LME Metals Conference Underpins Bullish Outlook for Base Metals

SEATTLE (Scrap Monster): The recently concluded LME Asia Week 2018 has predicted bullish outlook for base metals for the rest of 2018, mainly on the back of projected economic stability and metal shortage on account of supply disruptions. The renowned Metals Seminar was held at Hong Kong Convention and Exhibition Centre on Thursday, 17, May 2018. The yearly seminar was noted for increased participation by metals analysts and traders from across the world.

According to expert participants at the summit, the happenings during the initial five months in 2018 have done little to suppress the growing base metal demand. Consequently, the base metal prices are likely to show slight improvement during the rest of 2018. They noted that the pricing has stayed strong, despite the market absorbing substantial quantities of new production. On the supply side, disruptions on account of mine labor-management disagreements are likely to limit supply. As a result, base metal prices are likely to rise pretty quickly and sharply.

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Zhu Yi of Bloomberg Intelligence noted that import volumes of copper scrap by Chinese manufacturers has seen drastic decline during the first five months. However, the production as well as purchase of concentrates and blister has increased significantly during this period. Going forward, Southeast Asian countries will emerge as the major importers of copper scrap, Yi noted. Guy Wolf of Marex Spectron brokerage predicted increased investor interest in copper metal during the rest of 2018.

The anticipated drop in aluminum production in world countries including China on account of capacity cuts along with delay in approval for new capacities is expected to support aluminum prices. Nickel too has residual strength, primarily due to its increased usage in electrical vehicles, the conference noted.

LME Asia Week 2018 noted that base metal prices are expected to remain at materially higher levels over the next five years.