{"id":1183701,"date":"2020-05-11T14:40:42","date_gmt":"2020-05-11T19:40:42","guid":{"rendered":"https:\/\/www.mining.com\/?p=1023451"},"modified":"2020-05-11T14:40:42","modified_gmt":"2020-05-11T19:40:42","slug":"metals-markets-to-move-into-surplus-report","status":"publish","type":"post","link":"https:\/\/juniorminingnews.com\/?p=1183701","title":{"rendered":"Metals markets to move into surplus \u2014 report"},"content":{"rendered":"<p>Most metals markets will move into surplus in 2020 due to the covid-19 pandemic, according to <em>Fitch Solutions<\/em> latest market report. <\/p>\n<div class='ad-slot' id='div-gpt-ad-1561499308230-0'><script>googletag.cmd.push(function() {    googletag.display('div-gpt-ad-1561499308230-0');    googletag.pubads().addEventListener('slotRenderEnded', function (event) {        if (event.isEmpty) {            var id = event.slot.getSlotElementId();            var x = document.getElementById(id);            if(x == null) return;            if (x.parentElement.classList.contains('ad-slot')) {                x.parentElement.style.display = 'none';            }\t\t\t\t        }    });});<\/script><\/div>\n<p>The research agency has revised down its forecasts for both consumption and production of metals for a number of countries over recent weeks. <\/p>\n<p>&#8220;Operational hurdles as a result of covid-19, especially for smelters located in countries where governments ordered lockdowns, and voluntary production curtailments as a result of the collapse in metal prices will result in lower 2020 metal production compared to our previous forecasts,&#8221; <em>Fitch <\/em>analysts say. <\/p>\n<p>The firm expects that global recession in 2020 will hamper metals demand as end-use sectors, including autos, construction and home appliances enter a lull.<\/p>\n<figure class=\"wp-block-image\"><img decoding=\"async\" src=\"https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/image-6.png\" alt=\"\" class=\"wp-image-1023456\" srcset=\"https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/image-6.png 705w, https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/image-6-300x184.png 300w\" sizes=\"(max-width: 705px) 100vw, 705px\" \/><figcaption>Select Metals &#8211; Global Consumption Growth (% change y-o-y) &#8211; Source: USGS, WSA, Fitch Solutions<\/figcaption><\/figure>\n<h2>Copper<\/h2>\n<p><em>Fitch<\/em> expects global copper production to grow by 0.6% y-o-y in 2020, a steep drop from the previous forecast of 1.9% y-o-y growth. <\/p>\n<p>China copper production declined by 2.5% year-on-year in March to 771,000 tonnes, according to the National Bureau of Statistics, due to coronavirus disruptions. <\/p>\n<p>While the country&#8217;s lockdowns have been lifted, <em>Fitch<\/em> expects supply chain disruptions affecting copper concentrate imports, as lockdowns in Latin America tighten the seaborne market, to hamper Chinese refined copper production further in Q2 2020, before a slight recovery in H2 2020.<\/p>\n<figure class=\"wp-block-image\"><a href=\"https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/image-7.png\"><img decoding=\"async\" src=\"https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/image-7.png\" alt=\"\" class=\"wp-image-1023459\" srcset=\"https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/image-7.png 721w, https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/image-7-300x184.png 300w, https:\/\/www.mining.com\/wp-content\/uploads\/2020\/05\/image-7-720x443.png 720w\" sizes=\"(max-width: 721px) 100vw, 721px\" \/><\/a><figcaption>China &#8211; 2020 Metals Consumption Growth Forecasts, % change y-o-y (Previous Vs. Revised)<\/figcaption><\/figure>\n<p><em>Fitch<\/em> expects global copper consumption to decline by 1.1% y-o-y in 2020, compared to previous forecast of a 1.6% y-o-y growth. <\/p>\n<figure class=\"wp-block-pullquote alignright\">\n<blockquote>\n<p> The agency revised down 2020 copper consumption growth forecasts for the two largest consuming countries, China and the US <\/p>\n<\/blockquote>\n<\/figure>\n<p>The agency revised down 2020 copper consumption growth forecasts for the two largest consuming countries, China and the US, from 2.5% and 1.5% growth y-o-y to declines of 1.5% and 4.5% y-o-y, respectively. <\/p>\n<p>&#8220;As a result, we now expect the global copper market to fall into a large surplus of 344kt in 2020, compared to a deficit of 63kt in 2019. As the global economy recovers and so does copper demand in 2021, we expect the surplus to narrow to 162kt before shifting into a deficit of 51kt again in 2022,&#8221; <em>Fitch <\/em>says. <\/p>\n<h2>Aluminum<\/h2>\n<p>Fitch expects global aluminum production to grow by 1.2% y-o-y in 2020, less than half the previous forecast of 3.0% y-o-y growth.<\/p>\n<p>Globally, due to covid-19, the agency expects some disruptions to aluminum production and revised down forecasts across a number of countries including China, India, the US, and Germany. <\/p>\n<p>In March, Norsk Hydro announced that it will reduce and halt the production of some aluminum products. <\/p>\n<p>In Germany, ST Extruded Products Group closed three aluminum smelters. <\/p>\n<p>RUSAL also announced that it will delay the ramping up of additional capacity at the Taishet Smelter in Siberia from H220 to H121. <\/p>\n<p><em>Fitch <\/em>expects global aluminum consumption to decline by 2.0% y-o-y in 2020, compared to the previous forecast of a 1.5% y-o-y growth. <\/p>\n<p>The company has revised down 2020 consumption forecasts for China, the US, and India mainly, from y-o-y growth rates of 2.0%, 1.5% and 16.0% to y-o-y declines of 2%, 5% and 8%, respectively. <\/p>\n<p>&#8220;As a result, we now expect the aluminum market to be in a surplus of 3mnt in 2020 compared to 1mnt in 2019. Similar to copper, we expect the surplus to narrow to 2.5mnt by 2021 as the global economy improves.&#8221;<\/p>\n<h2>Nickel and tin<\/h2>\n<p>The nickel and tin markets will also suffer due to the economic effects of covid-19. <\/p>\n<p>&#8220;We have revised downwards our 2020 global production growth forecasts for both nickel and tin from 0.3% and 6.3% y-o-y previously to -0.3% and -2.6% y-o-y, respectively,&#8221; Fitch says. <\/p>\n<p>&#8220;In regards to tin, production cuts among leading producers, whether through voluntary ramp downs due to the low tin price environment or through government mandates, have placed a dent on refined tin production over recent months.&#8221;<\/p>\n<p>Fitch revised down its 2020 forecasts for nickel and tin consumption growth from -2.7% and 5.7% y-o-y previously, respectively, to a decline of 4.6% y-o-y each.  <\/p>\n<p>The agency forecasts combined consumer electronic sales across 58 markets globally to contract by 0.6% y-o-y in 2020 compared to a 3.4% y-o-y growth forecast in early January. <\/p>\n<p>&#8220;A decline in consumer electronic sales will undercut the incentive for consumer electronics manufacturers to maintain previous output levels thus weighing on demand for tin.&#8221;<\/p>\n<p><em>Fitch&#8217;s <\/em>revised forecasts now show the tin market balance to be zero in 2020, and the nickel market to be in a surplus of 38kt, after both markets registered deficits in 2019 of 8kt and 58kt, respectively. <\/p>\n<p>&#8220;While the nickel surplus will reduce in 2021 to just 4kt as stainless steel production gears up, the tin market will see a surplus of 4kt as it will take longer for consumer spending to pick up.&#8221;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Fitch has revised down 2020 copper consumption growth forecasts for China and the US.<\/p>\n","protected":false},"author":5,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center 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