The lazy days of summer.
For nickel, which is heavily influenced by the stainless steel market, the move has been driven by substitution at the consumer level. According to some news reports, two of China's largest stainless steel suppliers have sharply curtailed their output as prices topped levels that led companies to search for other metals. The mills include Taiyuan Iron & Steel Co., Baoshan Iron & Steel and Zhangjiagang Pohand Stainless Steel Co.
One analyst notes that nickel has lost around 30 percent of its value during the past month, down from an all-time high of around $52,000.
Adding to the downward trend, the International Nickel Study Group, based in Lisbon, Portugal, forecasts a nickel surplus of 70,000 metric tons this year, up from a deficit last year. The mills will be cutting their production schedules by 20 percent to 30 percent to offset softening prices and demand for finished products.
Copper, which has been driven by concerns about availability, is seeing signs of an increase in inventory stocks. This has led to some softening in prices. The London Metal Exchange reports that copper inventories increased by nearly 5 percent toward the end of June, the sharpest jump in more than six months. Meanwhile, some commodity analysts are expecting the grade to remain somewhat sluggish throughout the next several months, as consumers work off existing inventories.
There are indications that copper will reach a floor, as labor problems should cut off some copper production.
Aluminum seems to be in the middle of the proverbial summer slowdown. Whether it is more acute this time than a typical summer downturn is uncertain. However, several handlers of the grade say sheet mills and building products operations are getting backed up, with some postponing deliveries and orders. Prices for some secondary grades of aluminum have dropped by 5 cents to 8 cents in light of sluggish demand from the auto industry.
One Midwestern handler of aluminum says that scrap has not been flowing that well and there is a backup in buying. On the positive side, there are some pockets of orders, though they are not likely to improve the overall condition of the market until August at the earliest.
While the export market has helped propel many types of nonferrous metals, export orders also appear to be somewhat soft right now, with China, Korea and other countries reducing their orders.
(Additional news about nonferrous scrap, including breaking news and consuming industry reports, is available online at www.RecyclingToday.com.)
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|Date:||Jul 1, 2007|
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