Base metals: winners and losers in year to date

The price trend in all six LME-traded base metals so far this year has been higher apart from in copper.

Largely shrugging off uncertainty about the global economy and geopolitics, most of the metals peaked in August although copper set its high in March and tin and zinc set multi-month highs this week.

Zinc is the best performer in the complex – as of the close of Tuesday, October 25, it was up 47% from the start of the year. The three-month LME price peaked at $2,418 per tonne in October, rising from $1,610 in January.

Its rally has been partly fuelled by expectations of increased tightness in the supply/demand balance. This was principally due to permanent mine closures last year at Century and Lisheen and temporary curtailments made by Glencore.

At the other end of the scale, copper is this year’s worst performer, rising less than 1% since the start of 2015 – slow global growth and a slowdown in China have weighed on demand.

After starting 2016 at a soft $4,716 per tonne, it fell to its lowest since 2009 at $4,318 on January 15. Although it recovered from those lows, sentiment remains quite bearish – the metal was last around $4,730 per tonne.

Although China’s economy faces some major issues including spiralling debt levels and an overheated property market, the country’s outlook is starting to brighten – the latest manufacturing PMI data surprised on the upside. The International Monetary Fund expects China’s growth rate at 6.2% this year.

In the US, the focus is on the presidential elections in November as well as the Federal Open Market Committee meeting in December and the implications of a 25-basis-point rise in interest rates.

The outlook for Europe largely depends on how much disruption there will be when Brexit starts to take effect.

In the precious metals, expectations about a rise in US interest rates are the main driver of gold, which peaked at $1,375.25 per oz in July, its highest since March 2014, before consolidating amid speculative profit-taking and weakness in the jewellery sector.

The spot gold price was recently around $1,270 per oz.

The performance of these metals and major currencies in 2016 so far is summarised below:

Copper

– Started year at: $4,716/t

– Close as of October 25: $4,738/t

– Change in year to date: 0.47%

– Year-to-date high: $5,131/t on March 18 (highest since November 2015)

– YTD low: $4,318/t on January 15 (lowest since May 2009)

– YTD high/low range: $813

Aluminium

– Started year at: $1,510/t

– Close as of October 25: $1,670/t

– Change in year to date: 10%

– Year-to-date high: $1,709/t on August 18 (highest since July 2015)

– YTD low: $1,449 on January 12 (lowest since December 2015)

– YTD high/low range: $260

Nickel

– Started year at: $8,800/t

– Close as of October 25: $10,235/t

– Change in year to date: 16%

– Year-to-date high: $11,030/t on August 10 (highest since August 2015)

– YTD low: $7,550/t on February 11 (lowest since January 2003)

– YTD high/low range: $3,480

Zinc

– Started year at: $1,610/t

– Close as of October 25: $2,360.50/t

– Change in year to date: 47%

– Year-to-date high: $2,418/t on October 4 (highest since August 2011)

– YTD low: $1,444.50/t on January 12 (lowest since May 2009)

– YTD high/low range: $973.50

Lead

– Started year at: $1,784/t

– Close as of October 25: $2,058/t

– Change in year to date: 15%

– Year-to-date high: $2,157/t on September 30 (highest since May 2015)

– YTD low: $1,588/t on January 12 (lowest since November 2015)

– YTD high/low range: $569

Tin

– Started year at: $14,570/t

– Close as of October 24: $20,305/t

– Change in year to date: 39%

– Year-to-date high: $20,330/t on October 25 (highest since December 2014)

– YTD low: $13,085/t on January 14 (lowest since July 2009)

– YTD high/low range: $6,965

Gold (spot)

– Started year at: $1,063.35/oz

– Close as of October 25: $1,274.35/oz

– Change in year to date: 20%

– Year-to-date high: 1,375.25/oz on July 6 (highest since March 2014)

– YTD low: $1,062.40/oz on January 4 (lowest since December 2015)

– YTD high/low range: $312.85

Euro

– Started year at: $1.0852

– Close as of October 25: $1.0890

– Change in year to date: 0.350%

– Year-to-date high: $1.1616 on May 3 (highest since August 2015)

– YTD low: $1.0710 on January 5 (lowest since December 2015)

– YTD high/low range: 0.0906

(Editing by Mark Shaw)