Industrial metal prices went downhill significantly

by David Fleschen

Yesterday, industrial metal prices went downhill significantly. After an interim stabilization, the downward momentum increased once again with the start of trading in the USA. Copper and nickel each recorded losses of 3.3% - for copper it was the largest daily loss since the beginning of October. This morning, however, the metal prices are already noticeably on the rise again, so that the correction yesterday was apparently no more than a short breath. Copper is trading again at around USD 8,000 per ton, nickel is increasing in price by 3% to USD 17,600 per ton. Many market participants apparently expect an increasing demand for metals, which is primarily driven by measures to support the economy. Newly elected U.S. President Biden is set to announce his plans for further fiscal policy measures on Thursday. The package is expected to be worth several trillion dollars.

As of Jan. 7 - figures are published once a week - the "world container index" for 40-foot containers, calculated by maritime research and consulting firm Drewry, has now jumped upward to a new record high of $5,221 per container. It has thus doubled since the beginning of October. And the Baltic Dry Index, which measures freight rates for bulk cargoes (especially iron ore, coal and grains), is also rising sharply - by almost 30% since the beginning of the year alone. Since the beginning of December, the index has risen by 44%. The significantly higher freight rates point to brisk goods traffic by sea. China, which appears to be continuing to demand large quantities of raw materials, is likely to play a major role in this.

Source: Commerzbank Research, Photo: Fotolia

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