Latest news with #PolinaDevitt
Yahoo
6 days ago
- Business
- Yahoo
Silver's hot streak gathers pace; market at highest since 2011
By Polina Devitt and Sherin Elizabeth Varghese (Reuters) -Silver prices surged to their highest in almost 14 years on Wednesday, aided by worries about U.S. tariff policy, signs of tightness in the spot market and growing investor interest in alternatives to gold. Spot silver was up 0.3% at $39.40 per troy ounce as of 1354 GMT, its highest level since September 2011. Silver, both a precious and industrial metal, is up 36% this year, outperforming gold's 31% growth and coming within a whisker of the key $40-per-ounce mark. The metal hit a record high of $49 in 2011. U.S. President Donald Trump's plan to impose 50% import tariffs on copper from August 1 and the U.S. import tariffs for Mexico widened the premium of the U.S. futures for silver and other metals against the London benchmarks in July, leading to a growth in lease rates in the spot market. Gold, silver, platinum and palladium were excluded from Trump's April reciprocal tariffs, but "the broader market isn't trading it that way and is taking a page out of Comex copper's handbook", Nicky Shiels, head of metals strategy at MKS PAMP. Spot silver prices may hit $42 per ounce this year, according to Shiels. Analysts also noted that industrial demand for silver, heading for the fifth year of structural market deficit, remains solid, while investment demand is gaining momentum as a more affordable alternative to gold. Silver's recent rally has improved its ratio with gold to the strongest level in seven months. It currently takes 87 ounces of silver to buy an ounce of gold, compared with 105 ounces in April. "It is the copper tariff that sent some spinning off at odd tangents that captured the other metals," said a precious metal trader based in London, adding that the lease rates in the spot market should fall once the borrowing activity caused by the U.S. tariff fears subside. The current momentum could be hot enough to take silver over $40/oz in the short term, said Nitesh Shah, commodity strategist at WisdomTree. "But with positioning stretched, we would not be surprised if it fell back to $35/oz, before it starts its march higher to $45/oz next year," Shah added. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
6 days ago
- Business
- Yahoo
Silver's hot streak gathers pace; market at highest since 2011
By Polina Devitt and Sherin Elizabeth Varghese (Reuters) -Silver prices surged to their highest in almost 14 years on Wednesday, aided by worries about U.S. tariff policy, signs of tightness in the spot market and growing investor interest in alternatives to gold. Spot silver was up 0.3% at $39.40 per troy ounce as of 1354 GMT, its highest level since September 2011. Silver, both a precious and industrial metal, is up 36% this year, outperforming gold's 31% growth and coming within a whisker of the key $40-per-ounce mark. The metal hit a record high of $49 in 2011. U.S. President Donald Trump's plan to impose 50% import tariffs on copper from August 1 and the U.S. import tariffs for Mexico widened the premium of the U.S. futures for silver and other metals against the London benchmarks in July, leading to a growth in lease rates in the spot market. Gold, silver, platinum and palladium were excluded from Trump's April reciprocal tariffs, but "the broader market isn't trading it that way and is taking a page out of Comex copper's handbook", Nicky Shiels, head of metals strategy at MKS PAMP. Spot silver prices may hit $42 per ounce this year, according to Shiels. Analysts also noted that industrial demand for silver, heading for the fifth year of structural market deficit, remains solid, while investment demand is gaining momentum as a more affordable alternative to gold. Silver's recent rally has improved its ratio with gold to the strongest level in seven months. It currently takes 87 ounces of silver to buy an ounce of gold, compared with 105 ounces in April. "It is the copper tariff that sent some spinning off at odd tangents that captured the other metals," said a precious metal trader based in London, adding that the lease rates in the spot market should fall once the borrowing activity caused by the U.S. tariff fears subside. The current momentum could be hot enough to take silver over $40/oz in the short term, said Nitesh Shah, commodity strategist at WisdomTree. "But with positioning stretched, we would not be surprised if it fell back to $35/oz, before it starts its march higher to $45/oz next year," Shah added. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
03-07-2025
- Business
- Yahoo
Analysis-Platinum prices have limited upside after June's stellar rally
By Polina Devitt and Anushree Mukherjee LONDON (Reuters) -Platinum prices have limited room to rise further after a record quarterly rally, analysts and traders said, with Chinese imports expected to soften and South African output to recover against a backdrop of still-muted auto sector demand. Prices of the metal surged 36% in the second quarter as a rise in Chinese imports and a drop in supply from major producer South Africa followed earlier heavy flows into NYMEX exchange stocks on fears platinum would be hit by U.S. import tariffs. In June alone, prices jumped 28% as hedge funds and speculative traders piled in, notching their strongest month since 1986 and hitting an 11-year high of $1,432.6 an ounce. "Platinum has broken out of a decade-long range, and, in doing so, has put itself on the radar of professional and retail investors alike who now think 'Hey, this is really undervalued fundamentally'," said Tai Wong, an independent metals trader. "But there has been a lot of volatility at the highs, and the market will want to see bigger demand from China and/or exchange-traded funds for a sustained move higher," he added. After strong deliveries of platinum to NYMEX stockpiles between December and March on fears the metal would be hit by April's reciprocal U.S. tariffs, tight near-term availability led lease rates to spike, forcing industrial users to buy instead of borrow. While platinum group metals were eventually excluded from the April tariffs, another probe ordered by Trump in mid-April into potential new tariffs on all U.S. critical minerals imports meant uncertainty continued. Meanwhile, data from the world's largest PGMs producer South Africa showed mined output of the metals fell 24% in April, capping what Morgan Stanley referred to as "exceptionally weak" production data for the first four months of 2025. China's platinum imports were also strong in the quarter, at 10 metric tons in April and 10.5 tons in May. That followed research from industry group WPIC showing Chinese platinum jewellery fabrication rose 26% in the first quarter. Put together, those factors made up "an explosive mixture for higher prices", one trader said. BULLS RUNNING OUT OF PUFF But explosions tend to be short-lived, and analysts question whether there is enough underlying support to sustain a stronger rally. Metals Focus sees the global platinum market in a deficit of 529,000 ounces this year, but the resulting reduction in above-ground stocks will still leave them at 9.2 million ounces, equal to 14 months of demand - a fairly comfortable buffer. While uncertainty over U.S. trade policy on platinum lingers, raising import tariffs for the metal would ultimately be counterintuitive, says Wilma Swarts, director of PGMs at Metals Focus, as North American supply falls short of the region's demand. Platinum lease rates, which touched 22.7% in June, have since fallen back to 11.6%. Mine supply in South Africa meanwhile is expected to show signs of recovery in the second half, with overall global mined output seen down just 6% in the year as a whole. "There were definitely some challenges with the rains, power and water disruptions in southern Africa between January and March, but nothing major or out of ordinary," said Johan Theron, spokesperson for Impala Platinum. And strength in physical demand for platinum in China only lasted until prices topped $1,050 in early June, according to one trader. China's June import data, due on July 20, is expected to show a decline after very strong platinum deliveries in the previous two months. That leaves the platinum market vulnerable to one of the last decade's most bearish factors - waning demand from the auto sector, which uses the metal as a component in catalytic converters for combustion-engine cars. CAR TROUBLE Long-term pressure on the platinum group metals from the expansion of electric vehicles persists, while global trade disputes have further dampened the auto sector's mid-term outlook. Auto production forecasters have removed as much as 10 million units from production projections over the next four years, and lower vehicle production will lead to weaker PGMs demand, Metals Focus said. The consultancy is forecasting auto sector platinum demand to decline by 2% this year after a 3% fall last year. Nornickel, the world's largest palladium producer, says any further rise in platinum prices could lead catalyst producers towards more substitution of the metal for palladium. Price spreads between the two metals of more than 30% would encourage that, it said. Platinum was 22% more expensive than palladium on Thursday. But while analysts and traders are cautious about further gains in platinum prices, they are not expecting them to correct. StoneX analyst Rhona O'Connell said some of China's high April-May platinum imports could be in part a bargain-hunting exercise. "China is renowned for buying material that is out of favour," she said. "And although the electrification of the vehicle fleet is advancing apace, the internal combustion engines and the diesel sector are still in place." Analysts see prices stabilising at levels above those seen before the rally, supporting miners' margins as the market heads for a third year of structural deficit.
Yahoo
03-07-2025
- Business
- Yahoo
Analysis-Platinum prices have limited upside after June's stellar rally
By Polina Devitt and Anushree Mukherjee LONDON (Reuters) -Platinum prices have limited room to rise further after a record quarterly rally, analysts and traders said, with Chinese imports expected to soften and South African output to recover against a backdrop of still-muted auto sector demand. Prices of the metal surged 36% in the second quarter as a rise in Chinese imports and a drop in supply from major producer South Africa followed earlier heavy flows into NYMEX exchange stocks on fears platinum would be hit by U.S. import tariffs. In June alone, prices jumped 28% as hedge funds and speculative traders piled in, notching their strongest month since 1986 and hitting an 11-year high of $1,432.6 an ounce. "Platinum has broken out of a decade-long range, and, in doing so, has put itself on the radar of professional and retail investors alike who now think 'Hey, this is really undervalued fundamentally'," said Tai Wong, an independent metals trader. "But there has been a lot of volatility at the highs, and the market will want to see bigger demand from China and/or exchange-traded funds for a sustained move higher," he added. After strong deliveries of platinum to NYMEX stockpiles between December and March on fears the metal would be hit by April's reciprocal U.S. tariffs, tight near-term availability led lease rates to spike, forcing industrial users to buy instead of borrow. While platinum group metals were eventually excluded from the April tariffs, another probe ordered by Trump in mid-April into potential new tariffs on all U.S. critical minerals imports meant uncertainty continued. Meanwhile, data from the world's largest PGMs producer South Africa showed mined output of the metals fell 24% in April, capping what Morgan Stanley referred to as "exceptionally weak" production data for the first four months of 2025. China's platinum imports were also strong in the quarter, at 10 metric tons in April and 10.5 tons in May. That followed research from industry group WPIC showing Chinese platinum jewellery fabrication rose 26% in the first quarter. Put together, those factors made up "an explosive mixture for higher prices", one trader said. BULLS RUNNING OUT OF PUFF But explosions tend to be short-lived, and analysts question whether there is enough underlying support to sustain a stronger rally. Metals Focus sees the global platinum market in a deficit of 529,000 ounces this year, but the resulting reduction in above-ground stocks will still leave them at 9.2 million ounces, equal to 14 months of demand - a fairly comfortable buffer. While uncertainty over U.S. trade policy on platinum lingers, raising import tariffs for the metal would ultimately be counterintuitive, says Wilma Swarts, director of PGMs at Metals Focus, as North American supply falls short of the region's demand. Platinum lease rates, which touched 22.7% in June, have since fallen back to 11.6%. Mine supply in South Africa meanwhile is expected to show signs of recovery in the second half, with overall global mined output seen down just 6% in the year as a whole. "There were definitely some challenges with the rains, power and water disruptions in southern Africa between January and March, but nothing major or out of ordinary," said Johan Theron, spokesperson for Impala Platinum. And strength in physical demand for platinum in China only lasted until prices topped $1,050 in early June, according to one trader. China's June import data, due on July 20, is expected to show a decline after very strong platinum deliveries in the previous two months. That leaves the platinum market vulnerable to one of the last decade's most bearish factors - waning demand from the auto sector, which uses the metal as a component in catalytic converters for combustion-engine cars. CAR TROUBLE Long-term pressure on the platinum group metals from the expansion of electric vehicles persists, while global trade disputes have further dampened the auto sector's mid-term outlook. Auto production forecasters have removed as much as 10 million units from production projections over the next four years, and lower vehicle production will lead to weaker PGMs demand, Metals Focus said. The consultancy is forecasting auto sector platinum demand to decline by 2% this year after a 3% fall last year. Nornickel, the world's largest palladium producer, says any further rise in platinum prices could lead catalyst producers towards more substitution of the metal for palladium. Price spreads between the two metals of more than 30% would encourage that, it said. Platinum was 22% more expensive than palladium on Thursday. But while analysts and traders are cautious about further gains in platinum prices, they are not expecting them to correct. StoneX analyst Rhona O'Connell said some of China's high April-May platinum imports could be in part a bargain-hunting exercise. "China is renowned for buying material that is out of favour," she said. "And although the electrification of the vehicle fleet is advancing apace, the internal combustion engines and the diesel sector are still in place." Analysts see prices stabilising at levels above those seen before the rally, supporting miners' margins as the market heads for a third year of structural deficit.
Yahoo
02-06-2025
- Business
- Yahoo
Aluminium premium for US buyers soars after Trump doubles tariffs
By Polina Devitt LONDON (Reuters) -Premiums for consumers buying aluminium on the physical market in the United States soared on Monday after U.S. President Donald Trump said he planned to increase tariffs on imported steel and aluminium to 50% from 25%. The U.S. is heavily reliant on aluminium imports. About half of all aluminium used in the country for transport, packaging and construction is delivered from elsewhere, with the vast majority coming from Canada. The new tariffs are due to take effect on June 4. Buyers on the physical market usually pay the London Metal Exchange (LME) benchmark aluminium price plus a premium covering taxes, transport and handling costs. The U.S. Midwest duty-paid aluminium premium reached $0.58 per lb, or $1,279 a metric ton, on Monday. That was a 54% jump from Friday and 164% growth since the start of 2025. Part of Monday's growth was amplified by June 2 being the first trading day of the new month, when regional premiums often make a strong move. Goldman Sachs said the premium would need to rise to between $0.68 and $0.70 per lb to fully reflect the 50% import tariff. LME benchmark aluminium was last up 0.4% at $2,453.5 a ton. The higher premium could weigh on U.S. spot market purchases if consumers wait to see if there is a reversal or any exemptions, Morgan Stanley said in a note. Aluminium production depends heavily on the competitively priced and secure power supply source. It has been forty-five years since anyone built a primary aluminium smelter in the U.S. Emirates Global Aluminium said in May it would invest $4 billion in construction of an aluminium plant in the U.S. with first metal expected by the end of the decade. The plant would have an annual production capacity of 600,000 metric tons. For comparison, the U.S. imported 2.7 million tons of unwrought aluminium from Canada last year, according to the Trade Data Monitor. Steel and aluminium tariffs were among the earliest put into effect by Trump when he returned to office in January. The tariffs of 25% on most steel and aluminium imported to the U.S. went into effect in March. The 25% tariff prompted some producers to divert aluminium to Europe, leading to a 45%-fall in the European aluminium premium since the start of 2025 and inflating an outflow of aluminium scrap from the EU to the U.S.
