Exit Poll Prediction All India 2014

Demand for Zinc in Agriculture Grows due to Increased Population and Food Consumption

 Due to increasing world population, which might be more than 9 billion by 2050 and improved diets, the demand for the zinc as micro-nutrient in the agriculture is increasing greatly. The main zinc chemicals which have the highest demand are zinc chloride, zinc sulfate, and zinc oxide, based on the reports of global market research by IHS.

Director of specialty chemicals at IHS Chemicals, Stefan Schlag said that zinc is an essential element for both animal and plants. Zinc deficiency has become a serious threat to the public health, especially in children. Thus many nations are implementing measures to increase the zinc fertilizer usage in zinc deficient regions, he added.

Now the total demand for zinc is about 1.5 million tons. Stefan said that this would exceed 1.8 million tons by the end of 2018 and about 400 thousand metric tons of the demand would be of agricultural demand, mainly in the form of zinc sulfate. In 2012 and 2013 China included Zinc fertilizers for major crop production.

This increased the production of Zinc fertilizers and use in China increased from 50,000 metric tons to 100,000 tons metric ton per year, based on IHS Chemical estimates. One of the most common micronutrient deficiency problems worldwide is zinc deficiency. The deficiency is especially found in grain crops. Reports of IHS says that nearly 50 percent of cultivate soil all around the world contains less amount of zinc and it would become 65 percent by 2018. It would decrease the production of edible plants.

Studies conducted in Brazil, India and China proved that zinc can increase the yield of crop from 8 percent to 20 percent yearly. With the declining amount of arable land per person and increasing population, global crop yield should be increased to meet up the food necessities. Due to these reasons IHS forecast a demand growth for Zinc, is so bullish on the agricultural sector.

It is time to sell Gold - Bank Of America

Last year it was Goldman Sachs telling clients to "dump your gold" (only to become the biggest buyers of the precious metal in the following quarter). Just last month, Morgan Stanley advised clients that 'gold will not see $1300 again'... and today, Bank of America joins the crowd as Macneil Curry advises "It is time to sell Gold" (to BAML we presume?)... as the range trade of the past month is completing and the downtrend is set to resume. 

BofAML notes...

It is time to sell Gold. The range trade / consolidation of the past month is drawing to a conclusion. Further gains should not exceed 1315.70 (May-05 high) AND CAN'T EXCEED the Mar-14 high at 1331. Downside targets are seen to 1215.

Sell Spot Gold at market (1300), risking 1325, targeting 1215, potentially below.

Last Call Of Bank Of America On GOLD Dated 27th Feb 2014

My personal Opinion = Create Short positions only below 1268.

Copper Price Jumped On China Imports In April 2014 Data.

In late afternoon New York trade on Monday July copper changed hands nearly 2% or 6c a pound higher on optimism about demand from China and receding fears about supply growth.

July copper futures in New York in late afternoon dealings were last trading at a two-month peak of $3.1420 a pound after earlier in the day hitting a high of $3.1555.

The copper price has now recovered 6% since falling to near four-year lows in March although the metal is still down from $3.37 at the outset of 2014.

There was no fresh news out of China, responsible for more than 40% of global demand, on Monday that could have sparked the rally bar a fresh commitment from Beijing to push through capital market reforms announced earlier this year.

Optimism about the market-friendly measures was also somewhat dampened by Chinese President Xi Jinping saying that slower growth is the "new normal" for the country.

Traders were digesting fata released last week showed the country's inbound shipments of copper surged 52% to 450,000 tonnes in April.

April's jump brought the first quarter total to a record-breaking 1.75 million tonnes, although the numbers are misleading since as much as 60% of copper inventories in China are tied as collateral for trade credit and do not necessarily reflect stronger end-user demand.

China's surging imports coincide with a fall in copper stocks in LME warehouses to levels last seen in 2008.

China's surging imports coincide with a fall in copper stocks in LME warehouses to levels last seen in 2008.

There were also unconfirmed reports last month indicating that the Chinese State Reserves Bureau has bought up to 350,00 tonnes of copper in March and April to move into state warehouses.

The copper price has been hurt this year a combination of the slowdown in China and fears over surging supply.

Output is to top 22.2 million tonnes this year from just over 21 million tonnes in 2013 led by Codelco's new 160,000 tonnes-plus Ministro Hales mine, Glencore's Las Bambas project in Peru it sold to China's Minmetals recently, the first full year of production at Rio Tinto's Oyu Tolgoi mine in Mongolia and expansion at BHP Billiton's already giant Escondida mine.

But after an abnormally quiet 2013 with few supply disruption to existing operations, 2014 could yet turn out to be different.

Freeport McMoRan and fellow Indonesian copper miner Newmont Mining are deferring exports from Indonesia due to onerous new duties slapped on copper concentrate exports at the start of the year, while delays in bringing projects on stream to replace aging mines at state-owned Codelco, which dwarves other producers of the metal, could also limit supply growth.

Codelco, which produced 1.622 million tonnes last year, plans to invest $5 billion annually over the next five to six years to replace exhausted reserves and increase production with hopes of hitting than 2 million tonnes a year by the end of the decade.

Spot The Goldman And Glencore Aluminum Warehouses

Across the 137 warehouses that the London Metal Exchange has begun tracking, 2 stand out. Having been at the center of allegations of manipulation of the metals markets - most notably Aluminum - thanks to monopolistic warehousing, the following report from the LME will not entirely shock that none other than Goldman Sachs (and Glencore) have simply incredible waiting times for delivery of the base metal. We discussed the monopolization (thanks to lax Fed regulation) here, here, here, and here and as Reuters reports lengthy logjams at warehouses monitored by the LME, the world's oldest and biggest market for industrial metals, prompted bitter criticism by consumers and sparked a wide-ranging reform program at the exchange. With nearly 2-year-waits for Aluminum delivery by Goldman - we are sure regulators will see nothing wrong at all.

As Reuters reports,

The LME's new report, covering the month of April, showed the backlogs were concentrated at four warehouse locations and with three major warehouse operators.

The LME already publishes data on inventory levels by location and metal, but up until now has not published the amount of stock held by individual companies.

The LME report showed the longest queue was just over two years, or 748 calendar days, for aluminum at Pacorini warehouses in the Dutch port of Vlissingen and the second longest was 683 days at Metro depots in Detroit.

Pacorini Metals is owned by commodity group Glencore Xstrata and Metro International Trade Services is a unit of Goldman Sachs.

Nothing to see here regulators... move along...

Norsk Hydro to Shut down Kurri Kurri Aluminium Plant Permanently

Norsk Hydro decided to close its Kurri Kurri Aluminium Plant permanently. The smelter is situated at Kurri Kurri, in the hunter Region of New South Wales, Australia. The plant has been closed for its maintenance and ceased its production in 2012.

After being in the maintenance and care mode since 2012, the decision to close the Kurri Kurri Aluminium smelter permanently is allowing for redevelopment and remediation options for the site progresses. The decision to stop the production from the plant in 2012 was due to the overall market situation for the light metal including weak macroeconomic environment, low prices, uncertain trade outlook and strong Australian dollar to the American dollar.

The company has been evaluating and preparing for a possible shutdown of the plant and has been setting up plans for the site future. This made to take the decision of permanent closure of the Kurri Kurri Smelter. The company said that the plans would be again consulted with the stakeholders and local communities.

Executive vice president of Hydro’s primary Metal business area, Hilde Merete said that they were always committed to their stakeholders and the local communities in maintaining a good relationship, to understanding their ideas, values and concerns and to keep them involved in all plans and phases of the projects. The closure costs are expected to be compensated by the land and equipment sale.

However, the decision to shutdown makes the nation’s jobless rate high. The Kurri Kurri Aluminium plant had nearly 500 employees, with a net yearly production of around 180,000 tonnes.

China Imports and Exports of Copper and Aluminum in April 2014

According to the preliminary data from the General Administration of Customs, China's imports of unwrought copper and copper semis were 450,000 mt during April, with YTD imports from January to April at 1780,000 mt up 41.1 % YoY. 

China's exports of unwrought aluminum and aluminum semis were 330,000 mt in April, with YTD exports from February to April at 1180,000 mt, up 7.3 % YoY.