Friday, September 30

• Baltic Dry Index - minus 14 to 1,899. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) China’s Manufacturing Contracts for Third Month on Orders, Export Demand // Putin’s Second Coming Is No Gift to Russia or Investors: View // China Stocks Sink to April 2009 Low as Quarterly Losses Mount on Slowdown // Toyota, Honda Return to Full Production // German Retail Sales Drop Most in More Than Four Years on Crisis Concerns // U.K. Consumer Confidence Increases as Economic Optimism Improves, GfK Says // Copper Rout Outpaces Analysts Focused on Production Shortages: Commodities // Utilities Giving Away Electricity as Wind, Sun Overwhelm European Network // Europe Inflation Unexpectedly Quickens // European Stocks Decline on Economy, Extending Quarterly Slump // Morgan Stanley Seen as Risky as Italian Banks // Global Company Bond Sales Plunge on ‘Armageddon’ Scenarios: Credit Markets // U.S. Consumer Spending Slows as Incomes Fall // U.S. Is Heading Toward Another Recession, ECRI’s Achuthan Says: Tom Keene // Stocks Retreat on Growth Concern as Dollar, Treasuries Advance
• The Euro is now trading over 1% lower against the US Dollar. NYMEX crude is down nearly 1.3% and trading at $81.09/barrel. Gold is up nearly 9/10 of 1% and silver is down 1-7/16%. Base metals ended the session much lower. Indicator charts show nickel struggled form the beginning and stayed in a fairly solid downtrend the entire session. For the day, week, month and quarter, Dow Jones reports three month nickel ended the session at $7.98/lb . Stockpiles of nickel stored in LME warehouses fell on Thursday and now total just under 96,750 tonnes. Cancelled warrants on LME nickel are back up to nearly 9%. The last time LME nickel closed below $8/lb was on February 9, 2010, when stockpiles were recorded at 166,188 tonnes, just 288 tonnes shy of their all time high recorded the day before. At its lowest during the Great Recession, nickel closed at $4.29/lb on March 12th, 2009. If base metals, and in particular copper, are your barometer for the health of the world economy, then the signs are not looking good.
• Today ends the third quarter of 2011 and with only three months left to the year, the world economies continue to limp along. China, one of the bright spots in the economic recovery, will be shut down all of next week for holiday celebrations. The Commerce Department reported this morning that, according to MarketWatch "Personal income fell 0.1% in August, the largest decrease since October 2009. Consumer spending rose 0.2% in August after a 0.7% gain in July. Real consumer spending, adjusted for inflation, was flat." So far today, Wall Street is bearish.
• Have a safe and relaxing weekend!

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• Agreements Ratified by Union-Represented Employees at ATI Ladish Forging - more
• Europe Financial Meltdown Converging With Slump Seen by Investors in Poll - more
• Which governments take the biggest chunk from a $100,000 salary? - more
• CEO Survey Shows Less Confidence in U.S. Hiring, Outlook - more
• U.S. Data Better, but Let’s Get Real - more

  Stainless production rises in first half of 2011 but results are mixed - Preliminary figures released by the International Stainless Steel Forum (ISSF) show that stainless steel crude steel production increased in the first half of 2011 by 3.8% compared to the same period of 2010. - more

  POSCO building stainless steel plant in Turkey - POSCO broke ground Wednesday for its $350 million cold-rolled stainless steel plant in Izmit, Turkey in its efforts to become a leading stainless steel maker. - more

  Zimbabwe: Mining companies play by new rules - Saviour Kasukuwer, Zimbabwe’s empowerment minister has confirmed the majority of mining companies operating in the country have submitted plans to transfer 51 percent of ownership to locals. - more

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

• Indicators at 7:00 am CST show 3 month nickel trading around $.12/lb lower, and trending lower, with other London traded base metals mixed. The Euro is trading over 3/4 of 1% lower against the US Dollar, adding pressure to commodity trading. NYMEX crude is down 1% and trading at $81.32/barrel. Gold is up over 1/4 of 1% and silver is down nearly 1.2%. In overnight trading, Asian markets ended lower, with China off more than 1/4 of 1%. Chinese markets are closed all of next week for their National Day holiday. European markets are trading lower this morning  and US futures show Wall Street may open in a bearish mood. Nickel inventories fell on Thursday.
• Bloomberg morning - Copper Rout Outpaces Analysts Focused on Production Shortages: Commodities - more
• LME Morning - Base metals trade sideways, may be room on the upside - more
• Reuters - Copper heads for worst month in three years - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here
• International Nickel Study Group Press Release - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Copper cut its losses yesterday, but still closed slightly lower on the day, while the balance of the metals finished mixed. The few bits of news we had yesterday were enough to insure that the gains we saw in a number of markets stuck, as oil, the Euro and US stocks all managed to finish higher. On the US macro front, for example, we had a higher final revision to second-quarter US GDP to +1.3%, slightly better than expected, thanks mainly to a surprising upward revision in consumption. However, things remain dreary in the labor markets; although it was reported that the number of Americans filling new claims fell to a five-month low in the latest week, the sharp decline was due mainly to technical and seasonal adjustments. News out of Germany followed shortly thereafter, with the country's parliament approving the set-up of the European Financial Stability Mechanism, as expected. This handed Chancellor Angela Merkel a victory in more ways than one in that she did not need opposition votes to get the measure passed. However, the German Economy Minister said today that Germany's parliament would not be willing to leverage the fund and that policymakers should not rush to change the latest arrangement. "I do not see any willingness there to change the upper limits or increase the liabilities through other ways such as leveraging." The comments helped knocked the Euro down to $1.3488 earlier, with the currency relinquishing most of yesterday’s gains. The stronger dollar is weighing on commodities at the moment, with copper off sharply once again with other metals also struggling. Energy prices are down by some $1.90/brl, gold is lower, and Dow futures are indicating a 100 point decline at the outset. Chinese equity names are expected to struggle following reports that the Justice Department will be investigating accounting practices of Chinese companies listed in the US. In macro news, consumer prices in the 17 Eurozone nations rose 3% in September, faster than the 2.5% rate in August. This will make the job of the European Central Bank more difficult as it heads to another interest rate decision next week, where the recent speculation was that a rate cut was possibly in the cards. Out of China, we have reports overnight that the country’s manufacturing sector contracted for a third consecutive month in September, not much of a surprise here, as preliminary readings suggested a negative number was in the offing. The HSBC purchasing managers' index was at 49.9 in September, unchanged from August. HSBC believes a PMI reading of as low as 48 in China still points to annual growth of 12-13% in industrial output and a 9% expansion in gross domestic product, but we think investors will focus more on the fact that growth is slowing. China's official PMI is due to be published on Saturday. Reuters is running an interesting survey of Chinese metals demand, with most sources it consulted suggesting a slower rate of growth in metals intake. Antaike, for example, is saying that Chinese copper consumption may rise to 7.8-7.9 million tons in 2012 from 7.38 million tons this year, a rise of some 6-7% compared to a gain of 8.5% in 2011. On the other hand, CRU analysts tell Reuters that they may adjust down their copper demand forecast to 5% for next year. Primary aluminum demand growth may slump to single digits in 2012 after rising some 12-13% to 18-19 million tons this year. In nickel, demand is expected to slow in 2012 from a rise of up to 20% expected this year due to smaller output growth in stainless steel production. Antaike sees tin consumption growing at less than 5% next year after being up 2.5-3% this year, while refined zinc use may rise 8-9% to 5.4 million tons in 2012 compared to a gain of 5-6% expected this year, this according to information provider SMM. SMM added that power shortages and tight environmental checks to zinc alloy and galvanizing plants had cut demand this year, but that those conditions are expected to ease going into next year.  .... Nickel is at $18,175, down $495.  (Daily Metals Report here)
• Molybdenum Q4 Outlook - more
• (MNP) First exports from First Quantum Minerals’ revitalized Ravensthorpe nickel mine in Western Australia are tracking towards a November shipment, with full production set for December or early next year.
• China will be closed for most business next week celebrating National Day.
• (Reuters) The HSBC purchasing managers' index (PMI), which previews business conditions in a range of industries before official monthly output data, was at 49.9 in September, unchanged from August.

  DJ INSG: Sees Global Nickel Market In 70,000-Ton Surplus In 2012 - The world nickel market should be in surplus by 70,000 tons in 2012 as new capacity comes to production and already-commissioned projects ramp up output, the International Nickel Study Group said in a report late Thursday. - more

  $1.5bn PNG nickel mine to go ahead -  Australian miner Highlands Pacific says its $US1.5 billion ($A1.54 billion) Ramu nickel project in Papua New Guinea will start production next year, despite local threats to shut it down. - more

  SGX, LSE tie-up for joint London Metal Exchange - The Singapore Exchange Ltd is tying up with London's main bourse to make a joint bid for the London Metal Exchange, a source told Reuters on Friday, as the world's largest metal market seeks a suitor in a deal that could be worth 1 billion pounds ($1.57 billion). - more

  The following speakers made presentations at the INSG Meetings, which were held in Lisbon, Portugal in 26 to 28 September 2011 - more

  Metal demand will stay strong, says Anglo American chief - Cynthia Carroll, chief executive of London-listed miner Anglo American, expects demand for metals to remain strong despite the economic storm clouds. - more

  Costs to rise on nickel - The operations director of leading WA nickel producer Western Areas NL has warned declining supply in the nickel sulphide industry will precipitate rising energy and production costs. - more

  In the future, Stainless Global will be called Inoxum - On May 13, 2011 ThyssenKrupp AG decided on an integrated strategic development program to move the Group forward competitively and sustainably. - more

  The Thinker: Mining Conundrum - Eramet, the French mining company, is increasing its investment in nickel mining in the eastern region of Halmahera, North Maluku. - more

  Areva would sell Eramet stake if state agreed-report - French nuclear company Areva would sell its 26 percent stake in French nickel group Eramet if it had the go-ahead of its top shareholder, the French state, Areva's chief executive said in a newspaper interview. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Thursday, September 29

• Baltic Dry Index - minus 7 to 1,913. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) China Economic Growth Seen Less Than 5% by 2016 // Hong Kong Shuts Schools, Markets as Typhoon’s Gale-Force Winds Sweep City // China’s Stocks Sink to 14-Month Low as Investors Predict Economic Slowdown // Aussie Banks Become a Global Favorite in Default Swaps: Australia Credit // South Korea Urges Banks to Bolster Foreign Liquidity as Europe Storm Brews // Euro Area’s Rescue Options Are Shrinking Fast: Anil K Kashyap // European Stocks Advance on U.S. Economy; BNP Paribas, H&M Climb // Bernanke: U.S. Unemployment a ‘National Crisis’ // World Slump Seen Triggered by European Breakdown // Mortgage Rates Fall to Record With 30-Year at 4.01% // US Stocks Rally, Treasuries Retreat on Economy Data
• The Euro is still trading higher against the US Dollar, up more than 4/10 of 1% at the moment. NYMEX crude is up over 2% and trading at $82.88/barrel. Gold is up 2/3 of 1% while silver is up 1-3/4%. Base metals ended the session mostly higher. Indicator charts show nickel traded choppy within a $400/tonne range but kept a slight uptrend going all day. For the day, Dow Jones reports three month nickel ended the session at $8.47/lb . Stockpiles of nickel stored in LME approves warehouses fell Wednesday and now total just over 97,150 tons. The economic news was 'less negative' today and equity markets are rebounding. German lawmakers voted to expand a European rescue fund , while the number of American's applying for unemployment dipped under 400,000 last week and a five month low. But, warned the Labor Department, this low number may be due to a technical glitch, and no one is reporting the German vote will end the European debt crisis. The US GDP reportedly grew at an anemic 1.3% last quarter, much better than the 1% snail's pace growth reported earlier. And mortgage rates are at a record low, because no one is buying homes. Feel better yet?

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• It’s Man vs. Machine and Man Is Losing - more
• Americans Have No Cause to Feel Smug About Euro Zone Crisis - more
• This Time May Not Be That Different: Labor Markets, the Great Recession and the (Not So Great) Recovery - more
• A crash isn't inevitable, but worries aplenty - more
• Hoenig critiques Fed in parting shot - more
• King Copper and a New Low in the Shanghai Index - more
• Bernanke: Long-term unemployment a national crisis - more

  Rising stocks to weigh on nickel in 2012 - At the beginning of 2010, Thomson Reuters GFMS was somewhat bearish about the prospects for the nickel market. - more

  Steel demand, prices mainly soft for rest of 2011: analyst - Steel pricing will see mainly flat demand from important end-use sectors in the US for the rest of 2011, with one or two exceptions, according to an analyst's presentation at the American Institute for International Steel Fall Conference in Philadelphia. - more

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

• Indicators at 7:00 am CST show 3 month nickel trading around $.04/lb lower, with other London traded base metals mixed and mostly quiet. The Euro is trading over 1/2 of 15 higher against the US Dollar at the moment. NYMEX crude is up nearly 1/2 of 1% and trading at $81.58/barrel. Gold is up a little over 1/10 of 1% and silver is higher by 1/3 of 1%. In overnight trading, Asian markets ended higher, with China down nearly 9/10 of 1%. European markets are trading just slightly higher at the moment, and US futures show Wall Street wants to shrug off yesterday;s losses and return to a bull run. Nickel inventories continued to fall yesterday.  
• Bloomberg morning - Copper Declines on Concern Possible Recession Will Damp Demand for Metals - more
• LME Morning - Base metals ease, as risk aversion mounts - more
• Reuters - Copper slips on euro zone debt uncertainty - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Abbreviated Commentary: - The markets continued to gyrate wildly yesterday, but this time around, most of the action was on the downside, as investors sensed that they had bid things up things too fast and too quickly, and were now toning down the week's earlier euphoria. In addition to the sharp declines seen in energy, which practically wiped out most of Tuesday's gains, there was also significant weakness in base metals, gold, and US equities. Copper gave up most of Tuesday’s strong advance and opened much weaker heading into the Asian session today, getting to a low of $6820 before recovering somewhat as of this writing. Investors are nervous ahead of a German vote later today, which will settle a matter of whether the proposed European stabilization fund would be allowed to buy bonds of member states and offer emergency loans to governments. It would also raise Germany’s guarantees to 211 billion Euros from 123 billion. The vote is expected to pass -- there will be no surprise here -- but it is expected to do so only with opposition support, which means that Chancellor Angela Merkel's own coalition may be fraying. Therefore, how her party ultimately votes is likely more important than the yes vote itself, as it would give the markets a read on her political standing and her future ability to move other legislation along. We think the more important issue is that we have yet to hear anything definitive with respect to what proposals may now come out of the EU. As mentioned in yesterday’s note, we suspect that investors will likely give the politicians a bit more time, but things could turn rather ugly next week if nothing concrete starts to come out. (Daily Metals Report here)
• (China) Self-sufficiency in ore expected to pass 50% - more
• (CBN) China's nickel output in Jan-Aug hits 120,300 tons
• (SG) Stainless Steel surcharges hit 18 month low in Europe
• (SO) According to the China Iron and Steel Association (CISA), China's average daily crude steel output in mid-September (Sept. 11-20) this year came to 1,918,600 mt, down 2.31 percent compared with early September (Sept. 1-10).

  FeNi Production At Kwangyang (Korea) To Double In 2013 = SNNC plans expansion up to 54,000 tons per year = SNNC, a joint-venture between SMSP (New Caledonia) and Posco (Korea) is to double ferronickel production capacity at its Kwangyang plant by 2013. - more

  Ravensthorpe to boost WA nickel sector - Western Australia's recovering nickel sector will receive a major boost later this year when the Ravensthorpe nickel mine, mothballed by BHP Billiton, resumes production. - more

  Poseidon targets nickel production in 2013 - Poseidon Nickel, chaired by Andrew Forrest, expects to start production at the revived Mt Windarra project in Western Australia as soon early 2013. - more

  NiHAO, AGP Industrial, Glencore Sign Deal To Develop Nickel Mines - Nickel miner NiHAO Mineral Resources Inc. said Wednesday that it has signed a deal with AGP Industrial Corp. (AGP.PH) and Glencore International AGP to jointly develop mining projects in the Philippines. - more

  Another Chinese takeaway - Minerals company Tharisa is at an advanced stage in plans to build a ferrochrome smelter in China using chrome ore from its Rustenburg mine — because Eskom cannot supply the electricity it would need to operate a smelter in SA. - more

  Billionaire Potanin May Seek Norilsk Control - Billionaire Vladimir Potanin’s Interros Holding Co. may seek control of OAO GMK Norilsk Nickel after a $4.5 billion buyback and stock cancellation, gaining the upper hand in a shareholder dispute with United Co. Rusal. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Wednesday, September 28

• Baltic Dry Index - minus 168 to 97,458. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) China Stocks Sink to 14-Month Low as Property, Rail Shares Fall // Mortgage Rates Drop to Lowest in Two Years as Economy Slows: Japan Credit // Euro Crisis Makes Fed Lender of Only Resort // EU Proposes Financial Transaction Tax for 2014 // Merkel Indicates Greek Debt Review May Mean More Talks on Second Bailout // Euro Advances to One-Week High as Europe Denies Greek Writedown Pressure // European Stocks Slide, Snapping Three-Day Rally; Man Group Sinks // Mortgage Survivors Get Bargains as Fed Erases Price-Drop Danger // Demand for U.S. Capital Goods Climbs // Most U.S. Stocks Drop Amid Europe Concern
• The Euro continues to trade higher against the US Dollar, now up nearly 2/10 of 1%. NYMEX crude is down nearly 2-1/2% and trading at $82.37/barrel. Gold is now down over 1-1/2% and silver is over 4.6% lower. Base metals ended lower as well, as traders moved back to the sidelines as European debt concerns sent world markets a reminder they were still a legitimate threat. Indicator charts show nickel opened lower, had a slight hint of an increasing trend to it in choppy morning trading, but a sold downtrend in the afternoon. Dow Jones reports three month nickel ended the day at $8.39/lb . Stores of nickel stockpiled in LME approved warehouses slipped yesterday and now total just over 97,450 tonnes. US markets are volatile this morning as the bear tries to reign in the bull, while more bullish investors look to end an otherwise brutal quarter, on a solid upswing. Last two days of the quarter could be interesting.

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• Vital Signs: Consumers Remain Depressed - more
• Euro Zone Timeline: Key Coming Events - more
• What Are We Spending Our Money On? - more

  London clearing house LCH in talks with London Stock Exchange - LCH.Clearnet Group has entered into "exclusive" discussions with the London Stock Exchange Group about a possible transaction, the UK-based clearing house said Wednesday. - more

  We'll need 170,000 workers, says BHP - BHP Billiton has predicted Australia's resources industry will need an extra 170,000 workers in the next five years, underlining the job bonanza set to hit mining states. - more

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

• Indicators at 7:00 am CST show 3 month nickel trading around  $.14/lb lower, with all London traded base metals lower as well. The Euro is over 4/10 of 1% higher against teh US Dollar at the moment. NYMEX crud eis down 6/10 of 1% and trading at $83.94/barrel. Gold is down 2/10 of 1% and silver is off nearly 2-1/4%. In overnight trading, Asian markets ended lower, with China down more than 1%. European markets are trading lower this morning, with US futures showing Wall Street wants to buck the word trend and keep its bull run going. Nickel inventories fell yesterday.  
• Bloomberg morning - Copper Declines in London as Durable Goods Orders May Fall - more
• LME Morning - Metals mostly backpedal as eurozone uncertainty continues, correction founders - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here
• US Imports of Stainless Steel Mill Products - more
• MF Global LME BAse Metals Outlook - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Relief rallies continued across a number of markets yesterday, as anticipation built with respect to what the Europeans will potentially announce with respect to additional measures they could consider taking. Copper rose by a stunning 6% basis the three months to close at $7,594, but the magnitude of the recent decline has been so steep, that the rally appears as only a respectable blip on the charts. Both crude contracts were up sharply, with WTI tacking on more than $4 a barrel on the session, while Brent was up by $3. In addition, there were good gains in the US stock market, al beit some of the advance was partially given back late in the day. Gold held onto a good gain, as did the Euro, which traded to a high of just under $1.36. We have not been surprised by the recent moves higher in anticipation of an upcoming proposal coming from the EU, but given how quickly things have turned, the markets are starting to pause here in order to assess where things stand. If investors get a sense that things are dragging, the decline could easily resume, but this may not happen this week, as the politicians will be afforded some additional time. However, if no progress is made going into next week, the markets could easily start getting edgy. Right now, metals are modestly lower, but have had a very choppy session so far. Copper gave back almost all of yesterday’s gains at one point after hitting a low of $7250 in Asian trading. It has since recovered and is now down only about $50. The declines in the other metals were not as steep, but most did follow copper’s lead lower to some extent. Energy markets are flat right now, while the dollar is slightly weaker against the Euro, currently trading at $1.3670. US stocks are called to open higher. There is not much new in terms of news. A “troika team” out of Europe will be in Athens again to go over austerity measures, and German Chancellor Angela Merkel suggested that parts of the upcoming rescue plan involving another €109 billion could be reopened and/or renegotiated if circumstances warranted it. There is also a key vote coming up on Thursday that the markets will be watching. German Chancellor Angela Merkel may not secure a majority vote in her own coalition for expanding the 440 billion euro bailout fund, and may be forced to depend on opposition votes to push the measure through, weakening her power going forward if that is indeed the case. ... Nickel is at $18,804, down $151.  (Daily Metals Report here)
• (MFG) Plummeting nickel prices on the LME will crimp domestic stainless demand as distributors will likely show no intention of buying material, as surcharges for November material now look to be lower than October. A European trader said there had been no fallout from the price drop in terms of renegotiations of contracts.
• (Interfax) China's reliance on Indian iron ore dropped sharply in August, with India accounting for only 7.79 percent of China's total iron ore imports during the month, down from 12.98 percent in the first eight months this year and 15.62 percent in 2010.
• (ATA) The American Trucking Associations' advance seasonally adjusted (SA) For-Hire Truck Tonnage Index declined 0.2% in August after falling a revised 0.8% in July 2011.
• Report: Consumers spent less, earned less in 2010 - more
• Odds firm for a La Niña in 2011 - more

  First Nickel begins ore delivery from Ontario mine - Canadian miner First Nickel Inc said it restarted production at its Lockerby nickel-copper mine in Ontario and made its first ore delivery to diversified miner Xstrata Plc's nickel business. - more

  Ravensthorpe nickel mine to resume operations - The new owners of the Ravensthorpe nickel operation say they are confident the mine will resume production this year despite the recent slump in the metal's price. - more

  Vale must accommodate more local demands: Analyst - An analyst says the new management of PT Vale Indonesia, previously PT International Nickel Indonesia (Inco), must be more responsive to demands from regional administrations and people living near its mines in Central, South and Southeast Sulawesi. - more

  "Welcome Rain On Dry Land?" - China's Developing Appetite for SUS Scrap = Nickel supply/demand situation in China has changed = Price of Ni-based SUS scraps (new clippings) in Japan has been crawling low since about four months ago, but there seems a sign of recovery triggered by stronger buying interests from China. - more

  Stainless Steel Longs Production in Russia - The aggregate volume of stainless steel long products output (incl. tube billets) in 1H 2011, if compared to the equal period in 2010, grew 8.7% to 21148 tons. - more

  New Caledonia’s SLN found responsible for five cases of asbestos-related illnesses - New Caledonia’s labour court has found that the SLN nickel company was responsible for the asbestos-related illnesses of five of its former employees. - more

  LME Takeover Bids Mean Most at Stake for Goldman Sachs, UBS - The potential sale of the London Metal Exchange, home to the city’s last open-outcry trading, means Metdist Ltd., Goldman Sachs Group Inc. (GS), MF Global (U.K.) Ltd., UBS AG (UBSN) and Sucden Financial Ltd. have the most at stake. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Tuesday, September 27

• Baltic Dry Index - minus 1 to 1,927. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) Shanghai Composite Rises From 14-Month Low Amid Easing European Concerns // China’s Developers Facing ‘Increasingly Severe’ Credit Outlook, S&P Says // Asian Stocks Surge by Most Since ‘09 Bull Run on Europe Optimism // Germany Cuts Fourth-Quarter Debt Plan to $70 Billion as Tax Receipts Surge // Greek Leaders Appeal for Support as U.S. Presses for EU Action // European Stocks Climb Most in 16 Months Amid Effort to Contain Debt Crisis // Geithner Tells Europe to ‘Get On With It’ After Global Chiding Over Crisis // Fed Officials Voice Doubt on Inflation as Growth Tool // Global Stocks Surge Most in 16 Months
• The Euro continues to trade over 1/2 of 1% higher against the US Dollar. NYMEX crude is over 4.4% higher and trading at $83.79/barrel. Gold is up 1.8% and silver is 3.6% higher. Base metals ended higher as well. Indicator charts show nickel opening much higher, and increasing during the afternoon. For the day, Dow Jones reports three month nickel ended at $8.60/lb . Stockpiles of nickel stored in LME warehouses grew for only the fifth time this month yesterday and now total just over 97,450 tonnes. The bulls are firmly in charge of equity and commodity markets as traders around the world gamble the Europeans can fix their problems and avoid dragging the rest of the world back into recession.

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• Vital Signs: China, India Consumer More Energy - more
• Most Food Stamp Recipients Have No Earned Income - more
• Trader on BBC Sounds Alarm About Market Crash - more

  Global ferrochrome demand may rise 10 percent by 2012 - Ferrochrome demand expects a recovery in the global markets through 2012 on world economic growth and a shortage of new capacity in South Africa for the near future. - more

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

• Indicators at 7:00 am CST show 3 month nickel trading around $.34/lb higher, with all other London traded base metals much higher as well. The Euro is trading 1/2 of 1% higher against the US Dollar at the moment. NYMEX crude is up 3% and trading at $82.66/barrel. Gold is up nearly 2-1/2% while silver is higher by over 7-1/2%. In overnight trading, Asian markets ended higher with China up 1%. European markets are trading much higher this morning, and US futures show Wall Street will open bullishly. Nickel stockpiles grew yesterday. Equity and commodity markets are very bullish today.
• LME Morning - Base metals seen extending rebound but longevity questioned - more
• Reuters - Euro zone debt plan hopes boost base metals - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Most markets staged impressive recoveries on Monday, as investors sensed that something would be coming out of Europe soon with respect to the ongoing debt crisis. On the energy side, both crude contracts erased about $3 a barrel in losses to close slightly higher on the day. The US stock market also rallied, with the Dow tacking on 272 points, as did the Euro, which recovered from an eight-month low against the dollar. Base metals all put in fresh 2011 lows early in the Monday session, but then staged very modest recoveries to close mixed. As of yet, there are still no concrete proposals coming out of Europe, but there is the usual element of discord associated with various statements. As examples, the Spanish finance minister denied talk about funds being leveraged sevenfold to some €2 trillion, and also reiterated that she was in favor of a bank tax. Should that view in fact be the official position, markets will no doubt dive once again. For the moment, we will assume (or hope) that the minister is badly misinformed and not speaking for the whole group. There was also talk yesterday that interest rate decreases are also under consideration, but we suspect that this will be the least effective policy tool that the authorities can roll out. Later tonight, German Chancellor Angela Merkel and Greek Prime Minister George Papandreou will discuss the implementation of Greek reforms at a meeting in Berlin, an event that undoubtedly will be closely watched by investors. Right now, we are sharply higher in metals, with Shanghai recovering all of Monday’s steep declines, and setting up the stage for the strong showing we are currently seeing. Among the group, copper is doing by far the best, while the gains in the rest of the complex are more modest. Oil prices are up by about $2/brl, and gold is up a surprisingly strong $70/ounce. The dollar is weaker, at $1.3540, and US stocks are called to open higher. The short-term direction for the markets is higher still, leading up to an eventual European announcement. The prospect for a disappointment at this stage is slim in our view, as the authorities must sense that they can ill afford to surprise the markets by coming in short. More importantly, it remains to be seen whether all this turmoil will accentuate the deterioration in the macro numbers and tip global economies into recession, similar to what happened in 2008. One argument against this scenario from taking place the fact that credit markets have not seized up, as was the case in 2008/2009. In addition, metal demand, while frozen in pockets of the industry, is capable of coming back once a measure of confidence returns.  .... Nickel is at $18,745, up $745. (Daily Metals Report here)
• (Dow Jones) Shareholders of nickel miner PT International Nickel Indonesia Tuesday approved a proposal to change the company's name to PT Vale Indonesia, to mirror the name of its majority shareholder.
• (Yieh) According to data released by customs, Taiwan exported 13,556 tons of screw in August, surged by 3.67% from July and soared by 11.19% year on year. Furthermore, the screw export value broke US$374.57 million in August, increased substantially by 23.87% year on year and hit the new record highs.
• (MW) Brazilian miner Vale SA said the outlook in all metals markets, including nickel, continues to be "extremely positive," an executive director for the company said Monday.
• Ernst and Young refuse to revise nickel figures - more
• Commodities Post Best Run This Month as Policy Makers Step Up Debt Fight - more

  Nickel prices in freefall as demand slows - A market analyst says a slowdown in demand from China has led to a slump in international nickel prices. - more

  Thyssenkrupp CEO says demand high, downturn looms - paper - Germany's biggest steelmaker ThyssenKrupp is aware the sovereign debt crisis will soon impact its business, which is currently still strong, its chief executive told a German paper. - more

  Japan's Crude Stainless Steel Production By Major Mills, July 2011 = 324,812 tons, increase by 4.3% from the previous month =  Crude stainless steel production during July by seven major mills totaled to 324,812 tons in July 2011, up by 4.3% from the previous month (311,210 tons) - more

  Kosovo government toughens stance on polluters - Kosovo is cracking down on companies it accuses of polluting the environment in one of Europe's poorest regions, filing charges Tuesday against a cement factory it says is not monitoring emissions. - more

  Magaliesberg farmers ready to fight nickel miner - Ian Holman, a farmer near the Magaliesberg mountain range, and several of his neighbours, are readying for battle against mining outfits African Nickel and Autumn Skies Trading 455 CC, who have cast their eye on the scenic surrounds of Golden Valley, says a report in The Star. - more

  Courtesy AISI - In the week ending September 24, 2011, domestic raw steel production was 1,851,000 net tons while the capability utilization rate was 75.7 percent. Production was 1,699,000 tons in the week ending September 24, 2010, while the capability utilization then was 70.2 percent. The current week production represents a 8.9 percent increase from the same period in the previous year. Production for the week ending September 24, 2011 is down 1.8 percent from the previous week ending September 17, 2011 when production was 1,881,000 tons and the rate of capability utilization was 77.0 percent.

  Morning Nickel Inventory and Price Statistics & Figures

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

Monday, September 26

• Baltic Dry Index - plus 8 to 1,928. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) Record Cash Crunch Forecast to Abate as Global Outlook Dims: China Credit // Yuan Falls Most in Four Months on Concern Debt Crisis in Europe May Worsen // China Stocks Fall to Lowest Since July 2010 as Zhou Fans Inflation Concern // Asian Central Banks Signal Rate Rises Off Table as Europe Crisis Deepens // ECB Said to Consider Covered-Bond Purchases to Inject Liquidity in Markets // Euro Falls to Decade Low Versus Yen on European Debt Concern; Kiwi Drops // Merkel Says Greece Needs ‘Barrier’ to Stave Off Default // European Stocks Climb as Policy Makers Pressed for Debt Solution // Pimco Forecasts Europe Recession Next Year // New Homes Sales Fall to Six Month Low // Stocks Climb on Optimism Europe to Stem Crisis as Treasuries, Dollar Fall
• The Euro is presently trading 1/4 of 1% lower against the US Dollar. NYMEX crude is up over 1/10 of 1% and trading at  $79.97/barrel. Gold is down 3-2/3% and under $1600/ounce, while silver is lower by 3%. Base metals ended lower, but well off opening lows. Indicator charts show nickel opened in the basement, spent the first 2/3 of the session climbing, and the last 1/3 slipping. For the day, Dow Jones reports three month nickel closed at $8.16/lb , closing lower than anytime since last June. Stockpiles of nickel stored in LME approved warehouses fell on Friday and now total just under 97,150 tonnes. European and US equity markets are higher today on hopes of a resolution, however temporary, to the Greek debt crisis. After last weeks plummet, the market is due for a  bounce, even if it turns out to be no more than a dead cat.

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here
• AK Steel October Stainless Steel Surcharges - pdf here

  Commodity/Economic Articles and Comments

• A Weak Week But Not Unique - more
• Number of the Week: Americans Spend Smaller Share of Income Paying Debt - more
• The Worse Banks Treat the Chinese, the More the Chinese Save - more
• Household Net Worth in U.S. Fell in Second Quarter as Home Prices Slumped - more

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

• Indicators at 7:10 am CST show 3 month nickel trading around $.01/lb higher, and well off opening lows. Other London traded base metals are mixed. The Euro is trading less than 1/10 of 1% higher against the US Dollar. NYMEX crude is up 1/3 of 1% and trading at $80.12/barrel. Gold is down 1.8% and silver is lower by 7.3%. In overnight trading Asian markets ended lower, with China down over 2.1%. European markets are trading higher this morning and US futures show Wall Street wants to bounce back from last weeks beating. Nickel inventories fell on Friday. Dow Jones reported three month nickel ended last weeks trading at $8.29/lb.
• LME Morning - Prices plummet to multi-month and year lows; short-selling, position closing leaves market oversold - more
• Reuters - Copper tumbles to 14-month low on growth concerns - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here
• Weekly Scoreboard - pdf here
• Robry Monday Morning Economic Assessment - more

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Metals continued to decline sharply on Friday setting fresh lows despite other markets showing signs of stabilizing. Oil prices, for example, fell only slightly and the US stock market finished slightly higher after two days of harrowing declines that shaved almost 700 points off the Dow. We suspect that a lot of money moved to the sidelines on Friday, as investors waited for potential developments that could come out over the weekend. As it turned out, a few things were announced, but they consisted mostly of statements from various authorities underlining the urgency of taking steps to check the spreading crisis. In this regard, at the annual meeting of the IMF in Washington, US Treasury Secretary Timothy Geithner warned that a failure to combat Greek-led turmoil threatened “cascading default, bank runs and catastrophic risk.” He also urged that funds at the disposal of the Europeans be leveraged in order to increase the total size of the firepower at hand. In fact, there were reports in the weekend issue of the New York Times that the 440 billion-Euro European Financial Stability Facility may be leveraged through a possible credit line with the ECB, (among other options), potentially increasing its size to a few trillion Euros. There are also discussions under way on speeding up the start of a permanent rescue program, now scheduled for 2013. ]For its part, the IMF director, Christine Lagarde, warned that its $384 billion lending chest may not be enough to meet all aid requests if the world economy worsens, and that current capacity “looks comfortable today, but pales in comparison with the potential financing needs of vulnerable countries and crisis bystanders”. In the meantime, Greece has yet to secure its second 8 billion Euro bailout amid lingering questions about whether it will satisfy its deficit targets and loose talk (quickly denied) that it would urge creditors to take a 50% haircut on their bond holdings. Yet another IMF team will be visiting the country this week. Right now, we are seeing a slightly more positive tone in most markets. Metals are up, but were sharply lower earlier in the day. Copper sold off to an intraday low of $6800 earlier, and although still down, is now back over the $7200 mark, while ali sank to $2155 at one point before recovering. There were sharp declines in the rest of the group as well, but all have recovered. Oil prices are higher after selling off sharply earlier, with Brent finally approaching the $100 mark. The dollar broke to a recent high of $1.3360 against the Euro at one point, but is now weaker at $1.35, allowing the recovery we are seeing in commodities to take root. Gold and silver both are getting hammered. Gold has chalked up its worst 3-day fall in some 28 years, and is now hovering around $1630. (Perhaps its decline will now lead to a welcome drop in the number of incessant radio commercials we hear urging listeners to cash in their 401-ks and buy gold coins). US stocks are set to open slightly higher after posting one of their worst weeks last week in some three years. All three indexes fell by more than 5% for the week. ... Metals are not only being buffeted by the Euro headwinds, but seem to be under additional pressure on increasing signs of a deteriorating global macro picture that inevitably will manifest itself through weaker metal demand. In this regard, the widely watched PMI numbers compiled by HSBC/Markit will be out later this week, and it will be interesting to see what the numbers say about Chinese activity. Earlier today, we have reports out of Germany that business sentiment fell for a third month in a row, with the Munich-based ISO index falling to 107.5 from 108.7 in August.  ..... Nickel is at $18,290, up $20, but we did get to a low of $17,150 at one point. There is good support at $15,800 below that. (Daily Metals Report here)
• (Yieh) According to statistics, the inventory of stainless steel in Chinese Wuxi market in the middle of September totaled 203,916 tons, down by 4.93% from a month earlier.
• (China) Slower GDP growth in Q4 predicted - more
• Europe warned over its debt crisis - more

  London Metal Exchange Facing Takeover Bids - The London Metal Exchange, founded 134 years ago above a hat shop in the financial district, may be the latest major mutual exchange to be bought after record trading volumes attracted the interest of multiple bidders. - more

• Factbox - History of the London Metal Exchange - The London Metal Exchange, the world's top market for industrial metals, is considering selling itself after being approached about deals, it said on Friday. - more

  Stocks Of Manganese Ore And Chrome Ore At Chinese Portyard Are Still High = Early-September stocks are 3.7 million tons of Mn Ore and 2.94 million tons of Cr Ore = According the Chinese media reporting stocks of imported ores at main Chinese ports, manganese ore stocks were 3.710 million tons as of September 15, and chrome ore stocks were 2.942 million tons as of September 5. - more

  NUM joins call to restrict SA chrome exports - The National Union of Mineworkers has called for restrictions to be urgently placed on the export of resources, particularly chrome and ferrochrome. - more

  Outotec to deliver ferrochrome plant in China  - Outotec has agreed with Mintal Group Co. Ltd., a large manufacturer of ferrochrome and stainless steel, on the design and delivery of a new ferrochrome plant to Baotou, in the Inner Mongolia, China. - more

  Goro Nickel Refinery Focus of Investigative Probe - The Back to the Source investigative journalism conference held in Sydney on the weekend by the Australian Centre for Investigative Journalism drew professionals from around the world. - more

  Macquarie Bank Wins $93 Million Tax Dispute Over Sale of Minara Stake - Macquarie Bank Ltd., a unit of Australia’s biggest investment bank, won a A$95 million ($93 million) dispute with the Australian Tax Office over the 2004 sale of a stake in nickel producer Minara Resources Ltd. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Friday, September 23

• Indicators at 7:10 am CST show 3 month nickel trading around $.35/lb lower, with other London traded base metals getting hammered for a second day.  The Euro is presently trading less than 2/10 of 1% lower against the US Dollar. NYMEX crude continues to tumble, down nearly 2.8% and trading at $78.28/barrel. Gold is down more than 2-1/2% and silver is off nearly 9-1/2%. In overnight trading, Asian markets fell, with China down 6.10 of 1%. European markets are trading lower this morning, but only about 1/2 as bad as they were this time yesterday. US Dow futures are over 100 points lower at the moment. Nickel inventories fell yesterday and now total just shy of 97,250 tonnes. Very little news today besides yesterday's plunge, which as far as commodities go, is continuing into a second day. If copper is the canary in the economic gold mine as some think, then the sudden plummet in commodities is going to send a shock thru these circles. Another day to sit on the sidelines if you are buying or selling nickel.   
• No afternoon update today - have a safe and relaxing weekend.
• Bloomberg morning - Copper Drops to Lowest in a Year as Nickel, Tin Plunge on Recession Threat - more
• LME Morning - Prices cautiously cut losses after setting multi-month lows, bumpy market expected - more

  Reports

• Metals Insider - pdf here
• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here
• Allegheny issues October surcharge - more

  Commodity/Economic Comments - (read Ed Meir's complete morning base metals report here)

• Edward Meir of MF Global Morning Comments - After holding up fairly well earlier in the week, most markets got pummeled on both Wednesday and Thursday and are down again today. On the equity side, the Dow sank by about 670 points over the last two days and is now on track for its worst weekly finish in three years. World stocks as measured by the MSCI index hit a 13-month low, bringing their year-to-date loss to 16.3%. Commodities fared no better, with oil and base metal prices getting hammered on Thursday. Even the resilient gold market dropped nearly 5% to a one-month low, while silver lost 10% yesterday. A few markets stood out-- the US dollar soared to a seven-month high, (but is holding steady right now), while US bond prices pushed sharply higher, with the 30-year now yielding 2.87% - its lowest rate since January 2009. Ten-year German yields hit a record low as well.
• The week’s sell-off began shortly after the Fed announced on Wednesday that it would embark on a replay of “Operation Twist”, a plan first designed in the 1960’s to flatten the yield curve. Although the move was widely expected, investors were blindsided by the Fed's warning of "significant downside risks" to the economy, rather dire phraseology considering that recent macro data out of the US has not exactly been terrible. (More on that later). Bank downgrades by Moody’s also contributed to the malaise, as did a warning from miner Rio Tinto that metals demand was slowing. Although commodities were weak on Wednesday, the selling really picked up steam on Thursday when poor data from China hit the complex hard. In this regard, it was reported that manufacturing activity fell for a third straight month, while later in the day, data out of Germany showed September activity growing at its weakest pace in more than two years.
• In our view, the Fed’s policy language was unduly pessimistic and wholly unnecessary. Granted, US macro data has not been anything to write home about recently, but the numbers we have seen come out over the past few weeks do not necessarily point to an impending contraction. As examples, US August car sales were surprisingly strong, while the August ISM manufacturing reading and industrial production numbers both inched higher from the previous month. In addition, existing home sales came in much stronger than expected this week, rising by their fastest clip since March. Finally, and for what its worth from our perch at the ISRI metals conference in Chicago this week, we sensed that US sentiment in the scrap and primary business is not all that negative. Most people were telling us that US business was holding up, although those exporting to China were seeing a noticeable slowdown in activity. One exporter said that the number of phone calls he is now getting from China has dropped to one a day from the five or so he was getting a few months ago. (This fall-off seems to be borne out by the latest Chinese trade numbers as well, where we saw a 10% month-over-month decline in both copper and aluminum scrap imports). However, despite signs of sputtering, no one we met had any doubts that the Chinese growth story is still very much intact.
• Unfortunately, markets have more to worry about than just what is happening in the US. The Eurozone debt crisis continues to fester, as investors are waiting to see whether the Greeks will follow through on a drawn-out austerity program by finally making cuts to their bloated public sector payroll (or failing that, just hang it up and default). The country apparently has 750,000 government workers in a county of 11 million people, and until now, the government has been slashing salaries and pensions, but not actual jobs. It has plans to shed 150,000 workers through 2015, but is treading carefully given the political pressures it face and obviously too carefully to placate restless European lenders. In the meantime, the short-term carrot being dangled in front of Athens is an €8 billion tranche scheduled to be paid in October after a “troika team” signs off on Greek austerity measures. However, the prospect of more tax increases, layoffs, and spending cuts is likely to be met with growing hostility in a country where one in seven people is already out of work. Tension is building; the country’s two largest unions announced two 24-hour general strikes for Oct. 5 and 19, and there are serious doubts as to whether the government itself will survive if protestors take to the streets yet again.
• Having said all that, it is inconceivable to us that the European authorities will allow Greece to default given the magnitude of the numbers involved. Greece’s overall debt now stands at $500 billion. The last two countries to default in the early 1990s -- Russia and Argentina -- each had debts of only $82 billion and $79 billion respectively, so the size of the Greek exposure is infinitely larger and has the potential to do much more damage. What is even more frightening is the fact that Italy’s debt stands at a whopping $2.5 trillion, more than enough to wipe out any financial bailout fund either in place now or in the future. Given the scary numbers, the Europeans have no choice but to step up to the plate and increase their assistance to these "fringe" countries. Although the authorities have put some money to work, the amounts involved are insignificant, something the US Treasury Secretary unsuccessfully tried to convey to his European colleagues last week. However, whereas American urgings may have fallen flat, we think the current market shock waves could be getting through. As a result, we should see some sort of Greek “resolution”, perhaps by this weekend. Further down the road, the European stabilization fund is expected to be operational by late October (when all 17 European parliaments hopefully sign off on its mandate) and will come to the table with an additional $440 billion war chest. The approval process will now take additional urgency and could be fast-tracked. There are even reports on Bloomberg that its size will finally be increased. Finally, if all else fails and markets continue to tumble, we would not count out some sort of cross-border investment plan that could conceivably bring BRIC money into the European debt theatre, particularly from China, which has the most to loose if Europe and the US both slip back into recession. Of course, should the authorities allow the Greece to go through a partial default, as is being suggested on the wires today, we could experience a short-lived relief rally, but such a default will most definitely take us into very dangerous and unchartered territory.
• Outlook: Metals are clearly one of the commodity groups that are suffering given the market's clear obsession with a global slowdown, with even China being in the mix this time. We have been wary about second half prospects for the group for some time now, but have to admit that the extent of the decline has surprised us. It shows how quickly markets can fall when confidence is shaken; gains that have accumulated over months and year are given up in a matter of weeks. Copper has been overextended for some time, and so the fact that it is down so hard should not be that much of a surprise, as investors have largely focused on supply for months now, while assuming demand would remain constant. Charts suggest that we could get to the $6000 mark on copper before the current run ends its course. Aluminum could get to $2100 and is now in territory where most producers are seeing prices below their cost of production. Zinc's downside target is $1800, while lead could hit some support at $1950, although there is not much below there if we break that point. Nickel and tin are getting thrashed, as they typically have less liquidity and this tends to magnify their declines. There is some support for nickel at $17,000, (briefly breached earlier today) and below that, at $15,500. We do not see anything on tin until $15,400.
• Despite this week’s massive sell-off, there are a few silver linings we see amidst the carnage. For one thing, energy prices are falling sharply, and that is largely a good thing, although we would like to see more of the decline concentrated in the still-elevated Brent contract as opposed to WTI. We believe that falling energy prices will act like a global tax cut and in the least, persuade emerging market central bankers to hold off from increasing rates further. Indeed, some may even lower rates now that growth and intrinsic inflationary pressures are slowing.
• Another potential positive that could come out of the current situation is that the sell-off could pressure Congress to act more responsibly and agree on consensual and practical solutions to the country’s pressing economic problems. In the least, we should at least see some progress made on a short-term spending bill now weaving its way through the chamber and perhaps some meeting of the minds on the tax and job plans President Obama has put forward. Out of Europe, the sell-off will likely expedite progress in Europe vis-à-vis the Greek situation, as the authorities will have to realize that a market rout or a full-fledged Greek default is in nobody’s interest. What all this means in the short-term, is that markets are capable of turning around rather sharply if investors sense that the politicians are finally "getting it" and making progress in addressing some key issues. Although things look quite grim right now, we would want to start thinking about pulling in some of our shorts at this stage heading into next week. Not only are things massively oversold technically, but all this red ink should force the politicians to focus on the havoc they have wreaked and finally convey to investors that they are capable of rising to the occasion.(Complete Daily Metals Report here)
• (PF) French ferronickel producer Eramet has said that the Weda Bay nickel project in Halmahera, Indonesia, is likely to require about $6 billion in total investment. the project would consist of a first $3 billion stage with annual production of 35,000 tonnes of nickel, and a a second stage with roughly the same cost adding another 30,000 tonnes
• (MBN) Asian stainless trade comes to a halt after nickel price plunge
• China August net imports of refined nickel at 14,100 tonnes. Nickel ore imports from both Indonesia and the Philippines hit fresh all-time records of 2.4 million and 2.9 million tonnes respectively in August.

  Indonesia value-add mining deadline should be delayed -IMA - Indonesia needs to delay the implementation of a planned mining regulation that forces miners to process and not export minerals by 2014, to enable the much needed value-added investments to catch up, an industry association said. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

September Archives

Thursday, September 22

• Baltic Dry Index - plus 73 to 1,885. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg)  Iron Ore’s Longest Slide Since ’82 Threatens Mining Earnings: Commodities // China Stocks Fall Most in 6 Weeks on Manufacturing Outlook, Property Slump // China’s Manufacturing May Contract for a Third Month, HSBC Survey Shows // Indonesia Stocks Plunge Most Since 2008 as Rupiah Drops on Foreign Selling // Asia Stocks Tumble Toward Lowest in Year on Mounting Financial System Risk // EU Services, Manufacturing Drop in September // Dollar, Yen Strengthen on Concern Global-Growth Stalling; Aussie Slumps // European Stocks Drop as Fed Sees ‘Significant’ Economic Risks; Rio Tumbles // Fed Sees ‘Significant’ Risks to U.S. Economy // Republican Defections Kill U.S. Bill Needed to Avoid Government Shutdown // U.S. Mortgage Rates Hold Steady as Fed Aims to Lower Loan Costs // Stocks, Commodities Slump on Fed Outlook; Dollar Index, Treasuries Advance
• The Euro is trading over 1/2 of 1% lower against the US Dollar at the moment. NYMEX crude is down over 5-1/2% and trading at $81.16/barrel. Gold is down over 2.1% and silver is lower by 6.8%. Base metals joined the mad dash for cash today and all ended significantly lower. Indicator charts show nickel opened much lower and slid for the rest of the session. For the day, Dow Jones reports three month nickel ended the session at $8.56/lb . Yesterday's close was $9.23/lb and we warned that falling below $9.11/lb could put nickel 'technically in serious trouble'. Stockpiles of nickel stored in LME warehouses rose for only the fourth time this month yesterday, and now total just over the 97,800 tonne level. The more investors analyzed the Fed statement made yesterday, the more pessimistic they grew. US equity markets tanked shortly after it was issued, Asian markets fell hard, European markets fell even harder, and US markets are currently down in the 3 to 3-1/2% range. New or changed wording from last months statement including such phrases as "Moreover, downside risks to the economic outlook have increased' changing to "Moreover, there are significant downside risks to the economic outlook, including strains in global financial markets". In your senior English class, the use of the word significant may not have meant much, but when the Fed, who reviews each word closely before issuing a post meeting statement, it is a 'significant' change and carries 'significant' meaning. Traders look to the Fed and specifically, Chairman Ben Bernanke, as Mr Green Shoots, the man who almost single handedly ended the last recession by calming markets during a March 15th, 2009 60 Minutes interview. So when Santa Ben says there is a significant risk Christmas may be cancelled again this year, the market pays close attention. Two purchasing managers index came out negatively - the one in Europe was to be expected, not necessarily so the one in China. The Conference Board index of leading economic indicators for August stayed positive, but just barely. Nine thousand fewer American's filed for unemployment last week, but 432,000 still did. Ugly day - everywhere.

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• Iron Ore’s Longest Slide Since ’82 Threatens Mining Earnings: Commodities - more
• Economists React: Fed Is ‘Doing What It Can’ - more
• FOMC Statement: Side By Side Comparison - more

  Nickel to start its next leg down - ``We expect MCX Nickel should start its next big leg down now.  - more

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

• Indicators at 7:05 am CST show 3 month nickel trading around $.39/lb lower, with all London traded base metals sharply lower. The Euro is trading over 3/4 of 1% lower against the US Dollar, adding pressure to commodity traders. NYMEX crude is down over 4-1/2% and trading at $82.01/barrel. Gold is down over 1.4% and silver is lower by nearly 4.4%. In overnight trading, Asian markets ended lower, with China off nearly 3.1%. European markets are down sharply this morning and US futures reflect an over 200 point lower opening for the Dow (still a lot of time for that to change before the opening). Nickel inventories rose overnight.
• Bloomberg morning - Copper Declines to One-Year Low in London as China Manufacturing Contracts - more
• LME Morning - Base metals nose-dive as market confidence plummets - more
• Reuters morning - Copper crashes to lowest since Sept 2010 - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here
• Thyssenkrupp Nirosta October Stainless Steel Surcharge - more
• Outokumpu October Stainless Steel Surcharge - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Posted as soon as received (Daily Metals Report here)
• (Interfax) China's refined nickel and lead imports fell on a yearly basis in August, while imports of tin and zinc were on the rise, according to Sept. 21 figures from the General Administration of Customs (GAC).
• (MBN) China's nickel ore imports rise for sixth month to new record
• BMO updates 2011 commodity forecast - more
• Australian nickel miner Mincor cuts cost 39% to $5.43/lb at Kambalda mines - more

  Market Report On Imported Ferroalloys In Japan As Of September 15 2011 = Next quarter's prices for EF mills forced down by stronger yen = <> General view: There are three points to note. Two of them are related to the prices applicable to the deliveries during October - December 2011 quarter, of which preliminary negotiations are to start this week or next. - more

  Zimbabwe's Bindura okays $10m loan from Mwana - Shareholders in Zimbabwe's Bindura Nickel Corp (BNC) on Thursday agreed to seek a $10 million convertible loan from major shareholder Mwana Africa , after the nickel producer had failed to secure local funding. - more

  $1-B nickel mining project awaits indigenous peoples' permit - The proponent of a $1-billion nickel processing project in Brooke’s Point, Palawan said it has secured an environmental clearance certificate (ECC) from government but its permit from the National Commission on Indigenous Peoples (NCIP) remains pending. - more

  Stainless Imports Up 39 Percent Through June - Imports of total stainless steel through the first six months of the year were 39.2 percent ahead of the year-to-date 2010 figures, according to the Specialty Steel Industry of North America, Washington, D.C. The U.S. imported 406,269 tons of specialty steel through June. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Wednesday, September 21

• Baltic Dry Index - plus 16 to 1,811. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) China Faces ‘Hot-Money’ Surge on Financial Market Turmoil // China Growth Forecasts Trimmed by IMF as Worldwide Export Demand Softens // China Stocks Advance Most in Four Weeks as Leading Indicator Shows Growth // Japan Exports Climb Less Than Forecast as Slowing World Growth Saps Demand // Australian Mortgage Stress Climbs, Rental Vacancies Decline // Most Asian Stocks Rise as China’s Economy Seen Withstanding Europe Crisis // Greek Lawmakers Urged to Back Deeper Budget Cuts to Ensure Emergency Aid // U.K. Ministers Urge Stimulus as BOE Sees Likelihood of More QE // Debt Crisis Infects Companies via Surging Cost of Bank Loans: Euro Credit // U.K. Consumer Confidence Declines to Four-Month Low on Outlook for Economy // Bank of England Policy Makers See Greater Stimulus as Increasingly Likely // European Stocks Retreat on Greek Talks; Peugeot, Volkswagen Lead Decline  // Bernanke Has Few Tools to Heal Economy Amid Weak Housing // Republicans Urge Bernanke to Refrain From Further Stimulus to U.S. Economy // U.S. Stocks Decline as Investors Await Fed
• The Euro is presently trading 3/10 of 1% lower against the US Dollar. NYMEX crude is up over 1/3 of 1% and trading at $87.24/barrel. Gold is up 1/4 of 1% while silver is over 2.1% higher. Base metals all closed lower. Indicator charts show nickel was hit hard in teh hour before our morning briefing and at about that bottom, it froze for the rest of the session. For the day, Dow Jones reports three month nickel closed at $9.23/lb , its lowest close since August 25th, 2010. Stores of nickel stockpiles in LME approved warehouses slumped yesterday and now total just under 97,650 tonnes. Where is this glut of nickel everyone was forecasting for the last half of 2010? In a few days, we will be finished with 1/2 of the second 1/2 of the year and we are still watching nickel stockpiles fall. Oh wait. WBMS reported nickel was in a 4,900 metric tonnes surplus for the first seven months of this year so that would mean if you start the year at 136,890 tonnes on January 4th and you have 102,540 tonnes at the end of the seventh month (July), this should reflect a 4,900 tonne surplus?? Doesn't seem to work out quite right, but then again, we never pay much attention to what some report anyway. Equity markets aren't apparently gambling on a Fed move today like they were yesterday at this time. When it became clear yesterday afternoon that no 'emergency' move was going to be made, Wall Street gave up most of what it had gained earlier. Today, the market is subdued and in a holding pattern. We should know if the Fed is making any kind of move in about an hour. Nickel got hammered today and fell to a 13 month low. If it falls below $9.11/lb, which it last closed at in August 2010, it could technically, be in serious trouble.  

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• (Dow Jones) Investment bank BNP Paribas SA Wednesday lowered its forecast for base metal prices after it cut its world economic growth forecast for 2011 and 2012.....cuts 2011 LME nickel cash price yo $23,975/ton ($10.88/lb)
• Full Text: Republicans’ Letter to Bernanke Questioning More Fed Action - more
• Housing Is to the U.S. What Greece Is to the Euro Zone - more
• Vital Signs: Souring Mood in Germany - more
• Holders of Sovereign Debt - more

  Nickel To Remain Flat, While Oil and Gas Markets Will Drive Stainless Steel Demand - While we were discussing our coverage of nickel and stainless steel in a highly formal editorial meeting (read: intra-office banter), we happened upon the conference bill for the Institute of Scrap Recycling Industries (ISRI)’s 2011 Commodities Roundtable Forum right here in Chicago. - more

  Rio Tinto says buyer sentiment weaker, orders full for now - Global miner Rio Tinto warned Tuesday that customer sentiment is now more cautious and physical commodity prices overall are softer than they were six months ago on concerns about developed world economic growth and "persistent" financial market volatility. - more

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

• Indicators at 7:10 am CST show 3 month nickel trading around $.24/lb lower, with all London traded base metals trading lower. Nickel has been hit especially hard during the last hour. The Euro is trading over 4/10 of 15 lower against the US Dollar. NYMEX crude is down over 8/10 of 1% and trading at $86.20/barrel. Gold is down nearly 6/10 of 1% and silver is up 1/3 of 1%. In overnight trading, Asian markets ended higher, with China up 3%. European markets are trading lower this morning and US futures have yet to decide an opening direction. Nickel inventories fell overnight.  
• LME Morning - Metals weaken, drift on recession fears - more
• Reuters - London copper rises from 9-month low - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here
• IMF World Economic Outlook Update - more

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - next report to be published on Thursday
• (Dow Jones) Barclays Capital tips LME nickel prices to trade rangebound going forwards with $21,000-$23,000/ton predominating, without either constraints developing on the Chinese NPI sector (perhaps from government regulation) or sizeable revision to supply (or demand) expectations outside China.
• (Dow Jones) The global nickel market was in surplus by 4,900 metric tons in the first seven months of the year, the World Bureau of Metal Statistics said Wednesday.
• Tati Nickel gets international accreditation - more
• (tilt) Victor Vekselberg, Rusal’s chairman, is reportedly preparing the sale of the aluminium company’s 25 per cent sake in Norilsk Nickel for $18bn, or a 70 per cent premium to the market price. But analysts are skeptical a transaction would take place at such elevated levels.
• (Interfax) China produced 58.75 million tons of crude steel in August, or 47.16 percent of the total global output, the World Steel Association (WSA) announced Sept. 20.
• CISA to publish weekly iron ore index to reflect domestic market - more
• (SSY) In its latest World Economic Outlook, the International Monetary Fund (IMF) has forecast worldwide economic growth at 4.0% in 2011 & 2012. Both estimates have been revised down since the IMF's June update. The IMF has downgraded its view on growth in the advanced economies (-0.6 to 1.6%) and emerging economies (-0.2 to 6.4%) for this year. The IMF expects the Japan economy to contract by 0.5% this year, but expand by 2.3% in 2012. The IMF also revised its 2012 projection for the Chinese economy from its previous forecast of 9.5% to 9.0%. Furthermore, the IMF recognises that there are major downside risks to their forecast chiefly surrounding the euro zone and US.
• U.S. Fastener Producers Score Important Victory at the U.S. Court of International Trade - more

  Nickel Production During The 1st Half (Jan.-Jun.) Of 2011 Increases By 12% = despite the troubles in Western World, Chinese Ni-Pig-Iron expansion contributes = World Nickel production during the first six months of 2011 was 791,000 tons; an increase of 12.5% from the same period of 2010 (711.000 tons), mainly due to substantially bigger output of Chinese Nickel-Pig-Iron production (up by about 50% year-on-year). - more

  Growth in Metal Shipments Stable in August - August service center shipments increased from the same period in 2010 at about the same rate as July for both steel and aluminum in Canada and at a higher rate in the U.S. Inventory levels increased for both metals in the U.S. and Canada. - more

  Manila's MacroAsia sees nickel mine operating next yr - The Philippines' MacroAsia Corp can start production as early as next year at its Infanta nickel mine, part of a 1,113-hectare prospect it plans to develop with China's Jinchuan Group, once all required permits are in, a senior company official said on Wednesday. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Tuesday, September 20

• Baltic Dry Index - plus 31 to 1,795. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) China’s Growing Class of Wealthy Are Youngest in Asia Ex-Japan, HSBC Says // China Says It May Regulate Corporate Structure Used for Overseas Listings // Hong Kong Builders Are Set to Accelerate New Project Sales as Demand Cools // China’s Stocks Rise From 14-Month Low; Commodity Producers, Banks Advance // Narrowest Yield Curve in 10 Months Signals Deeper Recession: Japan Credit // Asian Stocks Drop as Italy’s Credit-Rating Cut Boosts Debt-Crisis Concerns // S&P Cuts Italy Rating on Weak Growth Outlook // German Investor Confidence Drops to 2 1/2-Year Low on Debt Crises, Economy // Gold Advances as European Debt-Crisis Concern Stokes Demand From Investors // Greek Default Specter Leaves Germans Facing Bad-Bank Bill // European Stocks Rise as Greece Calls Debt Talks ‘Productive;’ EON Advances // IMF Cuts Global Growth Estimate // Cattle Seen at Record $1.36 per Pound as Drought Reduces Herd: Commodities // Retailers in U.S. Risk Holiday Shipping Rush // U.S. Housing Starts Fall to Three-Month Low // Fed Likely to Begin ‘Operation Twist’: Survey // Stocks Gain on Fed, Greece Optimism
• The Euro is trading nearly 1/10 of 1% lower against the US Dollar now.  NYMEX crude is up 1/2 of 1% and trading at $86.12/barrel. Gold is up 1.4% and silver is 2/3 of 1% higher. Base metals broke off from following equities today and ended mostly lower. Indicator charts show nickel crested about the time of our morning briefing, and then slumped hard. A late recovery and after market slump. Dow JOnes reports three month nickle ended the session at $9.63/lb , but appeared to give up the days gains in after market trading. Stockpiles of nickel stored in LME approved warehouses fell slightly yesterday and now stands just under the 98,050 level. While the overall daily change as small, and the change was limited to activity in Rotterdam alone, it does not reflect the huge inbound shipment and even larger outbound shipment that was recorded. In and outbound volumes remain high, with outbound numbers in the lead so far month. Equity markets are betting Greece may not default anytime soon, and that the US Fed will sweeten the economic stimulus pot again today or tomorrow. For the most part, the economic news was far more pessimistic. The S&P downgraded Italy's debt. US housing starts fell to a three month low, despite record low mortgage rates. And the IMF cut world economic growth forecasts today and warned the US and Europe to get their fiscal house in order, before they both fell back into recession. The pessimistic growth rate cut hurt base metals trading, while the gloomy forecast put more pressure on the Fed, and the equity markets looked for Fed freebies.   

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• A Little Inflation Can Be a Dangerous Thing - more
• How to Prevent a Depression - more
• Vital Signs: Stalling 401(k) Accounts - more
• Updated Tax Polls - more

  Rio Tinto says buyer sentiment weaker, orders full for now - Global miner Rio Tinto warned Tuesday that customer sentiment is now more cautious and physical commodity prices overall are softer than they were six months ago on concerns about developed world economic growth and "persistent" financial market volatility. - more

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

• Indicators at 7:00 am CST show 3 month nickel trading around $.13/lb higher, with most London traded base metals higher as well. The Euro is trading 1/10 of 1% higher against the US Dollar at the moment. NYMEX crude is up nearly 1-1/4% and trading at $86.75/barrel. Gold is up up nearly 9/10 of 1% while silver is down nearly 4/10 of 1%. In overnight trading, Asian markets ended slightly lower, with China up 4/10 of 1%. European markets are trading higher this morning, and US futures show Wall Street should return to its bullish run today. Nickel inventories dropped slightly yesterday.  
• LME Morning - Metal prices edge up slowly, market remains cautious - more
• Reuters - Copper edges up from 9-month low - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here
• August 2011 Crude Steel Production - more
• Ryerson Customer Link - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - next report Thursday Sept 22
• (WSA) World crude steel production for the 64 countries reporting to the World Steel Association (worldsteel) was 125 million metric tons (mmt) in August 2011. This is 9.8% higher than August 2010.
• Regency Mines experiences delays in Papua New Guinea - more
• China vows unconditional support for EU - more
• Downturn in retailer container traffic ending as retailers prepare for holidays - more
• (AFPA) The American Forest & Paper Association released its August 2011 U.S. Paperboard Report today. Total boxboard production decreased by 2.7% compared to August 2010, and decreased 0.9% from last month.

  Victory Nickel mine gets go-ahead - Victory Nickel has the go-ahead from its board of directors to start the financing process for a new mine development that could be larger than HudBay's project in Snow Lake. - more

  Courtesy AISI - In the week ending September 17, 2011, domestic raw steel production was 1,884,000 net tons while the capability utilization rate was 77.0 percent. Production was 1,699,000 tons in the week ending September 17, 2010, while the capability utilization then was 70.2 percent. The current week production represents a 10.9 percent increase from the same period in the previous year. Production for the week ending September 17, 2011 is up 0.8 percent from the previous week ending September 10, 2011 when production was 1,869,000 tons and the rate of capability utilization was 76.4 percent.

  Morning Nickel Inventory and Price Statistics & Figures

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

Monday, September 19

• Baltic Dry Index - minus 50 to 1,764. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) China August Home Prices Rise in All Cities, Challenging Government Curbs // China Slowdown Looms as Inflation Limits Stimulus, ex-PBOC Official Says // China’s Stocks Fall to 14-Month Low on Tightening Concern, IPOs // Euro Weakens as Finance Chiefs Fail to Offer Plan for Greece; Dollar Gains // Greece Under Scrutiny for Next Aid Payment // Euro Bulls Capitulate After Trichet Comments // European Stocks Decline Amid Speculation on Greek Aid Payment // Bernanke Joins King Tolerating Inflation to Revise Economy // Tyco Plans Breakup Into Three, Seeking Growth // Bond Dealers Add $90 Billion of Treasuries in Fastest Expansion Since 2007 // U.S. Stocks Drop as Euro Weakens on Greek Concern
• The Euro continues to trade lower against the US Dollar, at present down over 1.1%. NYMEX crude is now 3% lower and trading at $85.31/barrel. Gold is lower by over 1.8% and silver is down 3-1/4%. Base metals also sold off today, all ending lower. Nickel opened lower, and while trading in a near $350/tonne range, its up and down moves added up to ending about where it started. Dow Jones reports three month nickel ended the day at $9.50/lb .  Monday's are starting to prove a difficult day for nickel traders, with Mondays over the last four weeks proving to be the weekly closing low point, or very close. Stockpiles of nickel stored in LME warehouses rose on Friday, for only the third time this month. Nickel stores now sit just shy of the 98,100 tonne level. Greek default concerns are back as topic number one - and thus world markets are trading lower today.

  Reports

• Reuters Metals Insider - pdf here
• Robry Monday Morning Economic Assessment - more

  Commodity/Economic Articles and Comments

• (MW) Investors have pulled more money from U.S. equity funds since the end of April than in the five months after the collapse of Lehman Brothers Holdings Inc., adding to the $2.1 trillion rout in American stocks.
• Q&A: Zoellick on the Euro-Zone Crisis and Growth Risks - more
• Number of the Week: Big Cuts in Manufacturing Capacity - more

  Mining investments seen at $2.8B - With the entry of Chinese investors, investments in mining could reach $2.8 billion this year, against the original target of $1.4 billion. - more

  Update on PolyMet Permitting - PolyMet Mining Corp. reported on progress in the environmental review and permitting process for its NorthMet project. - more

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

• Indicators at 7:05 am CST show 3 month nickel trading around $.16/lb lower, with other London traded base metals lower as well. The Euro is trading over 1% lower against the US Dollar at the moment. NYMEX crude is down 7/10 of 1% and trading at $87.33/barrel. Gold is up over 1/10 of 1% while silver is lower by 1%. In overnight trading, Asian markets started their week on the downside over concerns of a Greek debt default, with China off 2%. European markets are trading lower this morning, and if US futures hold, Wall Street will open with a triple digit loss. Nickel inventories gained on Friday.
• LME Morning - Copper slumps below $8,400/t, lowest since Dec '10, on waning confidence - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here
• Weekly Scoreboard - pdf here
• SMM Nickel Price Forecast (Sept.19-23) - more

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - (Today's Daily Metals Report here)
• (SMM) Metals prices in Shanghai plunged on September 19th as risk aversion sentiment quickly climbed on surging US dollar and increasing worries towards euro zone issues. In this regard, most active SHFE copper and zinc contracts reported over 2% losses.
• (MBN) Jinchuan's nickel price drops to 14-month low
• Minara tells investors to accept Glencore bid - more
• Russia's Norilsk says may drop convertible plan - more
• Mindoro Significantly Increases Agata Nickel Resources - more
• Iron ore prices 'damn good', says Rio Tinto's Sam Walsh - more
• (China) The walls come tumbling down - more
• (SM) The American Forest & Paper Association released its August 2011 U. S. Containerboard Statistics Report today. Containerboard production was flat when compared to July 2011, as was the month over month average daily production, down just 0.3%.

  RI, China ink US$6b deal for SE Sulawesi nickel smelter - Chinese representatives on Monday signed an agreement with Indonesian officials to invest US$6 billion in a nickel smelter in Southeast Sulawesi. - more

  IFM outlook positive on stainless steel demand - Industry experts expect the stainless steel market to grow at an average 6.8% per annum to 2015, with a positive read across to the ferrochrome market, International Ferro Metals CEO Chris Jordaan said on Monday. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Friday, September 16

• Baltic Dry Index - minus 93 to 1,814. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) China’s Stocks Rise as European Debt Concerns Ease, Trimming Weekly Drop // India Raises Rates, Breaks Ranks With BRICs // Asian Stocks Rise, Paring a Weekly Loss, on ECB Offer of Dollars to Banks // German Taxpayers Want Equity in Bank Bailouts: Karl Heinz Daeke // Euro Weakens Amid EU Divisions Over Greece Collateral; Dollar Index Rises // Europe Rules Out Stimulus, Skips Bank Aid // Stocks in Europe Rise for Fourth Day as Euro-Region Ministers Meet on Debt // BofA Keeps Countrywide Bankruptcy as Option // Payrolls Decreased in 30 U.S. States in August // U.S. Stocks Gain as Geithner Joins Europe Talks
• Indicator charts show nickel opened higher, but spent most of the session in a slide. For the day and week, three month nickel closed at $9.76/lb . Stockpiles of nickel stored in LME approved warehouses continue to fall, and now total over 97,600 tonnes. This is the lowest total reported since February 2009. We note two things that we linked to today. First, Edward Meir of MF Global noted in his morning report "We think the sense of dread that was gripping the markets for much of last week and earlier this week seems to be fading somewhat....." Across the pond, Alistair Osborne, Business Editor for the Financial Times, in reference to yesterday's unified Central Banks promise to support European banks stated "Central banks don’t do that sort of thing unless something is up; and something is most certainly up. In the eurozone, an unfolding Greek tragedy is careering towards its final, brutal act. And, in our joined-up, global economy that spells trouble everywhere, with the odds shortening by the day on a return to recession." Since this promise came 3 years to the day of Lehman Brothers failing, Osborne noted "But that sort of pre-emptive action can’t help but give you the jitters." Feel all warm and fuzzy inside yet?
• Have a safe and relaxing weekend!

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• (Dow Jones) Vale's Manitoba Operations is pleased to announce that USW Local 6166 members have voted 87.8% in favour of  accepting the Company's Offer of Settlement for a new three-year  collective bargaining agreement.
• Economists Put Even Odds on Euro Zone Breakup - more
• Recession Job Losers Take Bigger Hit to Future Earnings - more
• Financial crisis: central banks do not take this kind of action unless something is up - more
• The Beginning of the End for Suburban America - more

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

• Indicators at 7:00 am CST show 3 month nickel trading around $.01/lb lower, with other base metals trading mixed and quiet. The Euro is trading down over 6/10 of 1% lower against the US Dollar at the moment. NYMEX crude is down nearly 1/2 of 1% and trading at $89.00/barrel. Gold is off 1/3 of 1% while silver is up by nearly the same. In overnight trading, Asian markets ended the week on a higher note, with China up nearly 2/10 of 1%. European markets are trading higher this morning, while US futures are down for the moment. Nickel stockpiles fell overnight.
• Bloomberg morning - Copper Extends Rally as Debt-Crisis Concerns Abate in Europe - more
• LME Morning - Base metals see modest pick-up as risk appetite increases - more
• Reuters - Copper gains, EU meeting eyed - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here
• ABN AMRO Bank N.V Metals Monthly - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Metals opened higher yesterday as they were boosted by a weaker dollar, but prices really got a shot in the arm after reports surfaced after the US opening revealing that four major central banks have agreed to cooperate so as to insure that there is a sufficient amount of dollars in the banking system, particularly going into the year-end. We suspect the move was partly in response to reports out earlier this week that some French banks were having trouble accessing credit and thus had to revert to the ECB window. What the central bank moves also showed, in our view, was the fact that large institutions have the capacity to come together rather quietly and quickly in order to attack what they perceive to be potential market disruptions. We suspect this kind of cooperation will be marshaled again when the Euro debt crisis next rears its head and destabilizes the markets, which it inevitably will, the current "respite" notwithstanding. Markets are generally higher again this morning, with base metal prices showing good advances. Copper is also benefiting from industrial actions that have been unfolding this week. As we noted yesterday, Freeport McMoran's Grasberg copper mine in Indonesia began a month-long strike, while in Peru, Cerro Verde workers launched an indefinite walkout on Wednesday, although as of yet, output does not seem to be affected (this according to the company). One market that is struggling is gold, which sank to a two-week low earlier today (getting to $1761) as yesterday's central bank action to increase dollar liquidity apparently is apparently weighing on the complex. US stocks are expected to open slightly lower after a very strong session yesterday, while the dollar is stronger today, now trading at $1.38 against the Euro. On the macro front, we had a number of readings out yesterday, and although most of them came in on the weaker side, the markets were not particularly traumatized by any of the releases. In this regard, the day started off with the EU cutting its growth forecasts for the second half of the year in light of the sovereign-debt crisis and warning that the Euro-area economy would come “close to standstill by year-end.” The EU now expects third-quarter growth to come in at .2% and only .1% in the fourth. The growth outlook for Germany was lowered to 0.4% for the third quarter and 0.2% for the fourth, down from a previous estimate of 0.5% growth for each quarter. The EU is forecasting no growth for Italy in the second half of the year, while Spain is expected to expand by just 0.1%. Out of the US, industrial production unexpectedly rose in August, signaling that manufacturing still has a beat, al beit a very faint one at that, with output climbing 0.2% after a 0.9% gain in July. A Federal Reserve Bank of New York report showed manufacturing in the region contracting at a faster pace in September, with the index slumping to minus 8.8 from minus 7.7 in August, its weakest reading since November. The Philadelphia Fed index rose to minus 17.5 in September from the minus 30.7 reading seen in the prior month, which if readers recall, was the shockingly low number that hit the equity markets hard at the time. Despite signs of a slowdown, respondents to the Philly survey are optimistic that conditions will improve six months from now as evidenced in the uptick in the diffusion index for general business activity. .... We think the sense of dread that was gripping the markets for much of last week and earlier this week seems to be fading somewhat, and this should allow a measure of strengthening set in, at least going into today's session. In addition, investors may not want to get too short heading into a two-day EU finance meeting starting today (and attended by the US Treasury Secretary) where the possibility of a policy announcement could come our way. Having said that, the long-term problems still remain very much in place, namely how to handle Europe's intractable debt crisis and what to do about a noticeable slowing in global growth. Both those issues will likely be revisited at some later point, but for now markets seem to want to push a little higher. .....  Nickel is at $21,800, and unchanged; the sideways drift continues. (Daily Metals Report here)
• (Yieh) It’s reported that Tisco announced to cut the stainless steel export prices by US$60/ton average for November shipments and the company remained the domestic prices unchanged for October delivery.
• Allegheny Ludlum - Effective with shipments beginning November 1, 2011, a surcharge of $521 per ton ($26.05/cwt) is being added to grain-oriented electrical steel invoices. This surcharge is subject to monthly adjustment.
• Kraehe defends BlueScope Steel's $3m in executive rewards - more

  C Sulawesi exports 1,229 tons of nickel to China - Central Sulawesi Province in the seven months through July exported 1,229 tons of nickel ore to China. - more

  Marcventures ships high-grade nickel - Emerging mining player Marcventures Mining and Development Corporation (MMDC) has just completed its second shipment of high-grade nickel ore this month worth an estimated $3.82 million. - more

  City team going to Cleveland to make pitch for smelter - The city may be sending a team to Cleveland, the home base of Cliffs Natural Resources, to present Greater Sudbury's case for landing a smelter to process ore from the company's chromite deposits in northwestern Ontario. - more

  Judge denies request to delay U.P. mining permit - A judge Wednesday dealt another blow to opponents of a planned nickel and copper mine in Michigan's Upper Peninsula, refusing to delay initial underground blasting until their appeal of state permits for the project runs its course. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Thursday, September 15

• Baltic Dry Index - minus 20 to 1,907. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) China Willing to Buy Bonds From Sovereign-Debt-Crisis Nations, NDRC Says // China Bad Debt Crisis ‘Impossible’ for Merchants Bank’s Ma as Risks Curbed // Japan Warehouses Draw Investors After Quake as Office Market Returns Stall // U.S. Says Fighters Tied to Pakistan’s ISI Were Behind Kabul Embassy Attack // EU Lowers Euro-Area Growth Forecasts on Worsening Outlook From Debt Crisis // Germany, France Signal Support for Greece // Russian Billionaire Prokhorov Quits Party After ‘Takeover’ by Kremlin // ECB to Lend Dollars to Euro-Area Banks // European Stocks Rally on Greek Support, ECB Liquidity Measures // Mortgage-Default Filings Surge 33% in U.S. // Goldman Sachs Cuts S&P 500 Year-End Forecast to 1,250 Amid Europe Concern // UBS Has $2B Loss; Man Arrested in London // U.S. Consumer Confidence Holds at Year’s Second-Lowest Level, Index Shows // Manufacturing in New York Fed Area Contracts at Faster Pace Than Forecast // Industrial Production Rises for Fourth Month // Consumer Prices, Jobless Claims Exceed Forecasts // Stocks, Euro Advance, Treasuries Decline as ECB, Fed Offer Loans to Banks
• The Euro is currently trading nearly 9/10 of 1% higher against the US Dollar. NYMEX crude is up over 8/10 of 1% and trading at $89.63/barrel. Gold is down 2-1/4% and silver is lower but 3.1%. Base metals fared better, all ending higher. Indicator charts show nickel spent the entire session on the rise. For the day, Dow Jones reports three month nickel ended at $9.87/lb , same as last Wednesday. Stockpiles of nickel stored in LME approved warehouses fell for a third consecutive session and has fallen nine out of the eleven shipping days so far this month. Totals now exceed 98,200 tonnes.

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• Attention Americans: You Won’t All Be Rich Tomorrow - more
• UBS: We regret to inform you . . . - more
• Billions in Unemployment Benefits Paid in Error - more
• Tax receipts & the Economy - more
• Do equity price drops foreshadow recessions? - more

  China may get its first nickel ETF this year -trade - A financial firm backed by a Chinese bank plans to launch China's first physical-nickel backed exchange-traded fund (ETF) later this year, which could raise the country's import demand for the metal, trading sources said on Thursday. - more

  Ferrochrome project in Sohar - Construction work is set to begin later this year on a ferrochrome smelter project that has the potential to add significant value to Oman’s vast chrome ore reserves. - more

  China's higher-than-official steel output supports iron ore: MEPS - China's steel output at higher than officially reported figures as mills are relit to meet surging demand for construction steel is supporting high seaborne iron ore prices, rather than any overbuying by traders, consultants MEPS said in its latest report. - more

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

• Indicators at 7:05 am CST show 3 month nickel trading around  $.12/lb higher, with all London traded base metals higher this morning. NYMEX crude is up 2/3 of 1% and trading at $89.50/barrel. Gold is down over 1% and silver is down just under 1%. In overnight trading, Asian markets ended higher, with China down slightly. European markets are trading higher this morning and US futures show Wall Street will open on the positive side. Nickel inventories continue to slump.
• Bloomberg morning - Copper Gains From One-Month Low on Easing Debt Concern, Strikes - more
• Reuters - Copper rises after leaders reassure on Greece - more

  Reports

• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here
• Steel Founders' Society Of America CaSteel Reporter - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Metals prices retreated yesterday, as the complex did not participate in the generally firmer tone we saw in a number of other markets. Energy prices finished higher, the dollar fell, and US stocks advanced to their third consecutive gain. The stronger tone was likely attributable to more positive perceptions about what is going on in Europe. Since there are no substantive proposals floating around (at least none that have been made public), investors have had to console themselves by focusing on relatively trivial nuances, such as whether or not a statement was going to be issued by EU leaders, as was the case on Tuesday. (It was not). In Wednesday's session, investors were apparently impressed that German and French leaders had a conference call with the Greek prime minister, with the leaders announcing that Greece was an "integral" part of the Eurozone and that it should implement all its financial reforms "strictly and effectively". For their part, the Greeks are saying that they are on track to fulfill their targets and should be able to receive the next €8 billion of aid that they need in order to avoid default, presumably once a "troika" team arrives in the Greek capital over the next few days and signs off on the release. The Dutch Finance Minister also expressed support for Greece, something that did not go unnoticed in the markets given the country's almost pariah-like status, while Italy's lower house passed the government's austerity program (as expected). Moreover, there was revived talk of a Eurobond being launched in order to collectivize debt, and although the proposal did seem to contribute to the upside as well yesterday, it is vehemently opposed by the German Chancellor and likely will not see the light of day. On the negative side, an Austrian parliamentary committee failed to approve changes to the Eurozone's bailout fund allowing it to buy bonds. This is not fatal just yet, as the full parliament has yet to vote. (Europe's proposed stabilization fund, which will take over bond buying from the ECB, has to obtain parliamentary approval from each national parliament before it is up and running. Approvals are expected by the end of the year, but in the meantime, the ECB is the “buyer of last resort” for European bounds-- and a reluctant one at that). Right now, metals are higher, recouping some of yesterday's losses. Energy prices are also up, as is the Euro, which is now trading at $1.38, recovering impressively from the $1.3496 low it got to on Monday.  .... Nickel is at $21,662, up $287.  (Daily Metals Report here)
• (Interfax) China produced 77 million tons of steel products in August, up 1.70 percent month-on-month, according to figures released by Shanghai-based Mysteel Information on Sept. 15.
• (WSS) According to figures released by the International Molybdenum Association (IMOA), global production of molybdenum has increased by 14% in the first three months of this year when compared with the same period in 2010.
• India steel demand, output to surge by 2020-JSW - more
• (SSY) Latest update from the World Steel Dynamics SteelBenchmarker indicates a rebound in hot rolled band steel price in the US, which was up $36/t from the year-to-date low of $731/t at end-August to $768/t, the highest level since end-July. The EU price of $758/t rose $5/t during the same period. By contrast, China HRB price slipped by $1/t from its peak to $636/t. World export prices for hot rolled band stood at $711/t in early September, having increased since end-July.
• Metal Suppliers Barely Nicked by Budget Cutters’ Ax...So Far - more
• Reuters Summit-Stop stealing - the reform Russia needs most? - more
• Philippines welcome miners but not polluters - more
• Resource Development and Indigenous Peoples: Finding the path to co-operation – by Assembly of First Nations National Chief Shawn A-in-chut Atleo - more
• (CF) U.S. fastener imports increased 29.9 percent in value to $2.09 billion with a growth of 23.7 percent to 1.43 billion pounds in volume during the first six months of 2011, the Industrial Fasteners Institute reported. U.S. fastener exports also posted strong gains during the first half of 2011, rising 16.9% in value to $1.44 billion. But fastener exports declined 30.4% by weight to 793,315,558 pounds.
• (RITA) The amount of freight carried by the for-hire transportation industry remained the same in July as in June, according to the U.S. Department of Transportation's Bureau of Transportation Statistics' (BTS) Freight Transportation Services Index (TSI) released today. BTS, a part of the Research and Innovative Technology Administration, reported that the level of freight shipments in July, measured by the Freight TSI, remained at the second highest level since August 2008, exceeded only by March and equaled by June

  New Caledonia Resumes Nickel Exports To Korea - New Caledonia nickel ore exports to South Korea are expected to resume following a two-week conflict. - more

  Mining may grow 17% amid rising metal prices - Rising metal prices may push mining output in the Philippines by 17 percent this year, Environment Secretary Ramon Paje said Wednesday. - more

  Glencore drops Minara takeover conditions - Swiss commodities giant Glencore has dropped all conditions attached to its $1.017 billion takeover bid for West Australian nickel miner Minara Resources. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Wednesday, September 14

• Baltic Dry Index - plus 26 to 1,927. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) World Must Cut Deficits, Not Rely on China: Wen // China’s Stocks Advance for First Time in Four Days; Coal Producers Climb // Indonesia, India Intervene to Support Currencies as South Korea on Alert // Risk Rises at ECB as European Banks Lose Deposits // Greece Should ‘Default Big,’ Says Man Who Managed Argentina’s 2001 Crisis // Euro Strengthens as European Leaders Work to Contain Region's Debt Crisis // Deposit Flight at European Banks Raises Risks // Wholesaler Prices in U.S. Little Changed // Geithner Takes Tougher Tone on Europe // Retail Sales in U.S. Unexpectedly Stagnate // Stocks, Euro Gain on Europe Debt Optimism
• The Euro is currently trading nearly 3/10 of 1% higher against the US Dollar. NYMEX crude is down 1.7% and trading at $88.68/barrel. Gold is down 9/10 of 1% and silver is off nearly 1.6%. Base metals ended their session mostly lower and for the most part, quietly. Indicator charts show three month nickel started lower and gradually rose in choppy trading. Dow Jones reports that nickel was today's sole gainer, and finished the day at $9.69/lb . Stockpiles of nickel continue to fall, contradicting forecasts made in mid summer that the second half of the year should see large surplus'. Stockpiles now total just over 98,700 tonnes. Stocks are up on hopes the European debt problems have gone away - for at least today.

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• Manufacturing Drove Cities’ Growth in 2010 - more
• Small Business Hangs ‘Demand Wanted’ Sign - more
• Income, Poverty and Health Insurance Report: Fast Facts - more
• More Americans Are Doubling-Up - more
• Bank of America Cuts Exceed Jobs at Most Banks - more
• Get ready for the next crash - more

  Talvivaara needs two new miner every week - The mining industry in Finland may be better than ever. Also the outlook remains positive. - translated version here

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

• Indicators at 7:05 am CST show 3 month nickel trading around $.06/lb lower, with other London traded base metals lower as well. The Euro is currently trading over 4/10 of 1% higher against the US Dollar. NYMEX crude is nearly 4/10 of 1% lower and trading at $89.87/barrel. Gold and silver are both trading down over 9/10 of 1%. In overnight trading, Asian markets ended lower, with China up nearly 1/2 of 1%. European markets are trading higher this morning, an d US futures show Wall Street has no intention of this weeks bull run. Nickel inventories fell again overnight, and Dow Jones reported three month nickel ended yesterday's trading at $9.66/lb.
• LME Morning - Base metals fall, in 'risk-off' mode as eurozone concerns spiral - more
• Reuters - Copper slips on euro zone debt fears, dollar - more

  Reports

• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Metals ended mixed yesterday, as a weaker dollar helped steady the markets, but all in all, the day had an uneasy feel to it given the types of headlines we were seeing. Earlier in the day for example, the markets perked up when investors were told to expect a joint statement from the French and German leaders expressing support for Greece. However, sentiment soured soon after that when the statement was postponed. Just about the same time, there were reports that US Treasury Secretary Geithner would travel to Europe on Friday to meet with EU finance ministers and reportedly push for an expanded bailout fund and increased intervention. That report was also modified; although the US Treasury Secretary is still going to Europe, he apparently will not be pushing the Europeans to take any particular steps, an official at his office said. Adding his voice to the issue, President Obama told Spanish journalists that Eurozone leaders needed to show the markets they were taking responsibility for the crisis and that weakness in the global economy would persist so long as this issue was not resolved. Others were far more blunt in their assessment; the CEO of Fiat was quoted as saying that "I think there is a possibility, if the wrong steps are taken, that the [Euro] system goes off the rails", not exactly a resounding vote of confidence in the common currency. Meanwhile, in the European bond markets, Italy was forced to pay the highest interest rates for five year-paper since joining the Euro, while credit default swaps now suggest a 90% probability that Greece will default in the next five years. Given the country's massive debt load, we think the 90% probability rate is about right, but that the five-year window is optimistic. Here in the US, President Obama's jobs bill has been shot down by House Republicans, who said they would not support the measure given its reliance on tax hikes, adding that they were content to let those parts of the bill be decided in the November 2012 elections. Amid all the confusion and conflict, we were surprised that markets held up as well as they did yesterday. Perhaps investors are taking stock of the situation in Europe and concluding that things are so chaotic, that some urgent measures must be in the works (thus making the case for not getting too short). It remains to be seen whether this is indeed the case, but given how slowly things tend to transition from concept to reality, we suspect that such hopes are misplaced, which may explain today's softer tone in many markets. Energy, base metals, and US stocks futures are all lower as of this writing. In the case of metals, things were far lower earlier in the Asian session, with Shanghai closing sharply lower and not benefitting from the modest recovery we are seeing in the Western sessions. (See our table in our attachment). .... Nickel is at $21,210, down $90, and continues to drift within a sideways range.  (Daily Metals Report here)
• (MBN) Chinese stainless mills step up buying of refined nickel in September
• SFSA Changing Times in Steel – Safety & Markets - more
• Sandvik CEO says mkt strong despite global turmoil - more
• The Ceridian-UCLA Pulse of Commerce Index® (PCI®), issued by the UCLA Anderson School of Management and Ceridian Corporation fell 1.4 percent in August on a seasonally and workday adjusted basis, following a 0.2 percent decline in July. Based on the July and August data, the PCI will likely decline in the third quarter and suggests GDP growth of zero to 1.0 percent. - pdf report
• China willing to expand investments in Europe - more
• Pacific approaches La Niña. Positive Indian Ocean dipole develops. - more

  Toledo ships nickel ore to China - Toledo has announced the MV Vinalines Queen has sailed for China with 53,600 wet metric tonnes ("wmt") of nickel ore thereby completing the first shipment of high grade, 1.8% nickel grade material from the Berong mine. - more

  China's Molybdenum Market Conditions Hits Bottom This Week And Shows Upward Trend = FeMo resumed CNY200-300/ton within 2 days since price fell at end of last month = Molybdenum price in the Chinese market touched the bottom at the end of August, and continues to keep a flat movement. But, the sign for the improvement on the Mo market appears since this week, and together with this, the markets for molybdenum concentrate and oxide also are picking up. - more

  Judge To Hear Arguments On Kennecott Mine - Opponents of a nickel and copper mine planned for Michigan's Upper Peninsula hope to persuade a Lansing judge to delay implementation of a state permit that would allow drilling to go forward. - more

  Zimbabwe will not cancel mining licences-minister - Zimbabwe had no intention of canceling the mining licences of foreign companies and will continue talks with some miners over a law requiring them to give Zimbabweans a 51 percent stake in their local holdings, the mines minister said on Wednesday. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Tuesday, September 13

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

• Indicators at 7:00 am CST show 3 month nickel trading around $.08/lb lower, with other London traded base metals mixed and mostly quiet. The Euro is trading nearly 1/4 of 1% lower against the US Dollar at the moment. NYMEX crude is up 1.3% and trading at $89.33/barrel. Gold and silver are both trading up over 1/2 of 1%. In overnight trading, Asian markets ended lower, with China down 1.1%. European markets are trading slightly lower this morning and US futures show Wall Street may surrender some of yesterday's gains. Nickel inventories slumped yesterday and now sit just under 99,050 tonnes.
• LME Morning - Metals fumble around Monday's close on lack of positive momentum - more
• Reuters - Copper steady as euro zone worries linger - more

  Reports

• Reuters Metals Insider - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here
• SSINA Releases Market Data for June 2011 - pdf here
• SMM Nickel Price Forecast (Sept. 13-16) - more

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Metals have been quite weak over the last few days, with the selling particularly concentrated in copper and zinc as opposed to some of the others. In fact, copper hit a one-month low yesterday, shrugging off an impressive trade number from China that showed copper imports rising 11% from a month earlier. The sellerish tone has been evident in a number of other markets as well, including energy and equities, as ongoing debt concerns out of Greece is again providing the fodder for the selling, topped up by fresh worries (out yesterday) that French banks may see ratings downgrades in light of their high sovereign debt exposures. It is estimated that the French banks collectively hold some $57 billion of Greek paper. What can be done about Greece, a problem that keeps popping up to bash the markets? Sixteen months after a landmark bailout and seven weeks after another smaller deal were both put into place, not much progress has been made on stabilizing the country. In fact, it has yet to meet budget-cutting targets that EU officials insist need to be met before any further aid continues, and indeed, negotiations were cut short 10 days ago as EU/IMF officials sought to pressure the Greeks over the issue. On Sunday, the Greeks took a step forward in terms of raising more revenue by announcing that they would impose a new two-year property tax that should raise $2.7 billion this year, but even this relatively modest proposal seems to be running into resistance. Other revenue projects are not going that well either; plans to shave the government payroll has yet to result in any significant layoffs, while a scheme to conduct Greek state asset sales has not gained traction in an economy that continues to shrink. Another key provision of the bailouts agreed to in July --one calling for private-sector creditors to defer repayments -- is not fully in place either, as it seems that investor participation is falling short of the 90% threshold the Greeks are insisting on. Meanwhile, dissatisfaction is rising, with mass protests and strikes scheduled in the days ahead. Still, both sides are looking over the horizon and insisting they will succeed. The Greek government maintains that it will stay in the Euro and get its finances in order, while German Chancellor Angela Merkel said today that Europe was doing everything in its power to prevent Greece from defaulting and cautioned that an exit from the Eurozone would unleash "domino effects" and should be avoided at all costs. As Greece flounders, markets were also not pleased to see signs of growing discord within the ranks of the ECB itself, arguably the most respected European institution. On Friday, a top German ECB official resigned in protest over the bank's policy of buying troubled government bonds, but we doubt any change in strategy will ensue as a result. As it now stands, the ECB is the only entity buying sovereign debt, but its "buyer-of-last resort" role is supposed to transition to the EU's stabilization fund. However, before that fund is allowed to buy any debt, it needs to obtain parliamentary sign-offs from each EU country, something that is just now getting underway. Given the disappointing results chalked up so far this year with respect to stabilizing the Greek ship, we would argue that the Euro crisis is now entering a new and much more dangerous phase, one that may force policy makers to either fast-track the stabilization fund, increase its size, or perhaps ease the requirements as to how it can operate. Officials may even have to marshal funds from interested third parties, like China, who according to the FT, is already nibbling at some Greek and Italian debt. However, what may be needed here is for the Chinese to come in with a much bigger checkbook (perhaps rivaling the size of the stabilization fund itself) so it can shore up the European debt market and preserve an important export hub for itself. Failing all this, European policy makers may have to start thinking about preparing the markets for a possible Greek default, while simultaneously trying to control the collateral damage that such a radical step would ensue. The fact that this scenario is now being openly talked about lies at the heart of the market malaise we are seeing. Right now, metals are mixed in very quiet trading, while energy prices are up. The dollar is a tad weaker against the Euro, now trading at $1.3660, but we did break $1.35 briefly yesterday and are well up from the $1.43 level seen at this time last week. US stocks are expected to open lower, following a weaker tone seen in both Europe and Asia, but we are not seeing the heavy futures selling that awaited the Friday and Monday openings. On the US macro front, nothing important comes out today, but August inflation data, retail sales, and industrial production readings all follow later in the week. .... Nickel is at $21,457, down $143, and continues to drift within a sideways range. Support at $20,200, the mid-August low, has yet to be seriously tested. (Daily Metals Report here)
• (Interfax) Baoshan Iron & Steel Co. Ltd. (Baosteel), the Shanghai Stock Exchange-listed subsidiary of state-owned Baosteel Group, will raise ex-works prices for several steel products in October, the firm announced Sept. 13.

  Nickel Stockpile Orders Gain on Signs of Stronger Chinese Demand - Orders to remove nickel from London Metal Exchange stockpiles climbed to the highest level in almost two weeks on signs of stronger Chinese demand. - more

  Norilsk sees nickel stockpiles up - Global nickel stockpiles are now rising slightly after declining for over a year-and-a-half, putting pressure on prices, according to Norilsk Nickel , the world’s largest nickel and palladium producer. - more

  Miners look to reforms to boost Philippine mining - Investment opportunities in a bullish metals market and reforms to perk up the Philippine mining industry will dominate talks at this week's industry conference, but policy flip-flops are expected to remain a hot issue distracting investors. - more

  Courtesy AISI - In the week ending September 10, 2011, domestic raw steel production was 1,869,000 net tons while the capability utilization rate was 76.4 percent. Production was 1,699,000 tons in the week ending September 10, 2010, while the capability utilization then was 70.2 percent. The current week production represents a 10.0 percent increase from the same period in the previous year. Production for the week ending September 10, 2011 is up 0.8 percent from the previous week ending September 3, 2011 when production was 1,855,000 tons and the rate of capability utilization was 75.9 percent. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Monday, September 12

• Baltic Dry Index - plus 38 to 1,876. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) China Hard Landing May Be ’Distant Scenario’ as Data Show Demand Strength // India Industrial Output Grows at Slowest Pace Since ’09, Missing Estimates // Asian Stocks Slide Toward Lowest in a Year on Concern Greece May Default // Inflation Bonds Show Growth Bigger Worry as Rates Point to 1.3% Global CPI // Italian Yields Surge as Papandreou Struggles With Greece Default Concern // European Stocks Decline on Concern Greece May Default; French Banks Tumble // Carry Trades Lose Most in a Year as Stimulus No Barrier to Stronger Dollar // Bank of America to Slash 30,000 Jobs Under New Plan // Stocks Decline on Greek Debt-Default Concern; Treasuries Trim Early Rally
• The Euro is trading over 4/10 of 1% lower against the US Dollar. NYMEX crude is up over 1/2 of 1% and trading at $87.74/barrel. Gold is 2.4% lower and silver is down 2-2/3%. Base metals ended the session mixed and for the most part, quietly. Except nickel. Nickel opened lower and spent much of the morning in the red, until mid day when it jumped higher and never looked back. For the day, Dow Jones reports three month nickel ended the day at $9.79/lb . Rumors of a pig nickel shortage in China as someone stockpiles to start a nickel exchange-traded fund, gave nickel a boost today. Stockpiles of nickel stored in LME approved warehouses rose slightly on Friday and now sit just shy of the 99,250 tonne level. Traders are starting the week pessimistically as European debt concerns set a negative tone. Even safe haven gold is getting hit today, down nearly 2-1/2%. It's apparently a dash for the cash, and considering US treasuries are off their Friday record lows, traders are apparently not sure where to put it.

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• Something Stinks in Euroland - more
• The China Debate Continues - more
• Number of the Week: Elevated Unemployment Rate - more
• The U.S. View on Europe From the G-7 Talks - more
• Robry Monday Morning Economic Assessment - more

  Furnace roof boost for International Ferro - Shares in International Ferro Metals (IFL) roared ahead after the South African ferrochrome producer said the installation of its second furnace roof was completed on 2 September, on time and within budget.- more

  Moly waits for better climate - Moly Mines, the molybdenum hopeful that became an iron ore miner last year, could diversify further while it waits for market conditions to improve enough to give the green light to its flagship Spinifex Ridge project in the Pilbara. - more

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

• Indicators at 7:05am CST show 3 month nickel trading around  $.10/lb lower, with all other London traded base metals lower as well. The Euro is currently trading nearly 1/4 of 1% lower against the US Dollar. NYMEX crude is down 1/2% and trading at $86.19/barrel. Gold is down 1% while silver is lower by 1-1/4%. In overnight trading, Asian markets closed lower, with China off 2/10 of 1%. European markets are trading much lower this morning, and US futures show Wall Street cold open with a big loss. Nickel inventories rose slightly on Friday.    
• LME Morning - Weak euro could see base metals retest August lows - more
• Reuters - Copper dips as Greek default, econ fears mount - more

  Reports

• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here
• U.S. Exports of Stainless Steel Mill Products - more
• US Imports of Stainless Steel Mill Products - more

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - next report will be published on Tuesday
• (JMB) World Stainless Foil Market to Double to 18,500T in 2015
• (TNM) After spending years proving up one of Canada's largest undeveloped nickel-sulphide deposits, Victory Nickel has cleared the final regulatory hurdle to build a mine at its Minago project in northern Manitoba's Thompson nickel belt

  China’s Nickel Import Demand ‘Surging’ as Macquarie Says It’s More Bullish - Nickel import demand in China is “surging” because of a shortage of nickel pig iron, Macquarie Group Ltd. said, citing unidentified sources. - more

  Trend Of China's Import & Export Of Nickels In July 2011 = Import & Export increased as a whole = China's Customs Statistics reports the actual result of import & export of nickels as shown in the attached table. In July, the trend of import & export of nickels was satisfactory except only import of nickel matte was less than the actual result of the previous month. - more

  Zimbabwe: Chrome Exports Ban Anti-Indigenisation - The Ministry of Mines made a decision on July 20, 2011 to ban the exportation of raw chrome ore, chrome fines and alluvial chrome concentrates from Zimbabwe. - more

  Anti-mining advocates' side - Gina Lopez, the untiring managing director of ABS-CBN Foundation Inc. and stalwart champion of environment causes including No to Mining in Palawan movement and the Save Palawan movement, left with me a fair amount of reading materials on why mining must be banned in Palawan. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Friday, September 9

• Baltic Dry Index gains 56 to 1838.
• Notable forecast -  Walter de Wet of Standard Bank - "We believe that downside for base metals are becoming more exposed. This is partly driven by what we believe is policy uncertainty and risk, in especially Europe, which is growing by the day, but also a cyclical slowdown which we believe has a 50% possibility of turning into a recession."
• Nickel stockpiles fall to level of just over 99,000 tonnes.
• Dow Jones reports three month nickel ends week at $9.59/lb , down over $900/tonne in today's trading.  
• World markets sell off after Governing Council member Juergen Stark states he is resigning because of his disagrees with the ECB bond purchase program. Bloomberg is reporting Germany is preparing a contingency plan to safeguard its banks from any Greek bailout ramifications. US Dow presently over 300 points lower. German markets end over 4% lower.
• Have a safe and restful weekend.

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

• Indicators at 7:15 am CST show 3 month nickel trading around $.24/lb lower, with other London traded base metals lower as well. The Euro is currently trading nearly 4/10 of 1% lower against the US Dollar. NYMEX crude is down over 1.1% and trading at $88.04/barrel. Gold is lower by 1.9% and silver is down 1-2/3%. In overnight trading, Asian markets ended lower, with China off nearly 2/10 of 1%. European markets are trading lower this morning and US futures show a possible lower opening. Nickel inventories slipped again overnight.    
• Reuters - Copper falls; growth prospects in U.S., Europe hurt - more
• LME Morning - Metals easier, strong dollar after Obama speech pulls down prices - more

  Reports

• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - next report on Tuesday, Sept 13th
• Technical view on Gold, Silver, Nickel: Nirmal Bang - more
• (JMB) NSSC Raises Ni Series Flat Stainless Base Price in September
• (MB) NSSC's nickel-bearing stainless prices hit 12-month low
• (AMM) China's Benxi to build 800,000T stainless steel mill by 2016
• China's inflation eases to 6.2% in Aug - more

  Metals prices get the shakes - Buy bulks, sell base metals - that is the bottom line message from Citigroup Global Market's latest Commodities Strategy report. - more

  Atlas says subsidiary produced $24.4-m worth of metals - (excerpt) Listed Atlas Consolidated Mining and Development Corp. reported on Friday that its operating subsidiary Carmen Copper Corp. produced an estimated $24.44-million worth of metals in August. - more

  Jinchuan Group joins nickel mining - MacroAsia Corporation said Wednesday its joint investments with China's Jinchuan Group Ltd in a nickel mine in southwestern Palawan province may reach $1 billion. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Thursday, September 8

• Baltic Dry Index - plus 38 to 1,782. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) China Sold Japanese Debt in July for Ninth Month, Japan’s Government Says // Asian Central Banks Hold Interest Rates Amid Threat of Slowdown in Exports // Asia Stocks Swing Between Gain, Loss as Share Sales Temper Stimulus Hopes // Bank of England Resists Calls for More Monetary Stimulus to Boost Growth // Berlusconi Austerity Plan Passes Senate in Bid to Appease ECB, Investors // European Stocks Advance for a Second Day as Home Retail, KBC Shares Rally // China Puts Show No Faith in Wall Street Predictions for Rebound: Options // U.S. Trade Gap Narrows in Bright Spot as Jobless Claims Unexpectedly Climb // Euro Drops, Treasuries Gain on Economic Outlook as U.S. Stocks Fluctuate
• The Euro is now trading over 1.1% lower against the US Dollar. NYMEX crude is up nearly 3/10 of 1% and trading at $89.59/barrel. Gold is up over 2.1% and silver is higher by  the same. Base metals ended the session higher. Indicator charts show nickel stumbled early, but then went on rally run in the afternoon, to only stop after punching through the $22,000 tonne level. Dow Jones reports three month nickel ended the day at $10.01/lb . Stockpiles of nickel stored in LME approved warehouses fell below the 100,000 tonne level yesterday, for the first time since March 2009. After a fifth straight day of large withdrawals being recorded, the current level sits just under the 99,200 tonne level. This news is supporting nickel, although base metals in general are up with equity markets. European markets ended the day higher, but the Dow has yet to decide where it will end up. After an volatile morning, the Dow is presently measuring a big fat goose egg.

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• (Dow Jones) U.S. nickel exports rose 12.7% in July from the previous month, but was down 26.9% from the previous year, the Commerce Department reported Thursday.
• (Dow Jones) U.S. nickel imports rose 5.4% in July from last month, but was down 21.2% from the previous year, the Commerce Department reported Thursday.
• The Greater Recession: The Real Reason Americans Feel So Squeezed - more
• Overseas Tax Break Won’t Fire Up U.S. Job Machine - more
• Vital Signs: Companies Slow to Fill Job Openings - more
• New Recession or Double Dip? - more
• Sucktember - more

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

• Indicators at 7:00 am CST show 3 month nickel trading around $.07/lb lower, with all other London traded base metals lower and quiet as well. The Euro is presently trading nearly 1/2 of 1% lower against the US Dollar. NYMEX crude is off 1/10 of 1% and trading at $89.24/barrel. Gold is up 1-2/3% and silver is up the same. In overnight trading, Asian markets ended higher, with China down over 8/10 of 1%. European markets are trading higher this morning, and US futures are revealing no clues yet. Nickel stockpiles fell below the 100,000 tonne level overnight with a large decline recorded.   
• LME Morning - Metals remain rangebound, await direction from Obama speech - more
• Reuters - Copper stable on growth fears, supply tightness - more

  Reports

• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Most markets rebounded sharply yesterday, with energy among the standouts after oil finished at a five-week high. Base metals also gained ground, as did US stocks, but both gold and bonds were the big losers, with the precious metal losing some 4% over the course of the day. Copper prices led the LME advance, as labor disputes continued to weigh on the market. In this regard, a two-day strike by workers at Cerro Verde started yesterday and the possibility of an indefinite action was left open as well. Freeport's workers are set to strike from Sept. 15 to Oct. 15. A weaker dollar also underpinned metals, falling 0.4% against a basket of currencies. The strongest really was in the US equity markets, with the Dow tacking on 275 points after several days of weakness. Stocks teed off a better tone coming out of Europe and investors were also heartened by the sharp advance in Chinese equities, where the feeling is growing that the government there may soon start ease its tighter money stance given moderating growth trends. We will have to see what China's inflation readings are when they are released later this week, but the talk is that the number could come in slightly less than expected, allowing authorities room to back off. In fact, Bloomberg ran a good article (that can be accessed in the link contained in our attachment) talking about moderating inflationary trends now evident worldwide that would potentially allow central banks to first stand pat and then start decreasing rates in the months ahead. This is a theme that we have been pursuing as well, although we suspect a decrease in rates is still a few months down the road and very much contingent on further declines in oil prices.
• Right now, metals are slightly lower, as are energy prices, but gold is a little higher after the drubbing it took yesterday. The dollar is advancing against the Euro and has just now broken the $140 mark after the ECB’s Jean Claude Trichet announced that he would hold rates unchanged, while downgrading growth and inflation prospects at his news conference (going on now). The markets are also waiting for any guidance he could give on the ECB's bond-purchasing program. Recently, there has been some concern that the central bank has backed off buying bonds as a way of pressuring various government to move along with their austerity programs. European stocks are slightly lower, as were Asian stocks overnight on reports that core Japanese machinery orders fell twice as much as expected in July. Wall Street is expected to open lower after the downbeat Trichet remarks and news that weekly initial jobless claims came in at 414,000 vs. the consensus forecast of 400,000. .....  Nickel is at $21,440, down $195 after having a good day on the upside yesterday. (Daily Metals Report here)
• (Interfax) China's Ministry of Commerce (MOFCOM) has launched an anti-dumping investigation into certain high-performance stainless steel seamless tubes from Japan and the European Union (EU), MOFCOM announced Sept. 8.
• China's steel output running red hot - more
• Many in U.S. slip from middle class, study finds - more

  Aperam sees nickel average $24,000-25,000 next yr - Stainless steel maker Aperam expects the price of nickel to be above $20,000 per tonne by the end of the year and will average at between $24,000 and $25,000 next year, the head of the group's global purchasing said on Wednesday. - more

  South Korean ferromoly plants continue active moly oxide buying - Ferromolybdenum plants in South Korea continued to buy spot molybdenum oxide from overseas traders this week to replenish stocks ahead of the fourth quarter, market sources said Thursday. - more

  RusAl chairman wants to discuss price of Norilsk stake - RusAl wants to discuss the price of its stake in Norilsk Nickel, the aluminum giant's board chairman, Russian tycoon Viktor Vekselberg, said in a letter to Norilsk's management obtained by Prime news agency on Tuesday. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Wednesday, September 7

• Baltic Dry Index - minus 23 to 1,744. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) Asia Dragged Down by Europe’s Crisis Forced to Hold Rates as Prices Climb // Swaps Signal Asia Will Abandon Rate Increases This Week: Chart of the Day // China’s Stocks Advance for First Time in Week on Policy Easing Speculation // Stevens Signals Global Risks Outweigh Australia GDP Gains in Rates Debate // Indian Blast Kills 11 Near New Delhi High Court in Worst Attack Since 2008 // South Korea’s Lee Fails to Garner His Own Party’s Support for Tax Cut Plan // U.K. House Prices Decline 1.2% as Underlying Trend Improves, Halifax Says // Zapatero Sacrifices Party for Cuts as Spain Debt Beats Italy: Euro Credit // Finland May Abandon Greek Bailout If Collateral Not Granted, Katainen Says // Germany’s Top Court Rejects Constitutional Challenges to Euro Rescue Fund // European Stocks Rebound From Two-Year Low; Richemont Advances on Revenue // Obama Confronts 27-Week Unemployment Increase as This Century Is Different // Fed’s Evans Calls for Stimulus to Cut Unemployment to 7.5 Percent // Stocks Rebound From Four-Day Decline as U.S. Treasuries, Dollar, Gold Fall
• The Euro is presently trading 1/2 of 1% higher against the US Dollar. NYMEX crude is up 4% and trading at $89.46/barrel. Gold is down over 2.8% and silver is lower by 1%. Base metals all ended the session on the plus side today. Indicator charts show nickel opened much higher, and as equity markets grew during the afternoon, nickel followed. For the day, Dow Jones reports three month nickel gained over $1000/tonne and ended at $9.87/lb . Stockpiles of nickel stored in LME approved warehouses took another big hit yesterday and are now in serious jeopardy of falling below the psychologically important 100,00 tonne level. The last time we saw a total under 100,000 tonnes was March of 2009. At present, warehouses now hold a little over 100,450 tonnes, and this is a new low level for 2011. Markets around the world are trading higher today, but we will have to wait and see if it is anything more than a relief rally.  

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• Walter de Wet of Standard Bank - "However, based on our underlying fundamental view of the commodity markets we believe that while base metals and energy may rally when equities bounce, they are likely to fall by a greater margin should equities decline."
• The Fed's Camps - more
• Poll: Recession Had More Personal Impact Than 9/11 - more
• ‘Heavy Lifting’ Still to Come for Consumers - more
• (Reuters) German Chancellor Angela Merkel said on Wednesday that the euro zone's crisis could not be solved with radical quick fixes like jointly issued bonds, and that instead the bloc faced a "long hard" path to slash back debt built up over decades.
• Tropical Depression AL14 building in Atlantic - more

  Courtesy AISI - In the week ending September 3, 2011, domestic raw steel production was 1,855,000 net tons while the capability utilization rate was 75.9 percent. Production was 1,669,000 tons in the week ending September 3, 2010, while the capability utilization then was 69.0 percent. The current week production represents a 11.1 percent increase from the same period in the previous year. Production for the week ending September 3, 2011 is down 0.3 percent from the previous week ending August 27, 2011 when production was 1,861,000 tons and the rate of capability utilization was 76.1 percent. - more

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

• Indicators at 7:05 am CST show 3 month nickel trading around $.25/lb higher, with other London traded base metals higher as well. The Euro is presently trading 1/3 of 1% higher against the US Dollar. NYMEX crude is up 1-1/3% and trading at $87.17/barrel. Gold is down 1.8% and silver is lower by 2%. In overnight trading, Asian markets ended higher, with China up over 2%. European markets are trading much higher this morning, and US futures show Wall Street could open with a triple digit bounce on the Dow. Nickel inventories fell hard again overnight.    
• LME Morning - Metals higher, technical buying and covering halts three-day downtrend - more
• Reuters - Copper up, but demand jitters cap gains - more

  Reports

• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Metals slipped lost modest ground yesterday, as the stronger dollar and lingering concern about the European debt situation continued to weigh on the markets. Threats of strikes kept the losses in copper somewhat in check, but could not dispel the selling entirely. Global stock markets continued to fall on Tuesday, although the Dow pared the bulk of its almost 300 point decline to close with a 100 point loss, possibly on relief that the August ISM service number came in somewhat stronger than expected. The report continues to underline the recent trend of macro numbers showing relative resilience in the US economy, with housing and the labor sector being the glaring exceptions. Right now, most markets are higher. Copper is back over the $9000 mark and helping the modest gains we are seeing in the rest of the group, with the exception of ali, which is sitting things out, practically unchanged on the day. Oil prices are up by $.90 a barrel after an impressive recovery yesterday on possible weather disturbances in the Atlantic. This is peak hurricane month for oil, so price declines, when they do occur, will likely be reversed on the faintest signs of potential trouble. In the currency markets, the Euro is slightly stronger today, (now at $1.4050), after breaking $1.40 briefly yesterday, as is the Australian dollar, which rallied sharply after a report showed the economy there grew at its fastest pace in four years last quarter. The Swiss franc was little changed at 1.2058 per Euro, a day after the central bank set a peg at 1.20 versus the Euro.  ..... On the macro side, we get the Fed's Beige Book later today, likely suggesting weak, but still positive growth. We do not have much to add in today's comment to what we have been saying lately; we suspect that most metals will continue to trend slightly lower over the fourth quarter, particularly given the unsettled macro conditions and growing sings off slowing in most economies. ..... Nickel is at $21,225, up $550, and seeing a good pop today. (Daily Metals Report here)
• (Reuters) China's nickel output is expected to be 440,000 tonnes this year, an executive at the country's top nickel producer Jinchuan Group said on Wednesday.
• (Yieh) According to statistics released by the Japan Iron and Steel Federation (JISF), Japan imported by 14,404 tons of stainless steel in July, down by 21.9% in comparison of 18,450 tons in June. However, it remained flat from a year earlier.
• (Interfax) - Jinchuan Group Ltd. (Jinchaun), China's largest nickel producer, and Filipino holding group MacroAsia Corp. (MAC) have agreed to jointly invest roughly $1 billion in a nickel mining project in Palawan province in the southwest Philippines, MAC said Sept. 7.
• (OO) JSL Ltd (formerly Jindal Stainless Ltd) will invest Rs 6000-7000 crore on scaling up the capacity of its steel plant at Kalinga Nagar in Jajpur district from one million tonne per annum (mtpa) to 3.2 mtpa. The steel maker hopes to achieve the expanded capacity within four years.
• (MENA) DJ China Jinchuan, MacroAsia To Invest $1 Bln In Philippine Nickel Mines
• (MB) Numis raises 2012 nickel price forecast, downgrades copper, zinc, ferro-chrome
• (DJ) Western Areas Seeks Interest For Nickel Supply Contract
• (MBN) Baosteel Stainless cuts nickel pig iron usage on falling refined nickel prices

  France's Eramet sees nickel demand rising 4-5 pct a yr - Global nickel demand is seen rising 4-5 percent a year, the chief executive at French mining group Eramet said on Wednesday. - more

  China nickel ore imports to slow in H2 vs H1 - Jinchuan exec - China's nickel ore imports are expected to slow in the second half compared with the first, an executive at the country's top nickel producer Jinchuan Group told Reuters on Wednesday. - more

  $14-B investments in mining eyed from China within the next 5 years - Four mining agreements signed with Chinese companies which showed the government’s support for mining activities in the country could bring in $14 billion in investments within the next five years. - more

  Indonesia May Tax Shipments of Raw Minerals, Minister Says - Indonesia is considering imposing a tax on exports of mineral ores and concentrates such as nickel, copper and iron ore before their shipment in non-processed form is banned in 2014, Industry Minister Mohamad Hidayat said. - more

  Eramet to Spend $6 Billion in Indonesia, Minister Says - Eramet SA, operator of the world’s biggest ferronickel plant, plans to invest a total of $6 billion on the Weda Bay nickel project in Indonesia, the nation’s Coordinating Minister for the Economy Hatta Rajasa said. - more

  August LME Nickel Price Falls To US$10.02 Per lb. On Average = Due demotion of USNB, US$9.20's likely, but US$10.00's resumed this month = The average price of LME nickel in August, 2011 becomes clear. According to this, the average prices of LME nickel in August fell to US$22,083.86 per ton for spot and cash (US$10,017 per lb.) $22,100.00 per ton (US$10,024 per lb.) for 3-month forward buying. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Tuesday, September 6

• Baltic Dry Index - plus 17 to 1,767. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) China’s Stocks Decline for Fourth Day on Concern Economic Growth Will Slow // Australian Central Bank Holds Key Rate, Citing ‘Unsettled’ Global Markets // Asia Stocks Slide as Europe Debt Crisis Worsens; Hong Kong Surges to Close // Swiss National Bank Pledges Unlimited Currency Purchases // Greek Bonds, Notes Fall to Records on Concern Bailout Rendered Redundant // Default Swaps on Treasuries Drop to Record Low Against Bunds in S&P Denial // European Stocks Retreat to Two-Year Low After Debt-Crisis Concern Deepens // Banks Driving Widest Price Swings in Last Trading Hour Since 2009: Options // Zoellick: World in ‘Dangerous’ Period With EU Turmoil // Roubini Says Global Economic Slowdown Accelerating Next Financial Crisis // U.S. ISM Services Index Increased in August // U.S. Must ‘Stop Punishing Banks,’ Halt Putback Claims, FBR’s Miller Says // Stocks Slide, 10-Year Treasury Yield Drops
• The Euro is now trading over 8/10 of 1% lower against the US Dollar. NYMEX crude is down 2.4% and trading at $84.37/barrel. Gold is down 1.3% and silver is down over 2.1%. Base metals ended the session mostly lower and quiet. Indicator charts show nickel opened lower, climbed back up to where it ended yesterday, then fell hard as equity markets soured, recovering some late. Dow Jones reports three month nickel ended the session at $9.38/lb . Stockpiles of nickel stored in LME approved warehouses fell to their lowest levels since March 2009 yesterday, and now sit just over the 101,600 tonne level. Cancelled warrant readings remain high.  The US Dow opened much lower this morning but appears to be attempting a recovery. European markets took a bath yesterday, with Germany's markets ending 5% lower, and while ending lower today, neither got hit nearly as hard. European debt concerns are taking center stage again.

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here
• Robry Weekly Economic Assessment - more

  Commodity/Economic Articles and Comments

• Demand for Food Stamps Remains High - more
• Corporate Tax Rate’s ‘Silly’ Effect on Decisions to Build Factories - more
• WP: Special Report on “Breakaway Wealth” - more

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

• Indicators at 7:05 am CST show 3 month nickel trading around $.11/lb lower, with other London traded base metals mostly lower. The Euro is trading over 1/10 of 1% higher against the US Dollar at the moment. NYMEX crude is down nearly 2.8% and trading at $84.05/barrel. Gold is down 1/3 of 1% and slipped back under $1900/ounce, which it hit yesterday. Silver is down 1-2/3%. In overnight trading Asian markets traded lower, with China down 3/4 of 1%. European markets are trading lower again this morning, after taking a bath yesterday. US futures are currently showing at a negative 200 opening, as US markets play catch up to yesterday's worldwide sell off. Nickel inventories fell hard for a third consecutive session, and to a level now seen since March 2009.  
• Reuters - Copper steady, China buying offset growth concerns - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here
• Weekly Scoreboard - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Metals were under pressure on Monday, with copper trading at a one-week low on the back of continued weak macro data. In this regard, besides the weak service readings out of Europe referenced in Monday's note, Markit Economics said its Indian purchasing managers' index grew at its slowest pace in more than two years in August, while August Chinese service activity fell to a low of 50.6. Some support for copper arose from the supply side, where workers at Peru's Cerro Verde said they will launch a 48-hour strike starting tomorrow, while Freeport's mine workers in Indonesia have also threatened to strike on September 15. However, on balance, yesterday’s weaker tone in European equity markets, coupled with a struggling Euro and concern about the general global outlook, more than offset any supply-related issues. In addition, European debt concerns continue to be a source of angst; Italian bond yields rose to one-month highs yesterday, as pressure mounts on the government to get its fiscal house in order and get a credible austerity package passed. The suspension of an EU/IMF mission to Greece last week is also raising questions over where those negotiations stand, with the German finance minister bluntly warning the Greeks today that their next loan installment could be in jeopardy. In addition, markets are waiting for a ruling out tomorrow from a German high court on whether Berlin is breaking German and European law by contributing to multi-billion euro bailouts. Finally, there is an ECB rate decision out on Thursday, but this seems to have faded in terms of importance, as it is unlikely the central bank will decide to raise rates amid such a bleak environment. Right now, metals are showing only very minor changes on the day, having climbed back from earlier lows. Copper got to a low of $8870 earlier, but is now $100/MT higher, and many of the other metals have climbed back as well. The Euro has helped the snap-back by recovering to $1.4160, up from $1.4040 reached earlier in the day. The currency has moved higher on the stunning announcement out by the Swiss National Bank that it will be pegging its currency to the Euro (at a minimum target of 1.20 francs) and that it would enforce this rate by buying foreign currency in unlimited quantities. This is the kind of unilateral thinking that has doomed similar currency pegs in the past and it remains to be seen if the Swiss can pull it off. We have our doubts on this score, although we have to hand it to the Swiss for coming up with a novel and totally unexpected approach to dealing with their soaring currency. In the meantime, the announcement has had its intended consequences, with the Euro soaring by some 9% against the Swiss franc, while the dollar has gained some 7%. However, the stronger Euro is not leading to any noticeable improvement in the tone of European equity markets, which are down again today, paving the way for another sloppy opening on Wall Street. Chinese stocks finished lower for a fourth straight day. In other commodity markets, gold prices are on the defensive after hitting a record high earlier in the day, while Brent is up by almost $1/brl after shedding $2.30 in Monday’s session. At this stage, most macro indicators that have been coming our way over the past month are telling us that the global economy is firmly entrenched in a "soft patch", one which will likely need more time to play itself out. Ironically, one variable that could get the "healing process" under way rather quickly, would be lower energy prices. Such a development would act like a giant global tax cut and, more importantly, could persuade central bankers to stop raising interest rates in light of lower inflation readings. In fact, many central bankers could even start decreasing rates, as the Brazilians did last month. In the meantime, we cannot get too excited about metal prospects for the balance of the year, even in complexes like copper, which continue to be plagued by supply-related issues. When demand for a metal starts to erode, it typically more than offsets the impact of any “normal” supply-side disruptions, and we think copper may eventually fall victim to this scenario, especially if a slow-down gathers momentum in China. .... Nickel is at $20,570, down $325, and nearing the 2011 low of $20,200; we expect the level to be tested and eventually broken. (Daily Metals Report here)
• (smh) Among other industrial metals, a favourable price differential between Chinese and Western markets has encouraged stockpiling of nickel in bonded warehouses in China, a trader said. Cancelled warrants for nickel, the metal earmarked for delivery, climbed to a four-year high at 8.6 per cent of total stock.
• (SBB) Macquarie Commodities Research expects a surplus in the global nickel market in the second half of this year, but an even larger nickel surplus could emerge next year.
• (Australia) Mining employers demand Fair Work overhaul - more
• It's their smelter, they'll close if they want - more
• (Cass) Freight shipments in August increased a modest 1.9%, while overall spending on freight decreased 3.8%. - more

  China Jinchuan to invest in two Philippine laterite mines - China's Jinchuan Group Ltd is to invest in two laterite mines in the Philippines after signing agreements with two companies last week. - more

  Molybdenum production up 14% - Global production of molybdenum rose by 14 per cent in the first three months of this year compared with the same period in 2010, according to figures released by the International Molybdenum Association (IMOA). - more

  Market Tendency On Imports Of Ferro-Alloys At 31st August 2011 - The market tendency by item on imports of ferro-alloys into Japan at the 31st August of 2011 is as follows - more

  Chinese under-reporting of steel output persists in 2011, but motives differ from last year - The Chinese steel industry is struggling to meet soaring demand from infrastructure and social housing projects, and is turning to high cost, previously shuttered, steel mills to make up the difference.  - more

  Rusal Rejects Norilsk's $8.75 Bln Buyback Offer - Update - Russian aluminum producer United Company Rusal Plc said Monday its board of directors has unanimously rejected OJSC Norilsk Nickel Mining and Metallurgical Co.'s (NILSY.PK: News ) $8.75 billion offer to buy back part of Rusal's stake in Norilsk. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Friday, September 2

  Daily Nickel/Stainless Steel Wrap-up

• Baltic Dry Index - plus 58 to 1,740. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) China’s Stocks Fall on Inflation, Extend Worst Weekly Drop in Three Months // Credit-Default Swaps Paying the Most to Bonds Since 2009: Australia Credit // Asian Stocks Snap Six-Day Winning Streak Ahead of U.S. Employment Reports //  London Stock Exchange Joins Bidding for Swaps Clearinghouse LCH.Clearnet // European Stocks Plunge as U.S. Employment Stagnates; AstraZeneca Tumbles // U.S Employment Stagnated in August // Stocks Tumble, Treasuries Surge on No Jobs
• The Euro is now trading 4/10 of 1% lower against the US Dollar. NYMEX crude is down 2.2% and trading at $86.98/barrel. Gold is up 2-2/3% and silver is up 3.6%. Base metals ended their session lower. Indicator charts show nickel slid early, then dropped again when the US employment report was released. For the day and week, Dow Jones reports three month nickel closed at $9.74/lb . Stockpiles of nickel stored in LME approved warehouses took a big hit yesterday and now sit just under 103,300 tonnes. Cancelled warrants remain high, so continued stock volatility is likely. The Dow is trading in the 200 points lower range after July employment figures came out as expected. The report advised the 'average workweek for all employees edged down by 0.1 hour over the month to 34.2 hours'. Amongst a report full of bad news, this one statistic stands out as an economic indicator watched closely by some of those responsible for making official recession calls. Apparently the market wanted something besides what analysts forecast. Better news would have meant signs of economic recovery. Even worst news might have forces the Fed into taking QE3 measures. Now - the market is left to wonder. US markets are closed on Monday for Labor Day.

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• Long-Term Unemployment Casts Doubt on Fed’s Ability to Help - more
• Global Manufacturing Slowdown Shows Every Nation Can’t Count on Exports for Growth - more
• August Sales: How Retailers Fared - more
• Germany fires cannon shot across Europe's bows - more
• Welfare Rates Almost Unchanged During Recession - more
• Study confirms child hunger is a growing problem in rural areas - more

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

• Indicators at 7:05 am CST show 3 month nickel trading around $.06/lb lower, with other London traded base metals lower as well. The Euro is trading less than 1/10 of 1% lower against the US Dollar. NYMEX crude is down nearly 1% and trading at $88.10/barrel. Gold is up over 1.8% and silver is up more than 2.4%. In overnight trading, Asian markets ended lower, with China off nearly 1.1%. European markets are trading lower this morning and US futures show Wall Street may open lower. That is, unless the US employment report that everyone is waiting on, comes out with some unexpectedly good news. Nickel inventories fell hard overnight.  
• LME Morning - Metals locked in sideways trading, bearish on economic data - more
• Reuters - Copper falls as QE3 in U.S. less likely after data - more

  Reports

• Commodities Daily - pdf here
• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Metals retreated slightly yesterday, as the barrage of generally weaker macro statistics weighed on the markets. Even the better-than-expected August ISM number out of the US failed to provide much of a lift, although it did likely prevent the selling from gathering pace. In this regard, the ISM number came in at 50.6, well ahead of the 48.6 reading expected, and more importantly is now back into growth territory. However, some of the underlying components were biased towards the downside. As examples, although new orders strengthened from 49.2 in July to 49.6, they remain in contraction mode, while order backlogs contracted for a third consecutive month. In addition, investors have to reconcile the stronger number against last month's batch of relatively uneven regional surveys, including the weakest Philadelphia Fed Business Outlook (-30.7) since March 2009 and the lowest Richmond manufacturing reading (-10) since June 2009. Although the more recent Chicago and Kansas City PMI's held up much better, the fact that the ISM went positive amid such varying readings suggests the implied strength in manufacturing remains somewhat murky. However, there is no doubt that at least car sales have perked up of late, and this likely explains some of the better readings. Reports out yesterday showed that major US automakers experienced double-digit sales gains in August compared with year-earlier levels. GM reported a gain of 18%, Ford saw sales rise by 11%, and even Chrysler’s sales were up 31%, its largest increase in four years. Other US macro numbers out yesterday showed Q2 productivity readings and weekly initial claims levels coming in roughly in line with estimates and not creating much of a stir. Later today, we get the key US August nonfarm payroll number. The consensus forecast is looking for 70,000 jobs, but the divergence in estimates is quite wide, with some banks, like Goldman Sachs, slashing their forecast to as low as 25,000. We suspect the jobs number will come in less than expected, (MF Global’s chief economist is forecasting 40,000), as there has been a spate of layoff announcements over last few weeks that will likely put a substantial dent in the overall increase. As a result, we could see yet another sloppy day in the US equity markets, with weakness likely spilling over into metals. Right now, we are down ahead of the jobs number, with copper around $9070 and pretty much giving back most of the modest gains it has chalked up so far this week. Other metals are also lower, with lead being particularly hit hard for a second day running. Oil prices are off by another $.80/barrel, but we do not think a major sell-off will set in here given a number of weather systems that are now in formation. US equities are called to open lower, following another down day yesterday. (In a sign of how confusing --or deranged -- things are getting in the stock market, some analysts are suggesting that stocks may have sold off yesterday because the stronger US macro data in recent days reduces the need for a QE3 package from the Fed, so the implied conclusion is that investors prefer a weaker economy and would rather see a stronger printing press coming to the rescue. On the currency side, the dollar is holding steady at $1.4250 against the Euro, while gold is higher, slowly reclaiming the ground it lost in the recent correction.  ....  Nickel is at $21,560, down $190; resistance at $22,000 remains intact.(Daily Metals Report here)
• (Yieh) The US Department of Commerce (DOC) announced to evoke the antidumping (AD) order on stainless steel plate in coils from Italy.
• Russian Stainless Steel Consumption comparison - more
• (Interfax) Longstanding issues of oversupply in China's steel market are set to spread overseas, putting pressure on high international iron ore prices, Luo Bingsheng, party secretary of the China Iron and Steel Association (CISA), said Sept. 1.
• Mass Asian industrialisation to keep feeding into coal, iron demand  - more

  Supply And Demand Of Ferro Chrome In Japan For First Half 2011 = Reduced Production Of Special Steel Had Caused To Decrease HcCr Consumption By 8.4% - Let us trace the supply and demand of Ferro Chrome in Japan for the first half (January - June) of 2011. Japan produced 11,727,700 tons of crude special steel in the first half of 2011, having decreased by 1.9% compared with that (1,195,000 tons) in the same period of 2010, and this decline of the output influenced on consumption of High Carbon Ferro Chrome in the period. - more

  Foes make final try to stop UP nickel, copper mine - Opponents of a planned nickel and copper mine in Michigan's Upper Peninsula have mounted a last-ditch legal effort, asking a judge to put a state-issued permit for the project on hold ahead of initial blasting expected this month. - more

  Colombia miners happy over reform, fret about future - Miners in Colombia welcome institutional changes such as creating a new mining agency, but worry about an upcoming tax reform and a bill to raise royalties. - more

  Fatality at Toledo's Berong mine - AIM-listed nickel miner Toledo revealed that one of its workers died during operations at the Berong project in the Philippines. - more

  Russian billionaire sets sights on being PM - Billionaire businessman Mikhail Prokhorov is not satisfied with being one of Russia's richest people and its most eligible bachelor. He also wants to be its prime minister. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

Thursday, September 1

• Baltic Dry Index - plus 63 to 1,682. (chart)
• Dollar graph in lower right corner of this page - (chart of dollar index) (live java chart)
• Headlines & leaders - (Bloomberg) Asian Manufacturing Slowdown May Aid Region’s Campaign to Stem Inflation // Chinese Manufacturing Index Near 29-Month Low Signals Limits on Tightening // Wen Says China to Focus on Taming Inflation Even as Economic Growth Slows // Asia Stocks Set for Best Streak Since January on Factory Orders // Swiss Franc Climbs, Euro Weakens Against Dollar on Economic Growth Concern // Swiss Economy Grows at Weakest Pace Since ’09 as Strong Franc Cuts Exports // EU Manufacturing Shrinks More Than Estimated // European Stocks Rise for Fourth Day After Better-Than-Forecast U.S. Data // U.S. Self-Employed Struggle to See Opportunities // Surprise U.S. Factory Growth Eases Recession Concern // Treasuries Gain, Dollar Pares Gain as Attention Turns to U.S. Jobs Report
• The Euro continues to trade lower against the US Dollar, now down over 1/2 of 1%. NYMEX crude is up 1% and trading at $89.74/barrel. God is up over 1/10 of 1% and silver is higher by 3/10 of 1%. Base metals ended the session lower on a stronger Dollar. Indicator charts show nickel slumped early and traded in a narrow band the remainder of the session. Dow Jones reports three month nickel closed at $9.87/lb , unable to breech the $10/lb mark for a second consecutive day. Stockpiles of nickel stored in LME approved warehouses returned to positive growth and now total just over 104,500 tonnes. Markets are quiet today as today's economic news was apparently a draw and markets are nervously awaiting US employment numbers for July tomorrow.

  Reports

• Commodities Daily - pdf here
• Reuters Metals Insider - pdf here

  Commodity/Economic Articles and Comments

• Corn Catching Up With Saudi Oil as U.S. Fuel - more
• Vital Signs: Private Hiring Slows - more
• World-Wide Factory Activity, by Country - more

  Caraga mining sector likely to create 15,000 new jobs - Labor Secretary Rosalinda Baldoz sees the mining sector in Caraga generating 15,000 new jobs as private mining firms establish a nickel mining and processing plant in the region. - more

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

• Indicators at 7:00 am CST show 3 month nickel trading around $.13/lb lower, with other base metals trading lower as well. The Euro is down 6/10 of 1% against the US Dollar at the moment. NYMEX crude is unchanged at $88.80/barrel. Gold is down 1/10 of 1% while silver is higher by more than 1/10 of 1%. In overnight trading, Asian markets ended higher, with China dropping 4/10 of 1%. European market are trading lower this morning, while US futures show a possible negative open for Wall Street. Nickel inventories bounced higher overnight.  
• Bloomberg morning - Copper Declines for First Session in Seven on Concern China Growth Slowing - more
• LME Morning - Base metals drift lower, market awaits direction from US data - more
• Reuters - Copper caps worst monthly loss since June 2010 - more

  Reports

• Daily Market Report - pdf here
• Commodities Report - pdf here
• Commodities Daily - pdf here
• Metals Insight - pdf here

  Commodity/Economic Comments

• Edward Meir of MF Global Morning Comments - Copper rose yesterday for its seventh consecutive daily gain. Supply concerns and better-than-expected data from the US provided support, as did the improving technical picture. whereby the 200-day moving average on LME copper and the 100-day on COMEX were both taken out on the upside. Also helping the advance early in the day, were the relatively decent macro numbers reported out of the US. In this regard, August factory activity in the Chicago area came in at 56.5, well ahead of the 53 number expected, while July factory orders increased by 2.4%, ahead of the 1.8% forecast. (In both cases, the surge in automobile production most likely tipped the numbers into stronger territory). Finally, ADP showed private employers adding 91,000 new jobs in August after expanding payrolls by 114,000 in July. A good deal of the higher moves we have been making in metals over the past few days have been given back in today's session, particularly in lead and zinc, which are down sharply. Copper and ali are also off, as macro concerns are again pushing to the fore. In this regard, we got Chinese PMI numbers out overnight showing that factory activity rebounded a touch in August, with the index rising to 50.9 in August from a 28-month low of 50.7 in July and coming in very much in line with estimates. However, the sub-index for new export orders dipped to 48.3 from 50.4, while the sub-index for overall new orders was at 51.1 -- unchanged from July. Hurt by Beijing's steadily tightening monetary policy, China's PMI has fallen steadily since March, but not enough to make a dent in the country's persistently high inflation readings. In fact, the input price sub-index in the PMI data, a measure of how much factories pay for raw materials and intermediary goods, picked up to 57.2 in August from 56.3 in July. Similar readings out of Europe were worse, with August manufacturing activity falling back into contraction territory, with the index coming in at 49 versus the 50.4 seen in July, and ending a nearly two-year run in positive territory. Manufacturing activity recoiled sharply in both France and Italy, and output also fell in Ireland, Spain, and Greece. While Germany slowed to a crawl, it continued to grow. More disturbingly, new orders fell in all the countries surveyed, including Germany. The weak data has sparked a decline in the Euro, which is now trading at $1.4280, well off its intraday high of $1.4550 reached on Monday, and contributing to the pressure we are seeing being in both base metals and energy. We will be getting quite a few numbers out of the US later today, including revised Q2 productivity readings (expected down 0.5%), weekly initial claims (expected at 408,000), the Institute for Supply Management's August manufacturing index (expected at 48.5) and July construction spending (expected at +0.1%). Of the lot, the ISM number will be the most important, and our sense is that it could surprise to the upside given the strength we have been seeing in some of the regional readings of late. This could perhaps check some of the selling we are currently seeing, and lead to a modest recovery in prices over the course of the day. Nevertheless, today's batch of numbers, particularly out of Asia and Europe, show that the global economy is still mired in a soft patch, hardly a scenario for robust metal price appreciation over the short-term.  .... nickel is at $21,835, down $365; we are still waiting for a second day close above $22,000 (today), but so far, that does not seem to be happening. (Daily Metals Report here)
• Rio Tinto forecasts 'staggering increase' in world demand for steel component  - more
• (China) PMI rebounds to 50.9% in August, shows signs of stabilizing - more

   Nickel Pig Iron: China's Low-Cost Stainless Steel Secret - China is the world leader in stainless steel production due to its low-cost solution for difficult to process nickel laterite ores: nickel pig iron - more

  Nickel Price Downturn Dents Positive Trend For Stainless Steel - A slight pick-up in stainless steel demand is expected to develop after the summer holiday period, particularly if the downward movement in raw material costs comes to a halt. - more

  Morning Nickel Inventory and Price Statistics & Figures

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

August Archives

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