Steel shines, non-ferrous metals continue to fall: Emkay
Emkay Global Financial Services has come out with its report on metal sector. The research firm believes that, steel prices should not see any sharp fall from here on. However, zinc, base metals prices would be vulnerable going forward.
December 03, 2013 / 16:02 IST
Emkay Global Financial Services' report on metal sector
As expected global steel prices rose during the last fortnight (ending 2nd Dec). After falling, domestic long product prices stabilized during this period and have been strengthening on week-on-week basis. Weak INR and weather condition have been supportive. Iron ore prices backed by China also remained strong. CIS Black Sea export FoB prices remained up 0.5 percent at USD527.5/tonne during the fortnight, HR Sheet prices too gained marginally to USD557/tonne. While, flat product prices remained stable, long product prices saw recovery in the domestic markets. Demand from China continued to be robust giving 62 percent grade Iron ore prices a gain of 0.4 percent to USD136.8/tonne while the 58 percent grade prices rose back 1.1 percent to close at USD124/tonne. China domestic coking coal prices remained flat at USD239.4/tonne.World crude steel production for the month of October was reported at 134.3 mt, up 6.6 percent YoY and 1.3 percent MoM. Capacity utilizations during the month decreased from 79.3 percent in September to 77.5 percent in October. Chinese steel production rose 9 percent YoY to 65.1 mt as daily run rate improved decreased to 2.1 mt (from 2.18 mt in September)Believe, steel prices should not see any sharp fall from here on. Base metals prices on the other hand continued to weaken on global uncertainties and possible LME actions. USD index rose 0.3 percent to 80.9. Non-ferrous: aluminium prices fell sharplyDuring the fortnight, base metal prices continued to be at low levels. While aluminium and lead fell 2 percent and 1 percent to close at USD1700 and USD2041/tonne respectively, zinc declined marginally to USD1856/tonne and copper gained 1 percent to USD7009/tonne. Except aluminium inventories, which increased 2 percent to 5.47 mt, all other LME inventories remained lower during the fortnight. Copper, zinc and lead inventories fell 6 percent, 3 percent and 2 percent to 0.42 mt, 0.96 mt and 0.23 mt respectively.Believe, except for those with stronger fundamentals e.g. zinc, base metals prices would be vulnerable going forward, says Emkay Global Financial Services research.Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. 
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