Morning Bites

?Global crude steel output dropped 5% YoY to 153mnt in July, after the <1% YoY growth seen in June, according to the World Steel Association data. China’s production (~54% of global crude steel supply in July) was down 9% YoY, after the flat dynamics in June. Ex-China steel output inched up 1% YoY in July, the same as in June. Specifically, last month, Russian production declined 3% YoY, while US and EU output grew 2% and 6% YoY, respectively. Indian output (~8% of global steel supply) rose another 7% YoY (vs. +6% YoY in June)

Although steel market sentiment has been depressed in recent months, the recently announced new support package for China’s unfinished real estate projects might bolster local construction activity, we believe

#steel
https://metals-wire.com/sector/Steel

Morning Bites (part 2)

?Global mined copper production slid 1.7% YoY in June, after increasing 0.8% YoY in May, the International Copper Study Group (ICSG) reports. Over 1H24, output was up 3.1% YoY, due to production recovery at existing assets (mainly in Chile, Indonesia, and the USA), as well as additional production from mine projects ramping up to capacity, namely in the DR Congo (~11% of global supply). Meanwhile, the ICSG notes strong refined copper consumption (+3.3% YoY in 1H24), particularly in China (+5.5% YoY)

Overall, we maintain our positive view on copper, amid growing demand for renewables globally, and surging investments in China’s grid infrastructure

#copper
https://metals-wire.com/sector/Copper

Morning Bites (part 1)

? China has approved a CNY 1.4tn (USD 196bn) support package for 5.4k real estate projects, Xinhua reports, citing National Financial Regulatory Administration officials. The announced measures exceed market expectations, as in late-March commercial banks reached a preliminary agreement to fund CNY ~520bn (USD 72bn) for 2.1k projects. Meanwhile, some local mills also noted improved demand for rebar

In our view, the announced package for 'frozen projects' might add support to the weakened sentiment in the steel market

However, we recap that China’s unsold housing stock remains large, at approximately 3.6bn sqm, with an estimated cost of some CNY 7tn

#steel  
https://metals-wire.com/sector/Steel

Morning Bites

?CISA mills' daily crude steel production in early August was reported at 2.00mnt, +1.5% vs. the previous ten days, but 6.9% lower YoY. YTD output (up to 10 August) was down 2.2% YoY. At the same time, local steel inventories slid 0.9% over the period (also being down 0.9% YoY). We reiterate our view that soft domestic steel demand, which has triggered export growth, might keep weighing on China’s steel output in the near term, unless new material economic support measures are announced by Beijing

China accounts for ~57% of global steel supply

#steel  
https://metals-wire.com/sector/Steel

Morning Bites (part 3)
?? Workers at BHP's Escondida copper mine have gone on strike after failing to reach a wage agreement with management, Bloomberg reports. The protests at the world’s largest copper mine (~5% of global Cu mined supply in 2023) began on 13 August. Workers have rejected terms that included a signing bonus of $28,900 each and have demanded 1% of shareholder dividends to be distributed equally among them, citing the favorable current and projected prices of copper. The last significant strike at Escondida took place in 2017 and lasted 44 days (reducing Cu production by ~120kt), driving up global copper prices

In our view, the strike could, if it persists, stress the global Cu supply, which would in turn be favourable for prices. Meanwhile, we maintain our positive view on copper, amid growing demand for renewables globally, and surging investments in China’s grid infrastructure

#copper
https://metals-wire.com/sector/Copper

Morning Bites (part 2)

? China’s aggregate financing rose 46% YoY in July to CNY 0.77tn, reversing from the 22% YoY drop in June (-15% YoY on the 7mo24 basis). Meanwhile, traditional bank loans declined 25% YoY, missing the consensus estimates by 42%. We maintain our view that more government support measures would be required to trigger a full-scale recovery in China’s property sector and support the construction demand for industrial metals in 2H24

China accounts for 52% of global steel consumption, and for 57% and 61% of world Cu and Al demand, respectively

#global 
https://metals-wire.com/news-reports

Morning Bites (part 2)

? Ivanhoe is set to complete construction of Kamoa-Kakula’s phase 3 concentrator ahead of schedule, according to a company press release (it had peviously been planned to launch the project in 4Q24). The Phase 3 concentrator has a designed capacity of ~210kt (~1% of global Cu supply), bringing the plant's total capacity to 600kt. To recap, DR Congo's Cu output grew 24% YoY in 1Q24, driving the growth in global supply (+6% YoY in 1Q24)

Although the Cu supply dynamics might remain strong in the near term, as new projects are ramped up, the growing demand from grid construction and renewable energy installments in China might offset the negative effects on the red metal's price, we believe

#copper
https://metals-wire.com/sector/Copper

Morning Bites

?Global mined copper production increased 4.9% YoY in March, after the 9.5% YoY rise in February, the International Copper Study Group reports. Meanwhile, overall 1Q24 output was up 6.0% YoY. The dynamics were mostly driven by output growth in DR Congo (~11% of global supply), where production surged 24% YoY in 1Q24, supported by the expansion of the Kamoa mine, which offset the closure of Cobre Panama (since November 2023). On the demand side, the ICSG notes an increase in refined copper consumption (+4.0% YoY in 1Q24), driven by strong demand in China (+6.5% YoY in 1Q24) amid rapid expansion of the new-energy sector, while weak demand in the EU, US, and Japan weighed on ex-China usage (+0.7% YoY in 1Q24)

#copper
https://metals-wire.com/sector/Copper