LIVE FUTURES REPORT 22/12: Nickel down 1.6%; LME complex falls on Covid-19 variant fears

Nickel’s three-month price on the London Metal Exchange was down by 1.6% during morning trading on Tuesday December 22, with the rest of the complex mostly trading lower given the spread of a new variant of Covid-19 across Europe.

The LME nickel price was the most affected on Tuesday morning, dropping to $16,980 per tonne from Monday’s 5pm close of $17,267 per tonne.

The stainless-steel additive started the week with a 0.8% gain to $17,630 per tonne on Monday morning from December 18’s closing price of $17,484 per tonne, but has since dipped together with the rest of the metals on the LME.

News of the passing of a $900 billion stimulus package to help with the economic consequences of the pandemic in the United States in the early hours of Tuesday failed to offset growing concerns surrounding the Covid-19 variant.

“Perhaps, given how strong prices have become, the fact that the holiday period and year-end are approaching and there is uncertainty over how this new variant of Covid-19 will be handled by governments, this might mean there is a new risk that demand could be hit if more stringent lockdowns that affect manufacturing are imposed again,” Fastmarkets’ head of base metals and battery research William Adams said.

“Overall, we would not be surprised to see prices fall further now,” he added.

Lead was down for a second day in a row to $1,944.50 per tonne on Tuesday morning. The metal was the worst performer on Monday morning, falling by 3% to $1,975 per tonne from December 18’s 5pm closing price of $2,039.50 per tonne.

Nevertheless, there was a 5,255-tonne cancellation in LME lead stocks on Tuesday, spread across warehouses in Antwerp (1,375 tonnes), Hamburg (1,000 tonnes), Rotterdam (1,850 tonnes) and Vlissingen (1,000 tonnes).

Market seasonality boosts lead demand in the latter part of the year, reflecting strong seasonal demand due to the traditional winter battery-kill season in the northern hemisphere, Fastmarkets analyst James Moore said in a morning note.

Lead’s sister metal zinc had a 3,075-tonne fresh cancellation on Tuesday, largely from LME warehouses in Singapore (2,550 tonnes).

Zinc’s price was also down, by 0.47%, on Tuesday morning to $2,821 per tonne. On December 18 at 5pm it sat at $2,872.50 per tonne, close to its 2020 high of $2,890 per tonne reached on December 11.

Other highlights

  • Copper’s price was down by 0.6% to $7,800 per tonne on Tuesday morning.
  • Tin bucked the downward trend exhibited by its peers on Tuesday, rising to $20,000 per tonne as at 9am from $19,950 per tonne at the 5pm close on Monday, which was a 0.5% drop from December 18.
  • The US dollar index was higher at 90.28 as at 9.30am, up from 90.23 at a similar time on Monday. The index reached a high of 91.01 on Monday, a “knee-jerk move to the upside after safe-haven buying emerged,” Adams said, after last week’s low at 89.73.
  • Data out later today includes US readings on gross domestic product, existing home sales and the Richmond manufacturing index.
What to read next
Key talking points from the 75th anniversary event of European steel distributors’ association Eurometal, held July 2-3 in Luxembourg and attended by Fastmarkets.
Fastmarkets has launched MB-AL-0424 Aluminium P1020A premium, fob Indonesia, $/tonne on July 9 due to an expected increase in Indonesia-origin aluminium exports. MB-AL-0424 Aluminium P1020A premium, fob Indonesia, $/tonneQuality: P1020A or 99.7 % Minimum Al purity (Si 0.10% max, Fe 0.20% max) in line with LME specifications. Ingot, T-bar, sowQuantity: Min 500 tonnesLocation: FOB IndonesiaTiming: […]
Mexico’s production and consumption of long steel fell year-on-year in May due to weakness in the country's construction sector, but posted a month on month gain, according to the latest data from the Mexican steel chamber, CANACERO.
Charcoal-based pig iron can potentially support decarbonization strategies in the EU, despite not being widely used in the region, delegates were told at Fastmarkets' International Iron Ore & Green Steel Summit, held June 17-19 in Barcelona.
To increase the transparency of our methodology, Fastmarkets clarifies that the quotation period of the MHP nickel payable indicator is the month of delivery, or the month M. Any data points Fastmarkets received otherwise will be normalized to the M month based on the monthly spreads of the prevailing exchange-traded Class-1 nickel reference price, or […]
Despite the current headwinds, strategic partnerships and continued investment in the right areas, coupled with the underlying strong long-term demand fundamentals, will pave the way for success for lithium producers, according to the participants of the executive panel during the Fastmarkets Lithium Supply and Battery Raw Materials Conference, which took place from June 23-26 in Las Vegas, Nevada.