(FM) Most base metals prices on the Shanghai Futures Exchange fell during Asian trading hours on Monday November 5, as buoyant hopes last week over a possible resolution to the ongoing trade war between the United States and China were punctured by White House economic adviser Larry Kudlow stating a deal was not imminent. Market participants latched onto reports last week that US President Donald Trump had asked officials to draft a US-China trade deal, easing risk-off sentiment, but the positive mood quickly switched gears after Kudlow stated there was no such order. While hopes still linger that Trump and Chinese President Xi Jinping will talk at the sidelines of the G20 Summit in Argentina in mid-November and work to resolve the trade spat, uncertainties have dented sentiment once more.
Fastmarkets analysts Boris Mikanikrezai noted in Friday’s copper report that robust fundamental dynamics are conducive to stronger prices in the medium term, adding that the global refined copper market is expected to see a deficit of 137,000 tonnes this year, reflecting a 2.5% growth in global refined production and a 2% growth in global consumption.
Meanwhile, all other base metals prices fared negatively, with zinc’s most-traded December contract price marking the biggest decrease of 1.5%, followed by nickel’s most-traded January contract price, which shed 1%.
Chinese domestic demand for nickel in October was weaker than expected, according Fastmarkets analyst Andy Farida.
Farida said battery demand has slowed due to poor business and mild oversupply in the battery market, while output from Indonesian mines continues to accelerate.
