Latest market news

PGMs: Rhodium prices jump on rising demand

  • Market: Metals
  • 10/01/22

Rising demand from original equipment manufacturers (OEMs) has pushed up rhodium prices sharply since the start of January, as automakers strive to raise output as the global chip shortage starts to ease.

Rhodium prices hit $17,500/toz today – their highest since 1 September 2021 and up by a total of $14,250/toz or 22pc since 4 January, according to UK specialty chemicals firm Johnson Matthey.

The rise is largely underpinned by increasing demand from OEMs, which use rhodium in automotive catalytic converters to help combat nitrous oxide emissions. In the spot market, offers are now seen in excess of $17,000/toz, up from $14,500/toz at the start of last week and $14,100/toz at the end of 2021, market participants said, with one pointing toward a rise in "OEM demand as well as Chinese industrial interest".

Some automakers note that the global chip shortage is starting to ease, suggesting that vehicle production will start to recover after 2021's cutbacks, pushing up demand for automotive catalysts and rhodium along the way. Last year's vehicle production cuts weighed heavily on rhodium prices, which peaked at $29,800/toz in March but then fell by 54pc to $13,700/toz by 26 November.

"In 2022, we plan to take advantage of the strong economy and anticipated improved semiconductor supplies to grow our sales and share," Detroit-based General Motors (GM) said on 4 January as it expects an improvement in "total light industry sales from around 15mn in 2021 to around 16mn in 2022".

"The key constraint for sales continues to be reduced inventory levels as a result of the semiconductor shortage. Those inventory levels are beginning to recover against a backdrop of strong fundamental demand conditions," GM's chief economist Elaine Buckberg said.

Traders note that rhodium supply is tighter than expected, with global production expected to be flat this year. "The supply angle is perhaps tighter than some had thought and it appears that producers are well sold," a trader said, adding that "there is a healthy amount of bullish speculation being mixed with genuine good early year demand which caused the market to move higher. As soon as it did that all offers clammed up, and with producers already well sold, we have got ourselves into this massive move higher."

A platinum group metals (PGMs) producer commented that South African production is "certainly not thriving". "We always knew the supply/demand side of things would settle, it is just the question of when," the producer said, adding that Anglo American's inventories – which had built up in 2020 during convertor outages – are likely to decline in early 2022, further squeezing the supply base.


Sharelinkedin-sharetwitter-sharefacebook-shareemail-share

Related news posts

Argus illuminates the markets by putting a lens on the areas that matter most to you. The market news and commentary we publish reveals vital insights that enable you to make stronger, well-informed decisions. Explore a selection of news stories related to this one.

News
12/11/24

Japan’s scrap export tender slips in November

Japan’s scrap export tender slips in November

Shanghai, 12 November (Argus) — The monthly Japanese scrap dealer co-operative Kanto Tetsugen's export tender registered a lower result in November driven by a softening seaborne market. The tender for 15,000t of H2 scrap settled at ¥45,180/t fas today, marking a decline of ¥500/t from October. This set the fob price at an equivalent of ¥46,180/t, or $300/t. The outcome was higher than the initial expectation of ¥44,000-44,500/t fas. Despite the result showing only a marginal decline, the dollar-equivalent price fell by $15/t to $300/t fob Japan because of the depreciation of the Japanese yen. The yen fell by 3.64pc from 9 October to ¥153.64:$1 today. The tender cargo will be shipped to Vietnam, trade sources said. Export negotiations to Vietnam have been limited in recent weeks as sellers are holding back because of a vessel shortage. Participating in the Kanto tender is the optimal choice for Vietnamese buyers if they have restocking demand, a local trader said. The cfr price, including the quality premium for tender cargo, should be $340-345/t. The Argus H2 fob Japan assessment was at ¥43,600/t on 11 November, and the October monthly average was ¥43,882/t fob Japan. The H2 collection price at Tokyo Steel's Utsunomiya plant was ¥41,500/t delivered to the mill. Traders expect Tokyo Steel to increase the collection price to align with the higher price in the seaborne market. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Find out more
News

Peru bets on trade ties with Asia as Apec starts


11/11/24
News
11/11/24

Peru bets on trade ties with Asia as Apec starts

Lima, 11 November (Argus) — Heads of 16 countries are in Peru this week to kick off the Asia-Pacific Economic Cooperation's (Apec) annual Leaders Week, as government officials in Lima look to grow their partnerships with Asia while staving off potentially disruptive strikes. The summit comes at a fragile time for Peru, where President Dina Boluarte has a historically low presidential approval rate of 4pc and bus drivers and small business owners are demanding protections from a wave of extortion. The event begins today with meetings among senior officials of the 21 member countries and closes on 16 November with the leaders' meetings, the pinnacle Apec event. With the confirmed arrival of Chinese president Xi Jinping later this week, the summit is likely to strengthen ties between Peru and Asia, amid US concerns of China's growing influence in Latin America. US president Joe Biden is also expected to travel to Lima from 14-16 November, according to the White House. He is then slated to go to Manaus and Rio de Janeiro to meet with Brazilian president Luiz Inacio Lula Da Silva. This week is also the scheduled ribbon-cutting of the Chancay megaport, a $1.3bn commercial hub north of Lima that will cut the transport time between Latin America and Asia from 35 days to 25 days. Cosco Shipping, the Chinese state-owned port operating company, owns 60pc of the project and the rest is owned by Peru mining company Volcan. It aims to become the main commercial port in the Pacific for neighboring Brazil and has a 17.8-meter depth, the greatest in Latin America. While the port will be inaugurated on 14 November, Cosco Shipping has said operations are expected to begin in early 2025. Peru's priorities for Apec include trade investments and the energy transition, with a focus on its critical mining sector — and workers' transition to the formal economy in Peru, where the informality rate is about 73pc. These goals extend to the CEO Summit, which is running simultaneously and will host hundreds of business leaders from Asia looking to invest in Peru's energy and mining sectors. Angel Manero, Peru's agriculture minister, said last week the government expects to approve sanitary protocols with China to export nuts, with the potential of expanding to meat imports, according to the official gazette. He added there are talks with China about attracting investments through the creation of Special Economic Zones. Peru last hosted the Apec in 2016. This time, workers in Lima — led by bus drivers' unions — have vowed a three-day strike during Apec to call attention to a string of killings they say are linked to resistance to extortion. Among their main asks is repealing a recent law approved by congress that they say weakens prosecution of organized crime by, among other things, changing its definition to exclude crimes of extortion. Prime Minister Gustavo Adrianzén has repeatedly asked workers not to strike to avoid "a bad show" during the high-level meetings. By Bianca Padró Ocasio Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

UK's Liberty Speciality Steel could go insolvent


11/11/24
News
11/11/24

UK's Liberty Speciality Steel could go insolvent

London, 11 November (Argus) — The UK's Liberty Steel's Speciality Steel business is likely to go insolvent if its creditors do not approve a restructuring plan, the company said in a letter to creditors. The company's creditors will vote on the restructuring plan in the coming months and, if accepted, the plan will be in action on about 12 February 2025. Liberty Speciality's electric arc furnace, at Rotherham in Yorkshire, has melted less than 50,000t this year and has not operated since July, sources close to the company told Argus . The plant has capacity of more than 1mn t/yr. In its letter to creditors, Liberty said part of its financial distress "stems in part from a change in the appetite of some of its largest customers to continue to pre-fund" and pay prices agreed in July 2023. The company has been concentrating solely on the aerospace industry, where some of its customers had been making pre-payments of up to 80pc. Speciality Steel at present is subject to a winding up petition, filed on 8 October, by Harsco Metals Group and supported by other creditors Swallownest Engineering, Kings of Rotherham and RS Components. Harsco is owed about £4mn, according to sources close to the company. The petition is listed for a hearing at the High Court on 20 November, and the company intends to seek the withdrawal of the petition or adjournment of the hearing pending the outcome of its restructuring plan. Some creditors have already stated their intention to support the plan, Liberty said. Two Liberty customers have agreed, in principle, to make funding available to allow Speciality to continue trading "up to and beyond the point at which it is currently anticipated that the restructuring plan would come into effect", the company said. This would involve two upfront cash payments and "accelerated delivery premiums". Liberty's parent company, the Gupta Family Group Alliance, has reached an agreement in principle with two prospective lenders for Speciality and is in negotiations with a third. The funding, none of which is committed at present, is subject to the restructuring plan being sanctioned. The plan has no impact on the company's employees, Liberty said. The company has been operating its own short-time working policies at Speciality given low production levels. By Colin Richardson Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

China, Indonesia to strengthen mineral, renewable ties


11/11/24
News
11/11/24

China, Indonesia to strengthen mineral, renewable ties

Beijing, 11 November (Argus) — China and Indonesia have agreed to strengthen co-operation in the critical mineral and renewable energy sectors, during new Indonesian president Prabowo Subianto's first visit to the country since taking power last month. "The two sides will tap the potential to co-operate in new energy vehicles, lithium batteries and photovoltaics," according to a joint government statement issued during Prabowo's visit to Beijing on 8-10 November. China will support Indonesia's efforts to speed up the transformation of its energy sector and will carry out more "high-quality" co-operation with Indonesia in the digital economy, clean energy industry and energy infrastructure sectors, the statement said. "Indonesia welcomes Chinese enterprises to invest in Indonesia and we look forward to closer co-operation in various fields," Prabowo said at a China-Indonesia business forum on 10 November. Prabowo chose China as his first overseas destination as president, reflecting growing investment ties between the two countries. Chinese companies have set up more projects in Indonesia in recent years, especially in the electric vehicle power battery industry and steelmaking sectors. Major Chinese lithium cathode precursor manufacturer Green Eco-Manufacture (GEM) signed a deal with mining firm Vale Indonesia to develop a high-pressure acid leaching (HPAL) project in Sulawesi during Prabowo's visit. The project will produce mixed hydroxide precipitate (MHP), a key feedstock in the production of battery cathodes. Indonesia is the world's largest nickel producer. The country's share of global output could reach 60.6pc in 2024 and 62.8pc in 2025, mainly thanks to rising production from Chinese-backed projects, according to the International Nickel Study Group (INSG). Chinese battery cathode material producer Changzhou Liyuan in early October signed an agreement with the Indonesia Investment Authority (INA) consortium to expand capacity of its lithium iron phosphate plant in Indonesia to 120,000 t/yr by 2025, from 30,000 t/yr in the existing first phase. The Indonesian project is likely to become the biggest LFP plant outside China. Chinese companies are also seeking to secure more aluminium supplies from Indonesia. East China-based Nanshan Aluminium is expanding production capacity at its alumina refinery in Indonesia's Bintan industrial park and is also building a 250,000 t/yr refined aluminium plant in the country. State-owned Chalco is building a 1mn t/yr metallurgical alumina plant in Indonesia, while Tianshan Aluminium is working on an alumina plant in the country that will produce 1mn t/yr in its first phase. Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

News

Talks to restart as port of Vancouver lockout drags


08/11/24
News
08/11/24

Talks to restart as port of Vancouver lockout drags

Calgary, 8 November (Argus) — A labour disruption at the port of Vancouver is now into its fifth day, but the employers association and the locked-out union are to meet this weekend to try to strike a deal and get commodities moving again. Workers belonging to the International Longshore and Warehouse Union (ILWU) Local 514 on Canada's west coast have been locked out by the BC Maritime Employers Association (BCMEA) since 4 November. This came hours after the union implemented an overtime ban for its 730 ship and dock foreman members. The two sides will meet on 9 November evening with the assistance of the Federal Mediation and Conciliation Service (FMCS) in an effort to end a 19-month long dispute as they negotiate a new collective agreement to replace the one that expired in March 2023. The FMCS was already recruited for meetings in October, but that did not culminate in a deal. Natural resource-rich Canada is dependent on smooth operations at the port of Vancouver to reach international markets. The port is a major conduit for many dry and liquid bulk cargoes, including lumber, wood pellets and pulp, grains and agriculture products, caustic soda and sodium chlorate, sugar, coal, potash, sulphur, copper concentrates, zinc and lead concentrate, diesel and renewable diesel liquids and petroleum products. These account for about two-thirds of the movements through the port. Grain operations and the Westshore coal terminal are unaffected while most petroleum products also continue to move, the Port of Vancouver said on 7 November. As the parties head back to the bargaining table, the ILWU Local 514 meanwhile filed a complaint against the BCMEA on 7 November, alleging bargaining in bad faith, making threats, intimidation and coercion. "The BCMEA is trying to undermine the union by attempting to turn members against its democratically-elected leadership and bargaining committee, said ILWU Local 514 president Frank Morena on 7 November. "They know their bully tactics won't work with our members but their true goal is to bully the federal government into intervention." But that is just "another meritless claim," according to the BCMEA, who wants to restore supply chain operations as quickly as possible. The union said BC ports would still be operating if the BCMEA did not overreact with a lockout. "They are responsible for goods not being shipped to and from BC ports — not the union," Morena says. The ILWU Local 514 was found to have bargained in bad faith itself already, according to a decision by the Canada Industrial Relations Board (CIRB) in October. Billions of dollars of trade are at risk with many goods and commodities at a standstill at Vancouver, which is Canada's busiest port. A 13-day strike by ILWU longshore workers in July 2023 disrupted C$10bn ($7.3bn) worth of goods and commodities, especially those reliant on container ships, before an agreement was met. By Brett Holmes Send comments and request more information at feedback@argusmedia.com Copyright © 2024. Argus Media group . All rights reserved.

Generic Hero Banner

Business intelligence reports

Get concise, trustworthy and unbiased analysis of the latest trends and developments in oil and energy markets. These reports are specially created for decision makers who don’t have time to track markets day-by-day, minute-by-minute.

Learn more