Metals Demand Growth to Slow to 5.5% in 2005

Bloomberg.com: Australia & New Zealand: “Demand for copper, aluminum and other base metals used in manufacturing and construction will rise by 5.5 percent next year, slowing from 2004 as global economic growth cools, Societe Generale said.

“London Metal Exchange prices will remain historically high well into next year,” London-based analyst Stephen Briggs said in the SG Commodities Research report. The LME is the world’s largest metals bourse, handling $2 trillion a year in trades.

Prices will fall about 5 percent after this year’s 40 percent gain, Briggs forecast. Copper last week closed at a 15-year high on the LME, aluminum reached a nine-year peak and lead climbed to a record. Demand for those metals, along with nickel, zinc and tin, will rise 6.5 percent this year, he said.

China’s growth in demand is slowing to 15 percent this year from 20 percent last year, Briggs said. China, the world’s largest user of copper and aluminum, will spend at least $560 billion on power plants and transmission lines by 2010, requiring 500,000 tons of copper, according to Ingrid Sternby, an analyst at Barclays Capital in London. “

Yahoo! News – Noranda enters buyout talks: “Toronto-based Noranda, 43 per cent owned by Canadian conglomerate Brascan, is the world’s third-biggest zinc producer and ninth-biggest copper producer. It also produces nickel and primary aluminium.

Increasing Chinese demand for commodities, lack of new metals supply and consolidation in the industry provided ‘an opportune environment to review our options’ to increase value for Brascan and Noranda shareholders, said Bruce Flatt, Brascan chief executive.

Brascan made clear two years ago that it wished to sell its stake in Noranda to focus on real estate, power generation and asset management. Brascan said yesterday it was ‘supportive’ of Noranda’s efforts to find a buyer. “

Inco reports results for first quarter of 2004: “Inco enjoyed a strong first quarter for 2004 as a result of high metal prices and improved nickel production and deliveries. Nickel production increased by 15 per cent and Inco-source nickel deliveries grew by 19 per cent for the quarter compared with the first quarter of 2003. We are on track to hit our highest annual nickel production levels in nearly thirty years. With strong nickel markets currently expected to continue for the foreseeable future, we anticipate that 2004 will be an excellent year for Inco.”

Now here’s something I bet you didn’t know … did you know that an American Nickel isn’t made only of nickel? It isn’t even mostly nickel … Yahoo! News – U.S. Mint Rolls Out New Nickels: “Vending machines will be able to accept the new nickels because their composition ? 75 percent copper and 25 percent nickel ? and their size remains the same, Mint officials said”

As it turns out, the same is now true for the Canadian Nickel. It wasn’t always so, though.

Yahoo! News – Steelworkers President Uses New Tactics: “‘He’s reaching accommodation with the realities of the global market and trying to save what can be saved of the American steel industry,’ said Charles McCollester, president of the Pennsylvania Labor History Society.

Gerard, 57, started his career at 18 in a fiery nickel smelter in Sudbury, Ontario.

ISG shrank union job categories from 32 to five, freeing the company from rigid limits on redeploying workers. But the contract approved last February also required ISG to cut layers of management between the chief executive and the shop floor from seven to three.

Increased flexibility allowed ISG to cut the employee hours required to produce a ton of steel from 2 1/2 to one. The union gained more control over day-to-day operation of the mills.

A few years back, such togetherness was unthinkable. The perilous state of the industry changed that. “

Yahoo! News – Trade Fight Exports List: “Some of the items that the European Union has targeted for retaliatory tariffs, beginning Monday:

INDUSTRIAL PRODUCTS

Hand tools, Drilling tools

ELECTRONIC PRODUCTS

Water-tube boilers, Steam engines, Refrigerators, Various types of electrical machinery, Nuclear reactors

STEEL PRODUCTS

Ferro-nickel alloys, Nonalloy ingots, Flat hot rolled steel”

[just out of curiousity, what’s an electronic steam engine? … mw]