Metals Daily

This Morning Base metals opened Friday with a mixed tone against Thursday’s official closes. Zinc led the gains, rising 0.6% to $3,783 a tonne, while tin advanced 0.5% to $55,750 and copper edged 0.1% higher to $14,050. Lead was the weakest contract, down 0.8% at $1,846, followed by aluminium’s 0.4% decline to $3,180. Nickel eased 0.1% to $16,690. Macro & Geopolitics The brief respite in sovereign debt markets faded as the 30-year U.S. Treasury yield returned to around 5.25%, with investors questioning whether larger bond buybacks can offset concerns over debt and deficits. Brent crude held above $93 a barrel and remained on course for a second weekly gain as the U.S.-Iran war continued to disrupt supply from the Gulf and Washington prepared tougher sanctions. Elevated diesel and financing costs remain significant risks for European processors and manufacturers. Meanwhile, Canada and the United States reported progress toward an agreement that could reduce tariffs on Canadian vehicles, steel and aluminium before new duties are scheduled to begin on Saturday. Base Metals Copper remained above $14,000 as dollar weakness outweighed growing exchange availability, although it was heading for its first weekly decline in eight weeks. LME inventories reached 239,925 tonnes on Thursday, more than 17% above their August 14 level, while the cash premium over three-month metal contracted to around $76 from $545 on Monday. Aluminium remained under pressure despite Gulf production falling 44% year on year in July after war-related smelter disruption. Peru’s plan to accelerate approvals for 240 mining projects and attract at least $33 billion over five years could support the longer-term copper supply outlook. Zinc and tin outperformed early, while lead recorded the sharpest decline. Precious Metals Gold rose 0.5% to around $4,540 an ounce and was heading for a third consecutive weekly gain, supported by the softer dollar, fiscal concerns and geopolitical risk. Silver climbed 1.3% to about $68.92, platinum gained 2.4% to roughly $1,873 and palladium advanced 1.3% to around $1,351. Higher oil prices and the possibility of another U.S. rate increase remain potential headwinds, while demand for hard assets has strengthened amid concerns about the durability of Treasury market intervention. Steel North American pipe demand remains firm, with Welspun securing a record $1.8 billion U.S. supply contract for energy and infrastructure projects, although execution is scheduled for fiscal 2028 and 2029. In the Mediterranean market, Libya ordered its largest steel producer, Lisco, to suspend production because of severe electricity shortages; the plant has 1.7 million tonnes of annual liquid-steel capacity. A proposed Canada-U.S. agreement could cut tariffs on Canadian steel and aluminium to 25% from 50%. Rare Earth Metals Chinese shipments of yttrium oxide to the United States reached 29 tonnes in July, their second-highest monthly level since export restrictions were introduced, while rare-earth permanent-magnet exports to the United States also remained comparatively strong. Supplies to Japan of yttrium, terbium and dysprosium stayed heavily constrained. Japan is consequently considering allowing state-backed JOGMEC to invest directly in overseas critical-mineral projects without waiting for participation from a Japanese company. The proposal highlights intensifying competition for critical-mineral supplies. Forex The euro held near a three-month high at about $1.1685, gaining roughly 1% over the week, while sterling traded near a six-month peak around $1.3643. The dollar index slipped to approximately 98.82 and was heading for a weekly decline of more than 0.8% as fiscal concerns outweighed the Treasury’s bond-market support measures. A stronger euro reduces the local-currency cost of dollar-priced metals for European buyers, providing some protection against high LME and energy prices. The yen remained weak near 159.12 per dollar despite stronger Japanese inflation. Watch Today Flash August manufacturing and services PMIs are due from France, Germany, the euro area, the United Kingdom and the United States, offering a timely gauge of industrial demand. UK retail sales and preliminary euro-area consumer confidence are also scheduled. Canada-U.S. trade negotiations remain active ahead of the tariff deadline at 04:01 GMT on Saturday.