anz commodity daily 605 180412

8/2/2019 ANZ Commodity Daily 605 180412

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ANZ RESEARCH

COMMODITY DAILYContacts: Mark Pervan +613 9273 3716 | [email protected] Robertson +613 9273 3415 | [email protected]

MARKET HI GHLI GHTS OVERNI GHT WRAP

Oi l p r i ces up , Bren t -W TI sp read na r row s t o US$15 / bb l Gold f la t , desp i te s t rong ga in s in equ i t ies & o i l p r ices Base m e t a l s r ose on r i s k -on r a l l y & copper s t i gh t supp ly Coa l s l i pped , ac t i v i t y qu ie t w i t h m any a t t end ing Ch ina CT

OVERNI GHT RANKED PRI CE MOVES (% )

(0.8)

(0.8)

(0.5)

(0.1)

0.0

0.6

0.6

0.6

0.9

1.0

1.4

1.4

1.5

1.8

(2.0) (1.5) (1.0) (0.5) 0.0 0.5 1.0 1.5 2.0 2.5

Zinc

Co al (NEWC)

Lead

Gold

USD (DXY)

Silver

Aluminium

Platinum

Tin

WTI Oil

Copper

Baltic F reight

S&P 500

Nickel

WEEK-TO-DATE RANKED PRICE MOVES ( % )

(5.1)

(3.3)

(1.9)

(0.8)

(0.6)

(0.6)

(0.4)

(0.3)

0.5

1.3

1.8

2.4

3.1

6.6

(8.0) (6.0) (4.0) (2.0) 0.0 2.0 4.0 6.0 8.0

Tin

Co al (NEWC)

Nickel

Platinum

Gold

Zinc

USD (DXY)

Silver

Aluminium

Copper

Lead

S&P 500

WTI Oil

Baltic F reight

Note: Coal (NEWC) refers to front month futuresSources: Bloomberg, ANZ Commodity Strategy

Overn igh t Them es Risk appetite improved for commoditiesas a successful Spanish bill auction, IMF global growth forecast

upgrades, and better than expected US housing data

encouraged investors to brush away some of their recent

demand concerns. In addition, the German ZEW for April

printed better than expected and was the best reading since

June 2010, while US Q1 corporate earnings reports appears to

be favourable. Data wise, US house building permits rose to the

highest level since September 2008, offsetting the lower-than-

expected housing starts print and mildly softer read for

industrial production. European equities closed almost 3%

higher and US bourses were up around 1.5%. The

improvement in sentiment resulted in a broad sell-off in the

USD, which was also positive for commodities.

Crude benchmarks recovered , with US crude breaking out toa fresh nine-day high and outperforming Brent again. Brents

premium to WTI has now narrowed back towards the

US$15/bbl, continuing the recent unwinding of the Brent/WTI

spread, as well as crack spreads. Market speculation that the

US Seaway pipeline reversal will take place sooner than

expected (in Mid-May, rather than June) appears to be buoying

WTI relative to Brent. Meanwhile, the Iranian risk premium is

continuing to recede from the price of Brent more quickly than

WTI. The positive tone in wider markets was also supportive for

crude oil, tracking the solid gains in equity markets. Although

the mood could turn bearish if weekly US crude oil inventories

show stockpile builds beyond the 1.8mbbls expected.

Gold ended t he session f l a t a t US$1 , 650 / oz, after a sharp~$20 fall mid-way through the session in response to some of

the discouraging US data reads. The strong gains in equities

and bounce in crude oil prices didnt coincide with higher gold

prices, perhaps because market participants remained

concerned over China and Europe.

Base meta ls c losed most ly up , with bellwether coppersupported by the risk-on rally in wider financial markets. Rio

Tintos surprise drop in copper output also brought coppers

tight supply situation back into focus. Rio Tintos mined copper

output fell 13% to 119.5kt, against market expectations of

around 140kt. Rio and Xstrata said copper output would

improve in the second half of 2012, as seasonal bad weather

and lower ore grades weighed on first quarter output.

Newcas t l e coa l f r on t m on t h f u t u res s l i pped with activityquieter than usual, as most market participants attend Chinas

CoalTrans (CT). In one presentation, BHP said Chinas coking

coal demand is expected to remain resilient to 2025, supported

by capital and infrastructure spending in its steel industry.

Steel intensity is estimated to almost double to 700-

750kg/capita during the next decade, versus 445kg in 2010,

with seaborne coking coal imports to rise accordingly. BHP also

expects two-thirds of the global coking coal market to adopt

spot and short-term contracts by the end of 2012.

Apr i l 18 , 2012


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COMMODITY DATA

Close 1 Day 1 W k 1 Mt h 3 Mt h Close 1 Day 1 W k 1 Mt h 3 Mt h

LME BASE METALS (US$/t) LME BASE METALS (kt)

Aluminium 2,037 0.6 0.5 (7.6) (7.6) Aluminium 5,080 0.7 0.3 (0.0) 1.5

Copper 8,164 1.4 1.3 (3.5) (2.2) Copper 261 (0.2) (2.7) 0.1 (23.7)

Nickel 17,751 1.8 (1.9) (6.4) (13.7) Nickel 99 (0.5) (1.2) 1.9 6.4

Zinc 1,981 (0.8) (0.6) (2.1) (6.0) Zinc 912 1.1 1.4 3.9 7.6

Lead 2,058 (0.5) 1.8 3.2 (7.5) Lead 371 (0.1) (0.5) 0.4 7.4

Tin 21,522 0.9 (5.1) (7.8) (2.8) Tin 13 0.3 1.8 9.8 37.1

PRECI OUS METALS (US$/oz) Close 1 Day 1 W k 1 Mt h 3 Mt h

Gold 1,650 (0.1) (0.6) (0.1) (1.0)

Gold (A$/oz) 1,584 (0.7) (2.0) 0.7 (0.3) S&P 500 1,391 1.5 2.4 (1.0) 5.8

Silver 31.7 0.6 (0.3) (1.4) (1.2) VIX Volatility Index 18 (5.6) (9.5) 18.5 (2.4)

Platinum 1,586 0.6 (0.8) (4.3) 2.2 CRB Index 302 0.4 0.5 (4.3) (4.0)

Palladium 663 1.3 2.7 (4.4) (2.6) LME Metals Index 3,464 0.8 0.1 (5.0) (5.5)

ENERGY (US$/bbl) Close 1 Day 1 W k 1 Mt h 3 Mt h

WTI Oil* 104 1.0 3.1 (1.3) 5.3

Brent Oil* 119 0.2 (0.9) (4.3) 8.0 Baltic Freight Rate 989 1.4 6.6 11.9 22.6

Sing Gasoil 0.5% 132 0.0 (1.6) (4.1) 1.1 Baltic Capesize 1,542 (0.3) 0.7 8.9 2.0

Sing Fuel Oil 180cst(US$/t) 721 0.0 (2.3) (4.3) (1.0) Baltic Panamax 1,232 3.6 18.5 22.7 30.2

OTHER (US$/t) Baltic Handysize 546 0.6 1.1 4.6 20.3

China HR Coil (RmB/t) 4,390 (0.0) (0.0) 1.0 4.0 Close 1 Day 1 W k 1 Mt h 3 Mt h

Richards Bay Coal API4 101 (0.8) (1.9) (2.8) (5.3)

Newcastle Coal*** 103 (0.8) (3.3) (3.8) (12.5) DXY - USD Index 79.6 0.0 (0.4) (0.0) (0.4)

Australia Coking Coal** 211 1.4 1.0 (5.8) AUD/USD - Aussie 1.041 0.6 1.4 (0.7) (0.6)

Iron Ore Spot 149 (0.1) 0.8 3.0 6.7 NZD/USD - Kiwi 0.823 0.4 1.1 0.6 1.5

% Ch a n g eCurrenc ies

% Ch a n g eK ey Ind ices

% Ch a n g eFre igh t

Com m od i t ies I n ven t o r ies% Chang e % Change

105

110

115

120

125

Apr Jun A ug Oct Dec Feb

NEWCASTLE COALUS$/t

1,400

1,500

1,600

1,700

1,800

1,900

Apr Jun Aug Oct Dec Feb

GOLDUS$/oz

70

80

90

100

110

120

Apr Jun Aug Oct Dec Feb A pr

W T I OI LUS$/bbl

0.94

0.97

1.00

1.03

1.06

1.09

1.12

A pr Jun Aug Oct Dec Feb

A UDA$

16,000

18,000

20,000

22,000

24,000

26,000

28,000

A pr Jun A ug Oct Dec Feb

NI CKELUS$/t

6,500

7,000

7,500

8,000

8,500

9,000

9,500

10,000


COPPERUS$/t

1,900

2,100

2,300

2,500

2,700

2,900


A L UM I N I U MUS$/t

1,600

1,800

2,000

2,200

2,400

2,600


Z I N CUS$/tUS$/t

25.0

30.0

35.0

40.0

45.0

50.0


SI LVERUS$/oz

Notes: * Front-month futures ** Weekly prices ***Newcastle ICE coal futures contract

Sources: Bloomberg, McCloskey, ANZ Commodity Strategy


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ANZ FORECASTS

ANZ For ecast Table 1

COMMODI TY Un i t Ju n - 11 Sep -11 Dec- 11 Mar - 12 Ju n - 12 Sep - 12 Dec- 12 Mar - 13 Ju n -1 3 Sep - 13 Dec- 13

BASE METALS

Aluminium US$/lb 1.18 1.09 0.95 0.96 1.01 1.02 1.05 1.06 1.05 1.05 1.06

Copper US$/lb 4.16 4.07 3.41 3.62 3.85 3.98 4.08 4.08 4.13 4.15 3.95

Nickel US$/lb 11.05 9.98 8.34 8.70 9.15 9.70 10.15 10.25 10.40 10.45 10.15

Zinc US$/lb 1.02 1.01 0.86 0.87 0.90 0.91 0.95 0.98 1.01 1.03 1.04

Lead US$/lb 1.16 1.11 0.90 0.94 0.96 0.96 0.99 1.02 1.05 1.06 1.07

Tin US$/lb 13.08 11.16 9.45 9.09 9.45 9.75 10.30 10.55 10.80 10.95 10.80

PRECI OUS METALS

Gold US$/oz 1,508 1,706 1,683 1,632 1,740 1,790 1,815 1,855 1,870 1,830 1,770

Platinum US$/oz 1,785 1,771 1,531 1,526 1,685 1,700 1,700 1,765 1,795 1,765 1,725

Palladium US$/oz 760 752 630 673 700 730 775 820 850 850 838

Silver US$/oz 38.5 38.9 31.8 31.2 34.8 35.3 36.2 37.4 37.5 36.9 36.3

ENERGY

WTI NYMEX US$/bbl 102.5 89.5 94.1 102.4 107.0 108.5 111.0 114.5 116.5 116.0 114.5

Dated Brent US$/bbl 117.0 112.9 109.3 115.8 123.5 122.5 123.0 124.5 125.0 123.5 121.0

Uranium US$/lb 56.4 51.8 52.6 53.1 56.0 60.5 65.0 68.5 71.5 74.0 76.0

BULKS

Thermal coal2 US$/t 130.0 130.0 130.0 130.0 115.0 115.0 115.0 115.0 125.0 125.0 125.0

Premium hard coking US$/t 330.0 315.0 285.0 235.0 206.0 215.0 220.0 220.0 225.0 225.0 220.0

Hard coking US$/t 300.0 290.0 265.0 225.0 196.0 195.0 200.0 200.0 200.0 200.0 195.0

Semi-soft coking coal US$/t 275.0 230.0 208.0 171.0 151.0 170.0 175.0 175.0 175.0 175.0 170.0

Iron ore lump US$/t 206.1 202.0 177.6 168.0 175.2 180.0 183.9 183.9 181.5 176.7 173.2

Iron ore fines US$/t 171.8 168.3 148.0 140.0 146.0 150.0 152.0 152.0 150.0 146.0 142.0

OTHER METALS

Alumina US$/t 326 300 262 265 278 280 288 291 288 288 291

Molybdenum US$/lb 16.7 14.6 13.4 13.8 14.8 15.8 16.3 16.5 16.8 16.9 16.7

Cobalt US$/lb 18.3 17.1 15.1 14.8 15.3 16.2 16.8 17.0 17.5 18.0 18.0

EXCHANGE RATES

AUD/USD US$ 1.08 1.05 1.04 1.06 1.05 1.09 1.10 1.10 1.10 1.10 1.10

NZD/USD US$ 0.82 0.83 0.79 0.83 0.84 0.86 0.88 0.90 0.90 0.90 0.90

EUR/USD US$ 1.46 1.41 1.35 1.33 1.35 1.36 1.37 1.37 1.37 1.36 1.34

USD/JPY 81.03 76.78 77.48 80.06 78.96 75.67 73.00 70.67 70.00 70.00 70.00

USD/CAD C$ 0.96 0.99 1.01 1.00 0.99 1.00 1.02 1.04 1.06 1.08 1.10

USD/CNY Yuan 6.46 6.38 6.36 6.29 6.27 6.23 6.14 6.10 6.08 #/NA #/NA

Note 1: Average prices Note 2: Thermal coal prices are for JPY year starting April 1 Note 3: Historical data are actuals

Sources: Bloomberg, ANZ Commodity Strategy, ANZ FX Strategy


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anz commodity daily 605 180412

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