MARKET ROUNDUP
Industrial metals futures drifted lower on Wednesday, retreating from the 20-month high hit a day earlier, as market players questioned whether current prices were justified by supply and demand fundamentals.
IN FOCUS
- The chief executive of Freeport-McMoRan said he is not ready to go all out on expansions until demand has recovered in most of the world, but he remains “enormously enthusiastic” about copper's long-term outlook.
- The world copper market will continue to experience supply constraints, Charlie Sartain, the chief executive of Xstrata Copper - the subsidiary of diversified mining company Xstrata, said Wednesday.
- Xstrata Copper's top executive joined his peers on Wednesday in calling for another decade of supply constraint, even as the world's No. 4 producer pushes ahead on major projects in Peru and elsewhere.
- Projects in Peru, which holds the world's second-largest reserves behind Chile, are a focus, he said. Sartain said the company expects to boost output at its 275,000 tonne per year Antamina copper joint venture in Peru by 20 to 30 percent starting from 2012.
- World consumption of refined copper should rise 5.4 percent in 2010 from last year, Jose Pablo Arellano, the chief executive of the word's largest copper miner Codelco, projected on Wednesday.
- Miner Rio Tinto expects to see a “meaningful” deficit in global copper supply next year after a balanced market this year, with China likely forced to draw down strategic reserves to help meet demand, the company's top copper division executive said on Tuesday.
- As copper miners globally rush ahead on projects that were put on hold when prices collapsed, a major potential bottleneck is re-emerging that threatens to slow the delivery of new supply: people.
- Mexican copper output will rise about 5 percent in 2010 from last year to 250,000 tonnes, an executive at the country's biggest copper miner, Grupo Mexico, said on Wednesday.
- Australia's Equinox Minerals Ltd. reported a 37 percent jump in output at its Lumwana copper mine in Zambia in the first quarter, and forecast it would grow production even further this year.
- Russian nickel and copper export volumes fell in January-February 2010 from the same period of 2009, but their value rose, while aluminium export volumes rose and their value declined, customs data showed on Wednesday.
FUNDAMENTAL OUTLOOK
Industrial metals are trading subdued on international bourses. We expect industrial metals to trade firm during the first half of the trading session. In the afternoon session we have EZ retail sales numbers to be released any upside in these numbers is likely to trigger further upside in industrial metals.
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