Monthly Metal Review

Overview

September saw slides in virtually every sector of the global economy as political uncertainties left markets in a state of high anxiety all month. Clearly base and precious metals markets were by no means immune from the friction.

The same political posturing on both sides of the Atlantic that marked August carried over through all 30 days of September. The risk of renewed recession remained uncomfortably high throughout the month. European debt, with Greece yet again on the verge of default, remains the latest potential "straw that breaks the camels back"-- the event that could upend a global economy on a recessionary tipping point.

Confidence of individual investors and business leaders in the long-run coherence of Europe and the US on the fiscal and monetary fronts has been injured by the political wrangling on both sides of the North Atlantic. It remains to be seen how deeply this lack of market confidence will spread to the real economy.

September was a month of correction for the formerly surging non-ferrous and precious metals markets in particular. Virtually every commodity in this market lost value over the last thirty days. Short term double-digit drops in Copper, Zinc, Lead and Nickel can be attributed variously to slowed growth in Asia due to the economic uncertainty or to potential corrections in overheated commodities markets; copper, for instance, tumbled 20 percent in September. Meanwhile, even gold and silver-- precious metals whose prices have the benefit of not having to reply on real-world industrial demand-- fell this month amidst the market uncertainty. This inspite their appreciation over several months as they were encouraged by several factors, not in the least the fears of the global economic resection and the seeking for safer havens. However as the London Bullion Association Conference was taking place in Montreal this month most investors and analysts expect the gold price to breach $2,000 an ounce next year even possibly reaching S2,019 per ounce in November of 2012. Nevertheless the precious metals felt the chills of this month along with the other metals.

Despite this month of drops, many remain confident in the long-term prosperity of the metals commodities markets. Traders expect gold, silver and nickel to stay strong through the year. Strategic supply tightening by mining giants in Indonesia and elsewhere should stabilize the price of zinc and copper.

Investors have been heartened by positive signs out of Lima, Peru, where the ascendancy to president of former military man Ollanta Humala has gone smoother than once feared. The little-known Humala's unexpected victory earlier this year lead to a record selloff on the Lima stock exchange. Peru is the world's second-largest producer of copper, silver and zinc and the world is keeping an eye on their developments.

Brazil's September overhaul of its mining code will likely double that government's average royalty rates for minerals. The overhaul makes the permitting process for new mines more rigorous and there is talk of a 100 percent increase in tax, from 2 percent to 4 percent. The changes are likely to have the biggest impact on Rio de Janeiro-based mining giant Vale, the world's largest producer of iron ore and a leading producer of nickel and copper. Industry leaders say higher royalty rates will make the industry uncompetitive unless the government lowers the country's overall tax burden.

The September slump across all markets reflects the true global nature of the economic problems we face. To "say" that one understands the interconnected nature of the world economy in boom times is one thing. To see that same world economy stalled negatively affected by this interconnectivity in bad times is quite another thing to behold. An organized, comprehensive response from world governments-- particularly those in Europe and North America-- could go a long way toward freeing up the markets.

Investors have long been comfortable with the idea that what happens in London or New York affects trade in Beijing and Tokyo. Now, they must consider that what happens in Athens or Berlin could greatly impact what happens the world over.

Daily Prices

September 2011

Copper
Date(Fix.) ($/MT)
Average 8314.84
30-09-2011 7131.5
29-09-2011 6975.5
28-09-2011 7416
27-09-2011 7528
26-09-2011 7226
23-09-2011 7290
22-09-2011 7790.5
21-09-2011 8221
20-09-2011 8397.5
19-09-2011 8415
16-09-2011 8781.5
15-09-2011 8709.5
14-09-2011 8719.5
13-09-2011 8757.5
12-09-2011 8645.5
09-09-2011 8904.5
08-09-2011 9041
07-09-2011 8970.5
06-09-2011 8919.5
05-09-2011 8935
02-09-2011 9050.5
01-09-2011 9101
Silver
Date(Fix.) ($/OZ)
Average 38.15
30-09-2011 30.45
29-09-2011 30.19
28-09-2011 31.04
27-09-2011 33.5
26-09-2011 28.16
23-09-2011 32.9
22-09-2011 37.85
21-09-2011 40.25
20-09-2011 39.18
19-09-2011 40.46
16-09-2011 39.97
15-09-2011 40.34
14-09-2011 41.23
13-09-2011 40.02
12-09-2011 40.81
09-09-2011 41.4
08-09-2011 42.14
07-09-2011 40.98
06-09-2011 41.85
05-09-2011 42.71
02-09-2011 42.5
01-09-2011 41.47
PM MEAN AM Gold
Date(Fix.) ($/OZ)
Average -
30-09-2011 -
29-09-2011 -
28-09-2011 -
27-09-2011 -
26-09-2011 -
23-09-2011 -
22-09-2011 -
21-09-2011 -
20-09-2011 -
19-09-2011 -
16-09-2011 -
15-09-2011 -
14-09-2011 -
13-09-2011 -
12-09-2011 -
09-09-2011 -
08-09-2011 -
07-09-2011 -
06-09-2011 -
05-09-2011 -
02-09-2011 -
01-09-2011 -
Date(Fix.) ($/OZ)
Average -
30-09-2011 -
29-09-2011 -
28-09-2011 -
27-09-2011 -
26-09-2011 -
23-09-2011 -
22-09-2011 -
21-09-2011 -
20-09-2011 -
19-09-2011 -
16-09-2011 -
15-09-2011 -
14-09-2011 -
13-09-2011 -
12-09-2011 -
09-09-2011 -
08-09-2011 -
07-09-2011 -
06-09-2011 -
05-09-2011 -
02-09-2011 -
01-09-2011 -
Date(Fix.) ($/OZ)
Average 1776.25
30-09-2011 1624.5
29-09-2011 1616.5
28-09-2011 1649
27-09-2011 1665
26-09-2011 1606.5
23-09-2011 1709.5
22-09-2011 1743.75
21-09-2011 1801.625
20-09-2011 1795.5
19-09-2011 1805.5
16-09-2011 1786
15-09-2011 1794
14-09-2011 1823.75
13-09-2011 1813
12-09-2011 1838.5
09-09-2011 1865.25
08-09-2011 1841
07-09-2011 1827
06-09-2011 1893
05-09-2011 1895.75
02-09-2011 1864.625
01-09-2011 1818.25
Lead
Date(Fix.) ($/MT)
Average 2298.80
30-09-2011 2060.5
29-09-2011 2006
28-09-2011 2035
27-09-2011 2015
26-09-2011 1994
23-09-2011 2050
22-09-2011 2167
21-09-2011 2260
20-09-2011 2330
19-09-2011 2321
16-09-2011 2426
15-09-2011 2406
14-09-2011 2383
13-09-2011 2425.5
12-09-2011 2430
09-09-2011 2455
08-09-2011 2423.5
07-09-2011 2432
06-09-2011 2424
05-09-2011 2444
02-09-2011 2527
01-09-2011 2559
Zinc
Date(Fix.) ($/MT)
Average 2076.77
30-09-2011 1905
29-09-2011 1870.5
28-09-2011 1918.5
27-09-2011 1906
26-09-2011 1860
23-09-2011 1941.5
22-09-2011 1982
21-09-2011 2042.5
20-09-2011 2088.5
19-09-2011 2093.5
16-09-2011 2188.5
15-09-2011 2161
14-09-2011 2156
13-09-2011 2177.5
12-09-2011 2140.5
09-09-2011 2185.5
08-09-2011 2196
07-09-2011 2192.5
06-09-2011 2153
05-09-2011 2132.5
02-09-2011 2190
01-09-2011 2208
Tin
Date(Fix.) ($/MT)
Average 22655.23
30-09-2011 20850
29-09-2011 20605
28-09-2011 21300
27-09-2011 21550
26-09-2011 20800
23-09-2011 19100
22-09-2011 20200
21-09-2011 22675
20-09-2011 23125
19-09-2011 22645
16-09-2011 23525
15-09-2011 23455
14-09-2011 23415
13-09-2011 23510
12-09-2011 23140
09-09-2011 24095
08-09-2011 24450
07-09-2011 24150
06-09-2011 23895
05-09-2011 23875
02-09-2011 24055
01-09-2011 24000