Research

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

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Base Metals

10 December 2019 Issue

  • Metals prices look well placed to advance, but lack energy

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    17 December 2019

    Broader markets are generally still upbeat this morning, Tuesday December 17, with equities in Asia following the lead from western markets on Monday, although the metals are for the most part consolidating.

  • Metals prices mainly upbeat, boosted by some stronger Chinese data

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    16 December 2019

    Broader markets are generally upbeat this morning, Monday December 16, helped by last week’s partial United States-China trade deal and some positive economic data out of China.

  • Markets firmer on Trump’s ‘Big Deal’ tweet

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    13 December 2019

    Broader markets are upbeat this morning, Friday December 13, because hopes are running high that a preliminary US-China trade will be signed before new tariffs come into force on Sunday as well as following the UK’s general election result that means a Brexit deal moves forward.

  • Aluminium: Base building

    10 December 2019

    Aluminium prices remain relatively buoyant. They are not only holding above the early-October low, but forming an increasingly robust-looking, if rather shallow, uptrend defined by a series of higher lows. For the time being at least, this looks like base building, though we would say that the macro situation needs to continue to improve steadily in order for this based to be reinforced. Regaining $1,800 per tonne would bolster the technical setup.

  • Base metals investment analysis: Bullish fund sentiment returning to copper

    10 December 2019

    The COTRs published last week by the LME and CFTC show the net speculative short position in both LME and CME copper reducing again. And price action since those reporting dates – including the fresh buying behind Friday’s breakout above $6,000 per tonne – suggest fund setting is increasingly bullish.

  • Copper: Rally mode

    10 December 2019

    Copper prices have surged to their highest since July, confirming that the rebound from September is likely to continue in the months ahead. Although the macro environment remains clouded by US-China trade uncertainty, we believe that copper prices are likely to continue to move higher in the months ahead due to improving fundamental dynamics. With visible inventories at their lowest since 2009, we hold that copper’s fundamental fair-value is much higher than its current spot level.

  • Demand Indicators: 10 December 2019

    10 December 2019

    Demand indicators for the base metals market

  • Downloadable Base Metals Weekly Data December 10 2019

    10 December 2019

    Downloadable data for week December 10 2019

  • Lead: Consolidation, but still vulnerable

    10 December 2019

    Lead prices set fresh multi-month lows last week, dropping to $1,880 per tonne. This prompted some buying in India, which has led to a pick-up in premiums. But with prices falling further at the start of this week, the buying has not been strong enough to provide support yet. We still view this pullback as a correction to the market getting overbought in the summer and, as such, we expect support will be found soon. Indeed, we would argue that prices have already overshot on the downside.

  • Market Summary: Sentiment rising again

    10 December 2019

    Buying pressure has emerged at the start of this week after a strong US jobs report on Friday and positive Chinese trade data over the weekend boosted sentiment. All eyes are back on US-China trade talks again though, with the US scheduled to introduce the next round of tariffs on $156 billion of Chinese goods on December 15. Events this week could prove pivotal to setting price direction for the coming weeks given the ongoing uncertainties surrounding trade negotiations.

  • Nickel: Down to $13,000 per tonne

    10 December 2019

    Nickel has held above the psychologically-important $13,000 per tonne level, but only just. It remains vulnerable in the short term and continues to underperform the rest of the base metals complex, beset by Chinese stockpiling before the Indonesian ore export ban comes into force in January, bearish speculative fund positioning, the uncertain demand outlook from Chinese stainless steel mills and a technically weak backdrop.

  • Technical analysis: Tin and copper leading in the upside

    10 December 2019

    The base metals are mixed, with copper and tin rebounding higher quite strongly. The other metals are still shoring up support and, once done, could follow the leaders higher.

  • Tin: Catch-up continue into year-end and beyond

    10 December 2019

    LME tin has rebounded well since mid-November, playing catch-up with the broader base metals complex after a marked underperformance during most of 2019. We think that this catch-up phase can continue into year-end and beyond, principally because the fundamental backdrop of the refined tin market is tight and set to become tighter given the ongoing production cuts from Asia and a likely rebound in solder demand next year.

  • Zinc: Finding support, but bearish risks remain

    10 December 2019

    We still believe there is room for zinc prices to test higher in the short term due to persistent structural tightness and a potential double-bottom on the chart. But the greater catalyst is likely to be a positive development in US-China trade negotiations. An escalation in tariffs risks fuelling bearish sentiment, potentially pressuring prices to a fresh 2019 low, which would likely mean downwards revisions to our 2020 price forecast.