SMM Metals Reports

India's Gold Bar imports grew 28% in June 2014: GJEPC

The Gems and Jewellery Export Promotion Council (GJEPC) has released the details of imports of raw materials for gems and jewellery for the month of June 2014. According to data, the gold bar imports by the country during June this year witnessed a sharp rise of 28.43% over the previous year.
The monthly import statistics released by GJEPC suggests that the total gold bar imports by the country in June ‘14 amounted to Rs 2,840.43 crores (USD 379.72 Million).In rupee terms, the gold bar imports have soared higher by 28.43%. The rise in dollar terms stood at 25.57%. It must be noted that the country’s gold bar imports during June last year were Rs 1,765.98 crores (USD 302.39 Million).
According to GJEPC, the cumulative gold bar imports by the country during the initial quarter of the current fiscal from April ‘14 to June ‘14 remained on the higher side, going higher by 8.79% when compared with the corresponding three-month period during previous fiscal year. The country’s gold bar imports during April to June 2014 totaled Rs 8,907.76 crores (USD 1,491.74 Million). During the similar quarter last fiscal, the country had imported gold bars worth Rs 8,545.73 crores (USD 1,539.91 Million).
Also, the country’s gold jewellery imports during June ’14 totaled Rs 206.06 crores (USD 34.50 Million). The country’s gold jewellery imports during June ’13 were only Rs 102.42 crores (USD 17.54 Million). Thus the GJEPC import statistics indicate that the Indian gold jewellery imports have more than doubled during June this year.

SMM Base Metals Weekly Price Review and Forecast (Jul. 21-25, 2014)

SHANGHAI, Jul. 22 (SMM) – As expected, China’s economic data turned out positive. The US dollar index rebounded as Fed Chair Yellen indicated no timetable for interest rate hike during her semiannual testimony. Based metals complex showed mixed picture. LME zinc gained less than a week ago, but the most active SHFE zinc contract climbed 2.8% as investors built up positions. Limited arrivals and massive stockpiling by speculators allowed SMMI.Zn to rise 2.93%. LME aluminum jumped 2.7%, boosting market sentiment in China. Falling stocks in east China and Guangdong, as well as high buying interest by traders drove a 2.02% increase in SMMI.Al. SMMI.Pb edged up 0.55%. Growing supply and slackening demand caused SMMI.Cu to shed 2.42%. Tin and nickel prices in China were unaffected by the price movement on the LME. SMMI.Ni crept up 0.06%, while SMMI.Sn lost 0.2%. Overall, SMMI slipped 0.75%, dragged down mainly by falling copper prices.    
SHFE copper prices still underperformed LME copper. Some investors sold copper and bought zinc contracts, sending the most active SHFE copper contract prices below RMB 50,000/mt from RMB 51,100/mt. The September copper hit a low of RMB 49,700/mt before weekend, down below the 20-day moving average and posting a 2.5% loss for the week. The SHFE/LME copper price ratio fell further to 7.08. Total trading volumes grew by nearly 100,000 lots, and holdings in SHFE copper soared by over 37,000 lots. Night trading remained brisk. The narrowing price gap between nearby and distant-month contracts helped eased selling pressure on the latter, but shorts were still waiting in the wings. SHFE copper prices may test support at RMB 49,500/mt this week.
The price gap between SHFE 1407 and 1408 copper contracts remained large at RMB 300/mt last Monday – just before the expiration of the former. In this context, cargo holders intended to sell before the expiration and offered spot copper at discounts of RMB 100-240/mt to the front-month copper contract. Traders were sourcing spot goods in the market while selling futures. SHFE copper prices entered correction after SHFE 1408 copper contract rolled over to the new front-month contract. Cargo holders showed strong selling interest, and the resultant increase in spot supply drove copper premiums to narrow from RMB 100/mt to RMB 30/mt. Ample supply and weak demand downstream left copper market quiet last week.
Last week, SHFE 1409 aluminum contract followed LME aluminum up to RMB 13,875/mt, but surrendered some gains later in the week due to profit-taking. In China’s physical markets, few arrivals and rising SHFE aluminum prices turned sellers bullish, driving prices up by RMB 100/mt for several consecutive days. Traders were willing to buy at higher prices, but downstream producers built up stocks in small amounts. 
This coming week, the most active SHFE aluminum contract is expected to fluctuate between RMB 13,750-13,950/mt. In China’s spot markets, cargo holders will remain optimistic due to rising SHFE aluminum prices. Besides, falling inventories will also lend support to spot aluminum prices. Spot discounts are expected to shrink to RMB 40-90/mt over SHFE 1408 aluminum contract.      
The most active SHFE 1408 lead contract last week was resistant to declines and rose RMB 5/mt from the previous week, hovering largely between RMB 14,000-14,100/mt, with trading volumes down markedly. Prices for the most active contract are forecast to fluctuate essentially between RMB 14,000-14,150/mt this week.
After SMM #1 lead prices climbed RMB 50/mt last Monday, lead smelters turned unwilling to sell, but traders and downstream producers were actively buying, resulting in shortages of supply. As lead prices rose at a slower pace, lead smelters ramped up sales, but downstream producers turned wary of purchases, sending trading volumes down. Physical lead prices in Shanghai traded near the highs of SMM #1 lead prices due to tight supply. Physical prices in Henan ranged from lows up to the average of the SMM #1 lead prices, as regional supplies of low-priced material decreased. Small volumes of lead were offered at a RMB 70/mt discount over the average SMM #1 lead price in Jiangxi and at a RMB 100-150/mt discount in Hunan.
In China’s physical lead markets, prices should trade this week between RMB 13,900-14,050/mt. Lead smelters will be reluctant to move goods on a view that prices will rise, and should trade in limited volumes despite pressure from repaying banking loans at the end of July. Downstream producers with sufficient cash flows are expected to further build raw material stocks should lead prices continue to rise. Meanwhile, automobile ignition battery producers will also step up buying lead with the arrival of a high demand season.
Spot prices in China's domestic zinc market were firm, and spot discounts against SHFE 1409 zinc contract prices narrowed from RMB 100-150/mt two weeks ago to RMB 50/mt as SHFE zinc prices rose. Smelters held goods as spot zinc prices climbed above RMB 16,500/mt, and other cargo holders were also unwilling to sell, leaving supply tight. In the meantime, some traders took a wait-and-see posture as spot discounts continued to narrow, while downstream buying interest was also weak, keeping trading muted.
In China's spot markets, resources from some smelters will be limited due to maintenance this week, and a few of them will hold back goods. Coupled with traders unwillingness to sell, tradable goods are expected to be insufficient. Downstream buyers will stand on the sidelines. Tight supply will bolster spot zinc prices, with spot discounts against SHFE 1409 zinc contract prices between RMB 30-100/mt.
In Shanghai physical tin market, prices fell slightly early last week, but stabilized between RMB 138,000-140,000/mt later in the week. A small amount of tin from Jiangxi traded around RMB 137,800/mt. Tin from Bolivia traded around RMB 137,500/mt last Thursday and Friday. Smelters in Yunnan held back goods. Meanwhile, output in Jiangxi was limited by facility maintenance and raw material shortage. Both factors cut into the volume of tin available for sale in the market. Downstream demand was tepid in the offseason, but did pick up last Friday.   

Nickel plate/sheet supply increased steadily. Prices for spot nickel plate/sheet in Shanghai gained RMB 430/mt in the week ending July 18. Consumption from stainless steel mills was sluggish in the offseason, with transactions largely done by traders. The price spread between Jinchuan nickel and Russian nickel hovered around RMB 500/mt.      
This coming week, spot nickel prices are expected between RMB 126,000-132,000/mt. July is a low-demand month for stainless steel industry, so transactions will be made largely by traders. Prices for high-grade NPI have dropped below refined nickel prices, benefiting those stainless steel mills that produce with high-grade NPI. NPI looks set to be favored over refined nickel in stainless steel production through at least the end of July. 

China Aluminum Prices Rise on Falling Inventories, with Gains Expected Continuing, SMM

SHANGHAI, Jul. 22 (SMM) – Aluminum prices are now gathering up the rising momentum due mainly to falling inventories, Shanghai Metals Market understands. 
It is now the low-demand season, but aluminum stock declines have not slowed from those recorded during the peak-demand period. 
Last Thursday, total inventories in Shanghai, Wuxi, Hangzhou, and Nanhai were 798,000 tonnes, down 42,000 tonnes on a weekly basis, according to SMM data.
SMM attributes the decline mainly to the drop in market supply after production halts or suspension, in addition to growing consumption of aluminum liquid and the shipment to regions with new fabricating capacity, such as Shandong, Henan, Hebei, Hubei, etc. 
Over 2 million-tonne aluminum capacity has been cut so far this year, with complete shutdowns reported in May and June. More than one third of idled capacity is scheduled to be brought back online, but full resumption at the 700,000-tonne capacities in idled lines is not expected until August at the earliest, SMM learns. 
Part of this is due to the difficulty in securing sufficient funds to support large scale restarts, and many smelters continue to struggle in loss-making territory. Besides, tight liquidity is also slowing the commissioning of new capacity, SMM believes. 
The SMM recent survey of 34 large aluminum smelters and traders in China reveals 71% of them are bullish towards the outlook, expecting spot aluminum prices in China to rise to 13,900-14,000 yuan ($2,254-2,270) per tonne this week. The growth both in trading volumes and positions in SHFE aluminum market and few arrivals in spot market explain their optimism, the survey shows. 

China Zinc Imports and Exports Data June 2014

SHANGHAI,Jul.22 (SMM)--The General Administration of Customs on Jul.21 released China's imports and exports of refined zinc and other zinc products for June 2014.(unit:mt):
 Jun.YoY (%)Jan.– Jun.YoY (%)
refined zinc68,476123.55379,44938.14
The Republic of Namibia3,961-14,021-
North Korea2,421-13.5911,244-23.07
South Korea1,118-50.516,199-77.46
The US532.55259-20.83
Taiwan (China)2-79133.37
zinc alloy10,4479.9351,819-11.03
South Korea4,57124.5820,117-1.41
Taiwan (China)426-19.292,797-0.26
Hong Kong20771.571,381153.88
Zinc Ores159,174-29.39941,615-4.72
South Africa12,837-32,759556.74
North Korea2,12643.176,978-21.72
The Republic of Montenegro1,170-7,182-
South Korea655-12,292390.92
The Republic of Congo606-1,102-
The Philippines99110.2822072.23
refined zinc3,5981089.694,611121.50

US weekly raw steel output down 0.5% during week ended July 19, 2014: AISI

ALBANY (Scrap Monster): As per the statistics released by the American Iron and Steel Institute (AISI), the raw steel production in the country was marginally down by 0.5% during the week ended July 17th, 2014.
The total raw steel output during the week ending July 17th was 1,893,000 net tons. The AISI data indicates that the US raw steel production has declined 0.5% during the week. This is in comparison with the previous week (ie., the week ended July 12th ) production figures of 1,903,000 net tons. Also, the weekly output suggests a 2.2% rise in comparison with production during same week the previous year.
The capacity utilization rate of US steel makers was 78.7% during the week ended July 17th.
The capacity utilization rate has gone down when compared to 79.1% during the previous week (ie., the week ending July 12th). However, the capacity utilization was higher when compared with the rate of 77.3% during same week the previous year.
The region-wise comparative weekly production figures are provided below:-

Steel production (in ‘000 nt)
% Change
Week ended July 12th
Week ended July 17th
North East
Great Lakes
The American Iron and Steel Institute (AISI) is an association of North American steel producers. AISI's member companies represent over three quarters of both U.S. and North American steel capacity.
AISI determines its weekly raw steel production data based on weekly data from 50% of the domestic industry and estimates the rest using monthly production data.