Prices for SHFE base metals pick up
Prices for SHFE base metals pick up

13 July 2023 – The prices for base metals, such as nickel, aluminum or zinc, have increased today on the SHFE by up to 2.7%. Other major commodity futures are also moving up again. SHFE plans warehouses outside China? G10 countries with unemployment rates down significantly. And is the non-existent nickel scam even much bigger than previously thought?

Prices for SHFE base metals pick up 

Base metals prices on the SHFE are up again today. Copper is up 1.3%, aluminum is up 1.27%, lead prices are up about 1%, zinc prices jumps about 2.7% and tin is up just under 1.1%. Nickel futures are up about 2%. But steel and stainless steel-related futures are also up. Iron ore is up about 1.6%, HRC is up 0.8%, stainless steel futures are up 0.74%, and coke and coking coal are up between 0.8 and 1.0%. LME nickel 3-month had already surpassed the USD 21,000 mark again yesterday (Wednesday), gaining nearly 6% in value since the end of June 2023.  

SHFE plans warehouses outside China? 

According to media reports, the Chinese Shanghai Futures Exchange is planning to expand its commodity warehouse offering outside China. Thus, the SHFE enters into direct competition with the European London Metal Exchange, which has dominated the market for commodities so far. However, an official confirmation is apparently not yet available.  

Net margins of Chinese stainless steel producers increased 

The first data from Chinese stainless steel producers indicate a significant increase in net income. In the period from January to June 2023, drastic increases of well over 100% compared to the previous year were recorded for some manufacturers.  

G10 countries with significantly higher employment rates 

All bad? Not really. Looking at employment rates, all G10 countries, except Japan, come up with significantly higher employment figures compared to the pre-pandemic period. Unemployment rates have fallen to their lowest levels on average in the G10 countries compared to the ten-year period before the pandemic, according to Deutsche Bank data.  

Nickel fraud possibly even bigger than previously assumed? 

The nickel fraud, which the commodity trader Trafigura was supposed to have perpetrated and which is currently being prosecuted and which involves damages of almost 600 million USD, has recently taken on a new dimension. The main defendant, Prateek Gupta, recently told a court in London that the impetus for the fraud came from Trafigura itself and was suggested by employees of the commodities trader.  

If this allegation proves true, it could mean that the non-existent nickel fraud is likely to have been much larger and may even have been committed over a longer period of time.

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