July 28, 2023

• LME Aluminum 3M Select is down $2.5/mt, ending the week on a quiet note.
  • Last trade was $2,206.5/mt (6:45 AM CST)
  • Despite pleas from Norsk Hydro and other large aluminum producers, the LME continues to resist calls to ban Russian aluminum and other metals from the exchange. Earlier this week, Norsk Hydro sent the LME another letter requesting that the exchange reconsider its position, but the LME responded by saying “We note that all metals of Russian origin continue to be consumed by a broad section of the market, and we will remain vigilant in respect of this matter. They also stated, “it would continue to reflect all relevant government sanctions and tariffs, and monitor for any market orderliness concerns in respect of Russian metal,” according to Reuters.
  • Unsurprisingly, Rusal, which is Russia’s top aluminum producer, sided with the LME, proclaiming that it would be “highly disruptive” to remove its metals from the supply chain. "Rusal considers these comments to be aimed at destabilizing the market and driving anti-competitive behavior... hence to the benefit of the competitor,” the company also lamented. (Source: Reuters)
• LME Copper 3M Select is up $73/mt and is aiming for a positive week.
  • Last trade was $8,624/mt (6:45 AM CST)
  • Chilean copper production keeps ratcheting lower. While reporting its Q2 earnings yesterday, Teck Resources stated that 2023 production at its Quebrada Blanca project in Chile will be between 90,000 to 110,000 mt, down from its prior guidance of 150,000 to 180,000 mt. The company cites delays in construction and commissioning for the expected drop in production. (Source: Teck Resources, Bloomberg)
• Prompt month CME HRC Steel last traded at $838/st, up $8/st (6:45 AM CST).
  • According to steel producer ArcelorMittal, global steel demand will only grow by 1% to 2% this year, down from their prior growth forecast of 2% to 3%. The company cites shrinking demand in the US and Europe due to high interest rates for the dip in growth. “Construction is highly impacted by the interest rates we have seen,” Chief Financial Officer Genuino Christino stated on a call with reporters. Christino also stated that automotive demand “continues to be good in 2023.” (Source: Bloomberg)

Note: Clients with AEGIS Platform access can see this and other research, plus hedge portfolio reporting and tools here. 

Price Indications

Today's Charts

AEGIS Insights

07/26/2023: AEGIS Factor Matrices: Most important variables affecting metals prices

07/20/2023: Aluminum Prices Could Hinge on Chinese Stimulus

07/11/2023: Copper Prices Could Remain Subdued While African Production Grows

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

7/26/2023: GM ups 2Q auto volumes on US, China sales

7/24/2023: Smaller miners’ hunger for cash grows as copper prices fall, sparking M&A bets

7/24/2023: Cliffs ups steel shipments on auto volumes

7/24/2023: Worker trapped after accident at Codelco project in Chile unharmed

7/24/2023: China to step up policy adjustments amid tortuous recovery

7/24/2023: Focus: Smaller miners' hunger for cash grows as copper prices fall, sparking M&A bets

7/21/2023: Russian materials finding their way into the market place at discounted prices, Norsk Hydro says

7/21/2023: US' Tesla to invest, expand EV facilities in Malaysia

7/21/2023: Hydro says Russian metal threatens LME benchmark, Rusal hits back

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.