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Base metals’ prices may remain weak on trade tensions

On Wednesday, base metal prices on the London Metal Exchange saw a negative trend.

, ET Bureau|
Dec 05, 2019, 08.12 AM IST
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Commodity Summary
MCX

NICKEL
New Delhi: Prices of base metals are likely to remain weak because escalating tension between the US and China is expected to weigh on demand, analysts said. They expect prices to remain bearish in the month ahead, after President Donald Trump’s remark that a Chinese trade deal might now have to wait until after the US election in 2020. Also, the Trump administration is weighing on the threat of China hinting that it would soon publish a list of unreliable entities, which could lead to further sanctions against US companies.

On Wednesday, base metal prices on the London Metal Exchange saw a negative trend. “The biggest loser was nickel with the Shanghai benchmark hitting its lowest in more than four months on dimming hopes for a preliminary USChina trade deal,” said Navneet Damani of Motilal Oswal.
metal-graph

In the past one month, nickel prices fell almost 20 per cent on the LME to $13,327 a tonne. On India’s MCX, it fell 18.26 per cent to Rs 985 per kg during this period. Zinc fell 12 per cent on the LME over the past one month to $2,285 a tonne. On the MCX, the fall was 2.38 per cent to Rs 183 per kg. Rising uncertainties also weighed on the demand prospects for copper, pushing the red metal’s price lower by 2.7 per cent on the LME over a month to $5,857 a tonne, and 1.85 per cent on the MCX to Rs 430 per kg. Lead fell 10.6 per cent on the LME from its month high of $2,179 a tonne to $1,946. The fall on the MCX during the period was 2.24 per cent, to Rs 153 per kg.

“We expect prices in the global market to remain subdued for the next one to two months, as traders will offload the position due to the year ending. In the domestic market, the prices will be in sync with global prices,” Angel Broking deputy vice-president Anuj Gupta said.


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