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**AEGIS is attending the SMU Steel Summit Conference 2022 at the Georgia International Conference Center in College Park on August 22 – 24. If you would like to schedule a meeting during the summit, please contact Patrick McCrann at pmccrann@aegis-hedging.com or (713) 936-2806. ** |
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Due to weak demand from a variety of sectors, cobalt prices at the CME are nearing 11-month lows, according to S&P Global. However, several anonymous sources interviewed by S&P Global late last week suggest that China could begin stockpiling 2,300 mt of cobalt for its strategic metals reserve. Prices for metals normally rally as China starts its stockpiling efforts. However, others feel that battery demand needs to recover to see a sustained rally. Likewise, COVID lockdowns, which shut down manufacturing activity, could hinder any price gains. China has made similar purchases in the past, purchasing approximately 2,000 mt in 4Q 2020, and a rumored 3,000 mt in early 2021. Global cobalt mine production was 170,000 mt in 2021, according to the USGS. Are you looking to hedge your cobalt needs? The CME started cobalt futures in late 2020, and volume and open interest has been increasing in recent months. There is currently no options market, but end-users such as electric vehicle producers can hedge future needs via swaps. Using swaps can help guard against a potential increase in cobalt input costs. Such positions are standard for consumer hedging, but they can result in opportunity costs or cash costs if metal prices decline. Please contact AEGIS for specific strategies that fit your operations. (8/15/2022) |
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Note: Clients with AEGIS Platform access can see this and other research, plus hedge portfolio reporting and tools here. |
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Price Indications |
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Today's Charts |
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AEGIS Insights |
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08/10/2022: AEGIS Factor Matrices: Most important variables affecting metals prices 08/09/2022: Aluminum prices are finding support: Consumers can lock in lower costs in 2023 and beyond 08/02/2022: Russia Finds New Alumina Supply 07/27/2022: American Automotive Production is on the Rebound |
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| Important Headlines | ||
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8/12/2022: Column: Scarcity changes the LME warehousing game 8/11/2022: Cobalt metal prices hover at low levels despite talk of Chinese stockpiling 8/11/2022: China's construction steel demand likely to remain low for rest of 2022 8/9/2022: Aluminium foundry fights for survival in European gas crisis 8/9/2022: Column: Glencore's smelter warning galvanises the zinc price 8/8/2022: Energy industry bright spot for NorthAm steel 8/7/2022: US Senate passes landmark bill to tackle climate 8/5/2022: US imports of unalloyed aluminum continue to rise loosening supply further 8/5/2022: FUTURES WRAP: LME scrap contract reaches all-time daily trading volume high |
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Important Disclosure: Indicative prices are provided for information purposes only, and do not represent a commitment from AEGIS Hedging Solutions LLC ("Aegis") to assist any client to transact at those prices, or at any price, in the future. Aegis makes no guarantee to the accuracy or completeness of such information. Aegis and/or its trading principals do not offer a trading program to clients, nor do they propose guiding or directing a commodity interest account for any client based on any such trading program. Certain information in this presentation may constitute forward-looking statements, which can be identified by the use of forward-looking terminology such as “edge,” “advantage,” “opportunity,” “believe” or other variations thereon or comparable terminology. Such statements are not guarantees of future performance or activities.
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