Non-ferrous metal market or welcome the new market

In January, in the non-ferrous metal sector, the price of base metals and precious metals rose, and the price of rare earths and small metals fell. Among them, the base metal plate in addition to nickel prices fell slightly, other product prices rose across the board, zinc (8.93%), copper (5.46%), lead (4.93%) rose in the top three, aluminum, tin rose slightly weaker, up 3.56%, 0.25%, nickel prices fell slightly 4.20%.

Liu Meili, an analyst at the non-ferrous metals branch of the business community, believes that the market price of non-ferrous metals rebounded slightly in January, first of all, driven by eye-catching macroeconomic data. China's Caixin manufacturing Purchasing Managers' Index (PMI) in December 2016 was 51.9, the highest since January 2013, and the growth rate of new orders also exceeded November 2016, hitting the highest record since July 2014.

Secondly, non-ferrous metals will join the ranks of capacity reduction in 2017. Xu Lejiang, vice minister of the Ministry of Industry and Information Technology, said recently that the next step in the non-ferrous metal industry should, on the one hand, do a good job of capacity, on the other hand, continue to promote the development of new non-ferrous metal materials industry, strictly control the new capacity of electrolytic aluminum, improve the upstream and downstream cooperation mechanism of civil aluminum, and strive to make major breakthroughs in new non-ferrous metal materials such as civil aluminum, and form support for the non-ferrous metal market.
Third, before the Spring Festival, smelting enterprises focused on maintenance and production reduction. Like copper and zinc, there were different degrees of centralized maintenance in January, and the supply in the market decreased, supporting the price of non-ferrous metals. However, as factories continue to shut down and leave the site, demand has weakened sharply, and in the case of weak supply and demand, the non-ferrous metal market price increase in January is limited. On the basic level, the differentiation of basic metals is still obvious. Lead and zinc are still affected by mineral shortages, supply is tight, and prices are supported. Copper, aluminum inventories are still high, supply and demand imbalance, this price rise is more stimulated by the news. Nickel has been tight supply, affected by Indonesia's relaxation of the export ban, the market has reversed, and the price has fallen. However, the closure of nickel mines announced by the Philippines in late January still supported nickel prices. Nickel prices may resume the upward trend.

In January, due to the gradual departure of merchants, supply and demand are weak, and the non-ferrous metal market is difficult to have a big market, and in general, it is mainly stable. After the Spring Festival, businesses gradually return, but many businesses will start work in the real sense after the 15th day of the first month, and it is still difficult to have a big market in early February. After the middle of February, the construction gradually resumed, the peak season arrived, the demand increased, or there was a new round of market. However, Liu Meili expects that the market will certainly not be as good as the spring of previous years. At the beginning of the New Year, the central bank confirmed that the interest rate of the Standing lending Facility (SLF) had tightened the market liquidity. Non-ferrous metals will still join the ranks of capacity reduction in 2017, and the Federal Reserve announced in January that it would not raise interest rates, which supported the market. In summary, the resumption of work after the holiday, increased demand, and non-ferrous metal prices rose slightly in February, but the overall increase was limited.