While the world stockmarkets have had recent strong rises with Wall St closing yesterday within a whisker of 5 year highs, this has not flowed into the commodity markets. Last week the LME Aluminium price in AUD hit a fresh low of $1,708 which is the lowest level since at least December 2005 – Please see the attached graph (our records don’t pre-date this time). For copper prices in USD have been relatively steady and we have seen some relief on AUD basis with the AUD/USD falling slightly to 104.4 levels.
**** METALS-Copper falls as euro zone optimism loses steam ****
Copper fell after last week’s optimism over prospects for the euro zone flagged, leading investors to step back from buying riskier assets as they gauge the impact of the bloc’s ongoing crisis on global economic growth and demand for metals.
“Base metals prices fell due to a lack of positive news over the weekend – no Chinese bank reserve ratio cut, no fresh policies out of the euro zone, nothing to cheer about,” said CIFCO Futures analyst Zhou Jie. “And with macroeconomics looking so bad, fundamentals looking so weak and equities down, base metal prices slip.”
**** LME Asian Copper Stockpiles Above U.S. First Time Since 2008 **** By Agnieszka Troszkiewicz – Aug 20, 2012
Copper inventories in Asian warehouses approved by the London Metal Exchange surpassed those held in the U.S. for the first time since 2008.
Copper stockpiles held in South Korea, Singapore and Malaysia rose 450 metric tons to 110,225 tons, while inventories in the U.S., the only LME-approved location in the Americas, dropped 775 tons to 109,625 tons, exchange data showed today. The last time there was more copper in Asian warehouses than in the U.S. storage points was on Nov. 11, 2008.
Asia is now the biggest location for copper inventories. The LME-monitored warehouses in South Korea are the closest to China, the world’s biggest buyer of the commodity. About 39 percent of global demand for the metal in 2011 came from China and the U.S. accounted for 9.2 percent, according to Morgan Stanley.
**** SHANGHAI, Aug 20 (Reuters) ****
Chinese steel futures hit a record low on Monday, falling below 3,600 yuan ($570) on festering worries over demand in the world’s second-largest economy, with iron ore remaining trapped at a 2-1/2 year trough.
The most-traded rebar for January delivery on the Shanghai Futures Exchange dropped as low as 3,599 yuan per tonne, before closing half a percent lower at 3,607 yuan. Futures on rebar, used in construction, have declined 20 percent from the year’s peak.