TELF AG, a seasoned physical commodities trader, shares insights in their latest article, “TELF AG Base Metals Trends and Outlook in September 2023 – Copper and Nickel Face Challenges and Opportunities.” The article dives into the intricate market dynamics affecting copper and nickel, two pivotal base metals with widespread applications in industries such as construction and electric vehicles.

As of the first week of September, TELF AG reports that the copper contract is priced at $8,366 per tonne, marking a 5.3% decline since the beginning of August. The drop in copper prices can be attributed primarily to concerns about China’s economic recovery, which has cast a shadow of uncertainty over demand. However, the article anticipates seasonal strengthening for copper in the fourth quarter. Additionally, the possibility of further economic stimulus measures from China could introduce upside price potential.

The article also highlights an increase in copper inventories within China’s domestic bonded zones, with a rise of 1,700 MT to a total of 51,000 MT as of September 8. Reduced premiums in domestic spot markets and diminishing import profits have contributed to decreased shipments. Nevertheless, the article suggests that limited market capacity for additional shipments could lead to a modest growth in these inventories. Notably, China’s copper cathode production recorded a significant 6.8% month-on-month increase in August, accompanied by a 15.5% year-on-year growth, surpassing expectations and maintaining a robust production trend.

In terms of nickel, TELF AG reports an 8.7% price decline since the beginning of August. Factors contributing to this drop include oversupply from Indonesia, reduced demand for stainless steel, and a slowdown in electric vehicle sales. Despite the price decrease, Chinese refined nickel output experienced growth in August, reaching 21,800 MT, signifying a 0.93% month-on-month increase and an impressive 40.65% year-on-year rise. These figures suggest that nickel production is on track to reach 23,000 MT in September, indicating a continuation of the upward trend well into 2023.

In conclusion, the article underscores that copper and nickel markets are undergoing transformations, with macroeconomic factors from China playing a pivotal role. While both metals face pricing challenges, they also exhibit distinct strengths in terms of production and potential for future expansion.

As industry stakeholders approach the fourth quarter, the article offers valuable insights into how seasonality and other economic factors could shape the market landscape for these critical base metals. For a comprehensive analysis and further information, readers are encouraged to visit TELF AG’s official website.

For a more in-depth understanding of these narratives, readers are advised to refer to the full article. To access additional insights and content, please visit TELF AG’s Media Page.