Metal futures: LME extends gains

: Metals
22/03/02

Base metal prices on the London Metal Exchange (LME) climbed further in Wednesday's official morning session on continued expectation of supply disruption from the Russia-Ukraine conflict and mounting pressure from soaring energy prices.

Concern that crucial supply of base metals, particularly aluminum and nickel, will be disrupted because of Russia's invasion of Ukraine and subsequent sanctions continued to dominate the metals and wider commodity space leading to upward movement across the board.

Energy price hikes also supported power-intensive metal prices like aluminum and zinc, both of which have seen production curtailments over the past six months due to soaring costs for producers.

The three-month LME aluminum contract continued to climb to another fresh record, rising 3.1pc to $3,570/t. Global LME on-warrant aluminum stocks dropped 12.8pc on Wednesday to 510,750t.

Three-month LME nickel surged higher by 5.8pc to $26,350/t in the official morning session, its new highest level since May 2011.

Zinc prices hit highs not seen since May 2007 with the three-month LME contract climbing by 4.6pc on Wednesday to $3,894/t.

Chile recorded its lowest January copper output since 2011 with 429,923t produced, figures from the country's Bureau of Statistics show. Combined with Russian supply concerns this helped drive copper prices back above $10,000/t.

The three-month LME copper contract increased by 2.7pc to $10,220.50/t, while Comex's next most active month copper contract pushed 1.5pc higher to 4.67/lb

Fed chairman Jerome Powell told congress policymakers were on track to begin raising the key benchmark fed funds rate at the next meeting in two weeks to combat surging inflation and amid strong job growth. "We expect it will be appropriate to raise the target range for the federal funds rate at our meeting later this month," he said in prepared testimony to congress. He added that the Fed would also begin reducing its asset holdings, its balance sheet, "after the process of raising interest rates has begun."

Global equities were lower in the morning but pushed higher in the afternoon. In Asia, Hong Kong's Hang Seng dropped by 1.8pc as Tokyo's Nikkei 225 shed 1.7pc this morning. In Europe, London's FTSE 100 gained 1.4pc while the German DAX closed 0.7pc higher. Meanwhile in the US, the S&P 500 rose by 2pc and the Dow Jones Industrial average increased by 1.9pc during midday trading.

Brent crude futures climbed above $110/bl this morning and gas prices also surged higher, with European TTF April futures rising by around €60/MWh ($66/MWh) to €194/MWh just before 09:00 GMT before shedding some of these gains in the subsequent hour of trading. WTI, the US crude benchmark, rose by 7pc to $110.60/bl at closing.

Three-month LME lead was up by 1.1pc at $2,434/t and three-month LME tin inched 0.2pc higher to $45,850/t.

The standard LME aluminum alloy contract was unchanged at $2,725/t and the North American aluminum alloy rose by 1.6pc to $2,922/t.

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25/05/13

UK TRA proposes 40pc cap on other countries' HDG

London, 13 May (Argus) — The UK Trade Remedies Authority (TRA) has recommended the imposition of a 40pc cap on the other countries' quotas for hot-dip galvanised (HDG) and plate in its statement of final determination published today. It proposes that the caps come into effect on 1 October to enable material already on the water to clear and avoid supply restrictions. "This would address the concern about crowding out, whilst maintaining a similar volume of imports to come from existing supply countries," the TRA said. The other countries' quota for HDG is 88,075t for July-September, meaning anyone selling into it — the quota is dominated by Vietnam and South Korea — has access to 35,230t before duties become payable. The TRA said there should be no cap on organic coated material, despite requests to the contrary from UK Steel. Going forward, Turkey will not be in scope of the safeguard on HDG as its share during the investigation period was just 0.1pc. The TRA said unused quota should no longer be rolled forward to the next quota, and that countries with their own individual quota should have no access to the residual other countries' quota in the final quarter of the quota year, April-June. These two changes are largely in line with those made by the EU in its recent safeguard review. Vietnam will also come into the residual quota for hot-rolled coil, which is 24,295t/quarter, as its volumes have exceeded the 3pc limit specified by the WTO for developing economy status, reaching 4.3pc in the TRA's investigation period. Vietnam had been a favoured origin for traders and buyers, given its previous exemption from the measures. Egypt remains exempt and will likely be subject to increased interest going forward. Some large buyers have been visiting the country in recent months to establish supply lines. The TRA's recommendation "falls short of what is required, given the scale of the challenge the UK industry is faced with", UK Steel said. By Colin Richardson Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Mexico industrial production contracts in March

25/05/13

Mexico industrial production contracts in March

Mexico City, 13 May (Argus) — Mexico's industrial production contracted by 0.9pc in March from the previous month, as declines in mining and manufacturing were only partly offset by continued growth in construction. The drop was not enough to undo the 2.2pc increase in February — the sharpest monthly expansion in four years — as manufacturers ramped up output ahead of incoming US tariffs. The March industrial production index (IMAI), published by statistics agency Inegi, was higher than Mexican bank Banorte's forecast of a 1.4pc decline. Banorte noted signs of volatility affecting manufacturing and other sectors because of a complex trade outlook. Manufacturing contracted 1.1pc in March after expanding 2.9pc in February. The impact varied across subsectors, with metal goods down 5.5pc and transportation, including auto production, down 1.1pc. Volatility may ease in the coming months as US tariff policies become clearer and Mexican officials push to preserve the country's trade edge under US-Mexico-Canada (USMCA) free trade agreement rules, Banorte said. Construction expanded 0.8pc in March, following increases of 3.4pc in February and 0.5pc in January, driven by higher public investment tied to President Claudia Sheinbaum's economic plan, "Plan Mexico." Analysts see the plan as a catalyst for continued growth in construction this year, with measures including greater domestic content in public purchases, public-private participation in infrastructure projects and a target of $100bn in private infrastructure investment for 2025. These effects could be amplified by aggressive interest rate cuts from the central bank. Mining contracted by 2.7pc in March, returning to negative territory after a slight 0.1pc uptick in February. Oil and gas output also contracted 2.7pc after rising 1.0pc the month before, while non-oil mining contracted 4.3pc in March after a 0.6pc increase in February. By James Young Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

US inflation eases to 2.3pc in April

25/05/13

US inflation eases to 2.3pc in April

Houston, 13 May (Argus) — US inflation slowed in April, pulled lower by falling gasoline prices, while core inflation continued to show signs of mounting inflation pressures, as the new US administration's tariff policies have scrambled corporate and consumer investment and spending patterns. The consumer price index (CPI) slowed to a seasonally adjusted annual rate of 2.3pc in April, down from 2.4pc in March and off from 2.8pc in February and the lowest rate since February 2021, the Labor Department reported Tuesday. Analysts surveyed by Trading Economics had forecast a 2.4pc rate for April. Core inflation, which strips out volatile food and energy, rose at an 2.8pc annual rate, unchanged from the prior month. The deceleration in inflation came a month after President Donald Trump began to levy tariffs on imports from China and on steel, aluminum and automobiles, starting in February. Several tariff deadlines were pushed back, including a three-month pause enacted this week on much steeper tariffs for most countries. The tariffs have prompted companies and consumers to pull back on investments and some purchases while shaking up financial markets, and heightening concerns of a global recession. The energy index fell by an annual 3.7pc in April, down from 3.3pc in March. Gasoline fell by 11.8pc after a 9.8pc decline. Piped natural gas rose by an annual 15.7pc following a 9.4pc gain. Food rose by an annual 2.8pc, slowing from 3pc. Eggs slowed to an annual 49.3pc after an annual 60.4pc, as avian flu has slashed supply. Shelter rose by an annual 4pc in March, matching the prior gain. Services less energy services rose by 3.6pc, slowing from 3.7pc in March. New vehicle prices edged up by an annual 0.3pc. CPI rose by a monthly 0.2pc in April after falling by 0.1pc in March. Core inflation rose by 0.2pc for the month following a 0.1pc gain in March. By Bob Willis Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

ISTA blasts 'ludicrous' Tata Steel UK assertion to TRA

25/05/13

ISTA blasts 'ludicrous' Tata Steel UK assertion to TRA

London, 13 May (Argus) — Tata Steel UK's claim to the Trade Remedies Authority (TRA) that 2m-wide hot-rolled coil (HRC) could be bought for slitting is "ludicrous", according to the International Steel Trade Association (ISTA). In a submission to the TRA as part of its safeguard review, Tata said that if 2m-wide material, which it does not produce, is removed from the safeguard, it would be bought and slit, meaning it is no different from the material produced by Tata . But ISTA said 2m-wide HRC is a "significant part" of the yellow goods market and is used by companies such as JCB, Caterpillar and Liebherr for earth-moving, construction and agricultural equipment. It is also used in pipe and tube production and does not constitute a small proportion of the overall market, as suggested by Tata, ISTA said. The material must be imported as it is not manufactured in the UK and carries a premium over speed-stock widths produced by Tata. "For Tata Steel, who import volumes of this width themselves, to suggest that wider coil is ‘often imported only to be slit to narrower cuts' is ludicrous," ISTA said, arguing that there are "almost no" slitting lines in the UK that are capable of slitting 2m-wide material. The lines that do exist typically slit hot-dip galvanised (HDG) rather than HRC, Argus understands. Importers have also questioned the economic rationale of Tata's assertion that if higher-yield HDG is removed from the safeguard, importers would buy it and use it to compete with more commoditised grades produced by Tata. Higher-yield material carries a premium, and it would make no economic sense to pay it and then compete in the commodity market, trading firms told Argus . The TRA, which is expected to announce its provisional findings this week, is widely anticipated to propose caps on the quota for other countries' HDG. Importers told Argus that they were surprised by the aggressive tone of Tata's rebuttal to claims fielded by importers about material that it does not produce being excluded from the safeguard. By Colin Richardson Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

India’s Vedanta expands metals exploration

25/05/13

India’s Vedanta expands metals exploration

Mumbai, 13 May (Argus) — Indian private-sector mining firm Vedanta is exploring critical mineral assets in six states as it looks to strengthen its position in the fast-growing clean energy value chain. Vedanta is exploring for copper, nickel, cobalt, chromium, vanadium, tungsten and platinum-group elements (PGEs) in states such as Maharashtra, Rajasthan, Bihar, Arunachal Pradesh, Karnataka, and Chhattisgarh supported by India's policy push for mineral security , it said on 10 May. Vedanta secured four mineral blocks in the fourth round of India's critical mineral auctions. It won a vanadium and graphite block in Arunachal Pradesh and a cobalt, manganese, and iron (polymetallic) block in Karnataka. Its subsidiary Hindustan Zinc (HZL) was awarded one tungsten block in Andhra Pradesh and another in Tamil Nadu. The company is expanding its value-added aluminium products capacity in billets, primary foundry alloys, rolled products and wire rods. Aluminium billets are used in the aerospace, defence and solar power sectors, while aluminium rolled products are used in high-speed railways, electric vehicles, pharmaceuticals and battery enclosures. HZL is exploring uses for zinc beyond galvanizing steel to protect it from rust, which currently accounts for over 60pc of global zinc demand. It has entered the zinc alloy sector with a 30,000t plant and plans to significantly increase the share of value-added products in its aluminium portfolio to over 90pc in the near term. Vedanta's board earlier this year approved an investment of about $1.5bn to expand its aluminium capacity, including an expansion at its smelter in Orisha to increase production, as well as increased value-added product capacity at its flagship aluminium plants. By Deepika Singh Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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