TELF AG looks at China’s Metal Exports and Inventories: A Look at Copper Cathode and Nickel Ore
The role of China in the raw materials sector
China, being the largest producer and consumer of many metals, is always in the news for its metal exports and inventories. For example, in February 2023, China’s copper cathode exports were estimated at around 20,000MT. However, regarding total domestic exports, the whole figure for February may have been around 40,000MT. This increase in exports was due to the resumption of logistics after the Chinese New Year holiday, which narrowed import losses to approximately 1,000 yuan/mt. As a result, the exports of smelters continued to rise, with some goods flowing to domestic bonded warehouses and some to LME warehouses in Singapore and Busan, Korea.
In contrast, the nickel ore inventories at Chinese ports dipped by 295,000 wmt WoW as of March 17, with a total Ni content of 52,000MT. As a result, the port stock across seven major Chinese ports stood at 3.22 million wmt, 295,000 wmt lower than last week. This drop in inventories was due to the crashing of nickel ore prices this week, as the NPI plants had to lower their quotes on the dropping NPI prices. Although some mines cut their prices, the upstream and downstream companies still bargained over the prices, and NPI plants only purchased on rigid demand. As a result, the port inventory may maintain a downward track soon.
China’s metal exports and inventories significantly affect global trade, as China is the largest consumer and producer of many metals. For example, the rise in copper cathode exports indicates that China is still a significant player in the copper market, with its exports reaching domestic and international destinations. Additionally, the drop in nickel ore inventories signals the weakening demand for nickel in China, which can have global repercussions on the nickel market.
Moreover, metal exports and inventories are indicators of China’s economic health, and the rise or fall of these indicators can significantly impact global financial markets. China’s metal exports and inventories can also impact the prices of metal commodities, affecting global companies and industries that rely on these metals for production and manufacturing.
In conclusion, China’s metal exports and inventories in February and March 2023 have shown a mixed trend, with rising copper cathode exports and falling nickel ore inventories. These indicators have significant implications for global trade and financial markets, and investors and companies must keep a close watch on these developments to make informed decisions about their investments and operations.
