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Business Recorder
3 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.
Reuters
31-03-2025
- Business
- Reuters
Exclusive: Commodity traders Gunvor, Vitol queue to stock up on Russian aluminium from LME storage, sources say
LONDON, March 31 (Reuters) - Major commodity traders Gunvor and Vitol are waiting to withdraw large volumes of Russian-produced aluminium from London Metal Exchange-approved warehouses in the South Korean port of Gwangyang, three sources familiar with the matter said. Gunvor and Vitol mostly focus on energy, but oil and gas trading giants more broadly have made significant moves into metals markets to explore opportunities offered by the global clean energy transition. It is not known why Gunvor or Vitol want the aluminium in LME warehouses in Gwangyang, where the lion's share of metal is mostly of Russian origin - deposited after Russia invaded Ukraine in 2022 as consumers shunned the metal. Vitol and Gunvor declined to comment. LME data shows metal earmarked to leave warehouses in Gwangyang run by ISTIM - a major operator of LME depositories in the port - at 97,750 metric tons at end-February, worth more than $250 million. Queuing time to take delivery was 81 calendar days, or more than 11 weeks, the data showed. Queues typically only form when large amounts of metal warrants, title documents conferring ownership, are cancelled in a short period of time. The sources said Vitol has already taken delivery of some aluminium from LME warehouses in Gwangyang. Gunvor has not yet taken any, other sources said. In late December, 84,000 tons of aluminium stored in LME warehouses in Gwangyang was cancelled, according to LME data, which also shows another 21,150 was cancelled in January and February. A small proportion was loaded out in January, while in February, 33,200 tons was removed and 26,800 tons of aluminium has been removed from LME warehouses in Gwangyang so far in March. Cancelled warrants at 30% of Gwangyang's total stocks of 123,325 tons on March 28 suggest another 37,125 tons of aluminium is due to leave the LME system. Russian President Vladimir Putin in February offered the U.S. the opportunity for joint exploration of the country's rare earth metals deposits, as well as the supply of aluminium to the U.S. domestic market, under a future economic deal. Putin said Russian companies could supply up to two million metric tons annually of the metal used in the transport, construction and packaging industries. Industry sources say major destinations for Russian-origin aluminium are China and Turkey, where users accept sanctioned metal produced in Russia. The U.S. Treasury Department and the British government in April last year banned the 148-year-old LME and the Chicago Mercantile Exchange (CME) from holding Russian aluminium, copper and nickel produced from April 13. Aluminium in Russia is produced by Rusal, which last year supplied nearly four million tons or more than 5% of the global total estimated at around 74 million tons. Aluminium prices on the LME held up for a few weeks after Donald Trump became U.S. president, but have dropped 7% since March 12 to around $2,540 a metric ton on concern about U.S. tariffs and a global trade war.
