• The improvement in metals prices seen over the second half of 2012 has been completely unwound, largely due to a lack of physical demand and market concerns over the outlook for demand. In aggregate, base metal prices were 5% lower over March and down more than 10% over the year. Annual price movements vary across the metals complex but all metals have recorded declines.
• Growth in both China and the US economies disappointed in the first quarter of this year. While this has weighed on metals prices, losses have been partially restrained reflecting expectations for continued monetary stimulus. Nevertheless, Chinese growth is expected to remain solid this year and the US will continue along its modest growth path – helping to support base metal prices at relatively elevated levels.
• Metals markets will be in surplus in 2013, as a result of rising metal supplies and slower demand growth. Looser market conditions will make metal prices even more susceptible to any negative shifts in expectations over the demand outlook.
• The NAB Base Metals Index (BMI) is expected to decline by almost 8% in the June quarter. Prices will recover gradually later in the year.

For further analysis download the full report.

• Base Metals Market Update – April 2013 (PDF 272KB)