Daily Metals

THIS MORNING Base metals were mixed early on Thursday, with four contracts below Wednesday’s official close and two higher. Nickel was the weakest, down 1.3% at $16,100 a tonne, while copper and lead both eased 0.2% and zinc slipped 0.1%. Tin led the gains, rising 0.5% to $53,995, while aluminium edged 0.1% higher. The overall tone remained cautious as rising US interest-rate expectations competed with supply risks in copper. MACRO & GEOPOLITICS Strong US business activity and rising input costs increased expectations of another Federal Reserve rate rise in October. The US 10-year Treasury yield reached 5.1%, its highest level since 2007, supporting the dollar and raising financing costs across global markets. Oil prices eased from recent highs, with Brent remaining above $100 a barrel, as Iran expressed openness to diplomacy while warning that major differences with Washington remained. The United States and China agreed to extend their trade truce by two months, until January 10, reducing the immediate tariff threat. Presidents Donald Trump and Xi Jinping are due to meet in Washington today, with trade, technology, Iran and critical-mineral supplies on the agenda. BASE METALS Copper remained slightly lower as higher bond yields and a firmer dollar outweighed tightening-supply signals. China’s Yangshan import premium was flat at $117 a tonne on Wednesday, indicating continued demand for imported copper, while about half of the copper in LME-registered warehouses had been earmarked for delivery. Supply concerns intensified after operations were suspended at BHP’s Escondida mine following a fatal accident. The mine’s supervisors are due to vote on a contract offer from September 28 to 30, while unions at Antofagasta’s Centinela mine will hold a strike vote between September 26 and 28. Nickel recorded the largest morning fall, while aluminium, zinc and lead stayed close to Wednesday’s close. Tin held firmer despite the cautious wider mood. PRECIOUS METALS Gold was little changed near $4,282 an ounce as geopolitical risk provided some support, but higher US yields and expectations of further Federal Reserve tightening limited buying. Silver fell 0.6% to around $64.07, palladium slipped 0.1% to roughly $1,261 and platinum gained 0.2% to about $1,754. Precious metals may remain sensitive to changes in oil prices, the dollar and signals from Federal Reserve officials today. STEEL European steel-linked markets continue to face pressure from high energy and borrowing costs. Polish coking-coal producer JSW estimated a first-half net loss of 1.04 billion zlotys and an EBITDA loss of 236.5 million zlotys. The figures underline difficult conditions for suppliers serving European blast furnaces. Oil above $100 a barrel is also keeping transport and production costs elevated, while weaker European equity futures suggest limited confidence in near-term industrial demand. RARE EARTH METALS The United States is accelerating efforts to reduce its exposure to supply disruptions from China. Mercuria committed $500 million to a strategic critical-minerals reserve, while Glencore was selected as a founding supply partner. The programme is intended to build stocks for American manufacturers during shortages. China’s deliveries of rare-earth materials under its existing trade arrangements remain below US expectations, making today’s Trump-Xi talks important. Separately, Vietnam’s Masan High-Tech Materials agreed to sell a 4.99% stake to US supplier Elmet and enter an agreement of at least eight years covering about 1,250 tonnes of tungsten trioxide equivalent a year, strengthening a non-Chinese supply route. FOREX The euro fell to around $1.138, its weakest level in two months, as strong US economic data and rising Treasury yields supported the dollar. Sterling also weakened, while the yen traded around 158 per dollar. For European scrap traders, a weaker euro increases the local-currency cost of dollar-priced primary metals, freight and imported material. It may also support euro-denominated selling prices, although tighter financial conditions and expensive energy could weaken demand from mills and foundries. WATCH TODAY Germany’s Ifo business survey, French business and consumer-confidence data, and UK consumer-confidence data will provide fresh evidence on European economic conditions. US jobless claims and new-home sales follow later, alongside speeches from several Federal Reserve officials. The Trump-Xi summit will be watched for details on tariffs, Chinese purchases and rare-earth supplies.