Stainless Steel News and Nickel Prices, Molybdenum, Metal Pricing, Ferrochrome

  Daily Nickel/Stainless Steel Wrap-up

  • Baltic Dry Index – minus 24 to 2,468. (chart)
  • Dollar graph in lower right corner of this page – (chart of dollar index) (live java chart)
  • Headlines & leaders – (Bloomberg) China’s Recovery Strengthens as Industrial Production, New Lending Advance // Japan’s Economy Grew 2.3% Last Quarter, Less Than Initially Estimated 3.7% // Mongolia Plans Sovereign Wealth Fund to Invest $30 Billion of Mine Income // Asian Stocks Advance on Chinese Economic Data; Japanese Shares Fall on GDP // Italian Government Bond Futures to Offer Proxy to Hedge Greek, Irish Debt // European Stocks Advance for Seventh Day; BG, Repsol, BHP, TNT Shares Rise  // Economic Growth in U.S. Forecast to Slow After End of `Cash for Clunkers’ // U.S. Consumer Sentiment Rises More Than Forecast as Pace of Job Cuts Slows // Stocks in U.S. Retreat, Halting S&P 500 Index’s Five-Day Rally; Gold Rises
  • The US Dollar is currently trading higher against the Euro, but not by much.  NYMEX crude is down 2-2/3% and under $70/barrel, after reports showed inventories were building on lower demand. Gold is up nearly 9/10 of 1% and looks to close above the $1000/ounce level. Silver is up 1./4 of 1%. Base metals all ended lower, with some large base metal production and supply numbers coming out of China this week, spooking the market. Indicator charts show nickel trading was a series of up’s and down’s most of the session, until late. The market was treating the $7.76/lb mark as a support line, bouncing off it on three separate occasions, until it fell thru late, and the market fell hard. Dow Jones reports three month nickel ended the day and week at $7.68/lb . Inventories of nickel stored in LME approved warehouses rose again overnight, while the Baltic Dry Index fell 24 points. The Reuters/University of Michigan index reported consumer sentiment rose, up to 70.2 from 65.7 in early August. The Commerce Department also reported wholesale inventories declined 1.4% in July, while wholesale sales rose 0.5 %. All in all, a rather quiet week on the metals front. Here in the States, the Dow hit a new 2009 high yesterday, while in London, nickel fell to its lowest price level since July, erasing all of the gains made since. Inventories continue to build, while mines remain shut due to economic or labor issues. Have a safe and enjoyable weekend! 

  Reports

  • Commodities Daily – pdf here
  • Commodities Daily – pdf here

  Commodity/Economic Articles and Comments

  • (Dow Jones) LME base metals appear to be susceptible to a “strong” price correction, says Commerzbank. …. Adds the base metal market in general appears to be noticing the “warning signals” such as the falling Baltic Dry Index, increasing metal inventories worldwide and expanding mining production.
  • China’s exports fall 23% in August – more

  Recession is over but steel prices are all over the map – It’s been a not-so-busy week for major economic releases; also, most of the recent news has been generally positive.As reported by NAM, for example, of the 12 major reports that came out last week, seven were positive, four were negative (but improving) and “just one worsened” – and that would be the unemployment rate that hit 9.7% last month — a 26-year high. – more

  U.S. steel sector wary about post-clunkers demand – The 700,000 cars sold in the cash-for-clunkers program prompted U.S. automakers to boost 2009 production after a long period of inventory cuts, spurring North American steelmakers to restart idled mills. – more

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

  • Indicators at 7:30 am CST show 3 month nickel trading around $.01/lb lower, and the market is coming off a short bull run. Other base metals are mixed, but quiet. The Euro is trading slightly higher against the US Dollar at the moment. NYMEX crude futures are down 1/2 of 1% and hanging around the $71.50/barrel level. Gold is trading higher by over 4/10 of 1% and back over the $1000/ounce level, while silver is up nearly 8/10 of1%. In overnight trading, Asian markets ended slightly higher, with China leading the charge. This morning, European markets are higher, while US futures indicate the bull run isn’t over yet in Wall Street. LME stored nickel inventories rose again overnight, while the Baltic Dry Index numbers have yet to be published.   
  • Bloomberg morning base metal news – more

  Reports

  Commodity/Economic Comments

  • Edward Meir of MF Global Morning Comments – LME prices turned sharply lower yesterday, with copper losing 3%, nickel and zinc off by 5% each, and lead getting thrashed–down by 12% on account of the Antaike outlook we referenced in yesterday’s note. It was also interesting to note that metal prices remained weak all day despite a weakening dollar, firmer energy prices, and stronger US equity markets. This suggests that investors are finally starting to “disconnect” from the exogenous variables that have been responsible for much of the recent gains in and looking, instead, at the sector’s underlying fundamentals, which as we noted yesterday, remains somewhat uninspiring over the short-term. Although metals demand is recovering, it is far more normal. In addition, stocks continue to rise, and most importantly, the Chinese import bias is now trending lower. In fact, latest August Chinese import data released overnight confirms this view, (see table below) when it was revealed that copper imports during the last month were some 20% below July levels. In addition, copper stocks on the Shanghai Futures Exchange also shot up by 10,000 this week, the highest level in more than two years, with the rise far greater than expected. (See table above on stock the weekly stock breakdowns).  …. Nickel is at $17,200, and unchanged; another close below $17,400 today could lead to further deterioration in the chart patterns. (read Ed Meir’s complete morning base metals report here)
  • (Xinhua) Jiangxi to Build a 20 ktpa Nickel Project – Xingwang Group’s 20 ktpa Nickel Project Breaks Ground
  • (TTO) The Department of Transportation’s freight transportation services index fell year-over-year in July by the most in 20 years, but showed an increase from June, DOT said Thursday. The 13.5% decline in the TSI from July 2008 was the biggest in the decline in the 20 years in which the index has been calculated, DOT said in its monthly report.
  • (AAR) The Association of American Railroads (AAR) today reported that while U.S. freight rail carloads declined in August, down 16.4 percent (at 1,116,182 carloads) compared with the same month last year, the percentage decline for the month was the lowest since February. In the Rail Time Indicators Report issued today, AAR released monthly traffic data framed with other key economic indicators to show how freight rail ties into the broader the U.S. economy.
  • (BT) China’s output of electricity was 334.3 billion kW-hours in August, expanding 9.3 percent from a year earlier, the National Bureau of Statistics (NBS) said Friday.
  • (CD) China’s foreign trade figures continued to fall in August, but their downward rate slowed, the General Administration of Customs (GAOC) said Friday. The total value of imports and exports for August was $191.7 billion, a decrease of 20.6 percent compared with the same month last year, but a 2.3 percent increase from July.
  • (SSY) There are now some 60 fewer Capesize vessels waiting to berth at China’s iron ore ports compared with mid-June, according to information received from local sources. A total of 27 Capesize vessels are currently waiting to berth. This week SSY’s Capesize Iron Ore Port Congestion Index for China indicated that average waiting time at major China’s iron ore discharge ports has fallen to an 8-month low of 4.8 days.
  • (CD) China’s consumer price index (CPI), a major gauge of inflation, dipped 1.2 percent in August from a year earlier, the National Bureau of Statistics (NBS) said Friday.
  • (Dow Jones) Corus, the European arm of India-based Tata Steel Ltd (500470.BY), is restarting one of its two blast furnaces at its Port Talbot steel plant in South Wales, a company spokesman said Friday.
  • (MarketWatch) The first year of recession took a toll on household incomes, drove 2.6 million more people into poverty, and cost 1 million people their employer-provided health care, the government reported Thursday.

  World Production Of Stainless Steel Is Reviewed For 1st Half / 09 And Forecasted For 2nd Half = Global Scale On Production In 2009 Is Anticipated To Decrease By 6.6% But Expected To Recover In 2nd Half – The first half (January – June) of 2009, when a historical and huge reduction in production of stainless steel had attacked stainless steel mills in the world, was over and the production activities of stainless steel in the second half of 2009 have been currently watched. It is anticipated that the world output of crude stainless steel in the calendar year (January – December) of 2009 will be inevitable to be 24.30 million tons, decreasing by 6.6% compared with that in the preceding year of 2008 and coming down to the scale recorded in 2005. – more

  Ni-Based Japanese Stainless Export Deals For Nov Shipments To China Price Bargainings With Customers To Focus On $3,000 C&F Level – Japan’s stainless steel producers are scheduled to start negotiations this week on their exports of nickel-based CR sheets to China for November shipments. It is likely that the negotiations with local customers will focus on a price level of US$3,000/ton C&F in the wake of a fall in China’s domestic stainless steel market. – more

  New warnings about New Caledonia’s Vale Inco plant – A New Caledonian union group, FO, has given a file about alleged problems at a major nickel plant to the territorial government and the administration of the southern province. – more

  Commodity gains are sustainable, argues Citi – Concerns have been raised that once the impact of fiscal stimulus measures passes, commodity prices could fall back. But David Thurtell, metals strategist at Citi, believes that private sector buying will take up the baton. – more

  Light at the End of the Tunnel? – MCN editors polled service center executives for their views on demand, inventory levels, pricing and their expectations for the second half. – more

  Upswing tipped for slumping nickel industry – The Australian Bureau of Agricultural and Resource Economics (ABARE) has forecast a more promising outlook for the nation’s nickel industry. – more

  Hernic returns to full ferrochrome output – Hernic Ferrochrome, a unit of Mitsubishi Corporation, said on Friday it had returned to full capacity output from 60 percent in the spring following a rise in global demand for ferrochrome. – more

  Batista Bid For Brazil Vale Stake Rejected – Report – Brazil’s Banco Bradesco SA (BBD), which controls Bradespar SA , rejected a bid by billionaire businessman Eike Batista to buy Bradespar’s stake in Vale SA (VALE), the Estado de Sao Paulo newspaper reported Thursday. – more

  LCH.Clearnet May See New Owners, New Products – Clearing house LCH.Clearnet sees a possible new ownership structure, new services for credit default swaps and access for buy-side participants in its interest rate swaps business, Michael March, business development director for LCH.Clearnet told Dow Jones Newswires Friday. – more

  Patnaik government faces illegal mining storm again – Five years after the Naveen Patnaik government was embarrassed by the controversy over chromite mining at Tangarpada in Orissa’s Dhenkanal district, the government is now being pressured by opposition parties to order a CBI probe into ‘illegal’ mining and mines lease to industrial houses and individuals. – more

  Sudbury Nickel Strike Coverage

  Iron Ore News // Talks / Spy Scandal Coverage

  • China Daily Special Coverage
  • SINA
  • Chain of Events
  • Iron Ore Imports by China Drop 15% to a Six-Month Low  – Iron ore imports by China, the world’s biggest buyer, dropped to the lowest level in six months as mills and traders cut purchases on declining steel prices. – 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   (charts)
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