Abans Group Commodity World Round Up

18 Oct- 22 Oct

1. World Bank sees 'significant' inflation risk from high energy prices

Oct 21, 2021

According to the World Bank's newest Commodity Markets Outlook, energy prices are likely to rise gradually in 2022 after jumping by more than 80% in 2021, posing considerable near-term threats to global inflation in many developing nations. In 2021, several commodity prices reached or exceeded levels not seen since a ten-year high. Crude oil prices are expected to rise to $74/bbl in 2022, boosted by stronger demand, from a projected $70/bbl in 2021, before dropping to $65/bbl in 2023, according to the bank.

Source: Reuters

2 .Freeport copper output falls short in last quarter

Oct 21, 2021

Last quarter, Freeport produced less copper than projected from its mines in the Americas, raising concerns about a drum-tight global market that has seen prices return to record highs. Freeport's production shortfall came as the firm reported a quarterly profit that beyond analysts' expectations, thanks to increased copper prices, which helped boost revenue and operating income well above levels seen a year ago. After selling 1.03 billion pounds between July and September, it anticipates yearly copper sales to reach around 3.8 billion pounds this year.

Source:Bloomberg

3 .China coal prices dive 13% as Beijing plans to intervene to ease power crunch

Oct 22, 2021

Following Beijing's largest intervention in years to raise supply and cool runaway prices of the commodity amid a major power shortage, China's thermal coal futures plummeted on Friday, ending the week with their worst week in five months. China has been pressuring coal miners to increase output and imports in order for power plants to rebuild stocks in time for the winter heating season, but analysts predict that shortages will last at least another few months.

Source: Reuters

4 .Indonesia plans to ‘hit the brakes’ on raw commodity exports

Oct 20, 2021

President Joko Widodo said that Indonesia plans to "slow down" the export of all raw materials in order to attract investment and create jobs in onshore resource processing. Indonesia has restricted the export of unprocessed ore such as nickel, tin, and copper in order to promote downstream businesses such as battery production for electric vehicles and the aluminium industry, among others.

Source: Reuters

5 .Saudi energy minister sees demand from gas-to-oil switch at up to 600,000 bpd

Oct 22, 2021

Saudi Arabia's Energy Minister, Prince Abdulaziz bin Salman, warned that users switching from gas to oil might account for 500,000-600,000 barrels per day (bpd) of demand, and that the world was suddenly becoming aware of energy problems. The decision to switch would be based on how bad the winter weather would be and how expensive alternative energy rates would be, according to Prince Abdulaziz.

Source: hellenicshippingnews.com

6 . BoE chief economist says UK inflation could top 5%

Oct 21, 2021

The Bank of England's new chief economist, Huw Pill, told the Financial Times that inflation in the UK might reach a "very uncomfortable" 5%, and that the topic of whether to raise interest rates was a "live" one at the central bank's early November meeting. The Bank of England is expected to raise interest rates by 15 basis points on November 4, making it the first of the world's major central banks to do so since the COVID-19 epidemic hit in early 2020. The Bank of England has previously stated that inflation is likely to rise above 4%.

Source: Reuters

7 .Trafigura played key role in draining LME copper inventories

Oct 19, 2021

According to persons acquainted with the situation, Trafigura Group withdrew a considerable chunk of copper from London Metal Exchange warehouses, causing to extreme price movements. The trading house has become the talk of the copper market as a result of the drawdown, which has helped drop available stocks to their lowest levels since 1974 and pushed a key spread to its biggest level ever. Still, total requests to withdraw more than 150,000 tons of copper from LME warehouses in the past two months have all but drained the available stocks on the exchange, and Trafigura represents a significant proportion of those, the people said.

Source: Mining.com

8 .Nickel price surges to highest in seven years as supply dwindles

Oct 21, 2021

Nickel hit a seven-year high on Wednesday, boosted in part by problems at Vale's Sudbury facilities. Due to the prior strike at Sudbury and the latest suspension of Onca Puma, Vale decreased its nickel projection for 2021 from 200,000t to 165,000-170,000t this week. Bloomberg reported that Norilsk Nickel reported reduced output in the September quarter, and the Philippines indicated production could be 10% lower than the annual average, adding to supply problems.

Source: Mining Journal