The LME can say everything. It is up one day and down the next. Stock exchanges jump up like kangaroos and they fall down like dead lions. It is very difficult to foresee what is happening. At the moment the markets are doing well. If it keeps this way, it should certainly improve market conditions.
Producers are filled up with orders and they are pleased with how things are going up until now. The only uncertainty is in brass and copper. They would prefer to have a stable copper price rather than a high one or a low one. If it stays low they probably have higher margins. At the end of the day, I don’t think anyone is worried about what is happening in copper or zinc and in other metals, except stainless steel.
Stainless steel guys are worried about nickel prices being so low. The bronze ingot makers are worried about the cost of tin. The prices fluctuate according to the ups and downs of these metals. It looks as if consumers are buying and they are making decisions very rapidly in order to avoid any unexpected changes while they are negotiating their purchases. Prices of brass and copper have followed the market. The price of brass had gone down when copper was in the $6,000 range, but then it stayed there for just a couple of days and picked up again and got stronger. It has exceeded $7,000 now and people are sort of tranquilized by it.
It is difficult to hedge. If they need material they will have to take a risk and buy it. Orders are not satisfied. People are still looking up until the end of this year. It is going to be a satisfactory year. Either it will be the same as or slightly better than 2010. They are positive-minded.
The high cost alloys have weakened. In a way it has weakened because of the exchange rate of the U.S. dollar. There is a stronger dollar and a weaker euro, and these metals have compensated for the exchange rate. The steel market is quite weak. There is a lot of Chinese semi-finished product coming into Europe and I suspect in the U.S., and they are applying anti-dumping duties.
During LME Week in London, people seemed to be quite lively and on the whole positive.
Click here to listen to a podcast from this report.
Fernando Duranti can be contacted at fernandoduranti@leghemetalli.it.
Latest from Recycling Today
- Cards Recycling, Live Oak Environmental merge to form Ecowaste
- Indiana awards $500K in recycling grants
- Atlantic Alumina partners with US government on alumina, gallium production
- GP Recycling president retires
- Novelis Latchford commissions new bag houses
- UK facility focuses on magnet recycling
- Aduro revenue increases while losses widen
- Worldsteel updates its indirect steel data
