March 22, 2024

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• LME Aluminum 3M Select is down $20/mt, pulling back after two days of gains.
  • Last trade was $2,289/mt (6:45 AM CST)
  • Speculators are essentially flat LME aluminum, according to the LME’s most recent COT report, out Tuesday. As of last Friday’s close, investment funds, which are generally speculators in metals markets, are net short only about 1,680 contracts, down from being short over 22,000 contracts on March 1. The prior position was the largest short position these funds have had since late last year. This short covering likely stems from an anticipated increase in Chinese aluminum demand, and also stabilizing demand here in the US. (Source: LME)
• LME Copper 3M Select is down $106/mt, adding to this week’s pullback.
  • Last trade was $8,857.5/mt (6:45 AM CST)
  • Like aluminum, investment funds have been significant buyers of LME copper in recent weeks. As of last Friday’s close, investment funds are net long 37,860 contracts, their largest long position in over two years. This action has helped rally prices nearly 10% off the lows of early February and could stem from production issues in China. (Source: LME)
• Prompt month CME HRC Steel last settled at $794/st (6:45 AM CST).
  • Australian iron ore producers could be forced to seek out new buyers while top importer China aims to decarbonize its high-polluting steel industry, according to Reuters. Historically, Australia has been the world’s largest iron exporter, with 80% going to China. Most of China’s steel production uses iron ore as a raw material, but annual steel production has hovered near 1 billion mt for the past five years, suggesting that steel and iron ore demand has flatlined. As Reuters recently suggested, Australian iron ore miners could switch to other Southeast Asian buyers, but their demand will likely pale in comparison to that of China. Reuters also suggested that Australia could ramp up its own steel production, but this would take significant investment. (Source: Reuters)

Price Indications

Today's Charts

AEGIS Insights

3/20/2024: Midwest Premium Buyers Should Hedge While Prices Hover at 3-Year Lows, and Demand Appears To Be Stabilizing

3/20/2024: AEGIS Factor Matrices: Most important variables affecting metals prices

3/14/2024: Important US Economic Data (AEGIS Reference)

2/27/2024: Aluminum Consumers Should Still Implement Hedges, Even Though Russia Sanctions Mean Little

2/2/2024: China's Real Estate Woes Provide Opportunity for Copper Consumers

1/25/2024: Aluminum Starts 2024 On a Down Note, But Potential Supply Shocks Give Consumers a Reason to Hedge

3/20/2024: China, decarbonisation present Australia's iron ore miners with costly choices

3/19/2024: BYD sees NEV share reaching 50% in the next 3 months in China as EV price war heats up

3/19/2024: China's Yunnan struggles with power supply, stokes fear among aluminum sector

3/18/2024: China starts consultation for enrolling aluminum smelters into compliance carbon market

3/18/2024: Indonesia says nickel miner Vale to build another $2 bln HPAL plant

3/17/2024: Tesla Vs. BYD: Tesla Plunges As Analysts Slash Estimates; BYD Rebounds In EV Price War

3/15/2024: Cleveland-Cliffs CEO mulls much lower bid for US Steel if Nippon deal falls apart

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.