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Non-ferrous metals - 24 August 2012

At the start of the week, non-ferrous prices had fallen sharply against the backdrop of dire economic data. Compared with August 2011, scrap copper prices are down by at least 19%, when prices averaged at £5,000 per tonne.

By mid-week, markets were buoyed by news that the European Central Bank (ECB) would intervene and force down Spanish and Italian borrowing costs. This news had the effect of dragging up the base metals on the London Metal Exchange (LME).

Scrap copper prices have improved by £50 per tonne, while aluminium grades still remain unchanged. Nickel and alloy prices post further decreases as the summer slump continues to temper trade and demand.

Overall gate trade for scrap remains quiet for the time of the month, with merchants hopeful that business will start to pick up in the coming weeks as the holiday season and Olympics fever move on.

Volumes of tin held in LME- approved warehouses have nearly halved in little over a year from 22,495 tonne to 11,630 tonnes.

And in an effort to offset the dwindling tin price against rising production costs, Indonesian tin producers have reportedly idled up to two-thirds of their smelters. Production is not likely to resume until the producers see the price reach at least $22,000 per tonne.

Primary tin currently sits on the LME around $18,655 per tonne, down 21% on 2011 levels.

Even with this downturn, prices for white metals have seen a slight reversal of fortune, along with most other base metals this week.

99% tin is up £924 to £10,300 per tonne, while prices for the solder grades increase on average by £170 per tonne. Mixed pewter also benefits from the upswing, raising its price to £5,070 per tonne, nearly £300 per tonne up on last month’s prices.

For scrap nickel and alloys, prices are a mixed picture. 18/8 stainless steel solids move down £20 per tonne, while cupronickel posted a heavier decline, down £100 per tonne, for both 70/30 and 90/10 grades.

At the other end of the spectrum, pure tungsten gained £300 per tonne against MRW’s published price on 10 August to £13, 940 per tonne. 18/4/1 solids and turnings are also up this week, by £100 per tonne.

LME nickel slumped further, trading at around $15,605 per tonne mid-week.

The precious metals recovered from slumps in the past few weeks. Platinum primary and scrap prices managed to rise in the aftershock of the shootings of striking miners at the world’s third-largest platinum producer in South Africa.

Primary was up £1.74 per tonne and scrap £1.28 per tonne to reach £30.66 and £22.36 respectively.

Gold and other commodities are being boosted as the markets await US data for home sales, set to be released as MRW went to press. Weakening dollar again lends a hand in propping up fine gold and silver prices.

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