WEEK IN REVIEW: Markets warm up for 2Q

Spot markets have been reflecting currency volatilities this week, with the euro suffering Brexit jitters as the UK served notice of its departure from the EU.
The stronger dollar put a cap on some price increases in Europe. Cobalt, which has been a star of the non-ferrous markets in recent weeks, saw a limited correction after failing to break $30/lb resistance, but continues to be underpinned by limited nearby supply of high-grade cathode metal.
Metal markets are entering the second quarter on a stronger note as expanding manufacturing activity is driving demand.

Chinese manufacturing PMI growth expanded to 51.8pc from 51.6pc in February and having accelerated steadily since the start of the year, according to official statistics. A reading above 50 reflects growth, and a year ago in March, Chinese official manufacturing PMI was just above stagnation level at 50.2pc. It deteriorated in the second quarter and entered contraction territory in July.

All signs point to an opposite trend this year. The production index showed the strongest growth at 54.2pc and was up 0.5 percentage points since February and reflecting growth in new orders. Increased production put pressure on supply of feedstock, and raw material inventories shrank in March.

In some cases, inventories are below critical levels. Titanium raw material ilmenite is in short availability, on dwindling port stocks of imported concentrate as environmental inspections are disrupting domestic mine supply. This has caused prices to rise for intermediate product titanium tetrachloride and for titanium sponge, where prices are now at their highest level since December 2012.

This five-year high is tempting some idled capacity to reopen. But the potential is constrained by the raw material supply, and Chinese buyers have boosted their imports of titanium sponge, taking advantage of arbitrage with overseas markets.

China’s antimony industry has been waiting for the past couple of months for environmental inspections to reach Hunan, home of antimony metal …
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Source: Metal Pages