Zinc demand to outcast supply by the end of 2014, says ILZSG

According to the estimation released by the group, the demand for zinc would rise about to 13.65 metric tonnes, which is a 5.1 percent increase compared to the present situation, and will be followed by an additional increase in demand of 14.05 million metric tonnes, which is another 2.08 percent increase.

 

The anticipated increase in demand is expected from China as the production of galvanized sheet  in the country, is reported to have risen to a large extend. According to the reports from the International Lead and Zinc Study Group, the increase in global demand of zinc excluding the demand from China, is rather low, which is reported to be 2.3 percent hike in the year, 2014 and 1.3 percent hike in the year 2015.

 

The group also stated that, in Europe, 1.2  percent hike in demand is expected this year and 1 percent hike in demand is expected the year after, after remaining constant through the year of 2013.  In the year 2014, a sharp increase in the demand of zinc is expected with a raise of 8.4 percent, followed by the large scale import of zinc into the United states, even so the demand from the United States will decline in the year 2015 to 0.4 percent.

 

At the same time the production of zinc is expected to have a slight hike of 1 percent to 13.33 million metric tonnes in the year 2014, and a 3.8 percent increase in the production by 13.80 million metric tonnes, in the year 2015.

China’s electric car production encourages the rise in demand for aluminum

The world’s largest producer of carbon fumes, China, has decided on promoting electric cars by replacing about 30 percent of the government vehicles with a new electric power charged vehicles, with an agenda of reducing the rate of air pollution and also conserving the resources.

The present estimation of the demand of aluminum , based on the production of cars in China, South Korea and Japan, is likely 50,000 metric tones, and there is now a chance of 30 percent hike in aluminum demand, for as long as next decade, stated the President of Novelis, Shashi Maudgal.

He also stated that, China, is now under a strong determination to increase the production and usage of electric based cars. If the government decides on using this plan all over the country, then the demand will increase over 30 percent.

Today the company, is inaugurating its brand new aluminum plant in china, located in Changzhou, which is situated about 180 kilometers away from Shanghai. The new aluminum plant is expected to produce about 120,000 tonnes, of aluminum auto body sheets.

Whether the company has already fixed their customers, or are in communication regarding the supply are still unknown. Anyway the expected car companies in the list are SAIC Motor Corp and Chery  Jaguar Land Rover Automotive Company Limited.

World Nickel output and utilization to increase in 2015, says INSG

The participants at the meeting held last week by the International Nickel Study Group (INSG) in Lisbon, Portugal has predicted significant growth in global Nickel production and consumption during 2015.

According to INSG, the improved economic situation around the globe has led to increased consumption of Nickel during first half of the current year. The countries which reported significant consumption growth during the six-month period were China and North America. The conditions remained favorable for Nickel market in the European region and Japan.

The Indonesian ban on ore exports has affected Chinese nickel pig iron production. The shortage of availability of nickel ore has adversely affected the functioning of large number of new facilities that became on stream during this period, thus resulting in reduced global production of Nickel. However, nickel ore exports from the Philippines continued to increase.

INSG predicts marginal drop in world primary nickel production in 2014. The production is likely to to reach 1.93 Mt in 2014. It must be noted that the production during 2012 and 2013 were 1.75 Mt and 1.94 Mt respectively. However, the output is likely to record marginal growth in 2015 to total at 1.95 Mt. INSG cautions that the above forecasts are subject to alterations on account of future market developments.

The world primary nickel usage is estimated to increase from 1.78 Mt in 2013 to 1.92 Mt in 2014. The usage is likely to post further growth to reach 1.97 Mt in 2015, added INSG.

Natixis sees LME Nickel to avg $19,000 a ton in 2015

LME nickel prices are expected to average $19,000 a ton during next year, said Natixis in its Metals review.

According to Natixis, of all the base metals, there is perhaps the greatest potential uncertainty surrounding the outlook for nickel.

Uncertainty surrounds:--The strength of Chinese demand for nickel,
--The size of unreported nickel (and stainless steel) inventories held in China,
--The likely volume of NPI produced in 2015H1 as a ban on exports of Indonesian ore combines with seasonal weakness in Philippine supplies,
--The pace at which Indonesian nickel ore is likely to return to the global market in the form of 4% NPI.

Natixis's central forecast anticipates a period of deficit during first half of 2015, resulting in an average LME nickel price of around $19,000 a ton over 2015 as a whole, although there is scope for substantial variation around this mean.

By 2016, The firm would expect the market to have settled more closely upon its longer-term equilibrium, hence Natixis forecast for an average price of $17,375/tonne for that year.

Zinc deficit to be 366,000 T in 2015 -ILZSG

The global zinc market is forecast to have a deficit of 403,000 tonnes in 2014, dipping to 366,000 tonnes next year, the International Lead and Zinc Study Group (ILZSG) said on Monday.

The group also said, following its annual meeting, that the global lead market is forecast to be in a deficit of 38,000 tonnes this year and 23,000 tonnes in 2015.

In zinc, global demand for refined metal is expected to rise by 5.1 percent to 13.65 million tonnes this year and a further 2.9 percent to 14.05 million tonnes in 2015, the ILZSG said.

"These rises will be primarily driven by increased Chinese usage," it said in a statement.

Refined zinc metal output is forecast to rise by 2.9 percent to 13.25 million tonnes in 2014 and by 3.3 percent to 13.68 million tonnes in 2015 mainly due to further expansion of output in China, it added.

In lead, global demand for refined lead metal is forecast to increase by 1.4 percent to 11.33 million tonnes this year and by

2.1 percent to 11.56 million tonnes in 2015, the group said.

Growth in Chinese lead demand is due to slow this year.

"This is mainly due to a slowing of the increase of output of e-bikes that account for a significant portion of Chinese automotive lead-acid battery sales," it said.

World production of refined lead metal is forecast to edge up by 1.5 percent to 11.29 million tonnes in 2014 and rise by 2.2 percent to 11.54 million tonnes in 2015.

Gold price: ETF investors, hedge funds catch up to rally

On Monday gold futures managed to build on recent gains, jumping to the highest level since September 10.

In late afternoon trade on the Comex division of the New York Mercantile Exchange gold for December delivery was changing hands for $1,247.20 an ounce after bouncing off resistance at $1,250 and up $8 from Friday's close.

Gold is now up 4.8% from its 2014 sub-$1,200 low hit early in October.

Large investors and retail buyers have been selling into the rally, but latest weekly data show the holdings of exchange traded funds backed by physical gold increasing for the first time in five weeks.

The net addition was modest – only 4.9 tonnes – but did lift total holdings off five-year lows to 1,667.2 tonnes. Gold bullion holdings hit a record 2,632 tonnes or 93 million ounces in December 2012.

Like ETF investors, speculators in gold futures and options turned more bullish last week

Retail investors in silver continue to reduce their exposure to physical silver-backed ETFs which at the start of October reached a record 20,182 tonnes.

Last week silver funds lost just over 100 tonnes, dropping total holdings to 19,830 tonnes.

Like ETF investors, speculators in gold futures and options turned more bullish last week, while negative sentiment towards silver continued on the derivatives market.

Bullish bets on gold – net long positions held by large investors like hedge funds – jumped nearly 40% in the week to October 14 according to Commodity Futures Trading Commission data.

It was the first time in nine weeks hedge funds added to their bullish positioning after falling to the lowest level this year the week before.

On a net basis hedge funds hold 51,994 gold lots or 5.2 million ounces, still well below the year high of 144,272 lots.

Silver price speculators moved further into a net short position totaling 9,089 contracts.

It marks a dramatic reversal in sentiment towards silver by large investors or so-called managed money, from record longs of 46,795 or 240 million ounces only a three months ago.

Natixis sees lead prices to average $2,120 a ton in 2015

Lead prices are expected to average $2,120 a ton next year and $2,195 per ton in 2016, said Natixis in its Metal Review.

Global demand for lead has remained weak in 2014 due to a second consecutive annual decline in Chinese apparent demand. While other base metal markets with stronger fundamental have seen prices push higher, lead prices have instead remained trapped in a narrow range.

In Natixis central scenario, the lead market is expected to remain in broad balance, helping to keep prices within this tight range. There are, however, significant uncertainties surrounding Natixis outlook for both supply and demand, which could result in unexpected price volatility in the years ahead.

Natixis analysis of supply and demand suggests that the lead market will run a cumulative deficit of perhaps 20,000 tons over the period 2014-16. With this in mind, Natixis forecasts a very modest increase in lead prices over the period 2015-16.