- Write by:
-
Tuesday, August 23, 2022 - 13:01:13
-
638 Visit
-
Print
Mining News Pro - A metaphorical winter approaches for base metals equities, says Haywood Capital Markets in a new report published on Sunday.
Analyst Pierre Vaillancourt expects the constellation of base metals companies under coverage’s second quarter results to fall below expectations when they start reporting results from month’s-end.
“Overall, we look for most base metals producers to reflect weakening metals prices, as negative provisional price adjustments will impact results,” wrote the analyst in a note to clients.
Haywood also expects ongoing inflation pressure to impact costs materially, which continued at an annualized 8.7% rate (CPI) for the June quarter, including WTI crude oil (up 14% quarter-on-quarter) and diesel (US Gulf Coast Ultra Low Sulfur Diesel Prompt Spot index) up 32% q-o-q.
“As a result, we believe operating mine costs will continue to increase in the quarter. On the other hand, we note that operating conditions were more favourable for some companies, which will help mitigate the impact of inflation and metals prices,” said the analyst.
Average prices improved sequentially in the June quarter for zinc, closing at $1.78 per lb. versus $1.49 per lb. in the first quarter, and nickel gained to $13.16 per lb. versus $12.15 per lb. three months earlier.
However, the copper price declined 21% over the prior three months to $3.71 per lb. The zinc price fell 13% q-o-q to $1.38 per lb.
“Since the end of 2Q22, the price deterioration has intensified. So far in 3Q22, copper is down -10% to $3.34 per lb. – the lowest level since late 2020, zinc is down 12% to $1.21 per lb., and nickel is down 13% to $9.27 per lb.
“Base metals equities gave back their gains from previous quarters, as the Global X Copper Miners ETF fell 35% q-o-q, the S&P/TSX Global Metals index fell 34% q-o-q, compared to the S&P 500, which fell 17% q-o-q, and the S&P composite index, which dropped 14%,” said the analyst.
Short Link:
https://www.miningnews.ir/En/News/622037
Anglo American Plc said it is has received an unsolicited non-binding combination proposal from BHP Group.
Toronto-listed miner OceanaGold Corp said on Wednesday it will raise 6.08 billion pesos ($106 million) through an ...
A key measure of Chinese copper demand just sank to zero, another indication that global prices are not balanced with ...
Canadian miner First Quantum Minerals (TSX: FM) believes it will be able to take the already mined 121,000 tonnes of ...
Canadian miner First Quantum Minerals said on Tuesday that it has cut its debt by $1.14 billion in the first quarter.
Chile is expected to produce a record 5.8 million metric tons of copper in 2025, the state-run Chilean Copper Commission ...
Interros, Nornickel’s largest shareholder, on Monday called allegations by fellow shareholder Rusal about undervalued ...
Copper traded near $10,000 a ton, hitting a new two-year high on its way, as investors continue to pile in on a bet that ...
A Native American group has asked all members of a US appeals court on Monday to overturn an earlier ruling that granted ...
No comments have been posted yet ...