Forecasts and market analysis based on price assessments from Fastmarkets MB and Fastmarkets AMM

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Base Metals

9 April 2019 Issue

  • LME metals tread water; economic data in focus while market awaits trade deal


    16 April 2019

    Trading across most of the metals is relatively quiet on the morning on Tuesday April 16 and the market seems to be waiting for fresh direction, which we think means the market is waiting for a US-China trade deal.

  • Aluminium: Short-term risks to the downside

    09 April 2019

    Aluminium prices continue to range-trade, as macro developments and the market’s own fundamentals are giving mixed signals. This range-trading has been forming a potentially technically bearish rising wedge. Of all the base metals, investors are most bearish towards aluminium, which suggests they are positioning for this wedge to break to the downside. Concerns over rising Chinese and Russian supply provide a fundamental justification for taking a bearish view, but this is plenty of ammunition for short-covering rallies if that view is abandoned.

  • Base metals investment analysis: After a Q1 increase, commodity AUM likely to rise further in Q2

    09 April 2019

    Assets under management (AUM) held by investors across the commodity asset class increased in Q1 2019 amid higher inflows and rising prices, according to estimates from Barclays. If the macro outlook continues to be derisked, we would expect commodity AUM to increase further during Q2.

  • Copper: TC/RCs down, prices and premiums to rise

    09 April 2019

    This week our copper analysis mostly focusses on TC/RCs, which have reached our forecast to go below the $70/7.0c level. They may have further to fall in Q2 if the Las Bambas disruption continues. As for prices and premiums in the refined market, our forecast remains for seasonal strength in Q2.

  • Demand Indicators: April 9 2019

    09 April 2019

    Demand indicators for the base metals market

  • Downloadable Base Metals Weekly Data April 9 2019

    09 April 2019

    Downloadable data for week April 9 2019

  • Lead: Sentiment in the doldrums

    09 April 2019

    For most base metals, prices are holding up near their recent high ground, but that is not the case for lead, where prices have dropped below $2,000 per tonne and are trading some 2.8% below the average for the year. Better Chinese economic data, robust US total vehicles sales for March and a strong US employment report have failed to provide any improvement in lead prices. We expect a US-China trade deal will do the trick though.

  • Market Summary: China data and trade talks key for Q2 price direction

    09 April 2019

    A common theme throughout Q1 2019 was that progress on US-China trade negotiations has underpinned the recovery in base metal prices. As those talks continue to progress into Q2, we wonder how much more upside can be left in this story. If the focus switches to Chinese economic activity, base metal bulls would want to see economic indicators, which have been somewhat mixed, become more consistently positive this quarter in order for prices to continue their appreciation.

  • Nickel: All eyes on Shanghai

    09 April 2019

    In recent years, industry conferences have been noteworthy for igniting or extinguishing nickel bulls’ enthusiasm for the EV story. As we head towards Fastmarkets’ Battery Materials Conference this week, nickel prices are edging higher, testing technical resistance and potentially poised to break to the upside. In this week’s analysis we discuss some of the key nickel-related talking points likely to come up in Shanghai.

  • Technical analysis: Key technical levels being tested

    09 April 2019

    Copper, lead and nickel are focussed on eroding overhead resistance, while the other metals are currently more focused on testing underlying support.

  • Tin: Price correction unfolding, as expected

    09 April 2019

    Tin prices are drifting lower in line with our short-term base case forecasts, but there are many cross currents in play, which could still chase this market in either direction in Q2. Our current base case forecast for this period is $21,000 per tonne, which leaves room for the correction to run slightly deeper before prices strengthen again into mid-year and through H2.

  • Zinc: Consolidation, but fundamentals still tight

    09 April 2019

    Zinc prices have started to give in to selling pressure after their strong run in March. The market may need evidence of genuine tightness such as a rebound in physical premiums and fresh cancellations to re-embolden bullish sentiment. We would not be surprised if we see those signals this quarter as we forecast the fundamentals tightening in Q2 and Q3.