Commodities (Base Metals) Flashcards
(19 cards)
What government action in China is key for commodities?
Policy easing and tightening.
What are two key drivers of Chinese Commodity demand?
Infrastructure and property sales.
What has been the average length of commodity bear markets? Duration?
The average fall was 53.7% and on average they last 22.6 years.
What years did commodity bear markets occur?
1814-1843, 1864-1896, 1920-1933, 1951-1972, 1980-1999
What are 5 key variables that explain more than 90% of copper price moves?
speculative positioning, inventories, global growth, USD, marginal cash cost.
Copper is well correlated with EM performance?
Yes
What happens to copper and EM when the Dollar is strong?
They underperform.
Global Mine supply of copper is running around how many mt?
21mt
If you add in SXEW then how much is total annual refined supply of copper?
24mt
How much is global demand for copper?
24mt
How much is Chinese demand for copper?
11mt
What is the 1975-2015 growth rate of copper?
2.4%
What is the CRB historic correlation to the Dollar
-0.68
What is the historic key drier for lumber prices?
Residential construction
Why are Chinese steel prices important for Western World steel prices?
A rising chinese steel price leads to lower exports which reduces supply in other markets.
A falling chinese steel prices leads to higher exports and more supply in foreign markets.
In what year did China introduce so called supply side reform?What is it?
2015 was first stated and it concerns the remove of structural oversupply in many basic material producing sectors.
How did China’s change in environmental policy impact its demand for materials like iron ore, coking coal and thermal coal?
Its need to reduce pollution saw its steel mills wanting to utilize higher grade iron ore and coking coal like lump and pellets.
Primary attributes of Nickel?
anti-corrosive and ability to stand high temperatures
Primary uses of Nickel?
80% goes to alloys like stainless steel and