Molybdenum News Center

Week in Brief: Chrome Ore Contract Renegotiations; Copper Sales Talks; Evraz Highveld Saga Continues; Molybdenum Outlook Deteriorates

Chrome ore suppliers told Janie Davies about customer demands to renegotiate prices on shipments to China as prices drop and credit continues to tighten. Some suppliers have been forced to grant discounts for existing deals as customers threaten to walk away from cargoes.
As a result, there is still no floor for chrome ore prices, market participants warned, as prices edged lower.
In aluminium, Alcoa will curtail the operations of three of its US aluminium smelters and one domestic refinery, lifting to 45% the percentage of its smelting capacity that has been curtailed, closed or divested since 2007.
The company may cut even more aluminium smelting capacity and will consider further options in the current difficult environment, a senior executive said.
The cuts drove US Midwest premiums up, and premiums also inched up in Asia.
Meanwhile, China’s copper traders were negotiating sales for the coming year – ahead of Codelco making its 2016 long-term cathode offer to the market, Kiki Kang revealed.
The pre-emptive move reflects traders’ concern about the challenges they face in the coming months, and their hopes to gain leverage in contract talks with the state-owned Chilean copper producer.
Also in base metals, a jump in nickel stocks at London Metal Exchange warehouses in Singapore was linked to incentives offered by warehouses in that location.
This gave rise to a debate over the queue situation in Singapore and reports of what appears to have been a two-week amnesty for impatient traders.
UK secondary aluminium and aluminium scrap prices kept falling on Wednesday November 4, and are expected to drop further as scrap sellers face a rising need to shift material.
Click here for Friday’s rolling report and more on base metals prices on the LME.
Evraz Highveld Steel & Vanadium and its business rescue practitioners have moved to keep its business rescue plan on track in South Africa, in the face of opposition from East Metals, a major creditor, and Mastercroft, an 85% shareholder.
Evraz plc, the Russian parent of the troubled South African company, announced the same day that it remains fully supportive of rescue proceedings.
Metal Bulletin also found time to catch up with senior executives at major metallurgical groups.
Hydro’s Asia md, Henning Flaig, talked to Deepali Sharma and blamed trading by commodity trading advisers (CTAs) for volatility in aluminium spreads.
And there were wise words from JX’s Nippon ceo Shigeru Oi, who told Shivani Singh that fairness and balance are his watchwords for success.
Elsewhere in company news, Glencore shares gained 8% as the trader-miner said it expects to cut net debt by $25 billion by the end of this year.
And Lynx Resources acquired the SASA lead-zinc mine in Macedonia from Solway Investment Group.
Meanwhile, Freeport-McMoRan unveiled another production cut at its molybdenum mine in Henderson, Colorado, in the face of continued market deterioration.
Ferro-molybdenum and molybdic oxide prices in Europe appeared to lose steam after a brief rally that had started in late October.
 

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