Monthly Metal Review
- June 2018
- May 2018
- April 2018
- March 2018
- February 2018
- January 2018
- December 2017
- November 2017
- October 2017
- September 2017
- August 2017
- July 2017
- June 2017
China's factory activity contracted for the first time in seven months. Faced with slowdown, China's government plans to allow private businesses a larger role. Prime Minister Li Keqiang said China would reduce the state's economy role. The Party is unlikely to privatize sectors it considers strategic, but broad proposals include expanding a natural-resources tax, gradually allowing market forces to determine bank interest rates and promoting private capital in finance, energy, railways and telecommunications.
Base metals prices were boosted by strong housing and consumer confidence data from the US on Tues-day. Single-family home prices across 20 cities rose 10.9% YoY in March, the strongest such gains seen in the last seven years, while the Conference Board's consumer confidence index posted a five-year high of 76.2 in May. However, gold prices fell.
Regional oversupply of copper concentrate due to China's boosted purchases on the spot concentrate market is drying up. Grasberg mine in Indonesia suspended operations on May 15th and shortage of raw material scrap is already affecting Chinese smelters. Rio Tinto's Oyu Tolgoi mine in Mongolia is expected to commence copper concentrates shipments to China around June. The mine's maximum annual production is estimated to be 450'000 mt of copper and 330'000 gold oz. Approvals from Mongolian government are still awaited in order to carry material out of the mine.
The U.S Export-Import Bank approved a $500-million direct loan to help finance development of Rio Tinto's Oyu Tolgoi project in Mongolia.
Contract trading broke volume records at the LME and New York's Comex as April's gold-price drop sparked liquidation across assets. Equities surged in May, even as much of the Eurozone fell deeper into recession. France officially returned to recession whilst Germany managed 0.1-percent Q1 growth. The Eurozone contracted an annualized 0.8 percent in Q1, contrasting with 2.5-percent U.S. annual growth rate. The European Central Bank cut its key rating to 0.25 percent to a record-low 0.5 percent.
BHP Billiton's pared-down exploration budget will have no greenfield spending beyond copper and 2014 exploration and capital spending will fall to $18 billion. CEO Andrew Mackenzie said capital and exploration spending would peak at $22 billion this year.
Miners in Canada's Quebec province face either royalty payments or mining tax in 2014, whichever is larger. The royalty will be 1 percent of the first $80 million production; 4 percent on greater amounts. A graduated tax on profits will start at 16 percent, to 28 percent.
Japan saw robust, 3.5-percent annualized economic expansion. UK inflation slowed more than forecast to a seven-month low of 2.4 percent on-year. The Bank of England forecast 0.5-percent Q2 UK growth following a 0.3-percent Q1 rise.
Operations at Freeport McMoRan's Grasberg gold-copper mine in Indonesia were suspended after 28 miners died in a training-tunnel collapse.
U.S. Federal Reserve Chairman Ben Bernanke said stimulus will continue, to protect recovery. He said bonds buys could gradually fall if employment shows sustainable progress. U.S. unemployment fell to a four-year low of 7.5 percent in April. Builders began new-home construction at an adjusted lower annual rate of 853'000. But building-permit applications jumped 14.3 percent to an adjusted rate of 1.02 million annually, the best since 2008. April orders for durable goods rose 3.3 percent.
Fuji Heavy Industries said it will invest $400 million to increase its U.S. capacity to manufacture Subaru autos. New-car registration in the UK increased in April for the fourteenth month, up 14.8 percent on-year. Auto sales across all EU countries fell 10 percent in the most recent figures, from March. Germany saw a 17.1-percent drop.
The UN's International Seabed Authority said companies could apply for seabed-mining licenses in 2016. The agency has issued 17 exploration permits and another seven are being considered. A spokesman said there has been a surge in interest from private and state-owned companies.