a $400/tonne loss, then back up to a little on the plus side, then back down, but not as bad, then back up, but not as high, then something spooked the market, and everyone was selling. From a daytime high of around $31,500, to at one point, below support of $30,000/tonne. Dollar was up, but only slightly against the Euro. Overnight markets in Shanghai saw nickel the only gainer there. LME inventories grew by another 1.6% overnight, with no outbound shipments reported. Wednesday is Third Wednesday, and with futures required to deliver on that day, we sometimes see dramatic moves right before, or on the day of. Last month it was on the Tuesday before, this month the fun may have come a day earlier. We stated last Tuesday when nickel was selling for $15.30/lb, that we could see nickel back in the low $14/lb range very soon. Obviously, we didn't see the dip becoming as extreme as it has. Now that we are trading at support, it will be interesting to watch. If support holds, we could see nickel sneaking back up. If it doesn't stick, then look for further declines. For the first day of the trading week, nickel closed at $13.70/lb ($30,200/tonne)
  • LME markets are open all this week, and while the U.S. will be on Thanksgiving holiday break on Thursday, we will bring you a daily report each day.    
  • Closing Metals Report - more
  • Reuters - more
  • AP - more

  Copyright/courtesy Dow Jones - by Andrea Hotter - (quote) "But while the lower prices are providing a good dip-buying opportunity, traders said there's a reluctance by market participants to build fresh longs, because the fundamentals aren't supportive enough."
  Copper fell more than 2 percent on Monday as China moved to curb its overheated economy, making investors fret over slowing demand by the world's top consumer. - more

  Following is a table showing China's base metals production in October and during January-October, according to the National Bureau of Statistics. - more

  US Stainless steel steel exports were mostly flat in September, sliding .07% from August. The decline would have been worse, had it not been for exports of stainless steel 'oil country goods', which were up 60% over August, most notably, to Venezuela. Cold rolled stainless exports slumped, while hot rolled exports were up slightly. Overall, US exports of stainless steel items were 10.8% higher than October of 2006.  

  The International Iron and Steel Institute (IISI) has today issued a formal request that all relevant competition authorities review the proposed alliance between BHP and Rio Tinto. - more

  At least five people were killed when a gold and nickel mine tunnel collapsed Monday in the southern Philippines due to heavy rains, a regional relief official said. - more

  ThyssenKrupp AG said it is buying Apollo Metals Group from Murray International Holdings for an undisclosed sum. - more

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

  • Indications at 7:55 am CST show 3 month nickel selling down by $.01/lb After being down as much as $450/tonne earlier, nickel appears to be on a rebound cycle as we publish the morning update. News out of Russia that a court has ordered striking dock workers back to work in St Petersburg, could mean more nickel shipments in the future. We posted numerous reports for the numbers crunchers among you over the weekend.  
  • Bloomberg - more

  Haywood Securities Metals & Mining Weekly - pdf here

  In the weekly poll of analysts for SMM Specialist, 29 metals analysts responded. Of those, 16 (55%) felt the price of nickel would fall this week, 8 (27%) felt the price would hold, and the remaining 5 (17%) felt the price would rise.

  China's hefty appetite for raw materials may wane after next year's Olympics as social and inflationary pressures curb investment, London Metal Exchange director Phillip Crowson said on Monday. - more

  Eramet chairman Patrick Buffet said in an interview with Investir that he believes continental Europe needs to keep control of certain mining assets. - more

  The information that China may raise the export ingot steel tax to 25% from the current rate of 15% in early December 2007 has heated up the regional steel market, according to the Vietnam Steel Association (VSA). - more

  Mr Wang Anjian senior analyst of Chinese Academy of Geological Sciences, at recent China Mining 2007 said that global ore miners would risk losing USD 130 billion market share in China over the next decade, if they continue to seek for USD 75 per tonnes for ore shipment to China. - more

  President Robert Mugabe's government published a draft bill on Monday forcing mining firms to transfer majority shareholdings to local owners, including giving the Zimbabwe government a free 25 percent stake. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus  606 tons = 41,994 tonnes (1.64% - 690 tonnes cancelled warrants/ 41,304net stock level)
  •   Shanghai Jinchuan nickel - 267500-269000 RMB/t, plus 1000
Saturday, Sunday November 17 & 18
  Sunday ramblings - Anyone noticed how bearish the news has become over the last few weeks? From a surplus of stainless in China, to decreased production in Japan, ever increasing inventories of nickel in LME warehouses, to numerous analyst's finally acknowledging the validity and future of the so-called 'pig nickel', and the increasing evidence that substitution is making a bigger dent in stainless production, than formerly thought. Some of the negativity we are reading is quite possibly being caused by an underlying frustration that the market has not recovered from the summer slump in stainless steel production as quickly as many, including ourselves, had estimated.  Recovery was thought to be coming during the third quarter of 2007, and when that did not materialize, many producers estimated the fourth quarter. Now most are predicting, or should we say, hoping,  it will come during the first quarter of 2008.

The stainless steel market is in the midst of a mini-revolution. 200 series stainless has gone from the ignored stepchild, to an important seat at the table. We first became aware of 200 series stainless on an engineers forum, years ago. There, a member of this forum, an engineer by the name of Michael McGuire, who was, and apparently still is, writing a book called "Stainless Steel for Engineers", was constantly questioning his fellow engineers, and the stainless steel industry as a whole, on why 200 series stainless steel was not getting serious attention. While it was obvious this member was highly respected among forum peers, all engineers, for his technical knowledge about all types of stainless steel, his ringing endorsements for this new stainless steel, went mostly dismissed. We wonder how sought out engineers like Mr. McGuire are these days. The incredible increase in the price of nickel, has forced many to look at more cost effective alternatives and 200 series stainless has suddenly been thrown into the spotlight.  Stainless steel producers, and distributors, typically as excited about a major shift in the supply chain, as customers are, have made the investment necessary, and are now in the 200 series market for the long haul. For those only interested in the spectrum from the nickel point of view, this should be very concerning. Like any business driven by customer satisfaction, stainless steel distributors and producers are going to find a way to provide what their customers require. Consumers are no longer asking for more competitive prices, they are demanding it. Buyers of stainless steel had become accustomed to occasional spikes in the price of stainless, usually measured in months. This price spike is unprecedented in how high it has gone, and how long it has lasted. 200 series may not have the long and proven track record as 300 series stainless steel has, but it is offering customers an interesting, competitive, and in some cases, a business saving, alternative.

China has not only become the world's largest consumer and producer of stainless steel, but they are making some serious changes to both the supply and demand dynamics. Need another example? Just a few short years ago, deserted mines in the Philippines held stockpiles of discarded and 'worthless' low grade laterite nickel ore. Now, mining companies are in business to mine nothing but. For nickel producers, 2007 has truly proved to be the Chinese Year of the 'Pig'.  

  If Rio's board doesn't want to talk to him, BHP Billiton chief executive Marius Kloppers will have no hesitation in going around them and approaching Rio shareholders directly, he told reporters in South Africa at the weekend. - more

  Citigroup Commodity Heap - pdf here (thanks to a reader for the link)

  BMO Capital 'The Goods' - pdf here

  India Infoline Commodity Report - pdf here

  Bombay Metal Market October report - pdf here

  Denis Battrum Molybdenum Commentary - pdf here

  Institute of Scrap Recycling Industries, Inc. Friday Report - pdf here

  National Mining Association Mining Weekly - pdf here

  Rusmet quoting RBC Daily - According to the International Nickel Study Group, this year the world will see production of 1.47 million tonnes of nickel, nearly 7% more than last year, and according to RBC, for the first time in a decade, the market will be in surplus. And for the first time since 2001, the world will see a decline in consumption of nickel, predicted to be 1.35 million tonnes, 5% lower than last year. Stainless steel production, using up to 90% of nickel, is set to hit 29 million tons this year, only 2.2% more than 2006, which saw an increase of 16% over 2005. INSG predicts nickel consumption in the United States will decline this year by 6.7% and in Europe by 16%, while they foresee the expected rebound in stainless steel production next year, to help nickel consumption in the United States to increase by 3.4% in 2008, and in Europe, by 12%. "Neil Buxton of the consulting company GFMS Metals Consulting suggests that the price of nickel this year will be relatively stable, but next year they may again exceed the $40 thousand U.S. per ton. Australian metal producer Mincor Resources anticipates that in the first quarter of 2008, prices will grow by 25% and overcome the 40 thousand U.S. per ton mark."  With a predicted surplus of 130,000 tonnes of nickel this year, INSG predicts this surplus may fall to around 100,000 tonnes next year.

  Rusmet quoting Brook Hunt - Brook Hunt specialists expect that the production of primary nickel in 2007, will reach 1.46 million tons, while consumption will reach 1.43 million tons by 4.7% more than in 2006.... World consumption of nickel is projected to grow by 9% in 2008, at 5.9% in 2009, and by 6.3% in 2010. Brook Hunt also expects prices to start sliding, possibly as early as the first half of 2008, to a low of $4.50/lb by 2010, and not expected to increase until 2017, where they forecast prices could return to $8/lb.

  US based Specialty Steel Industry of North America has released statistical data on imports, US consumption and import penetration for YTD August 2007 as compared to January to August 2006 - more

  Copyright/courtesy Sangyo Shinbun - "The Japanese company Nippon Steel & Sumikin Stainless Steel, and its main supplier in South Africa has agreed to leave the purchase price for ferrochrome unchanged at the level of July until the end of 2007."

  Between mourning the loss of Chris Judd and the self-ruination of Ben Cousins and toasting the Victorian-thumping antics of the Western Warriors and Wesfarmers, West Australians are trying to work out whether they should worry about BHP's proposed takeover of Rio Tinto. - more

  Brazilian iron ore exports are expected to add 140m tonnes to global seaborne trade by 2012 as global shipments grow by 9% per year to meet an increasing demand for steel. - more

  Top 10 Stainless Steel Producers in 2006

courtesy May report here

Friday, November 16
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $14.15/lb 3 month buyer - $14.22/lb (6.6% lower than 1/1/07)
  • Baltic Dry Index - minus 68 to 10,870.
  • LME nickel inventories - plus 126 tonnes into Rotterdam, Netherlands warehouse, minus 12 tonnes from Rotterdam warehouse, plus 78 tonnes into Busan, South Korea warehouse, minus 18 tonnes from Busan, warehouse, and plus 72 tonnes into Singapore warehouse
  • Nickel had another day where it spent much of the time in red. LCH lowered the margin for nickel and zinc near the end of the day, which gave the bulls a reason to jump in and take the price back over its opening, but their effort was short lived, and by the end, nickel had slumped. The news out of Japan yesterday, that Nippon Steel & Sumikin Stainless Steel was continuing its 30% reduction in nickel bearing stainless steel production, on the back of a second day of the US dollar strengthening against the Euro, has thrown a bearish spell over the market. MFG has support at $13.60/lb, so if nickel slumps below $14/lb next week, we could see some bargain hunting. For the day and week, three month nickel closed at $14.17/lb ($31,250/tonne) . Having ended trading last Friday at $15.33/lb, this week saw nickel fall 7.6% and is now trading at its lowest this month.  
  • Closing Metals Report - more
  • Have a safe and restful weekend!!

  Scotia Mocatta Metal Matters - pdf here

  Copyright/courtesy Forbes - "Commonwealth Bank of Australia analyst David Moore said nickel markets are becoming a little less confident about an expected rebound in demand from the stainless steel industry over the coming months."

  LCH.Clearnet, which clears trades for the London Metal Exchange, has lowered its initial margins for nickel and zinc, as well as for North American aluminum alloy, or NASAAC, the London-based clearing house said Friday. - more  (Current LME Margin Rate Spreadsheet - XL spreadsheet here)

  Molybdenum oxide and ferromolybdenum prices are leading "separate lives," according to a trader and a converter, as upward pressure on the former and downward pressure on the latter have led to a continuation of negative conversion margins. - more

  The unexpected shutdown of Benguet Corp's Masinloc chromite mine in the Philippines has aggravated the already tight chromite supply situation in Asia'. - more

  Lohakit Metal, a leader in integrated stainless-steel processing, is expanding its market upcountry for D-stainless with low nickel, The Nation reports. - more

  The Reserve Bank of India (RBI) today said it would shortly put into circulation new ferritic stainless steel coins of Re 1 with the theme `Nritya Mudra'. - more

  China's finished steel output may be overstated by 100 million mt/year, a leading steel analyst told Platts Thursday. - more

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

  • Indications at 7:50 am CST show 3 month nickel selling down by $.05/lb . Market appears to be much quieter today, bloodied and bruised from yesterday, with nickel having spent all morning in the red, but so far, price is only down slightly. Yesterday, the dollar rallied on news that China was committing to the dollar, and news out of China this morning, is that they have been hit harder than earlier thought by the US sub-prime problem. Market is still buzzing about what might happen in the BHP-Rio takeover ordeal. Last night, the media began to speculate that Tinto might protect itself from takeover, by offering to takeover BHP. Others are dismissing that this morning, but we have another mining soap opera in the making.
  • Bloomberg - more
  • Forbes - more

  Citigroup metals analysts said they believe "the defining features of 2008 may well be reduced volatility in metals prices, and key equities finally moving to full market multiples." - more

  SSINA Releases Eight-Month Market Data - pdf here

  SteelBenchmarker™ reported that the U.S. hot-rolled band (HRB) spot price for Nov. 12 surged 1.6 percent to $586 per metric ton, FOB the mill, after falling 0.6 percent three weeks ago. - more

  It is reported that during this week ferrochrome prices in Chinese market continues to rise. - more

  Reuters reported that Turkish mining firm Dedeman will begin producing 100,000 tonnes per year of ferrochrome at a smelter in Turkey or the Middle East by the end of 2009.  - more

  The Central Government of China announced on the 18th June of 2007 to enforce the regulations for exports of molybdenum from China and an effect of this enforcement came up to the surface with decreased exports in July - September quarter of 2007. - more

  Metal service centers reported increased steel shipment levels during October for the first time since August 2006, but inventory levels continued to decline as processors and distributors continue to sell off excess stocks. These efforts have driven inventories to a levels that the Metal Service Center Institute recognizes as “at or near their cyclical lows.” - more

  According to the presentation of third quarter result of ArcelorMittal, the board member reports that stainless steel demand has been improved and is likely turning better by early 2008.  - more

  Sumitomo Metal Mining Co and Mitsui & Co have agreed to invest an additional $280 million in the Goro nickel project in New Caledonia after high materials costs and environmental concerns pushed costs up 70 percent.- more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 216 tons = 41,388 tonnes (1.28% - 528 tonnes cancelled warrants/ 40,860 net stock level)
  •   Shanghai Jinchuan nickel - 266500-268000 RMB/t, minus 6250
Thursday, November 15
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $14.56/lb 3 month buyer - $14.72/lb (2.5% lower than 1/1/07)
  • Baltic Dry Index - minus 57 to 10,938.
  • LME nickel inventories - plus 126 tonnes into Rotterdam, Netherlands warehouse, minus 12 tonnes from Rotterdam warehouse, minus 48 tonnes from Liverpool, England warehouse, and minus 48 tonnes from Tyne & Wear, England warehouse
  • If you were long in nickel today, your Halloween goblin came late. If you were short, then your Christmas present came early. And if you are a nickel buyer, and decided yesterday to wait another day to issue a purchase order, you just saved your employer a heap of moolah. All of the base metals traded on the London Metal Exchange spent the day in the red, but nickel seemed to be in a race to see if it could fall by the largest margin, which it eventually accomplished. If you can picture a ski slope, with a cliff at the end, you have a general idea what the nickel chart looked like today. Nickel had fallen by around $800/tonne, recovered a small portion of that loss, then appeared to take up base jumping. (for those who might not what that means - video here). When the dust finally settled, three month nickel ended the days trading at $14.37/lb ($31,690/tonne), its lowest close this month.
  • Closing Metals Report - more

  Euro-Inox has released a concise overview of the most common stainless steel options that are available. A 6-page folder has been produced, entitled: What is stainless steel? - more

  In October, China produced 9,900 tonnes of nickel, a 1.7% gain over October of 2006. Thru October, China has produced 102,400 tonnes of nickel this year, a 23% increase over the same period in 2006.

  Brazil's mining giant CVRD sees a possible takeover of rival Rio Tinto by world's biggest miner BHP Billiton as a good thing for the industry that will not threaten CVRD's dominance in the iron ore market. - more  (opinion - let's see now, we can be one of the Big Three of iron ore producers, or one of the Big Two. Which would you pick?)

  Blurb - "Companies investing in Chinese real estate or heavily polluting industries, including some foreign companies, have been told by bankers that they cannot access credit before the end of the year because of a government order to freeze lending."

  Yesterday, we posted the story of the stainless steel sculpture that sold for $11.8 million dollars. A reader sent us a note today that advised us we missed the bigger 'stainless' story. How about $23.6 million dollars for a stainless steel heart? Same Southeby's auction and it becomes "the most expensive piece by a living artist ever auctioned". Read more here (also note the previous record holder was also a stainless steel sculpture and thanks to PS for bringing this to our attention)

  (not metals related - well maybe not) Surfer dude stuns physicists with theory of everything - more and for you 'academic' types - here is his 31 page "An Exceptionally Simple Theory of Everything" here

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

  • Indications at 7:55 am CST show 3 month nickel selling down by $.39/lb . Someone must have yelled "fire sale" in London today, as metals across the board are in the red this morning, most have fallen in the 3-5% range already. Could be a brutal day for traders, and one buyers may want to sit out and watch from the sidelines. Nickel buyers who must buy should watch closely, as sentiment is bearish and has swung to their favor.
  • Bloomberg - more
  • Reuters - more

  Standard Bank: Weekly Commodity Research  - pdf here

  The Stainless Steel World 2008 Call for papers is now available - pdf here

  (excerpt) "Product substitution away from the higher nickel-containing stainless steels was addressed by Poole and Vorberger and expanded upon by service center executive Jill Talve of Franklin Stainless Corp. From her company’s perspective, the shift from 304 stainless to the 200 series represents a structural change in the marketplace with mills and end-use consumers having “little reason to go back to 304.” The 200 series, she reiterated is “here to stay.” Talve also offered an encouraging near term outlook for stainless based on the anticipated return of buyers as inventories by stockists (i.e., service centers and distributors) and mills return to more normal levels." - more

  EU Steel Prices Still Under Pressure But Should recover in 2008 - more

  Today is the half way point of November. Based on average cost of ingredients 'so far this month', we estimate the stainless steel surcharge for January 2008 could be around $.09/lb higher for 304 stainless and $.11/lb higher for 316 stainless, when compared to December surcharges. January surcharges will not be established until the first part of December, and will use the average cost of nickel, moly, chrome, and iron over the entire month of November, and thus, any price movement during the next two weeks, will change the above numbers.

  Indonesian miner PT International Nickel, or Inco, said around 500 workers from its Sorowako mining site went on strike Thursday, partially affecting operations.  - more

  China’s Lianzhong Stainless Steel (Lisco)has set a floor price for 201 cold rolled stainless steel, and the company instructed their dealers should not sell any 201 grade cold rolled stainless coil below their floor price. - more

  Copyright/courtesy Metal First - "Nippon Steel & Sumikin Stainless Steel (NSSC) announced on Wednesday the firm will keep 30% output reduction of nickel series stainless cold rolling operation at Hikari plant through March 2008. The firm reduces the output by 30% from a year earlier level in July and by 40% in August and September. The firm also announced 20,000 yen per tonne price hike for the products for domestic distributors for November order from previous month to reflect higher nickel price in September and October."

  New Caledonia’s only nickel producer says it would like to build another one or two nickel plants in the territory.  - more  and another translated article here

  Molybdenum prices could rise in 2008 back or above 2005 levels as buyers cope with 5% less output while demand is rising 4%--thus widening a supply deficit that already has boosted spot prices by 20% this year. - more

  Mr Ram Vilas Paswan union steel minister said that India is set to become the world's 2nd largest producer of steel before 2015-16 and the steel sector is likely to witness an investment of INR 870,640 crore by 2020. - more

  The U.S. dollar's weakness against other currencies is hurting overseas operations of American mining companies, but analysts say it could make them more attractive to foreign takeover. - more

  Courtesy/copyright Interfax - "Mikhail Potanin, the president of the investment fund Unexim, owns 28.2% in Norilsk Nickel (RTS: GMKN) - the world's biggest nickel and palladium producer, while president of Interros holding company Vladimir Potanin owns 25.3%, a Norilsk Nickel memorandum on the separation of energy assets says."

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 18 tons = 41,172 tonnes (1.41% - 582 tonnes cancelled warrants/ 40,590 net stock level)
  •   Shanghai Jinchuan nickel - 272500-274500 RMB/t, plus 750
Wednesday, November 14
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $15.15/lb 3 month buyer - $15.31/lb (1.4% higher than 1/1/07)
  • Baltic Dry Index - minus 44 to 10,995.
  • LME nickel inventories - plus 84 tonnes into Rotterdam, Netherlands warehouse, minus 12 tonnes from Rotterdam warehouse, minus 18 tonnes from Busan, South Korea warehouse, minus 6 tonnes from St Louis, MO, USA warehouse
  • Traders got a boost early when Europe's largest bank reported a third quarter profit higher than the prior year. But the bank also warned that losses in the U.S. housing market were spreading to credit card and other consumer loans, forcing the bank to set aside $3.4 billion to cover bad loans. For most of the day the bears were silence, as nickel slowly crept higher, at one time coming within $25 of that the $34,000/tonne barrier we have been mentioning over the last few days. Then suddenly, in late London kerb trading, the price of nickel collapsed again into the red. And there it ended the trading day. For Wednesday, three month nickel ended trading at $15.01/lb ($33,100/tonne)
  • Closing Metals Report - more

  Cr, Cu, Mn, Mo, Ni, and Steel Price Drivers by USGS - presentation from May made public in September - here

  Canadian mining writer Stan Sudol is back - "Our company has a strategic position in the trillion-dollar Sudbury Basin which by far, is the richest mining district in North America,” observes Terry MacGibbon, executive chair of FNX Mining Company Inc. - more here

  Ferrochrome producers could find it more profitable to divert sales to China from Europe if European steel mills continue to squeeze prices. - more

  CHINA'S fragmented steel industry is approaching a consensus that it can do nothing to stop BHP Billiton from swallowing Rio Tinto. - more

  India's exports of high grade iron ore fell 23 percent during the first six months of the financial year ending March 2008 from a year ago, mainly due to the combined effects of an export tax and a strong rupee. - more

  New European Union rules requiring firms to register and document metals and other substances they handle is causing consternation among companies which fear the law will be costly and difficult to meet. - more

  (excerpt) Jeff Koons's ``Diamond (Blue),'' a 7-foot-tall stainless steel sculpture resembling a faceted stone in a setting, sold for $11.8 million. It was a record for the artist even though the price didn't reach the $12 million presale estimate. - more (photo here)

  Team Stainless New Video

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

  • Indications at 7:55 am CST show 3 month nickel selling up by $.20/lb . Base metals are green across the board this morning in LME trading, with nickel no exception. Yesterday's boost in the US stock market, and overnight gains in China, have given traders a boost in confidence that credit crisis concerns may be easing.
  • Bloomberg - more

  Behre Dolbear & Company Global Mining News - pdf here

  TD Bank Weekly Commodity Price Report - pdf here

  SFSA October 2007 Steel market condition - pdf here

  Copyright/courtesy INSG Study Group - "During its 18th Session held in Lisbon on 2-3 October INSG reviewed the current outlook for trends in World supply and demand for nickel during 2006 and 2007 and issued the following forecast: Global primary nickel usage was forecast to fall from 1.4 million tonnes in 2006 and to 1.35 million tonnes in 2007 (a decrease of 3.6%). A recovery in usage was expected for 2008 due to increasing demand for nickel containing products in China. Global primary refined nickel production was forecast to rise from 1.47 million tonnes in 2007 to 1.57 million tonnes in 2007 (an increase of 6.8%). INSG also discussed supply side trends and noted that the production of a new product - Ferro Nickel/Pig Iron - had expanded rapidly in China during 2006 and 2007."

  (excerpt) "Development of copper, zinc, lead and bauxite is removed from the category of industries encouraging foreign investment; exploring and mining of tungsten, tin, antimony and molybdenum are listed in the category of industries forbidding, rather than restricting foreign investment, and gold, silver and platinum remain in the restrictive category." - more (as Robin Bromby of the Australian put it - "What this means is that no foreign company can get involved in mining these metals. Add this to earlier moves to raise export taxes on metals and the message from Beijing is clear: you westerners can exhaust your deposits and in 50 years we'll still have ours....Who are the suckers?" - more. We have made similar observations about Russian mining policies in the past. Outsiders can't own more than 49.5% of a Russian nickel mine, but Mother Russia can own 100% of a nickel mine in your country. See here)

  China's increasingly restrictive policies on foreign investment will not preclude qualified foreign investors from investing in China's mining sector, a Ministry of Land and Resources (MLR) official said at the MLR-organized China Mining 2007 conference, held in Beijing yesterday. - more

  In anticipation of that the world supply situation of molybdenum in 2008 will tighten, many cases to shift contract term for molybdenum purchase to yearly base are coming up as a remarkable phenomenon. - more

  Surging costs of production and transport will underpin record high prices of ferro chrome, a key ingredient for the stainless steel industry, a conference heard on Monday. - more

  Copyright/courtesy Scotia China Update "China’s stainless steel output is likely to grow 42% to 7.6 million tonnes this year, according to local industry consultancy Antaike, with low nickel grades making up more than half its output. China’s stainless steel mills are likely to produce 3.45 million tonnes of 300 series stainless steel, which contains nickel – accounting for about 45% of total output in 2007. They will produce about 2.15 million tonnes, or 29%, of the 400-series stainless steel, which uses chrome instead of nickel, and 2 million tonnes, or 26%, of the cheaper 200 series, which uses less nickel than the 300 series. China’s stainless steel output is likely to rise by 12% to 8.5 million tonnes in 2008, and to 10.6 million tonnes by 2010, according to Antaike."

  It is reported that the growth momentum in China's steel production continues to slow down in October 2007. - more

  Blurb - "India's largest stainless steel maker, Jindal Stainless Ltd, has signed an initial agreement with two private firms and state-run Mahanadi Coalfields Ltd to form a joint venture, a senior official said. The joint venture firm would mine coal from two adjacent blocks in Orissa and is expected to start operations in three years, director N.C. Mathur said on Tuesday." courtesy - Mint

  Courtesy/copyright People's Daily - "The Industrial and Commercial Bank of China (ICBC), the country's biggest lender, is predicting in a recent report that China's reserve ratio requirement for commercial banks will probably reach 15 percent in 2008. China has raised the reserve ratio for nine times this year to a ten-year high of 13.5 percent in an effort to ease excess liquidity that is pushing the economy to the verge of overheating. The report from ICBC's Institute of Urban Finance forecast that China's economy would grow at a sizzling pace of 11.3 percent this year, with the full-year inflation rate of 4.5 percent, compared with the government target of three percent."

  Photo of Burj Dubai, the world's tallest structure and building in the world - here. Beautiful photo, but this one gives a better perspective of the height here

  RT news visits Norilsk Nickel and Norilsk, Russia - video here (Norilsk is a closed city to outsiders so the fact this reporter was allowed in is amazing)

  ArcelorMittal, the world's largest steelmaker, reported a 36 percent increase in third-quarter profit, more than analysts estimated, as the company squeezed suppliers for lower prices. - more

  THE leaders of China Mining Inc have decided not to try to resist a BHP-Rio mega-merger. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 24 tons = 41,154 tonnes (1.53% - 630 tonnes cancelled warrants/ 40,524 net stock level)
  •   Shanghai Jinchuan nickel - 271500-274000 RMB/t, minus 4250
Tuesday, November 13
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $15.11/lb 3 month buyer - $15.30/lb (1.3% higher than 1/1/07)
  • Baltic Dry Index - plus 44 to 11,039. (new record high)
  • LME nickel inventories - plus 372 tonnes into Rotterdam, Netherlands warehouse, minus 30 tonnes from Rotterdam warehouse, minus 72 tonnes from Busan, South Korea warehouse, minus 18 tonnes from Singapore warehouse
  • Traders took another stab at the $34,000/tonne mark today, but only once, and that attempt only came within $100/tonne. After that try collapsed, nickel floundered in negative territory, trying to regain its starting point. It was unable to do so, and by late trading, ran out of steam. Buyers of nickel will be watching the market closely the next few days. With cancelled warrants down again, they are sending the signal that most are unwilling to purchase in the $15/lb range, and with nickel having been unable to break the $15.40/lb mark and hold for the last two days, it is possible we could see nickel slip back into the low $14/lb range. MF Global lists support at $13.61/lb ($30,000/tonne), with resistance at $16.11/lb ($35,525/tonne). Rumors flying that someone may be getting ready to make a play for Australian Allegiance Mining, which is scheduled to start producing nickel from its Avebury mine in Tasmania next year. If someone makes an offer, we could always see the action give the bulls a little more confidence and take nickel trading higher.  For Tuesday, three month nickel ended trading at $15.15/lb ($33,400/tonne)    
  • Closing Metals Report - more

  China exported 977,934.61 tons of stainless steel in the first nine months of 2007, 469,844 tons, or 92.47% more than a year earlier, according to statistics from the China Customs. - more  (comment - this figure will worry Chinese officials, as they face a dumping complaint in Europe with other countries looking at possibly doing the same)

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

  • Indications at 7:55 am CST show 3 month nickel selling down by $.09/lb. So far this morning, traders have made another run for the $34,000 tonne barrier, but fell short, and have since retreated into negative territory. Other base metals are up in morning trading.
  • Bloomberg - more
  • Forbes - more
  • Reuters - more

  Commonwealth Bank - The HARD Line - pdf here

  Canada Commodity Price Update - pdf here

  Last week, Macquarie joined the China International Nickel and Cobalt Industry Forum held at Antaike in Ningbo, Zhejiang province. The conference was well-attended by more than 600 delegates from the nickel, cobalt and stainless steel industries. - more

  US imports of stainless steel products totalled 67,950 tonnes in October, down 7% from September’s preliminary total of 73,160 tonnes of imports. Overall applications from China declined 38% to 10,500 tonnes, but China continues to be the largest exporter of stainless steel to the US.

  A recent change in calculating alloy surcharges for stainless steel could reduce speculation and bring stability to the pricing, which has fluctuated due to the volatile nickel market. - more

  Steel, metals and coal shipments from St Petersburg will be disrupted from Tuesday after dock workers in Russia's second-largest city launched an indefinite strike over a pay dispute. - more

  courtesy  AISI - In the week ending November 10, 2007, domestic raw steel production was 2,130,000 net tons while the capability utilization rate was 89.3 percent. Production was 1,887,000 tons in the week ending November 10, 2006, while the capability utilization then was 81.5 percent. The current week production represents a 12.8 percent increase from the same period in the previous year. Production for the week ending November 10, 2007 is up 1.4 percent from the previous week ending November 3, 2007 when production was 2,100,000 tons and the rate of capability utilization was 88.0 percent. Adjusted year-to-date production through November 10, 2007 was 92,108,000 tons, at a capability utilization rate of 86.1 percent. That is a 3.7 percent decrease from the 95,682,000 tons during the same period last year, when the capability utilization rate was 89.0 percent.

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 252 tons = 41,130 tonnes (1.56% - 642 tonnes cancelled warrants/ 40,448 net stock level)
  •   Shanghai Jinchuan nickel - 276000-278000 RMB/t, minus 2250
Monday, November 12
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $15.26/lb 3 month buyer - $15.44/lb (2.3% higher than 1/1/07)
  • Baltic Dry Index - plus 128 to 10,995.
  • LME nickel inventories - plus 228 tonnes into Rotterdam, Netherlands warehouse, minus 228 tonnes from Rotterdam warehouse, plus 222 tonnes into Singapore warehouse, plus 48 tonnes into Chicago, IL, USA warehouse
  • Watching nickel trade on the London Metal Exchange today was like watching a person bouncing on a trampoline. Four times, nickel rose sharply, (in the $400/tonne range) only to plummet back to a point at or below where it had started its most recent upturn. U.S. dollar was up today, which added negative pressure. Inventories are still rising, with cancelled warrants falling, and net inventory now also reading over the 40,000/tonne mark. Today's official price posting above $15/lb for the first time since late July. Triland said nickel needed to break above the $34,000/tonne level to 'maintain' its upward momentum. It did - 4 times today, but fell back sharply each time. If the bulls are trying to break thru this barrier and hold, they will have to try again tomorrow. If they are unsuccessful too many times, we could see the attempt collapse, and the price retreat back to around $14/lb. Lot of speculation this weekend in the media about what is next in the rejected BHP offer for Rio Tinto. Will BHP make a hostile offer, will China make a bid, will CVRD jump in, why CVRD won't jump in, why the deal is bad for China, why the deal may be good for China, etc, etc. If you are following this, we suggest you watch China closely, as they are already upset that the majority of the iron ore, that they are so dependent on, is in the hands of three major suppliers, BHP and Tinto being two of them. It's bullish news for metals in general, particularly iron ore, but not so much for nickel, as Tinto adds little, if any, nickel production to the equation. For the first day of the trading week, three month nickel ended at $15.24/lb   ($33,600/tonne)   
  • Closing Metals Report - more

  Copyright/courtesy Reuters Nov 7th article titled "China 2007 stainless steel output seen up 42 pct" by Rujun Shen - "China's stainless steel output is likely to grow 42 percent to 7.6 million tonnes this year, according to an analyst with consultancy Antaike, with low-nickel grades making up more than half its output. Lower nickel prices in the second half of the year, and higher-than-expected output of nickel pig iron, has led Antaike to revise up its forecast for Chinese nickel consumption to 347,000 tonnes in 2007. "We revised up the apparent consumption forecast as a result of upward revision of the nickel pig iron output. When the nickel price is above $30,000, nickel pig iron companies want to produce more because they feel they can make a profit," analyst Xu Aidong told Reuters.....Antaike expects Chinese nickel output will increase to 221,000 tonnes, including 95,000 tonnes of contained nickel in ferronickel and nickel pig iron.... High nickel prices forced the International Nickel Study Group to revise down its estimate of global consumption this year, while predicting a surplus this year and next. Consumption is expected to have fallen by 3.6 percent in 2007 to 1.35 million tonnes, as China growth failed to offset European cuts, but will recover to 1.47 million tonnes in 2008 as Europeans resume using nickel, it forecast in early October....China's stainless steel production is likely to rise by 12 percent to 8.5 million tonnes in 2008, and to 10.6 million tonnes by 2010, Antaike analyst Chen Shufang said, in notes prepared for a conference this week.... "Stainless steel is still mainly for ... domestic consumption. China will eventually become a net exporter of stainless steel, but not next year." China's stainless steel mills are likely to produce 3.45 million tonnes of 300 series stainless steel, which contains pricey nickel -- accounting for about 45 percent of total output in 2007, Chen said. They will produce about 2.15 million tonnes, or 29 percent, of the 400-series stainless steel, which uses chrome, and 2 million tonnes, or 26 percent, of the cheaper 200 series, which uses manganese instead of nickel for corrosion resistance and shine."

  (quote from article) "The LME has been unfairly represented in all this. We actually believe that (the price drop) was coincidental. It is possible the downward move was already underway," Abbott said. - more

  Cuba said at the weekend that unrefined nickel plus cobalt production was returning to normal after weeks of torrential rains in eastern Holguin province had shut down open pit mines and slowed output. - more

  The China boom will keep powering the Australian economy in the years ahead, despite the financial storm still gathering in the US. - more

  Just two weeks after European steelmakers requested a curb on Chinese steel imports, a group representing international steel exporters, importers and consumers has fired back, saying U.S. steelmakers benefit unfairly from subsidies. - more  (373 page report here)

  Is the European Steel industry trying to drive its customers out of the EU With calls for safeguard and anti-dumping measures on Chinese steel? - more

  Is the U.S. losing its economic clout? Blurbs from articles posted within last 7 days online - " China is likely to replace the US as Japan’s biggest export destination this year for the first time in modern history, reports Reuters." "Canada's exports to China surged by 43 percent in the first part of 2007, pushing China into a tie with Japan as the country's third-largest export market, national agency Statistics Canada said Thursday." "Trade with China is essential to Australia's economic boom. China is set to overtake the US as our largest trading partner — our two-way trade with it is worth $50 billion, a 21 per cent increase on 2005-06." " The country's two-way trade with East Asian nations has crossed 80 billion dollars, making the region India's largest trade partner ahead of the EU and the US." "The European Union remained China’s largest trading partner, with the bilateral trade volume standing at $ 287.5 billion from January to October, up 27.5 percent compared with the same period last year. The U.S. and Japan are China’s second and third largest trading partners, with the total trading volume both up around 15.7 percent to $ 248.2 billion and $ 191.9 billion, respectively." "Officials expect China, a growing force in Africa, to take over from the U.S. as the country's primary trade partner in the next six years. The U.S. currently purchases more than one third of Egypt's exports."

  India manufacturer answers questions about 200 series stainless - here

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

  • Indications at 7:50 am CST show 3 month nickel selling down by $.02/lb . So far nickel pricing has played the yo-yo bounce twice today, and while traders are trying to drive the price higher, the bearish sentiment surrounding the entire base metal sector this morning, is dragging it back. Sub-prime concerns in the U.S. have once again taken the spotlight. Last week's reasoning for the price of nickel jumping on Friday do not make much sense. Russia announced it shipped a lot less nickel during the last quarter than it had hoped. If the market were running in a supply side deficit, this would be encouraging to the nickel bulls. But considering stores of "excess" nickel have reason to levels not since since 2000 during the same period, we wonder exactly 'what' is so encouraging about this news. The bears could see this as evidence the market is capable of being in a far higher supply side surplus situation than inventories currently reflect.  
  • Bloomberg - more

  Haywood Securities Mining & Metals Weekly - pdf here

   GFMS Market Analysis - Nickel - more

  In its weekly forecast by Shanghai Metal nickel analysts, of 35 responding, 18 (51%) felt the price of nickel would rise this week, while 11 (31%) felt the price would stay about the same as last week, and the remaining 6 (17%) felt the price would fall.

  Courtesy/copyright Dow Jones - "LME 3-month nickel needs to break above $34,000/ton to sustain upward momentum, says Triland Metals. Notes 3-month nickel cleared key moving averages just below $32,000/ton on Friday, underpinned by bullish news Russian nickel exports down 4.2% on year January-September." "Rising total LME open interest in recent weeks indicates funds returning to metals markets, speculators building long positions in nickel, lead, shorting copper, zinc, says Macquarie Research. "

  Nickel demand from stainless steel producers is firming in Europe in the fourth quarter and should revive in Asia in the first quarter of next year, senior executives from the world's biggest nickel miner said on Monday. - more

  China will bar foreign companies from investing or exploring in some major non-renewable mineral resources, according to a policy statement issued by the Ministry of Commerce and the National Development and Reform Commission (NDRC). - more

  The potential tie-up of iron-ore concerns Rio Tinto and BHP Billiton puts the world's steelmakers -- the biggest consumers of iron ore -- in a weak bargaining position as they hash out 2008 long-term contracts. - more

  At the Hachinohe Works of Pacific Metals for production of ferro-nickel, an accident to No.7 electric furnace occurred at around 8 pm on the 5th of November. By this accident, two workers were killed and one worker was seriously injured. Consequently, three electric furnaces ( Nos. 6, 7 and 8 ) installed at the Hachinohe Works have suspended to operate. Pacific Metals announced this accident on the 6th of November. - more

  Steel prices are likely to continue their growth in 2008 by about 7-8 per cent on the back of increasing production cost and high consumer demand, especially from infrastructure and electronics consumer goods, said the latest report by India Infoline. - more

  BHP Billiton's proposal to create a $US400 billion ($437 billion) mining powerhouse with Rio Tinto has done three things: repriced the entire mining sector, placed just about every listed resource company on takeover alert, and put its target into play. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 270 tons = 40,878 tonnes (1.82% - 744 tonnes cancelled warrants/ 40,134 net stock level)
  •   Shanghai Jinchuan nickel - 278500-280000 RMB/t, plus 3500
Saturday, Sunday November 10-11
  When one of the top directors of Gazprom, the Russian state-owned gas giant, was recently summoned to a meeting with his chairman, the billionaire executive did not go to the company’s lavish new head offices in a high-rise south of Moscow’s city centre. - more

  The Melbourne Cup is the biggest event in Australia’s calendar, a week-long orgy of betting, boozing and barbecues that unites the nation and attracts half a million people to the Flemington racecourse. - more

  BHP Billiton's proposal to create a $US400 billion ($437 billion) mining powerhouse with Rio Tinto has done three things: repriced the entire mining sector, placed just about every listed resource company on takeover alert, and put its target into play. - more

  China's move to tighten foreign investment restrictions in mining and metal processing is aimed at reining in low value-adding industries, so as to conserve its energy and water resources while also seeking to cut down on environmental damage. - more

  According to a metal analyst at Standard Chartered, the contract prices of iron ore are set to rise by 50% in 2008. It added that with upcoming annual iron ore price negotiation most steel analysts have generally revised upwards their forecast for iron ore prices in 2008. - more

  Despite the upcoming winter and low temperature, China's construction steel market has maintained an uptrend since National Day holiday except for some slight adjustments in Northeast and South China. - more

  Domestic stainless steel mills have started buying modest volumes of nickel-bearing scrap for the first time in several months in what is being heralded by some processors and nickel traders as the end of the destocking phase. - more

  Copyright/courtesy AISRA news - "Stainless-steel makers are reducing the amount of nickel they use in their products as the price of the metal ingredient soared to are cord, an industry group said. Production of nickel-free stainless steel increased to 28.1% of total output in the second quarter, from 23% in 2006 and 22% in 2003, according to the Brussels-based International Stainless Steel Forum. About two-thirds of nickel supply goes into production of stainless steel." Nickel prices are still very ''high, "Peter Kaumanns, statistics director at the Forum, which represents companies responsible for 85% of 2006 production, said. "The trend will continue for the rest of the year."

  The increasing cost of shipping raw materials is the new challenge that steel producers must face in Latin America, CRU Strategies consultant Ricardo Morales told BNamericas. - more

  It is reported that China’s steel industry was less than thrilled to wake up yesterday and find it might soon be wrestling with two giant iron ore suppliers rather than three in the tightest iron ore market the modern world has seen. - more

  National Mining Association Mining Week - pdf here

  The Chinese government on Friday announced a major overhaul of its national holiday system, canceling the May Day "golden week", but adding three traditional festivals as national holidays. - more

Friday, November 9
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $14.52/lb 3 month buyer - $14.65/lb (3% lower than 1/1/07)
  • Baltic Dry Index - plus 123 to 10,867.
  • LME nickel inventories - plus 240 tonnes into Rotterdam, Netherlands warehouse, minus 150tonnes from Rotterdam warehouse, minus 18 tonnes from Baltimore, MD, USA warehouse
  • Nickel started off in the green this morning, but just barely. Then after the official price had been set, trading slid into the red, where it appeared to have settled for the weekend. Then all of a sudden, the price jumped - and jumped big. This type of jump usually means news of supply disruption has hit the trading floor, but we are unable to find anything in world media. Monday is a non-LME kerb date. British weather expert Piers Corbyn has predicted a "super storm" to hit the Netherlands at the end of November, and the Port of Rotterdam is closed this weekend for a building North Sea storm, after Netherlands officials closed the huge storm-surge barrier near the Dutch port city for the first time since it was built in the 1990's. But, while weather officials say this storm is dangerous, it is not on a scale to match any mega storm Corbyn has predicted. The Rotterdam port is currently storing over 24,000 tonnes of the 40,000 tonnes of nickel LME is warehousing. Then again, the reason for the price spike could be much more simple. As we have stated in days past, the market has been very tense, looking to break one way or the other. When the market gets this tense, movement could be generated by seemingly minor bearish or bullish news. The INSG news that demand for nickel will increase by 10% next year that came out yesterday, or the acknowledgement yesterday that BHP is trying to buy Rio Tinto and become the world's fourth largest company, add bullish news to the market (although Rio brings a big goose egg in nickel production to the equation). And then it could be as simple as trading computers deciding its time to shake things up, which the media likes to explain as "technical buying". The market has been trying to break back into the $15/lb range for quite some time now... and for the first time since Sept 19th, the three month price closed above this mark. Since the end of July, the Sept 19th kerb close was the only day that nickel has ended trading over $15/lb. Until today. Three month nickel ended the day and week at $15.33/lb ($33,800/tonne) (update - a trader told Dow Jones the spurt was caused by news Russia exports of nickel had fallen. How this is bullish, with nickel inventories still building, is beyond us!!)
  • Closing Metals Report - more
  • Cool video - tracking flight patterns over North America - video here  Recent photo's of construction in Dubai here Have a safe and restful weekend!!

  Russia exported in January-September 180,200 metric tons of nickel, 4.2% less than in the corresponding period last year, the federal customs service said Friday. - more

  US Sep Nickel Imports -18.4% From Aug, -13.7% From Yr Ago - more US Sep Nickel Exports +15.9% From Aug, +105.1% From Yr  Ago - more

  Copyright/Courtesy Dow Jones - "French mining company Eramet is to install a coal-fired power station with capacity of 210MW in New Caledonia, a project representing investment of around 250m euros. The plant, which will be delivered turnkey by Litwin, will be installed by Eramet subsidiary Societe Le Nickel at the Doniambo nickel foundry in Noumea."

  CRYSTALLEX International is a Toronto-listed firm that has the right to operate Las Cristinas, an enterprising gold resource in Venezuela. - more

  Update - Nickel price has spiked in the last half hour showing a gain of around $.63/lb. Unknown cause at this time but degree of increase reflects traders may have received some supply disruption news. Rotterdam is closed due to a storm, but this was expected, and unless storm barriers have catastrophically failed, it is doubtful this is the cause.  

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

  • Indications at 7:50 am CST show 3 month nickel selling down by $.18/lb .
  • Bloomberg - more

  Yieh's Monthly - " Stainless steel substitutes in market demands (continued)" - pdf here  (if you missed part 1 - pdf here)

  New Bites - "Japanese import of stainless steel was 7,989 tons in September, reducing sharply by 44.1 percent as compared with the same period of last year." - "China imported only 320,000 tons of scrap in September, decreasing by 160,000 tons or a 33.3% YOY." - "The port of Rotterdam is closed for the first time since its construction in the 1990s, shutting off sea traffic, because of a storm in the North Sea.. "

  Japan Iron and Steel Federation compiled the data on exports of stainless steel products from Japan in September of 2007 on the basis of the statistics released by the Ministry of Finance and the contents were as per the table shown below. - more

  If three month nickel was worth $15.12/lb on the last day of 2006 in U.S. dollars, and $14.61/lb yesterday, then the price has fallen by 3.4%.... in U.S. dollars. But if you reside in one of the nickel producing countries, the fall has been deeper, less Indonesia. For instance, the price for three month nickel has fallen by 24.3% since the first of the year, in Canadian dollars. In Australian dollars, down 18.5%. Of the major nickel producing countries we checked, only the Indonesia Rupiah is lower than it was at the end of last year, and thus the value of nickel in that country is only 1.8% lower. Other nickel producing/owning countries and the effect of the falling US dollar and value of nickel in that country.... Russia Rouble up, nickel in Russia down 10.2%, Euro up - nickel down 13%, Philippines Peso up - nickel down 14.8%, Dominican Republic Peso up, nickel down 4%, Norwegian NOK up, nickel value down 17.9%, Brazil Rea up and nickel down 18.7%, and the French Franc, used in New Caledonia, up and nickel down 12.9%. A special thanks to John from the IV forum for his patience in helping us understand this.

  Economists are notorious for being unable to reach an easy consensus on many issues, but talk to any of them about the outlook for the global economy and before long the word "China" always starts to dominate the conversation. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 72 tons = 40,608 tonnes (2.29% - 930 tonnes cancelled warrants/ 39,678 net stock level)
  •   Shanghai Jinchuan nickel - 275000-276500 RMB/t, plus 750
Thursday, November 8
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $14.45/lb 3 month buyer - $14.61/lb (3.2% lower than 1/1/07)
  • Baltic Dry Index - plus 70 to 10,744.
  • LME nickel inventories - plus 240 tonnes into Rotterdam, Netherlands warehouse, minus 204 tonnes from Rotterdam warehouse, plus 504 tonnes into Singapore warehouse, plus 12 tonnes into Chicago, IL, USA warehouse
  • Nickel started off in the red this morning but by afternoon had risen back into the plus column. By late afternoon, it was trading about $500/tonne higher, after US Federal Reserve Chairman Ben Bernanke testimony in Washington, DC, led the dollar lower. Inventories rose over the 40,000 tonne mark, and cancelled warrants slipped a little. Nickel is drifting, with traders looking for news to either shake buyers loose, or panic sellers. Top heavy inventory levels counter-balance spotty supply concerns. The sub-prime debacle draws most of the economic attention, with China the optimistic trump card. Three month nickel ended the day at  $14.86/lb   ($32,750/tonne)  
  • Closing Metals Report - here

  Global consumption of nickel may gain 10% next year on rising demand from stainless steel mills in the US and China, the International Nickel Study Group said. - more

  Construction has begun at Madagascar's $3.3 billion Ambatovy nickel and cobalt project, one of the world's largest, the Malagasy government said. - more

  The U.S. Department of Commerce on Wednesday issued a preliminary ruling that circular welded carbon-quality steel pipe from China has hurt the domestic industry and its workers. Six U.S. pipe manufacturers and the United Steelworkers union in Pittsburgh, claimed in a petition in June that they wanted relief from the illegally dumped and subsidized steel pipe from China. A final decision is expected in January.

  Comment - The headlines tell a frightening story. Toothpaste laced with Diethylene Glycol, a chemical found in anti-freeze. Lead paint found on numerous brands of toys imported from China. And yesterday it was announced that the U.S toy "Aqua Dots"  and Australian toy "Bindeez", both made in China, had been found to be laced with a chemical that becomes a date rap drug, when ingested, after 5 children in these countries were hospitalized. And these instances are only the tip of the iceberg. In the rush to import goods from China, the U.S. and other countries are learning the hard lesson of buying from an industrial giant still in its infancy, suffering the pains of phenomenal growth. Money is flooding into China from worldwide buyers who want it fast, and want it cheap. And millions of Chinese, most honest with a few less than so, want their piece of the action. Factories have, and are, sprouting up at an unprecedented rate, by qualified, and unqualified owners, alike. It is a market that invites cutting corners, pushing volume out the door, at the expense of quality. We do not join the ranks of China bashers out there, as we recognize nearly every industrial power has suffered similar problems in their early stages. Every society, no matter the nationality, has its share of unscrupulous operators in it for the buck only. But we remind our readers, it is a buyer's beware market, with the importer bearing the inevitable responsibility for the quality of the product, no matter who made it. We have listed a few stories below, as a reminder on why we all should be very cautious.  

  • Recent media reports detailing a series of quality problems with Chinese-made exports--pet food tainted with prohibited chemicals, toys covered with lead paint and tires that fall apart at high speed--have understandably alarmed the American public and resulted in a number of international product recalls. - more   
  • "A lot of Chinese companies have a saying," he said between drags on a cigarette. "Do you want to kill yourself? Then do business with Wal-Mart." - more
  • It's not necessarily safe to eat the food in China or from China - or to be accused of tainting it. That explains the recent arrest by Chinese authorities of 774 people in a crackdown on production and sale of poor-quality and counterfeit food and drug products. - more

  In a Kremlin meeting room with a horseshoe table, it took Vladimir Potanin four hours to change the future of the Russian economy. - more

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

  • Indications at 7:50 am CST show 3 month nickel selling up by $.04/lb .  Nickel has spent much of the morning in the red on news stores of nickel stocked in LME warehouses went over the 40,000 tonne mark today. The trading price has recently risen into the green, however slightly. In other news, the world's second largest miner, Rio Tinto, has reportedly turned down a marriage proposal from the world's largest miner, BHP. Rumored for months, BHP has finally confirmed its advances have been rebuffed. If you missed it yesterday, and have 30 minutes, we strongly recommend you watch the "Review of the Nickel and Nickel Intermediates Market" presentation by Brook Hunt. Especially those who have been pooh-poohing pig nickel and its effect on the overall market.
  • Bloomberg - more

  The International Iron and Steel Institute (IISI) forecasts 2007 will be another strong year for the steel industry with apparent steel use rising from 1,120.9 mmt in 2006 to 1,197.6 mmt in 2007, an increase of 6.8%. - more and pdf report here  (global stainless steel crude output at 15 million tons during first half of 2007 year, up 9.1% over same time of 2006.)

  At the negotiations with stainless steel mills of Japan on price of South African charge chrome for shipments in October - December quarter of 2007, Japanese side strongly resisted to a rise of the price but, in consequence of the negotiations, the price of charge chrome for October - December quarter is anticipated to be settled by roll-over from that for the preceding quarter of July - September. - more

  South Korean Hyundai Steel had cut stainless steel CR production capacity in the third quarter, due to the nickel price slump and weak demand - more

  China’s Lianzhong Stainless Steel (Lisco) said it will temporarily stop selling 201 hot rolled stainless in November due to the slow domestic market. - more

  Japan's trade minister urged China on Thursday not to put the squeeze on Tokyo and other buyers of its rare metals as Beijing tightens its grip on the resources, which are indispensable for Japan's high-tech industries. - more

  China's stainless steel capacity has reached a "conservative" 12 million tonnes, said a senior executive with the country's largest producer, adding that growing production could turn the country into a net exporter next year. - more

  Flooding has kept at least 42,000 Cubans from returning to their waterlogged homes and officials shut a nickel mine in the wake of last week's Tropical Storm Noel, state media reported Wednesday. - more

  French metals group Eramet has ordered the construction of a 210-megawatt coal-fired power station at the Doniambo nickel foundry operated by its Societe Le Nickel unit in New Caledonia. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 552 tons = 40,536 tonnes (2.66% - 1080 tonnes cancelled warrants/ 39,456 net stock level)
  •   Shanghai Jinchuan nickel - 274000-276000 RMB/t, plus 2750
Wednesday, November 7
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $14.56/lb 3 month buyer - $14.61/lb (3.32% lower than 1/1/07)
  • Baltic Dry Index - plus 69 to 10,674.
  • LME nickel inventories - plus 240 tonnes into Rotterdam, Netherlands warehouse, minus 42 tonnes from Rotterdam warehouse, minus 120 tonnes from Busan, South Korea warehouse, plus 30 tonnes into Chicago, IL, USA warehouse
  • While the price of nickel spent much of the trading day in positive territory, by the close it had succumbed to the downward pressure that had affected all other LME traded base metals. Three month nickel ended the day at $14.61/lb  ($32,200/tonne) 
  • Closing Metals Report - more

  November 2007 Largo Letter - pdf here

  The Chinese government has reacted strongly to European anti-dumping applications against Chinese steel products, stating China's iron and steel industry would expand to satisfy domestic demand rather than to dominate the global market. - more

  30 minute presentation made to the Mining Journal 20:20 Investor series by Brook Hunt Consultants titled "Review of the Nickel and Nickel Intermediates Market" - here  (Internet Explorer only)

  India is emerging as one of the predominant producers and consumers of steel in the world as it significantly increases its growth rate in the sector, says Steel minister Ram Vilas Paswan. - more

  Apparently someone in Australia has grown tired of the phrase "down under" and has published their own version of the atlas - here

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

  • Indications at 7:50 am CST show 3 month nickel selling down by $.09/lb After spending much of the morning in the green, at one point up over $750/tonne, nickel has since stair stepped its way into red territory. U.S. dollar slipped to another record low against the Euro this morning, on news China is thinking of diversifying into other currencies.  
  • Bloomberg - more
  • Reuters - more

  copyright/courtesy Scotia Daily Edge - China Commodities Weekly - "There are apparently still four million tonnes of low-grade nickel ore sitting in Chinese ports. In recent months, Chinese stainless mills have made significant improvements to the quality of nickel pig iron and “basic stainless steel feed” that is produced from this imported nickel ore. As a result, the majority of products from imported ore is actually used in the production of 300-series stainless steel production, rather than 200-series. Regarding the stainless steel market, although producers have been trying to raise prices for two months in a row, local spot markets have been drifting lower in recent weeks." (this is the first independent verification of reports we have read in China that they are using pig nickel in 300 series stainless steel production. This analyst lives and works in China. )

  More than 300 landowners and chiefs in Solomon Islands Bugotu reportedly withdrew their support from the Bugotu Landowners Association. - more

  China will bar foreign companies from investing or exploring in major non-renewable mineral resources, according to a policy statement issued by the Ministry of Commerce and the National Development and Reform Commission (NDRC). - more

  An environmental organisation in New Caledonia says it’s scandalous that the Goro Nickel plant is just about complete while key surveys have not been done yet. - more

  The Chinese government has urged the European Commission to tread cautiously over last week's anti-dumping complaints from European steel mills, and resist implementing anti-dumping measures against Chinese steel product imports, according to a Ministry of Commerce (MOFCOM) statement released last Friday. - more

  CHINA, the world's largest producer of stainless steel, may become a major exporter of the corrosion-proof alloy next year, threatening a global recovery in prices. - more

  The price of nickel-based stainless steel scrap ( new clippings ) to be purchased by stainless steel companies for deliveries in November from domestic sources has been decided to be risen by Yen 30,000 per ton. - more

  India has significant reserve of iron ore. You will all agree, that 22 billion t – serious reserve. About 60% from ore, which is extracted in Indian subcontinent – ore with high content of iron. Today, ore is needed everywhere: China, Europe and the USA. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 108 tons = 39,948 tonnes (2.87% - 1146 tonnes cancelled warrants/ 38,838 net stock level)
  •   Shanghai Jinchuan nickel - 271500-273000 RMB/t, plus 3000
Tuesday, November 6
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $14.31/lb 3 month buyer - $14.46/lb (4.43% lower than 1/1/07)
  • Baltic Dry Index - plus 66 to 10,605.
  • LME nickel inventories - minus 96 tonnes from Rotterdam, Netherlands warehouse, minus 18 tonnes from Pusan, South Korea warehouse
  • Dollar down, metals up. Dollar set a new record low against the Euro today, and this is adds positive momentum news for base metal trading. Nickel inventories backed off a little today, but are still higher than they have been since 2000. Cancelled warrants remain strong, which implies if inbound shipments slowed down from their recent pace, the downturn today would become a trend. If you don't think nearly 40,000 tonnes of nickel in LME warehouses means much to trading, the news today of an explosion at a Japanese nickel smelter could have easily driven prices up by $1 - $2 pound in the first third of this year. Now, it raises eyebrows, but doesn't bring a rush of money into the market. Three month nickel ended the day at $14.65/lb ($32,300/tonne) 
  • Closing Metals Report - more

  The Chinese government has urged the European Commission to tread cautiously over last week's anti-dumping complaints from European steel mills, and resist implementing anti-dumping measures against Chinese steel product imports, according to a Ministry of Commerce (MOFCOM) statement released last Friday. - more

  Courtesy AK Steel - average monthly price in October compared to September

  • Nickel = $14.09./lb up 5.1%
  • Chrome = $1.471/lb up 10.8%
  • Iron = $315/GT down 1.59%
  • Molybdenum = $31.86/lb down 0.8%
  • Excel spreadsheet with 3 year history for your presentation here

  For precious / base metal investors -  Toby Hansen's free monthly advisor - pdf here (if you are interested in receiving this report for free - send your e-mail address and request to tobinator00@yahoo.com)

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

  • Indications at 7:50 am CST show 3 month nickel selling up by $.14/lb . A drop in inventories, however small, has added a spark to LME trading. Also news from Japan of a smelter explosion has caught their attention.
  • Bloomberg - more
  • Reuters - more
  • CNN - more

  EU Stainless Cold Rolled Coil and Nickel Price Forecasts from MEPS - more

  World Average Carbon Steel Prices - Latest Forecasts from MEPS - more

  Behre Dolbear Global Mining News - pdf here

  Commodity Price Update - pdf here

  TD Bank Weekly Commodity Price Report - pdf here

  There are clear signs of a price recovery pervading transactions of nickel-based stainless CR sheets in East Asian nations such as China, Taiwan and South Korea, according to market sources. - more

  China, the world's largest producer of stainless steel, may become a net exporter of the corrosion-proof alloy next year, threatening a global recovery in prices. - more

  Japanese ferronickel producer Pacific Metals, also known as PAMCO, shut its sole 40,000 mt/year Hachinohe plant in Aomori prefecture in northeastern Japan when one its three furnaces blew up late Monday claiming two lives and leaving one person injured, the company said Tuesday. - more

  The proprietary matte finish, InvariMatte®, from Contrarian Metal Resources is being used in the construction of what will become the world’s largest stainless steel roof at the New Doha International Airport in the State of Qatar. - pdf here

  Baoshan Iron & Steel Co. and Shanxi Taigang Stainless Steel Co., China's two largest producers of stainless steel, may charge customers including Volkswagen AG a surcharge from January to pass on higher raw material costs. - more

  Mysteel believes that there is strong likelihood that Chinese HRC export price is going to improve in November due to firm domestic market prices coupled with rising input cost and possible short supply. - more

  It is an essential stage for the industrialist but it is also a unique opportunity for the citizen to make hear his voice: the public investigations concerning the factory and the surface of storage of the residues started yesterday in Mount-Gilds and Yaté. But for the moment, only associations were expressed. - more (translated)

  Gladstone Pacific Nickel of Brisbane has plans to create the world's largest nickel and cobalt refining facility. The feasibility study says the first stage of the project carries a price tag of US$3.4 billion, but it also will be able to produce nickel for a cash cost of US$2.19/lb. - more

  Courtesy AISI - In the week ending November 3, 2007, domestic raw steel production was 2,100,000 net tons while the capability utilization rate was 88.0 percent. Production was 1,987,000 tons in the week ending November 3, 2006, while the capability utilization then was 86.5 percent. The current week production represents a 5.6 percent increase from the same period in the previous year. Production for the week ending November 3, 2007 is up 0.5 percent from the previous week ending October 27, 2007 when production was 2,088,000 tons and the rate of capability utilization was 87.5 percent.

  Today's beginning nickel inventory

  •   London Metal Exchange - minus 114 tons = 39,876 tonnes (3.11% - 1242 tonnes cancelled warrants/ 38,634 net stock level)
  •   Shanghai Jinchuan nickel - 268500-270000 RMB/t, minus 4500
Monday, November 5
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $14.13/lb 3 month buyer - $14.33/lb (5.37% lower than 1/1/07)
  • Baltic Dry Index - minus 9 to 10,539.
  • LME nickel inventories - plus 1,116 into Tyne & Wear, England warehouse, plus 84 tonnes into Rotterdam, Netherlands warehouse, minus 18 tonnes from Rotterdam warehouse, minus 18 tonnes from Pusan, South Korea warehouse, and minus 102 tonnes from Singapore warehouse
  • Outbound shipments were fairly respectable from LME warehouses on Friday, but another large shipment into Tyne & Wear put the grand total into the plus column. After two days of increases in the official price, cancelled warrants edged back into the high 2% range. Traders were in a foul mood this morning, and nickel headed lower at the opening, and stayed in the basement the entire session. For the day, three month nickel ended at  $14.33/lb ($31,600/tonne)
  • Closing Metals Report -  (pending)

  AK Steel Holding Corp. Monday said that it will increase transaction prices for all hot-rolled and cold-rolled stainless steel products by about 6%, effective on Nov. 12. - more

  Universal Stainless & Alloy Products, Inc. announced today that its Dunkirk Specialty Steel, LLC subsidiary has reached a new five-year collective bargaining agreement with the Dunkirk hourly employees represented by Local 2693 of the United Steelworkers. - more

  Copyright/courtesy Dow Jones - (from Indonesia's PT Antam results issued last week) "Nickel ore sales increased 241 per cent to Rp3,939 billion due to higher prices and volumes. Nickel ore, substantially all sold as saprolite (high grade and low grade nickel) to ferro nickel and stainless steel producers in Europe and North Asia, became the largest revenue earner ahead of nickel contained in ferro nickel. Antam produced 5,205,907 wet metric tonnes (wmt) of saprolite and exported 5,010,268 wmt in the first nine months of 2007. The average price of saprolite increased 53 per cent to US$85.43/wmt. Antam boosted nickel ore sales in 2007 by beginning to export saprolite nickel ore to China for the first time. Antam has traditionally sold saprolite to Japan and in the past four years began exporting saprolite to Eastern Europe. In 2006, Antam exported 3.4 million wmt of saprolite. In 2007 due to the new orders from China, Antam will boost saprolite exports to approximately 5.5 million wmt. Depending on demand from China, linked to a continuing strong nickel price, Antam will likely export 5 - 6 million tonnes of wmt of ore in 2008."

  China media

  • Stainless steel scrap from Japan dropped to 12,152 tons in September, 31.9% lower than August, and 38% lower than September 2006. Shipments to mainland China fell 19.1%, to South Korea, down 77%, down 54.8% to Taiwan, and down 82.2% to Thailand. Exports increased to Hong Kong by 71.3%, and by 93.7% to India. The price decreased by 28.3% compared to August exports.
  • European Union imports from China's cold rolled stainless steel  - First half of 2007 compared to first half of 2006 - 1-3 millimeter austenite = plus 1096% / 0.5-1 millimeters austenite = plus 937% / 0.5-1 millimeters hard martensite = plus 433%

  Trends in US dollar nickel prices, the value of the Australian dollar and in the volume of nickel production will continue to drive industry performance during the outlook period. - more

  During a meeting of the stainless steel and special alloy committee, held during the recent BIR fall meeting, several speakers noted that the end of this year will likely result in minimal changes in stainless steel production, especially in Europe and the United States. - more

  CRU presentation - Molybdenum - Does moly need new producers - presentation here (must have IE browser) (also presentations by Adanac Moly here, Storee Moly here, Queensland Ores here, Thompson Creek here, Moly Mines here, and Virgin Metals here)

  Only twelve months ago, the whole area was covered in a thick blanket of spruce forest. Today, the landscape in Kainuu in northern Finland is witness to the construction of Europe’s largest nickel mine. - more

  Tears flowed freely from his tired old eyes. He stood wobbly supported by a stick looking beyond the range of mountains to the west. - more (forward this to your local NGO)

  Old research found over the weekend - anyone aware of any opposing research? - That copper cooking kettle may provide better protection against foodborne bacteria than a stainless steel one, according to scientists. - more

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

  • Indications at 7:50 am CST show 3 month nickel selling down by $.27/lb . Except for tin, all the base metals traded in London are in the red this morning, as are, or were, most of the world markets (see here). Nickel inventories are now just 10 tonnes shy of the 40,000 tonne mark.
  • Bloomberg - more

  Haywood Securities Metals & Mining Weekly - pdf here

  AK Steel has released December surcharges - 304 Stainless has gone to $1.4607 per pound (up from $1.3622 in November) and 316 Stainless is $2.4148/lb (up from $2.2982 in November). Allegheny should release their surcharges later today or tomorrow.

  SMM Specialist weekly poll of Chinese metals analyst brought the following results - of 35 analysts responding, only 2(5%)  felt the price of nickel would rise this week, 8 (22%) felt the price of nickel would fall, and the remaining 25 (71%) felt the price would remain the same.  

  It is reported that market forces are likely to achieve consolidation in China's booming steel sector, which Chinese authorities could not do using force. - more

  Antimining candidates in last weeks barangay elections swept promising rivals in an intensely fought contest in Brookes Point, Palawan, where two large-scale nickel mining projects are starting out. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 1,062 tons = 39,990 tonnes (2.90% - 1158 tonnes cancelled warrants/ 38,832 net stock level)
  •   Shanghai Jinchuan nickel - 273000-274500 RMB/t, minus 1250
Weekend Review, Nov 3 & 4
   Opinion - This is the time of year when purchasing agents begin making plans for 2008. For those who must purchase stainless, or nickel, 2008 looks to be as puzzling as 2007 has turned out to be. None of the major metals analysts we follow forecast nickel to hit the $50,000/tonne limit in 2007, except maybe a few weeks before it actually happened. And for those who forecast nickel would crash during 2007, well they were right - and they were wrong. Three month nickel started the year at $15.10/lb, soared to $23.50/lb in May, then 'crashed'.... to about where it had started the year. For an industry that had grown accustomed to $3/lb nickel over the preceding decade, the talk of records and crashes meant only one thing - incredibly high stainless steel prices all year long. So what does 2008 hold? A lot of questions and few certain answers.

On the demand side, there are signs that stainless producers are returning to the buying side. After the price of nickel self destructed in early summer, producers and distributors put a halt to buying, saddled with over-priced inventory and fearful more loss would come if they bought at the-then-current price. Now in its sixth month of slowdown, inventories of stainless steel have fallen to very low levels in many regions. There are numerous clues that this destructive period of de-stocking has, or is ending, but no producer is going to shout it from the rooftop, with nickel traders salivating for a reason to drive the price higher. We find it interesting that last week, CVRD's CFO told a news conference that "...we are trying to catch up with the demand of our clients." What started out to be another record breaking year of worldwide stainless steel production, is now looking to be a mostly flat year. While there are a thousand scenarios of what 'could' happen, we feel two are the most likely. When producers become less clandestine about their purchases and the resurgence in nickel demand becomes more obvious, as in the growth in LME inventories reverses its present growing pattern, then we will see nickel prices begin to rise. At this point, how producers respond could very well decide what nickel prices will do in 2008. Producers, like consumers like cost stability. And it appears that while the first half of the year offered anything but stability, the period of demand destruction since, has brought some price stability back, albeit at a much higher rate than they had hoped. If prices begin to rise, and producers see no signs of another major price correction, we could see them stay in the game. But the 'crash' of 2007 is still fresh on everyone's mind, so we could see an increase in the price of nickel force both distributors and producers back behind their defences. We tend to feel a mixture of both is likely, which means the market could get very volatile this winter. Inventories have fallen so low in some regions, that distributors will have to buy, whether they want to take the gamble or not. In other regions, seasonal demand will add pressure to produce. China reported last month that it would consume 9.24% more stainless steel in 2007, but this came a month after China's deputy chairman of the China Iron and Steel Association warned, that China's total stainless steel production capacity had surpassed current demand and discouraged any further growth in output.

The nickel supply side is less confusing. Three mega mines are tentatively scheduled to come on line in 2008. Ravensthorpe in the spring, and Goro and Onca Puma in the latter half. Other sources include new mines or expansions at Moa Bay, Caldag, Redstone, and various LionOre operations, among others, are also set to add a significant amount of nickel into the market. It is doubtful the new operation's will offer the market anything more than a immediate psychological boost, as a new mine does not open producing at full capacity. If all open as scheduled, they will undoubtably have an effect on market prices by 2009, but how, and if, this extra capacity could effect 2008 prices, remains less obvious. Current mines are, and have been producing at capacity for years now, as mining companies look to make every penny possible for shareholders during this bull market. This flat out production is risky, as over-taxed equipment suffer expensive breakdown's, and good employee's, hard enough to find and hire, burn out and leave for less stressful careers. BHP, which made the expensive decision to shut down for maintenance this fall, usually an annual situation, was ridiculed by some market watchers as trying to drive prices higher, and some stockholders, for shutting down during a bonanza. Both accusations were ludicrous, but it may give other CEO's pause before taking similar action, no matter how necessary. Since January of this year, inventories of nickel into LME sanctioned warehouses have grown six fold (10 time the lowest point), and are now higher than they were at anytime all last year. This has yet to have the effect on the price of nickel it would have had in past years, as nickel prices continue to hang on. But it does reflect a healthier supply chain. If the cycle follows historical precedent, the world will see a surplus of nickel in the future, as mining companies worldwide respond to a shortage by building too many mines. We aren't there yet, and the growth in LME stocks are currently due to the slowdown in stainless production.   

Other factors worth keeping in mind when considering where stainless and nickel prices may be heading. The production of low grade laterite nickel ore, the so-called "pig nickel", has made a dent, however small. In the short term, the high cost of production and environmental damage it causes, has kept its impact minimal. But Chinese scientists are actively working on finding ways of making its use more economically and environmentally feasible. Substitution, while offering a short term solution, could become a long term problem for nickel bearing stainless steel. The path nickel took into record breaking territory in early spring, day after day after day, forced many users to look at other options. Disgruntled customers may change vendors, but rarely the product itself. Infuriated customers start looking for other options, and there are always options. Stainless steel users whom had seen nickel double in price from $3/lb, then double again, and then nearly double again, and had seen stainless more than double in price during the same period, have grown upset, and many are examining other materials. Manganese bearing 200 series stainless, which producers couldn't give away a few years ago, and recyclers feared would contaminate their system, has become a legitimate threat. And while these factors may give the bulls pause, there are other aspects that keep the bears fearful. For the last few years, all anyone has talked about is China. From a non-factor to the world's largest producer and consumer of just about everything in less than a decade, what has happened in China in recent years, could only be described as phenomenal. With a population nearly four times that of the U.S., this country's economy could stop growing at the same unbelievable rate it has for the last few years, and still remain a major driving factor. And no one in their right mind is forecasting a serious slowdown. But putting aside what has, and is happening in China, there are many areas that are experiencing unprecedented growth. Anyone interested in construction can't help but look at what is happening in Dubai and not marvel. The collapse of the Communist block threw Russia into upheaval, but this country now forecasts it will have the world's fifth largest GDP within a decade. And while there are similar success stories on nearly ever continent, we return back to Asia, to China's western neighbor. India, with a population greater than China, is an economy primed to fire. We doubt we will witness growth at the rate we have seen in China, primarily due to geo-political reasons. India's government does not have the luxury of Communist rule, which means plans are dependent on the whims of the world's largest democracy in an extremely fragmented society. But India is a sleeping giant, who may be wakening.

So, with all that said, where do we think stainless prices are heading? We don't really see many reasons for prices to noticeably fall anytime soon, unless LME inventories grow a lot higher, and investors run scared. At the best, we may experience a period of stability, while more likely, prices could be heading up by the first quarter of 2008.

Did you ever notice when you offer a penny for someone's thoughts, they feel obliged to give you their two cents worth? Opinions - you always get more than you wanted. We also remind our readers, that free advise is usually worth what you pay.                          

  The Sydney Morning Herald - The world's top five nickel sulphide producers - Russia's Norilsk, Brazil's CVRD, BHP Billiton, China's Jinchuan and Xstrata - control 80 per cent of production, giving them increased pricing power.

  National Mining Association Mining Week - pdf here

  Comments from 3Q Investor Conference call - Mr. Fabio Barbosa, CVRD’s Chief Financial Officer, in response to question "Well Jorge, I think the demand has been picking up, it is growing after this de-stocking process, after the adjustment that took place, and clearly demand is stronger today than it was in the previous months and this is something that is happening throughout Asia in our view, so from the demand side I would say that is natural to expect that performance as well and we hope to be able to deliver all the nickel that is demanded by our clients and the market. ...I would say that demand is stronger now than in the third quarter and we are trying to catch up with the demand of our clients."

  Courtesy NoticiasFinancieras - "Chilean businesses have reached an increase of 12% in profits up to September, in comparison with 2006. The higher profits were achieved by the mining and forestry companies....The two largest mining firms, state-owned Codelco and BHP Billiton's Escondida, have reached 50% of the total profits in Chile." Courtesy Mineweb - "....moly mining appears to be the single largest industry in Armenia, and is thus vital to the state's economic security. Moreover, Cronimet--the German mining company which controls Armenia's leading moly mine, Zangezur Copper and Molybdenum Combine, as well as its two smelters and roasters--is the single largest investor in the Armenian economy."

  Indonesia needs to introduce market-friendly regulations in order to encourage more investors to explore the country's rich mineral resources, a senior executive of a major mining company says. - more

  Sixty-one mining contracts under review by a mining commission in Democratic Republic of Congo should be cancelled or renegotiated, according to a preliminary report from the panel seen by Reuters on Saturday. - more  and another here

  There are always two sides to any given situation. Some people express it as, “there are two sides to a coin”. There is the good side and the bad side. - more

Friday, November 2 (Daylight Savings Time ends tomorrow night for Canadian and US readers)
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $14.38/lb 3 month buyer - $14.58/lb (3.56% lower than 1/1/07)
  • Baltic Dry Index - minus 33 to 10,548.
  • LME nickel inventories - plus 1,650 tonnes into Tyne & Wear, England warehouse, minus 60 tonnes from Rotterdam warehouse
  • Nickel trading started off in the red today, and spent the day there. Official prices, set after the close of the second ring, still showed up over yesterday, reflecting yesterday's afternoon gain was more robust than the decline this morning. Afternoon trading recovered from the morning drop of around $650/tonne, but never quite got out of the red. Second day of cancelled warrants running double what they have been, which hints at some potential respectable outbound shipments in the near future, but today's receipt of 1,650 tonnes in England overshadowed that news. For the day and week, three month nickel finished trading at $14.58/lb ($32,150/tonne). For the week nickel ended 1.1% higher than last Friday's close.
  • Dow Jones Closing Metals Report - here

  Commonwealth Research - The HARD Review - pdf here

  Piping & Equipment Market Condition & Activity Bulletin - pdf here

  (from China media) The German Edelstahl recycling company forecast that the German stainless steel output will fall 20%  in 2007, compared to 2006. Output of 300 series stainless was lower than 20%, and accounts for 67% of German stainless production.

  India Commodity Report - Steel Prices: Room for Upside - pdf here

  The global commodities bull has sure been flexing its muscles in recent years. - more

  China is industrialising, demand for iron ore, copper, nickel and aluminium is surging, so commodity prices, profits and share prices of resources companies are going ballistic. - more

  Universal Stainless & Alloy Products, Inc. announced today that its Dunkirk Specialty Steel, LLC subsidiary has agreed with the United Steelworkers that the Dunkirk hourly employees, whose collective bargaining agreement was to expire at midnight on October 31, 2007, will continue to operate at the Company's Dunkirk facility. - more

  Indonesia is missing out on a global mining boom as the country's parliament drags its feet in approving a new mining law, making overseas firms wary and putting on hold billions of dollars of new investment. - more

  Kerry Harmanis - lawyer, fishmonger and minerals prospector - became the face of the resources boom this week when he agreed to sell his nickel mining company Jubilee Mines for a mammoth $3.1 billion to global miner Xstrata. - more

  ThyssenKrupp Steel USA, LLC, and ThyssenKrupp Stainless USA, LLC, today broke ground on the site of its $3.7 billion carbon and stainless steel processing facility in Calvert, Alabama. - more

  Weekend Reading - for the history buffs (interesting info about how Sherritt produces nickel) - 3 part Canadian article - Enriching Earth’s Riches. "It would appear to be from the late 60's judging by the photo of Lynn Lake." part 1 part 2 part 3 And speaking of history, remember when WMC was the third biggest producer of nickel in the world before BHP grabbed them? here

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

  • Indications at 7:55am CST show 3 month nickel selling down by $.09/lb . Inventories of nickel grow overnight by 3.36% and hit highest level since February 2000. Traders refuse to panic sell....still wait for stainless steel producers to blink first.  
  • Bloomberg - more

  Copyright/courtesy Dow Jones - "Triland Metals anticipates LME 3-month nickel will break above $34,000/ton short-term, after confirming strong support at moving averages in $31,700-$31,550 zone overnight. JP Morgan notes LME nickel shorts reducing their exposure on reports stainless steel demand rebounding, especially in Asia. "While there is no evidence of an increase in benchmark pricing the fact that the industry has had such a poor 3Q and early part to 4Q suggests that the downside for nickel prices is limited from here."

  Copyright/courtesy Stainless Steel World - "According to market participants, the physical nickel market could be set for a comeback on increased buying activity and more stable prices on the London Metal Exchange. Although stocks are at seven-year highs, traders have reported more enquiries during week 43 and stainless steel mills have noted some resurgence in demand. “The market is turning a little bit, it is just doing it very, very slowly - it’s still a nervous market. It is turning but people don’t want to blow the horn too early on when it’ll happen,” said one trader."

  News Bites

  • Rusmet - The Chinese company Taiyuan Iron & Steel is going to cut steel supply to the domestic market of China at 20% in November, because the company is going to increase exports. In addition, the sluggish domestic market needs to be stimulating.

  China News

  • Facing fierce competition and structural adjustment, China's steel industry will probably change course next year, said Huang Tianwen, president of Sinosteel Corporation, at yesterday's World Shipping (China) Summit, according to the China Securities News. - more
  • Chinese nickel pig iron production will continue as it has found itself a niche domestic market to feed, an analyst at UK-based industry consultants Brook Hunt said on Thursday. - more
  • China's October Purchasing Managers Index declined to 53.2 from 56.1 in September, according to data released Thursday by the China Federation of Logistics and Purchasing, marking the third straight month that the index has fallen. - more
  • CHINESE iron ore buyers came out swinging yesterday against any move by BHP-Billiton to reflect varying shipping costs in iron ore prices. - more
  • It is reported that the world's most powerful steel industry has warned BHP Billiton, the world's biggest miner, that it would get hurt if it acted dishonorably by walking away from the iron ore price negotiation system that has been in place for 40 years. - more
  • Baosteel had settled iron ore prices with Companhia Vale do Rio Doce BHP and Rio Tinto during the 3rd week of December 2006 at 80.4 US cents per metric tonnes per one percent unit iron on FOB basis, which translated to USD 51.05 per tonnes for 63.5% grade iron ore. - more

  THE recent bid by global resources group Xstrata for independent nickel producer Jubilee Mines of Australia signals continuing optimism about the global stainless steel sector's growth prospects. - more (from article - "In a September presentation, Norilsk Nickel forecast that it would remain the world's biggest nickel producer this year at about 267000 tons, followed by CVRD with 248000 tons, Billiton with 139000 tons and Xstrata with 116000 tons.")

  Cia. Vale do Rio Doce, the world's second-largest nickel producer, is reviewing plans by its Indonesian unit to build smelters at two projects pending an assessment of the amount of mineral reserves. - more

  There seems to be a definite pattern, among financial analysts who study commodity natural resources, in the way they organize and look at the data; the pattern manifests itself as a tendency to emphasize supply or demand but not both, in the same analysis, as a key driver of price.  - more (about Molybdenum)

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 1,266 tons = 38,928 tonnes (3.85% - 1086 tonnes cancelled warrants/ 37,842 net stock level)
  •   Shanghai Jinchuan nickel - 274000-276000 RMB/t, minus 1000
Thursday, November 1
  Daily Nickel/Stainless Roundup
  • Today's official LME nickel closing prices - cash - $14.31/lb 3 month buyer - $14.47/lb (4.35% lower than 1/1/07)
  • Baltic Dry Index - minus 75 to 10,581.
  • LME nickel inventories - plus 180 tonnes into Tyne & Wear, England warehouse, minus 108 tonnes into Rotterdam, Netherlands warehouse, minus 18 tonnes from Singapore warehouse
  • With news that the US Fed had dropped the lending rate by 25 points, as widely expected, nickel started off in the green this morning, then took an bounce, just in time for the setting of the day's official price. Then it succumbed to strong negative pressure, and surrendered its gains. Both bulls and bears deciphered the Fed statement overnight, and saw statements that gave each side ammo, but the message getting most of the attention today, is that this may be the last cut for awhile. This news helped the dollar, and typically what is good for the dollar, isn't news well received by base metal traders. On a bear to bull scale, 0 being the most bearish, the news has generally run in the 5 range lately, and we are seeing this reflected in LME trading, which, except for a few days in mid October, hasn't done much since October began. Traders seem to have decided the $13.75/lb - $14.75/lb range is their new comfort level. For the day, three month nickel ended the day at  $14.71/lb ($32,445/tonne)               
  • AFX Closing Metals Report - more

  Stainless Steel Surcharge - US stainless steel surcharges for December will be posted by the large stainless steel producers during the next few days. We post them here as they are updated. We think that you will see the 304 surcharge go up by 5%+ or $.08/lb, and 316 should go up by $.10/lb, or 4% over November surcharges.

  Three of the four major EU stainless steel producers have announced significant changes to the method of calculating alloy surcharges. - more

  Nickel Graph Temporarily DownOne of our readers has a photo on their business site with the caption "Worth $500,000 What's in your bone yard?" Well, we had to ask. Was the dollar amount real, or hypothetical? According to Dave Winnecour, Director of Operations at Florida Scrap dealer, Metallic Recovery, the story is true. Back in April, when Inco 600 was bringing about $14/lb, this 36,500 pound beast, brought over $500,000 to their customer. The price of nickel has fallen since, but with scrap prices still running in the $9.50/lb range, this monster would bring anyone who possessed it, a $350,000+ payday in scrap value. (Now you know why you better tie down your scrap) Thanks to Dave for the story and use of his photo, and you can learn more about Metallic Recovery here

  Chinese steel makers and electricity firms are paying exorbitant prices for ageing bulk carriers ready for immediate use, in desperate attempts to control soaring transport costs, industry executives say. - more

  When we hear the words ‘stainless steel’ in industry we immediately think of corrosion resistance and, until now, the grades of stainless steel most used for industrial applications have been 304 and 316. - more

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

  • Indications at 7:50 am CST show 3 month nickel selling up by $.09/lb  . Nickel, with aluminum, are the only base metals selling higher this morning, as the rest of the trading on the LME is down. Trading was tense the last few days, as the Fed announcement approached, and with no surprises coming from the meeting, the market has yawned and looks for the next turning point. Nickel operations in Cuba and Dominica Republic have so far been spared any disruption due to Tropical Storm Noel, and the volcano on Java, Indonesia should have no effect on neighboring islands or their nickel operations.
  • Bloomberg - more

  Commonwealth Research - The HARD Line - pdf here

  Courtesy/copyright Dow Jones (yesterday) - "For the first time in over four months, LME nickel closed above the 100 day moving average and $30,000/ton appears to be solid support so the metal could retest $34,000/ton, a London-based trader said. Traders said if the U.S. Federal Reserve cuts rates by 25 points later Wednesday as expected or leaves them unchanged the metals could test to the downside. But if there is a 50 point basis cut, then that could provide some impetus for a move higher." (it was cut 25 points - let's see if they were right)

  Nickel producer Inco, owned by Brazil's Companhia Vale do Rio Doce, expects to lift nickel output by 11.5 percent to 290,000 tonnes next year, a CVRD director said on Thursday. - more

  News and Blurbs

  • Taiyuan Iron & Steel, Baosteel, Zhangjiagang Pohang and Guangzhou Lianzhong all plan to lift their price on stainless steel for November but have yet to announce rates.
  • According to ELG Haniel Metals Ltd Chairman Michael Wright, in a presentation to the BIR convention in Warsaw last week, substitution is taking a bigger bite out of austenite stainless, than earlier believed. Overall world stainless production is forecast to remain flat this year, with austenite stainless (300 series) expected to fall from 19.3 million tons last year (6.4 to 7.7 million tons), to 17 million tons this year. Ferritic stainless steel (400 series) output will increase by 20% over last year, in line with prior annual growth, while low nickel manganese stainless (200 series) will increase by 50% (2.6 to 3.9 million tons in 2007). Mr Wright forecast for 2008 that the stainless steel output will be 32.5 million tons, a 13% gain over this year, including 19.5 million tons of austenite, 8.4 million tons ferrite, with 4.6 million tons manganese stainless steel.
  • China's largest stainless steel mill Taiyuan Iron and Steel Group (TISCO), announces it will reduce cold rolled production by 20% during November, and cut its hot rolled production by 30%. (only have one source on this - if true, it bucks the trend, as other major producers have announced they were resuming full production in November)
  • CHINA'S steel industry group said state measures have significantly slowed steel exports, helping curb too much growth in production but it also warned of declining profitability in domestic mills. - more (written primarily for the benefit of the EU which is considering a dumping complaint)
  • Dow Jones - State-owned mining company PT Aneka Tambang said it will team up with China's Tsingshan Holding Group Co. Ltd to develop a nickel mine on the island of Obi in North Maluku.
  • According to data issued by the US Department of Commerce, stainless steel products import application for US totaled around 68,000 tons in October, a 7 percent drop compared to it was 73,000 tons in the same period of last month.
  • China's rapid growth in domestic mining of iron ore is outpacing the strong rises in iron ore imports as well as domestic steel output, said Liang Shuhe, deputy director of the Foreign Trade Department under the Ministry of Commerce. - more
  • China's crude steel production will reach approximately 480 million tons this year, up 14 percent from last year, while pig iron output will increase 12.4 percent from last year to reach approximately 465 million tons, according to a China Iron and Steel Association (CISA) forecast released yesterday. - more
  • China's steel output, already the world's largest, is expected to rise to nearly one bln tons per year by as early as 2015, said an Australian government official. - more
  • Eurofer, the European Confederation of Iron and Steel Industries, submitted anti-dumping complaints to the European Commission in Brussels on Oct. 29 against the import of stainless steel cold-rolled flat products (SSCR) and hot-dipped metallic coated sheet and strip (HDMC) from China, according to a statement Interfax received yesterday from Stahl-Zentrum, an umbrella organization for the German steel industry. - more

  Persons now involved in the lucrative multimillion-dollar scrap metal trade will shortly be dealt a severe blow as Government has announced an immediate cessation of the export - more

  South Korea stainless steel mill has announced to increase the export price of stainless steel cold rolled products to China by US$100/ton for November-December shipments. - more

  (excerpt) Cuba's nickel mining, its major export industry located at Moa, was not affected by the storm, which crossed Cuba farther inland than expected, an industry source said. "It's sunny in Moa today," the source said. - more

  (excerpt) According to a Manila-based steel industry insider, the Philippines government, after much deliberation, has raised the duty on imports of HRC and CRC from 3 percent to 7 percent, effective from October 20.

  New Caledonia’s Congress has unanimously approved a territorial law to pave the way for the nickel project in the north to proceed. - more

  IRON ore doubling in price next year? Extraordinary idea, but one sector analyst (unnamed, unfortunately) told the New York oil and metals news service Platts that prices could double following 2008 contract price talks, which have begun in Tokyo. - more

  Today's beginning nickel inventory

  •   London Metal Exchange - plus 54 tons = 37,662 tonnes (4.12% - 750 tonnes cancelled warrants/ 36,912 net stock level)
  •   Shanghai Jinchuan nickel - 275000-277000 RMB/t, plus 3000


October Archives


Daily Comparison         (* = per lb) or (+ = per tonne)

Date

LME Stock Level +

Cancelled Warrants

Net Stock Level

Official Cash Close *

Official 3 months close *

Day's Ending *

11-30

44,862

4.68%

42,762

$11.98

$12.13

$12.29

11-29

44,904

5.16%

42,588

$12.59

$12.77

$12.22

11-28

44,424

4.88%

42,258

$12.52

$12.58

$12.75

11-27

44,028

4.21%

42,174

$12.84

$13.04

$13.02

11-26

43,956

3.36%

42,480

$13.24

$13.33

$13.09

11-23

43,550

2.55%

42,440

$12.91

$13.05

$13.20

11-22

43,350

2.92%

42,084

$13.33

$13.43

$13.06

11-21

42,530

2.52%

41,556

$13.43

$13.56

$13.47

11-20

42,324

2.01%

41,472

$13.54

$13.56

$13.74

11-19

41,994

1.64%

41,304

$14.00

$14.22

$13.70

11-16

41,388

1.28%

40,860

$14.15

$14.22

$14.17

11-15

41,172

1.41%

40,590

$14.56

$14.72

$14.37

11-14

41,154

1.53%

40,524

$15.15

$15.31

$15.01

11-13

41,130

1.56%

40,488

$15.11

$15.30

$15.15

11-12

40,878

1.82%

40,134

$15.26

$15.44

$15.24

11-9

40,608

2.29%

39,678

$14.52

$14.65

$15.33

11-8

40,536

2.66%

39,456

$14.45

$14.61

$14.86

11-7

39,984

2.87%

38,838

$14.56

$14.61

$14.61

11-6

38,876

3.11%

38,634

$14.31

$14.46

$14.65

11-5

39,990

2.90%

38,832

$14.13

$14.33

$14.33

11-2

38,928

3.85%

37,842

$14.38

$14.58

$14.58

11-1

37,662

4.12%

36,912

$14.31

$14.47

$14.71

3 month nickel averaged $11.01/lb for all of 2006, $6.69/lb in 2005 - Cancelled warrants are goods sold


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All prices, unless marked official closing prices, are indications only of LME 3 month buyer traded prices and courtesy newswire services. To understand what our prices mean, see "A Guide To LME Trading"...pdf here or "The ABCs of a Metals Exchange" ...pdf here (Molybdenum prices are for molybdenum oxide, an ingredient and major price factor in 316 stainless) (all ton listings are metric tons = 2204.6 pounds ) Updated daily before 8 am CST and before 1 pm CST weekdays, with some weekend updates - Disclaimer Original content and opinions copyright www.estainlesssteel.com



10/31/07 Market Prices

Ferromolybdenum (65-70%)
$34.10/lb
 

Moly Oxide (>51%)
$32.15/lb
 

Ferrochrome (60-65%)
$1.40/lb
 

10/31/07 Scrap Prices

(small qty)
$.65 - $.70/lb

(LTL/ton)
$.84/lb

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