LME main commodity international prices (2024. 10. 14.~10.18.) 

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Today, we will take a look at the international non-ferrous metal prices and the reasons for fluctuations from October 14 to 18, 2024.

LME Prices from October 14 to 18, 2024

LME Price Fluctuation Analysis (Oct 14~18, 2024): The Impact of Economic Uncertainty and a Strong Dollar

This week (October 14~18), non-ferrous metal prices at the London Metal Exchange (LME) were highly volatile due to global economic uncertainty and movements in the foreign exchange market. The trends of aluminum, copper, and nickel varied according to their respective market conditions, with China’s deteriorating economic indicators and a strong U.S. dollar acting as the key drivers.

1. Aluminum Price: China’s Economic Slowdown and Supply Glut

Weekly Trend: Decline

Aluminum experienced a consistent decline throughout the week, with the drop becoming steeper towards the end of the week. The primary cause of this was concerns over reduced demand due to China’s slowing economic growth. China’s industrial production growth for September, which the government announced, fell short of market expectations, heightening concerns about decreased consumption of industrial metals, including aluminum.

On the supply side, there were also unstable factors. China’s aluminum production has steadily increased since the first half of 2024, leading to an ongoing state of oversupply in the global market, which contributed to the decline in trading prices.

Key Indicators:

- China’s September Industrial Production Growth: 3.9% year-on-year (expected 4.5%) 

- U.S. Dollar Index (DXY): Up 0.4% this week, recorded at 106.5

2. Copper Price: Uncertainty Around the Fed’s Rate Policy

Weekly Trend: Rise at the Beginning, Decline Later

Copper prices saw a slight increase at the beginning of the week, but later declined towards the end. This was due to the possibility of the U.S. Federal Reserve raising interest rates, which negatively impacted investor sentiment towards the copper market. In particular, the manufacturing output data from the U.S., announced on October 17, fell below expectations, raising concerns about an economic slowdown.

Since copper is closely linked to global economic conditions, the prospect of an economic downturn caused by interest rate hikes and the resulting reduction in demand were the main factors behind the price drop. However, in the long term, positive outlooks for energy transition projects and demand related to electric vehicle (EV) batteries limited a major fall in prices.

Key Indicators:

- U.S. September Manufacturing Output: -0.1% (expected +0.2%) 

- China’s Copper Imports: Down 4% month-on-month

3. Nickel Price: Steady Demand from the Electric Vehicle Industry

Weekly Trend: Stable

Nickel saw little fluctuation this week, maintaining a stable trend. Strong demand from the electric vehicle battery sector helped prevent downward pressure. Nickel is a key raw material in EV batteries, and the expansion of production by major global automakers supported nickel demand. Additionally, the increase in nickel production from Indonesia contributed to supply stability and helped prevent a price surge.

Key Indicators:

- China’s Electric Vehicle Sales: 450,000 units in September (up 8% year-on-year) 

- Indonesia’s Nickel Production: Up 5% in Q3 2024 year-on-year

4. Foreign Exchange and Energy Prices: Downward Pressure on Metal Markets 

Another significant factor affecting this week’s LME metal prices was the strengthening of the U.S. dollar and a drop in energy-related costs. The U.S. Dollar Index (DXY) rose 0.4% this week, reaching 106.5, increasing the cost of importing non-ferrous metals. This reduced demand, particularly in emerging markets. Additionally, the fall in energy prices lowered production costs, leading to an increase in metal supply and subsequent price declines.

Key Indicators:

- Energy-related costs: This week’s price per barrel was $84, down 3% from the previous week 

- U.S. Dollar Index (DXY): Up 0.4% this week, recorded at 106.5

Conclusion: Market Outlook

This week’s (October 14~18) LME prices showed a general downward trend, with the main factors being global economic uncertainty, a strong dollar, and China’s economic slowdown. Aluminum and copper were particularly affected by these negative influences, while nickel’s price decline was limited thanks to relatively stable demand. Over the next few weeks, metal prices will likely be heavily influenced by the U.S. Fed’s interest rate decisions and the speed of China’s economic recovery.

As a result, participants in the metals market should closely monitor these macroeconomic factors and adopt flexible strategies to navigate the high volatility.