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Business Recorder
4 days ago
- Business
- Business Recorder
Copper slides as available LME inventories jump
LONDON: Copper prices fell on Monday after a jump in available inventories in London Metal Exchange-approved warehouses and a firmer dollar triggered selling while above-consensus loan data from top consumer China provided some support. Benchmark copper on the LME traded 0.7% lower at $9,595 a metric ton in official rings. Strong technical support exists around $9,565, the 100-day moving average. At 109,625 tons, headline copper stocks in LME warehouses are only up 900 tons. However, traders are looking at inventories that were cancelled or earmarked for delivery but were then re-warranted. More than 26,000 tons of copper that was due to leave the LME system in Asia was re-warranted, meaning those volumes can again be traded on the exchange. President Donald Trump last week announced a 50% copper tariff effective August 1. Traders said the cancelled inventories had likely been intended for shipment to the United States ahead of import tariffs, which the industry had expected would be announced in November. Logistics sources said the three weeks between the announcement and the August 1 deadline did not allow enough time to ship metal from Asia. Higher availability on the LME has widened the discount for the cash copper contract against the three-month forward contract to $50 a ton, the highest since April 23. Elsewhere, improving Chinese loan data suggested stimulus measures boosted credit demand during the US-China trade truce. Particularly encouraging was total social financing, used by analysts as a gauge of industrial metals demand, rising to 8.9% last month from 8.7% in May. 'Apart from tariffs, the other discussion is about Chinese stimulus,' said Bank of America analyst Michael Widmer. 'There's a possibility they are taking a closer look at overcapacity in some industries. It may mean they try to support the housing market.' Clues to Chinese demand are expected to come this week from China's housing price, industrial production and GDP data. Overall, a firmer US currency is weighing on industrial metals. Aluminium was down 0.7% at $2,584, zinc slipped 0.7% to $2,720, lead fell 0.8% to $2,005, tin was flat at $33,650 and nickel retreated 0.7% to $15,095 a ton.
Yahoo
01-04-2025
- Business
- Yahoo
Gold is on a tear — and might have even further to run
Gold prices hit a new high in New York of almost $3,150 an ounce. Rising demand for bullion has been driven by tariff uncertainty and economic slowdown fears. Analysts predict further price increases, with forecasts as high as $3,500 an ounce. Gold is on a tear, hitting a record high in New York on Monday at almost $3,150 an ounce to bring the rise this year to 19%. The increase comes after President Donald Trump announced a 25% tariff on all imported passenger vehicles and key car parts last week, with more levies expected to be announced on Wednesday. Gold passed the $3,000 threshold for the first time in March as fears of an economic slowdown, tariff uncertainty, and central bank purchases drive up demand. Analysts at Bank of America think gold could hit $3,500 an ounce if demand increases by 10%. Analysts led by Michael Widmer, head of metals research, said in a note that rising demand could come from China's insurance industry investing up to 1% of its assets in gold — the equivalent of about 6% of the yearly gold market — along with central banks raising their gold reserves to more than 30%, up from 10%; and retail investors buying more too. "Uncertainty around Trump Administration trade policies could continue to push the dollar lower, further supporting gold prices near-term. In our view, a broad rebalancing of America's twin deficits could be bullish gold too," they wrote. Analysts at Macquarie Group also think gold could rise as high as $3,500 as soon as during the third quarter. Goldman Sachs is projecting $3,300 by the end of the year, while Morgan Stanley predicts a range of between $3,300 to $3,400. "Another key reason why gold prices are still rising to new record highs is because of underlying momentum in the gold price, which is causing speculators to bid the gold price higher for short-term profits," Levi Donohoe, director of London-based bullion dealing company Auronum, told Business Insider. "The immediate technical target in the short term is $3,200 per ounce, suggesting that the buying of gold at these levels will continue into the summer." "As 'Liberation day' nears, the yellow metal's momentum roars into overdrive, spurred by investors seeking solid ground amid shifting ground," said Ahmad Assiri, a research strategist at Pepperstone. "An uptick in inflation chatter seems to add more fuel to the rally, sending gold deeper into beast mode." "While other asset classes battle uncertainty, gold's swift ascent has overshadowed the usual market buzz, with traders watching its every move." John Reade, senior market strategist at the World Gold Council, said gold's rally was evidence of its enduring role as a safe-haven asset. The focus would now be on whether it can stay above $3,000, he added. However, not everyone thinks gold will continue to glister. Jon Mills, an equity analyst at Morningstar, believes bullion could fall to $1,820 an ounce over the next five years — a drop of more than 40%. He told BI last week that a higher supply of gold, lower demand from investors and central banks, and traditional signs a peak is nearing, including more deals in the gold industry, booming M&A activity, and a recent proliferation of gold-based funds, all point to spot prices going down. Read the original article on Business Insider Sign in to access your portfolio
Reuters
05-03-2025
- Business
- Reuters
Trump's tariffs drive US physical market aluminium premiums to record high
Summary US Midwest aluminium premium up 60% since start of 2025 US lacks capacity to produce needed aluminium Aluminium likely to be diverted, potentially to Europe LONDON, March 5 (Reuters) - Price premiums for aluminium on the physical market in the United States have surged to a record high due to the looming threat of tariffs on imports of the metal used in the transport, construction and packaging industries. U.S. President Donald Trump is planning to restore 25% tariffs on aluminium imports from March 12. Tariffs on most imports from Mexico and Canada took effect on Tuesday. Buyers on the physical market usually pay the London Metal Exchange benchmark aluminium price plus a premium which typically covers taxes, transport and handling costs. The U.S. Midwest duty-paid aluminium premium at above 40 U.S. cents a lb or nearly $900 a metric ton is up nearly 60% since the start of 2025 . "Ultimately, the U.S. is a net importer of aluminium ... Producers will not want to pay the tariff, they will try to pass on as much as they can to consumers," said Bank of America analyst Michael Widmer. "This leaves you with a market where aluminium units will potentially be diverted away from the United States." Widmer said the premium may have to rise to near 47 cents a lb to fully account for a 25% levy. U.S. aluminium import taxes will apply to Argentina, Australia, Canada, Mexico, European Union countries and the UK. Canadian smelters account for the bulk of primary and alloyed aluminium exports to the United States, 70% of 3.92 million tons last year, according to information provider Trade Data Monitor. "The US cannot produce all that aluminum, they don't have the capacity," said Eivind Kallevik, CEO at Norwegian aluminium producer Hydro in an interview after the company's fourth quarter results. "If the U.S. is going to keep manufacturing cars and other products, they will need to attract the metal. That means higher premiums and costs." The second largest exporter to the United States is Saudi Arabia, not included in the list so far, with an 11% share, according to Trade Data Monitor. Analysts said aluminium produced in countries where import levies apply is likely to be diverted to Europe, where the duty-paid physical market premiums has dropped to 11-month lows at $240 a metric ton, down 35% since the start of 2025.
