July 6, 2023

• LME Aluminum 3M Select is up $11/mt, hovering near the bottom end of this week’s trading range.
  • Last trade was $2,148/mt (6:45 AM CST)
  • Analysts continue to fine-tune Chinese aluminum production estimates while drought issues in top-producing Yunnan Province begin to ease. In a report released on Tuesday, Bloomberg Intelligence stated that in its base case scenario about 800,000 mt of the previously 1.9 million mt could be restarted this quarter. This is largely due to heavy rains throughout the region that have refilled hydro reservoirs. Approximately 80% of Yunnan province’s aluminum smelters are powered via hydropower.
  • This increase in production could also push the Chinese aluminum market into a surplus of 658,000 mt, with total production up 3% to 41.2 million mt, they also stated. (Source: Bloomberg)
• LME Copper 3M Select is down $8/mt, but is nearly $90/mt off this morning’s lows.
  • Last trade was $8,314.5/mt (6:45 AM CST)
  • A downturn in US manufacturing activity could be contributing to the recent slump in copper prices. The Institute for Supply Management’s manufacturing Purchasing Manager’s Index (PMI), a key gauge of manufacturing activity, fell to 46.0 last month, the eighth straight month of declines and the lowest since May 2020. A reading below 50.0 signals that the sector is contracting. (Source: Bloomberg)
• Prompt month CME HRC Steel last traded at $878/st, up $4/st (6:45 AM).
  • Last month, India exported 502,000 mt of finished steel products, the lowest level since December 2022 as global steel demand contracts. For the April-June quarter, the country exported 2.05 million mt, down 6.4% compared to last year. According to Argus, “Exports hit a 13-month high in April, but have since tapered off on slowing demand from Europe and increased competition from other Asian origins.” (Source: Argus)

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Price Indications

Today's Charts

AEGIS Insights

07/05/2023: AEGIS Factor Matrices: Most important variables affecting metals prices

06/22/2023: Chinese Metals Imports Could Be the Canary in the Coal Mine for Demand

05/17/2023: Cobalt End-Users Should Hedge While Market Is Oversupplied

05/3/2023: Copper Producers Can benefit From Hedging Both Inputs and Production

7/5/2023: India’s steel exports drop to six-month low in June

7/5/2023: Zambia says deal with India's Vedanta over disputed copper assets imminent

7/5/2023: India's April-May finished steel imports from China at six-year high

6/30/2023: Zambia's Mopani Copper Mines losses deepen amid search for new investor

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