November 20 saw precious metals retreat as gold, silver, and platinum fell 0.17%, 0.89%, and 0.26%, respectively, while palladium gained a whopping 3.3%.
Precious metals like platinum and palladium have been falling along with gold and silver. However, all precious metals saw a rise on November 19, 2015.
The fall in prices for gold and silver has caused the gold-silver ratio to stand at 75.84. So, it takes almost 75.8 ounces of silver to buy an ounce of gold.
China accounts for about half of the global steel production. China’s steel output declined by 3.1% YoY in October 2015 to 66.1 million tons.
Supply-side disruptions, including the Samarco accident, don’t mean much against the quickly worsening demand outlook. This should keep a cap on iron ore prices going forward.
The market is factoring in very low iron ore prices following the supply-and-demand mismatch scenario that began in mid-2014.
Financing is crucial because it stimulates consumption and investment in an economy. By tracking credit growth in China, investors can gauge patterns that forecast future demand.
In October, building sales in China increased by 12.6% year-over-year. On a year-to-date basis, building sales have increased by 14.9%.
China’s industrial production rose by just 5.6% in October compared to 5.7% in September and 6.1% in August. The reading is below market expectations of 5.8%.
For the week ended November 13, inventories were 86.5 million tons, according to the data collected from 44 ports in China by SteelHome. This is an increase of 9% from the levels at the end of June.
Iron ore shipments through Port Hedland slumped to 36.5 million tons in October after reaching a record high of 39.4 million tons in September 2015.
The output from Samarco contributes ~2% of the global seaborne iron ore market. The impact of the production loss from this operation should not be enough to move the needle up on iron ore prices.
The weak demand from China is hurting iron ore prices. The supply side, on the other hand, remains quite strong.
In this series, we’ll discuss the reasons that iron ore prices fell after a strong rebound, recent data releases on the supply side, and October’s iron ore exports.
The combination of a strong dollar and rising real rates is having a predictable effect on precious metals prices.
Freeport-McMoRan (FCX), an Arizona base miner, fell by more than 4% on Thursday. It ended the day at $8.41. It’s trading close to a multiyear low.
On November, 19, base metals stopped falling as the dollar weakened. In the LME (London Metal Exchange), copper, zinc, and tin ended the day with gains.
On November 19, LME Copper rose 0.4% because of the slightly weaker dollar. Base metals started the day on a negative note and traded at multiyear lows.
The total supply of silver is forecast to fall to 1,044.4 million ounces in 2015, down almost 3% from the previous year. But sales of silver coins reached a fresh high of 33 million ounces in 3Q15.
Since the beginning of November 2015, all major base metal miners have been trading lower due to pressure from copper and other base metals. On November 18, they all rallied and closed the day in profits.