OUTLOOK: Even the supply tightening looks a bit too thin – Jeremy Goldwyn

Given Trump, Brexit, and China’s slowdown, Jeremy Goldwyn, of the goldwyn partnership consultancy, finds it hard to get really excited by the trimming of production across the base metals markets.

Notwithstanding the confusion over Brexit, the US election process (and its potential negative consequences for world trade and maybe even world peace) plus the continued parlous state of the Chinese economy, there have been several other stories recently calling the turn in the base metals sector.
Moves such as President Duterte’s clampdown on the Philippine nickel mining industry, recent Chinese action against tin miners and now Beijing’s intervention for environmental reasons against the entire base metals mining sector have fuelled speculation that supply-side tightening might actually counteract the lack of demand improvement that’s been depressing the metals sector.

However, I remain firmly unconvinced that this will be enough to justify any sustained strength in prices. Instead, I foresee a tough few months ahead while the negative geo-political risks continue to gain...

Published

Fastmarkets MB staff

August 18, 2016

15:40 GMT

Los Angeles