Abans Group Commodity World Round Up

03 May - 07 May

1. Electric vehicle market growth is a blessing for lithium and copper

May 6, 2020

Growth in the electric-vehicle market has been a blessing for metals like copper and lithium. The global electric-car market saw a growth of 41% last year, according to an International Energy Agency report. The strong momentum for electric cars has continued into 2021, and the market is “on track for a decade of strong expansion.” Fuel cells used to power some EVs reportedly employ small, but expensive, amounts of platinum and palladium. Battery EVs, meanwhile, contain 183 pounds of copper, according to the Copper Development Association. The Biden administration has proposed a $174 billion investment in the EV market. It is also pushing for an EV tax credit renewal. Average lithium prices have climbed by 41.6% so far this year through April 2021, according to Benchmark Mineral Intelligence. That follows a drop over the past three years that saw average prices fall from $18,729 per metric ton to $7,725 as of October 2020.

Source: Marketwatch

2. China posts rapid trade growth in April 

May 7, 2020

China extended its impressive trade performance in April, with exports unexpectedly accelerating and import growth hitting a decade high, in a boost to the world's second-largest economy. Exports in dollar terms surged 32.3% from a year earlier to $263.92 billion, beating analysts' forecast of 24.1% and the 30.6% growth reported in March. Imports were also impressive, rising 43.1% from a year earlier, the fastest gain since January 2011 and picking up from the 38.1% growth in March. It was also slightly faster than the 42.5% rise forecast.

Source: Reuters

3. Gold investment demand continues to struggle but market is improving: WGC

May 6, 2020

The World Gold Council (WGC) said that 18.3t tonnes of gold, valued at $1.1 billion, flowed out of the global gold-backed exchange-traded funds (ETFs) in April, marking outflows for five of the past six months. In total, global assets under management (AUM) stand at 3,567 tonnes, valued at $203 billion. However, the WGC did some bright spots in the gold market. In particular, European funds saw gold inflows last month for the first time since January. According to the report, North American-based gold funds led the way in outflows in April, with total holdings dropping by 28.4 tonnes. In comparison, European-based funds saw inflows of 10.6 tonnes. Although the investment demand has been fairly disappointing since the start of the year, analysts at the WGC said that they expect to see a pick-up through the second half of 2021.

Source: Kitco

4. U.S. And Iran Make Progress On Nuclear Deal Talks

May 6, 2020

U.S., Iranian and European officials said on Thursday there were wide gaps between Washington and Tehran on resuming compliance with the 2015 Iran nuclear deal; though a U.S. official said an accord was possible within weeks if Iran decided it wanted one. U.S. Secretary of State Antony Blinken said Washington did not know whether Iran was prepared to make the decisions needed to return to full compliance.

Source: Reuters

5. Copper price could spike to $13,000 or even $20Kon low stocks – BofA

May 4, 2020

In a report, the bank of America’s (BofA) analysts said that they could see copper prices rallying to $13,000 a tonne as the market continues to see a significant supply crunch and growing demand.  The copper supply, as measured by inventories in LME warehouses, is at its lowest level in 15 years. They added that stocks could currently cover 3.3 weeks of demand. Bank of America said that the copper market is in a similar situation as nickel prices in 2006 and 2007.

Source: Mining.com

6. Bank of England sees faster economic rebound

May 6, 2020

The Bank of England said Britain's economy would grow by the most since World War Two this year and slowed the pace of its trillion dollar bond-purchasing programme, but stressed it was not reversing its stimulus. The BoE raised its forecast for British economic growth in 2021 to 7.25% from February's estimate of 5.0%. That would be the fastest annual growth since 1941 when Britain was rearming. But it comes after output plunged by 9.8% in 2020, the biggest drop in more than 300 years. The economy was set to return to its pre-pandemic size in the last quarter of 2021, three months earlier than previously thought, the BoE said.

Source: Reuters

7. Fed warns about potential for ‘significant declines’ in asset prices

May 6, 2020

Rising asset prices in the stock market and elsewhere are posing increasing threats to the financial system, the Federal Reserve warned in a report Thursday. In its semi-annual Financial Stability Report, the central bank said that while the system overall has remained largely stable even through the Covid-19 pandemic, future dangers are rising, in particular should the aggressive run on stocks tail off.

Source: CNBC

8. Indonesia to overtake China as top refined nickel producer this year

May 2, 2020

Materials supply chain intelligence company Roskill expects Indonesia to become the world’s largest producer of refined nickel this year, pushing China to second place. As recently as 2014, Indonesia produced only 24kt of refined nickel. In 2020, Indonesia produced 636kt of refined nickel, most of which was nickel pig iron (NPI) for the domestic and Chinese stainless steel industry. This level of production made the country the world’s second-largest nickel producer behind China.

Source: greencarcongress.com