It was another busy week in Metal Bulletin’s offices across the globe, as conferences got under way in Shanghai and Berlin, while a senate hearing in the USA brought banks in commodities back into the spotlight.
In Shanghai, the 10th Metal Bulletin Asia Copper Conference kicked off, and at least one Chinese customer accepted Codelco’s $133-per-tonne copper premium offer for 2015 delivery.
China Minmetals Non Ferrous, meanwhile, said it will focus on mining projects.
The London Metal Exchange ceo said he had seen an increase in the number of copper producers hedging the copper price since he took up his role at the exchange.
And Codelco’s president said that he thinks that without the $12 billion investment to bring five greenfield and brownfield mining projects online, Codelco would have to close in about 15 years.
An executive at the mining company told the Shanghai conference that copper prices will average $3 to $3.50 per lb ($6,614-7,716 per tonne) in the long term as a result of rising capital and operating costs in mining and strong underlying demand.
And here’s what Freeport McMoran’s svp of sales and marketing had to say about blending and the copper industry’s arsenic problem.
Metal Bulletin reported that Freeport shut its copper smelter in Miami, Arizona, after a fire at the facility.
Clients of JCL Trading and Investing, a major Chinese copper trading firm in Guangdong province, were exercising caution in dealing with the company.
Treatment and refining charges (TC/RCs) for copper concentrates dropped in the first two weeks of November.
Senate hearing
In the USA, a Senate report showed that the US Federal Reserve forced JP Morgan to sell its Henry Bath warehouse. It also rejected applications by Goldman Sachs and Morgan Stanley to trade physical iron ore, and refused an application by Goldman Sachs for a joint-venture sugar plant in Brazil.
And a second US Senate report showed that warrant cancellations at Metro International Trade Services’ Detroit warehouse by Deutsche Bank, Red Kite and Glencore were financially incentivised by Metro and significantly contributed to the lengthy warehouse queue. Read the full story here.
Goldman Sachs executives defended the bank against allegations that its activities in physical commodities were a “recipe for manipulation”.
And representatives argued that carry trade, not incentives, led to the Detroit warehouse queues.
Andrea Hotter had this news from the hearing, and much more, here.
Recycled aluminium in Berlin
Jethro Wookey was at Metal Bulletin’s 22nd international recycled aluminium conference in Berlin, where David Rosenblum of OmniSource Corp warned delegates that many factors will converge to tighten aluminium scrap supply in North America in the next few years.
A lot of the talk centred on the automotive industry, and Constellium’s recent results showed an improvement thanks to the autos business.
Delegates heard about American Specialty Alloys’ (ASA) plan to offer flat-rolled aluminium to the North American automotive market at a 30% discount to the current average cost, thanks to its new continuous casting technologies designed to increase production efficiency and lower overhead costs.
Nickel, ores and alloys
And there was more from Shanghai, where an official from KGHM International said that molybdenum concentrate from Sierra Gorda is expected to reach the market early next year.
Nickel rallied, meanwhile. LME prices breached $16,600 per tonne, up from below $16,000 at the start of the week, after fresh assurances that Indonesia will maintain its ore export ban – for anyone who still had doubts.
And in the alloy markets, struggling ferro-chrome producers in China received a long-awaited boost as major Chinese steel mills Tsingshan and Tisco raised their monthly purchase price for domestic material for the first time since December 2013.
It’s too soon for South African charge chrome producers to feel relieved, though: Metal Bulletin’s charge chrome index, cif Shanghai stands at 80 cents per lb for the third consecutive week, still about 1 cent above Tsingshan’s price.
Fleur Ritzema
fritzema@metalbulletin.com
Twitter: @FleurRitzema_MB
