Morning Bites
🚗💨Internal combustion engine (ICE) car registrations in the EU rose 3% YoY in 4Q22 from the low base, reversing from the 4% YoY decline in 3Q22. Petrol car sales were up 5% YoY in 4Q22 (vs. -3% YoY in 3Q22), while diesel car registrations dropped 1% YoY (vs. -5% YoY). Diesel cars accounted for 28% of ICE car sales in 4Q22 (roughly unchanged QoQ and YoY). Overall, the stagnant sales dynamics are unfavourable for PGMs, as the EU represents 20% and 31% of global Pd and Pt autocatalyst demand, respectively
🚘EU+UK EV sales surged 31% YoY in 4Q22, accelerating from the 5% YoY growth in 3Q22. In particular, BEV sales gained 36% YoY (vs. +16% YoY in 3Q22), while PHEV sales rose 22% YoY (vs. -9% YoY). The share of BEVs in total EV sales grew slightly to 64% in 4Q22, from 62% in 3Q22. Overall, the upbeat local EV sales are likely to have a positive effect on the demand for battery metals (such as nickel, lithium and cobalt)
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com:3000/news-reports
🚗💨Internal combustion engine (ICE) car registrations in the EU rose 3% YoY in 4Q22 from the low base, reversing from the 4% YoY decline in 3Q22. Petrol car sales were up 5% YoY in 4Q22 (vs. -3% YoY in 3Q22), while diesel car registrations dropped 1% YoY (vs. -5% YoY). Diesel cars accounted for 28% of ICE car sales in 4Q22 (roughly unchanged QoQ and YoY). Overall, the stagnant sales dynamics are unfavourable for PGMs, as the EU represents 20% and 31% of global Pd and Pt autocatalyst demand, respectively
🚘EU+UK EV sales surged 31% YoY in 4Q22, accelerating from the 5% YoY growth in 3Q22. In particular, BEV sales gained 36% YoY (vs. +16% YoY in 3Q22), while PHEV sales rose 22% YoY (vs. -9% YoY). The share of BEVs in total EV sales grew slightly to 64% in 4Q22, from 62% in 3Q22. Overall, the upbeat local EV sales are likely to have a positive effect on the demand for battery metals (such as nickel, lithium and cobalt)
#cars #EV #nickel #lithium #cobalt
https://metals-wire.com:3000/news-reports
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Newcrest Mining 2H22 results - EBITDA disappoints
📝The miner's CY 2H22 revenues were moderately below consensus and us (by 4% and 6%, respectively). The EBITDA miss was even deeper (-18% vs consensus and -8% vs. us), mostly due to the >15% higher than expected cost per ton at Newcrest's top-producing Cadia and Lihir assets
📌The company reiterated its FY23 guidance, with CY 1H23 copper and gold production both growing by some 15% HoH
💰Meanwhile, the company has declared an upbeat USD 0.35/sh dividend (interim + special) to be paid in March 2023, which implies a good 2.1% DY
📌At spot, taking into account potentially higher output and commodity prices, we expect Newcrest's CY 1H23F EBITDA to materially improve HoH
#NCM #copper
https://metals-wire.com/company/NCM_AU/
📝The miner's CY 2H22 revenues were moderately below consensus and us (by 4% and 6%, respectively). The EBITDA miss was even deeper (-18% vs consensus and -8% vs. us), mostly due to the >15% higher than expected cost per ton at Newcrest's top-producing Cadia and Lihir assets
📌The company reiterated its FY23 guidance, with CY 1H23 copper and gold production both growing by some 15% HoH
💰Meanwhile, the company has declared an upbeat USD 0.35/sh dividend (interim + special) to be paid in March 2023, which implies a good 2.1% DY
📌At spot, taking into account potentially higher output and commodity prices, we expect Newcrest's CY 1H23F EBITDA to materially improve HoH
#NCM #copper
https://metals-wire.com/company/NCM_AU/
South32 2H22 results - overall positive
📝The company's underlying revenues in CY 2H22 were slightly weaker than we had expected (-4% vs. us, and in-line with the consensus). At the same time, EBITDA was better (+6% vs. consensus and +9% vs. us), due to lower costs per ton across the main divisions and positive inter-group adjustments
📌Meanwhile, the miner's FY23 production guidance remains unchanged: CY 1H23 aluminium and coal output is to grow 5% and 10% HoH, respectively
📌On our numbers, at spot, South32's CY 1H23F EBITDA is to enjoy double-digit growth HoH, amid the guided production increase and the recent recovery in coking coal and nickel prices
#S32 #aluminium
https://metals-wire.com/company/S32_AU/
📝The company's underlying revenues in CY 2H22 were slightly weaker than we had expected (-4% vs. us, and in-line with the consensus). At the same time, EBITDA was better (+6% vs. consensus and +9% vs. us), due to lower costs per ton across the main divisions and positive inter-group adjustments
📌Meanwhile, the miner's FY23 production guidance remains unchanged: CY 1H23 aluminium and coal output is to grow 5% and 10% HoH, respectively
📌On our numbers, at spot, South32's CY 1H23F EBITDA is to enjoy double-digit growth HoH, amid the guided production increase and the recent recovery in coking coal and nickel prices
#S32 #aluminium
https://metals-wire.com/company/S32_AU/
Morning Bites
🔗CISA mills daily crude steel production grew 3.8% to 2.06mnt in early-February, from the last ten days of January. This was 7.2% higher YoY, vs. the 1.3% YoY decline in the previous ten days. Meanwhile, local steel inventories grew 9.4% over the period (7.0% above the 2022 level, as of 10 February), which implies that the local demand for steel is still rather weak. We remind our readers that China has recently published strong financial data for January (historically, the most important month). That, in our view, might bolster domestic construction activity and, hence, demand for industrial metals in 2023
#steel
https://metals-wire.com/sector/Steel
🔗CISA mills daily crude steel production grew 3.8% to 2.06mnt in early-February, from the last ten days of January. This was 7.2% higher YoY, vs. the 1.3% YoY decline in the previous ten days. Meanwhile, local steel inventories grew 9.4% over the period (7.0% above the 2022 level, as of 10 February), which implies that the local demand for steel is still rather weak. We remind our readers that China has recently published strong financial data for January (historically, the most important month). That, in our view, might bolster domestic construction activity and, hence, demand for industrial metals in 2023
#steel
https://metals-wire.com/sector/Steel
Vale 4Q22 results - above market expectations
📝Vale's revenues in 4Q22 were stronger than both our and consensus expectations (by 8% and 5%, respectively), mostly due to a realised iron ore price that was >10% above our forecast. Despite the stronger top-line figure, cash costs per ton increased even more, which limited the positive effect on EBITDA (+3% vs. consensus and -1% vs. us)
⛏To recap, the company expects to increase iron ore production 2% YoY in 2023. However, nickel output is likely to shrink 6% YoY, due to depletion of the Ovoid mine and expansion delays
💰The company's BoD has approved USD 1.6bn of dividends to be paid in March 2023, which implies a DY of some 2.0%
📌On our numbers, at spot, Vale's 1Q23F EBITDA might be materially stronger QoQ, supported by the recent recovery in iron ore prices
#VALE #Iron_ore
https://metals-wire.com/company/VALE_US/
📝Vale's revenues in 4Q22 were stronger than both our and consensus expectations (by 8% and 5%, respectively), mostly due to a realised iron ore price that was >10% above our forecast. Despite the stronger top-line figure, cash costs per ton increased even more, which limited the positive effect on EBITDA (+3% vs. consensus and -1% vs. us)
⛏To recap, the company expects to increase iron ore production 2% YoY in 2023. However, nickel output is likely to shrink 6% YoY, due to depletion of the Ovoid mine and expansion delays
💰The company's BoD has approved USD 1.6bn of dividends to be paid in March 2023, which implies a DY of some 2.0%
📌On our numbers, at spot, Vale's 1Q23F EBITDA might be materially stronger QoQ, supported by the recent recovery in iron ore prices
#VALE #Iron_ore
https://metals-wire.com/company/VALE_US/
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Agnico Eagle 4Q22 results - missed forecasts
📝The goldminer posted weaker 4Q22 revenues than the consensus and we had expected (by 3% and 6%, respectively), driven by lower grades at several mines. The EBITDA miss was more dramatic (-5% vs consensus and -15% vs. us), affected by >5% higher cash costs per ounce
⛏According to Agnico's production guidance, its gold output is likely to be 6% and 10% higher (on average) in 2023 and 2024, respectively, than in FY22
📈However, the company sees an increase of ~9% YoY in total cash costs per ounce in 2023, due to inflationary pressures. Management expects this figure to decline in 2024-25
📌At spot, we expect Agnico Eagle's 1Q23F EBITDA to show some improvement QoQ, bolstered by higher gold prices and the slight production recovery
#AEM #gold
https://metals-wire.com/company/AEM_US/
📝The goldminer posted weaker 4Q22 revenues than the consensus and we had expected (by 3% and 6%, respectively), driven by lower grades at several mines. The EBITDA miss was more dramatic (-5% vs consensus and -15% vs. us), affected by >5% higher cash costs per ounce
⛏According to Agnico's production guidance, its gold output is likely to be 6% and 10% higher (on average) in 2023 and 2024, respectively, than in FY22
📈However, the company sees an increase of ~9% YoY in total cash costs per ounce in 2023, due to inflationary pressures. Management expects this figure to decline in 2024-25
📌At spot, we expect Agnico Eagle's 1Q23F EBITDA to show some improvement QoQ, bolstered by higher gold prices and the slight production recovery
#AEM #gold
https://metals-wire.com/company/AEM_US/
Week ahead data releases in M&M
This week, many global M&M names are to report their financials. We believe that the consensus is slightly bullish in its profitability forecasts for large miners, such as BHP, Rio Tinto and Anglo American
#reporting_season
https://metals-wire.com:3000/events
This week, many global M&M names are to report their financials. We believe that the consensus is slightly bullish in its profitability forecasts for large miners, such as BHP, Rio Tinto and Anglo American
#reporting_season
https://metals-wire.com:3000/events
Morning Bites (part 1)
💎India’s rough diamond net imports fell 33% YoY in January, accelerating from the -27% YoY in December. Simultaneously, India’s polished diamond net exports declined 31% YoY (vs. -28% YoY in December). According to GJEPC Chairman Vipul Shah, Surat's diamond manufacturers (~90% of global polished stones supply) are working at 60% capacity, with ~20,000 employees laid off, as orders have dried up – particularly, from the US. Hence, we reiterate our view that the diamond sector is likely to remain stressed (at least in the short term), amid unfavourable macroeconomic conditions globally and the material decrease in De Beers’ recent rough sales
Meanwhile, India’s lab-grown rough diamond net imports decreased 8% YoY in January (vs. 12% YoY in December). However, the share of lab-grown net rough imports in natural diamond imports jumped to 17% in January (vs. 12% a year ago)
#diamonds
https://metals-wire.com/sector/Diamonds
💎India’s rough diamond net imports fell 33% YoY in January, accelerating from the -27% YoY in December. Simultaneously, India’s polished diamond net exports declined 31% YoY (vs. -28% YoY in December). According to GJEPC Chairman Vipul Shah, Surat's diamond manufacturers (~90% of global polished stones supply) are working at 60% capacity, with ~20,000 employees laid off, as orders have dried up – particularly, from the US. Hence, we reiterate our view that the diamond sector is likely to remain stressed (at least in the short term), amid unfavourable macroeconomic conditions globally and the material decrease in De Beers’ recent rough sales
Meanwhile, India’s lab-grown rough diamond net imports decreased 8% YoY in January (vs. 12% YoY in December). However, the share of lab-grown net rough imports in natural diamond imports jumped to 17% in January (vs. 12% a year ago)
#diamonds
https://metals-wire.com/sector/Diamonds
Morning Bites (part 2)
⚡️Power use by Peru’s key copper mines has plunged in February, following the local political unrest, Reuters reports. Based on the country's energy data, MMG's Las Bambas (1.5% of world copper supply) and Glencore's Antapaccay (0.7%) mines are currently the most affected, consuming half of their normal power usage. Meanwhile, the dynamics at other major pits (e.g. Antamina and Cerro Verde) are quite stable. Overall, the news might add some support to the sentiment on copper, especially amid the historically low level of inventories and the potential recovery in China's demand
⛔️First Quantum's Panama copper mine might halt operations on 23 February, according to a Reuter's source. Overall, this is in line with the company's recent statement. To recap, Cobre Panama (1.5% of global copper output) is running out of storage space, as the local maritime authority has ordered the stoppage of metal loadings at port due to certification issues
#copper
https://metals-wire.com/sector/Copper
⚡️Power use by Peru’s key copper mines has plunged in February, following the local political unrest, Reuters reports. Based on the country's energy data, MMG's Las Bambas (1.5% of world copper supply) and Glencore's Antapaccay (0.7%) mines are currently the most affected, consuming half of their normal power usage. Meanwhile, the dynamics at other major pits (e.g. Antamina and Cerro Verde) are quite stable. Overall, the news might add some support to the sentiment on copper, especially amid the historically low level of inventories and the potential recovery in China's demand
⛔️First Quantum's Panama copper mine might halt operations on 23 February, according to a Reuter's source. Overall, this is in line with the company's recent statement. To recap, Cobre Panama (1.5% of global copper output) is running out of storage space, as the local maritime authority has ordered the stoppage of metal loadings at port due to certification issues
#copper
https://metals-wire.com/sector/Copper
Anglo American Platinum 2H22 results - overall weak
📝The PGM miner's 2H22 revenues came in slightly more upbeat than we had anticipated (-3% vs. consensus and +5% vs. us), supported by higher realised rhodium prices and the proceeds from purchased concentrate. However, the effect of costs pressure was more substantial, resulting in a rather weak EBITDA performance (-8% vs. consensus and -5% vs. us)
📈Overall, management sees a 9-16% YoY increase in cash costs per ounce in 2023, amid ongoing inflationary pressures
⛏This year, the company expects a deficit of 170kt (vs. the 570kt surplus in 2022) and 80kt (vs. the 480kt deficit) on the platinum and palladium markets, respectively. At the same time, rhodium is to remain in shortage (of 30kt)
📌On our numbers, at spot, Amplat's 1H23F EBITDA might face a low double-digit decline HoH, due to the recent correction in PGM prices
#AMS #PGMs
https://metals-wire.com/company/AMS_SJ/
📝The PGM miner's 2H22 revenues came in slightly more upbeat than we had anticipated (-3% vs. consensus and +5% vs. us), supported by higher realised rhodium prices and the proceeds from purchased concentrate. However, the effect of costs pressure was more substantial, resulting in a rather weak EBITDA performance (-8% vs. consensus and -5% vs. us)
📈Overall, management sees a 9-16% YoY increase in cash costs per ounce in 2023, amid ongoing inflationary pressures
⛏This year, the company expects a deficit of 170kt (vs. the 570kt surplus in 2022) and 80kt (vs. the 480kt deficit) on the platinum and palladium markets, respectively. At the same time, rhodium is to remain in shortage (of 30kt)
📌On our numbers, at spot, Amplat's 1H23F EBITDA might face a low double-digit decline HoH, due to the recent correction in PGM prices
#AMS #PGMs
https://metals-wire.com/company/AMS_SJ/
Morning Bites (part 1)
📈Global primary aluminium production rose 3% YoY in January, decelerating from the 6% YoY growth in December, the International Aluminium Institute (IAI) reports. Last month, Chinese aluminium output rose 6% YoY (+11% vs. the 2019 level), while ex-China production remained flat YoY (+2% vs. 2019)
🇨🇳China's Yunnan is to decrease its aluminium production further, Reuters reports. Over the weekend, the province was ordered to cut an additional 415kt of aluminium smelting capacity (0.6% of global supply), following the dry season. Meanwhile, according to Shanghai Metals Market (SMM), domestic power rationing might reduce Yunnan's Al output to 3.4mnt in February (vs. the ~4.0mnt level held since September 2022). Overall, the news is likely to have a slightly positive effect on the metal’s prices, especially amid low inventory levels
#aluminium
https://metals-wire.com/sector/Aluminium
📈Global primary aluminium production rose 3% YoY in January, decelerating from the 6% YoY growth in December, the International Aluminium Institute (IAI) reports. Last month, Chinese aluminium output rose 6% YoY (+11% vs. the 2019 level), while ex-China production remained flat YoY (+2% vs. 2019)
🇨🇳China's Yunnan is to decrease its aluminium production further, Reuters reports. Over the weekend, the province was ordered to cut an additional 415kt of aluminium smelting capacity (0.6% of global supply), following the dry season. Meanwhile, according to Shanghai Metals Market (SMM), domestic power rationing might reduce Yunnan's Al output to 3.4mnt in February (vs. the ~4.0mnt level held since September 2022). Overall, the news is likely to have a slightly positive effect on the metal’s prices, especially amid low inventory levels
#aluminium
https://metals-wire.com/sector/Aluminium
Morning Bites (part 2)
💎De Beers has again raised its small rough diamonds prices ~10%, Rapaport reports, citing buyers and insiders at the miner’s 2nd cycle. The increase applied to goods weighing around 0.03ct across different qualities. To recap, the company previously increased small diamonds prices by the same 10% at its January sight. In our view, the dynamics might reflect some lagged effect from the closure of Rio Tinto's big Argyle mine in late-2020 (there are no plans to reopen it) that produced mainly small-size stones. Overall, De Beers’ rough prices were still up ~3% YoY at its 2nd sales cycle in 2023, on our numbers
#diamonds
https://metals-wire.com/sector/Diamonds
💎De Beers has again raised its small rough diamonds prices ~10%, Rapaport reports, citing buyers and insiders at the miner’s 2nd cycle. The increase applied to goods weighing around 0.03ct across different qualities. To recap, the company previously increased small diamonds prices by the same 10% at its January sight. In our view, the dynamics might reflect some lagged effect from the closure of Rio Tinto's big Argyle mine in late-2020 (there are no plans to reopen it) that produced mainly small-size stones. Overall, De Beers’ rough prices were still up ~3% YoY at its 2nd sales cycle in 2023, on our numbers
#diamonds
https://metals-wire.com/sector/Diamonds
BHP 2H22 results - EBITDA underperformed
📝In CY 2H22, the company's revenues were stronger than we had expected (+5% vs. us and -2% vs. consensus), due to higher proceeds from its iron ore segment. At the same time, EBITDA came in materially below the forecasts (-7% vs. consensus and -5% vs. us), due to substantial growth in unit cash costs (e.g., at Escondida copper mine, they exceeded our estimates by a double-digit margin)
🛒The company aims to sell its Daunia and Blackwater coking coal mines (24% of its total coal production), partly given the recent hike in Queensland's royalties, that affected the mines' financials
⛏According to the miner's guidance, its iron ore production might be down ~6% HoH in CY 1H23, while copper output might grow 7% over the period
📌On our numbers, at spot, BHP's CY 1H23F EBITDA might be materially stronger HoH, supported by the upbeat iron ore and copper prices
#BHP #iron_ore
https://metals-wire.com/company/BHP_AU/
📝In CY 2H22, the company's revenues were stronger than we had expected (+5% vs. us and -2% vs. consensus), due to higher proceeds from its iron ore segment. At the same time, EBITDA came in materially below the forecasts (-7% vs. consensus and -5% vs. us), due to substantial growth in unit cash costs (e.g., at Escondida copper mine, they exceeded our estimates by a double-digit margin)
🛒The company aims to sell its Daunia and Blackwater coking coal mines (24% of its total coal production), partly given the recent hike in Queensland's royalties, that affected the mines' financials
⛏According to the miner's guidance, its iron ore production might be down ~6% HoH in CY 1H23, while copper output might grow 7% over the period
📌On our numbers, at spot, BHP's CY 1H23F EBITDA might be materially stronger HoH, supported by the upbeat iron ore and copper prices
#BHP #iron_ore
https://metals-wire.com/company/BHP_AU/
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Antofagasta 2H22 results - slightly above market expectations
📝In 2H22, Antofagasta's revenues were stronger than both the consensus and our expectations (+1% and +5%, respectively), supported by higher realised prices and inflows from the transport division. As a result, the EBITDA figure also positively surprised (+1% vs. consensus and +7% vs. us)
⛏As previously announced, the group plans to increase copper production 3-10% YoY in 2023, reflecting the Los Pelambres mine expansion
💰The company's BoD has recommended a final dividend of USD 0.51/sh, which implies a DY of some 2.4%
📌On our numbers, at spot, Antofagasta's 1H23F EBITDA might enjoy low double-digit growth HoH, amid higher prices across its whole metals basket
#ANTO #copper
https://metals-wire.com/company/ANTO_LN/
📝In 2H22, Antofagasta's revenues were stronger than both the consensus and our expectations (+1% and +5%, respectively), supported by higher realised prices and inflows from the transport division. As a result, the EBITDA figure also positively surprised (+1% vs. consensus and +7% vs. us)
⛏As previously announced, the group plans to increase copper production 3-10% YoY in 2023, reflecting the Los Pelambres mine expansion
💰The company's BoD has recommended a final dividend of USD 0.51/sh, which implies a DY of some 2.4%
📌On our numbers, at spot, Antofagasta's 1H23F EBITDA might enjoy low double-digit growth HoH, amid higher prices across its whole metals basket
#ANTO #copper
https://metals-wire.com/company/ANTO_LN/
Teck 4Q22 results - unpleasant surprise
📝The miner's 4Q22 revenues came in weaker than we had expected (-18% vs. us and -7% vs. consensus), as the company missed its FY22 copper and coal guidance. Hence, sales of the commodities underperformed our estimates by 6% and 17%, respectively. Consequently, EBITDA was quite discouraging (-13% vs. consensus and -17% vs. us)
⛏According to the miner's FY23 guidance, copper output is estimated to jump >40% YoY, following the ramp up of the Quebrada Blanca project (its production outlook remains roughly unchanged). Meanwhile, coking coal production is set to increase 10-20% YoY (marginally lower than the previous guidance)
📌On our numbers, at spot, Teck's 1Q23F EBITDA might materially recover QoQ, bolstered by the potential growth in production, as well as elevated coking coal and copper prices
#TECK #copper
https://metals-wire.com/company/TECK_US/
📝The miner's 4Q22 revenues came in weaker than we had expected (-18% vs. us and -7% vs. consensus), as the company missed its FY22 copper and coal guidance. Hence, sales of the commodities underperformed our estimates by 6% and 17%, respectively. Consequently, EBITDA was quite discouraging (-13% vs. consensus and -17% vs. us)
⛏According to the miner's FY23 guidance, copper output is estimated to jump >40% YoY, following the ramp up of the Quebrada Blanca project (its production outlook remains roughly unchanged). Meanwhile, coking coal production is set to increase 10-20% YoY (marginally lower than the previous guidance)
📌On our numbers, at spot, Teck's 1Q23F EBITDA might materially recover QoQ, bolstered by the potential growth in production, as well as elevated coking coal and copper prices
#TECK #copper
https://metals-wire.com/company/TECK_US/
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Morning Bites
🚘EU + UK passenger car registrations rose 12% YoY in January, slightly decelerating from the 13% YoY gain in December. The results were in line with our estimates. However, the figure was still 25% below the pre-COVID 2019 level (-16% in December), with most of the YoY growth due to the low base effect. Hence, we reiterate our view that EU car sales are likely to remain subdued in the near future, following the unfavourable macroeconomic conditions globally. Overall, this might add some stress to the demand for PGM from the auto industry
#cars
https://metals-wire.com:3000/sector/PGM
🚘EU + UK passenger car registrations rose 12% YoY in January, slightly decelerating from the 13% YoY gain in December. The results were in line with our estimates. However, the figure was still 25% below the pre-COVID 2019 level (-16% in December), with most of the YoY growth due to the low base effect. Hence, we reiterate our view that EU car sales are likely to remain subdued in the near future, following the unfavourable macroeconomic conditions globally. Overall, this might add some stress to the demand for PGM from the auto industry
#cars
https://metals-wire.com:3000/sector/PGM
Rio Tinto 2H22 results - EBITDA in-line with consensus
📝The miner's revenues in 2H22 were stronger than both our and consensus expectations (by 3% and 6%, respectively), bolstered by higher realised iron ore and copper prices. As a result, EBITDA was also slightly more upbeat (+4% vs. us and in-line with consensus)
⛏According to Rio's recently announced FY23 guidance, its iron ore shipments are to increase up to 4% YoY, while aluminium output is to grow 3-10% YoY
💰Management has declared a final dividend of USD 2.25/sh (~2.9% DY), taking Rio Tinto's full-year dividend to USD 4.92/sh. Overall, this is substantially lower than the record payment of USD 10.40/sh for 2021
📌On our numbers, at spot, Rio Tinto's 1H23F EBITDA will be materially higher HoH, amid the recent recovery in iron ore prices, as well as lower transportation costs
#RIO #Iron_ore
https://metals-wire.com/company/RIO_LN/
📝The miner's revenues in 2H22 were stronger than both our and consensus expectations (by 3% and 6%, respectively), bolstered by higher realised iron ore and copper prices. As a result, EBITDA was also slightly more upbeat (+4% vs. us and in-line with consensus)
⛏According to Rio's recently announced FY23 guidance, its iron ore shipments are to increase up to 4% YoY, while aluminium output is to grow 3-10% YoY
💰Management has declared a final dividend of USD 2.25/sh (~2.9% DY), taking Rio Tinto's full-year dividend to USD 4.92/sh. Overall, this is substantially lower than the record payment of USD 10.40/sh for 2021
📌On our numbers, at spot, Rio Tinto's 1H23F EBITDA will be materially higher HoH, amid the recent recovery in iron ore prices, as well as lower transportation costs
#RIO #Iron_ore
https://metals-wire.com/company/RIO_LN/
Morning Bites
🔗Global crude steel output was down 3% YoY to 145mnt in January, decelerating from the 11% YoY decline in December, according to the World Steel Association. Meanwhile, the 2% YoY growth in China's output (55% of global steel supply in January) was likely due to the low base effect from production curbs a year ago. Ex-China steel output shrank 9% YoY (vs. -13% YoY in December). Steel output in the EU declined further, by 15% YoY (vs. -18% YoY), amid the local energy crisis. US steel production decreased 10% YoY (the same YoY dynamics as in December). The data also shows that the drop in Russia’s steel output decelerated to 9% YoY in January, from -17% YoY in December
📌To recap, China has recently published strong financial data for January (historically, the most important month). In our view, that might support domestic construction activity and, hence, the demand for industrial metals in 2023
#steel
https://metals-wire.com:3000/sector/Steel
🔗Global crude steel output was down 3% YoY to 145mnt in January, decelerating from the 11% YoY decline in December, according to the World Steel Association. Meanwhile, the 2% YoY growth in China's output (55% of global steel supply in January) was likely due to the low base effect from production curbs a year ago. Ex-China steel output shrank 9% YoY (vs. -13% YoY in December). Steel output in the EU declined further, by 15% YoY (vs. -18% YoY), amid the local energy crisis. US steel production decreased 10% YoY (the same YoY dynamics as in December). The data also shows that the drop in Russia’s steel output decelerated to 9% YoY in January, from -17% YoY in December
📌To recap, China has recently published strong financial data for January (historically, the most important month). In our view, that might support domestic construction activity and, hence, the demand for industrial metals in 2023
#steel
https://metals-wire.com:3000/sector/Steel
Week ahead data releases in M&M
As the reporting season continues, several major M&M names are to report their earnings. For the PGM miners publishing this week (Sibanye and Impala), our EBITDA forecast is slightly below the consensus. For other producers, our outlook is more upbeat
#reporting_season
https://metals-wire.com:3000/events
As the reporting season continues, several major M&M names are to report their earnings. For the PGM miners publishing this week (Sibanye and Impala), our EBITDA forecast is slightly below the consensus. For other producers, our outlook is more upbeat
#reporting_season
https://metals-wire.com:3000/events
Morning Bites (part 1)
🔗CISA mills daily crude steel production grew 1.5% to 2.09mnt in mid-February, from the first ten days of the month. This was 10.2% higher YoY, vs. the 7.2% YoY growth in the previous ten days. Meanwhile, local steel stock increased 8.3% over the period (15.5% above the 2022 level, as of 20 February), which implies that domestic demand for steel remains soft. To recap, China has recently published strong financing data for January (historically, the most important month). That, in our view, might support domestic construction activity and, hence, demand for industrial metals in 2023 (e.g. steel and base metals)
#steel
https://metals-wire.com/sector/Steel
🔗CISA mills daily crude steel production grew 1.5% to 2.09mnt in mid-February, from the first ten days of the month. This was 10.2% higher YoY, vs. the 7.2% YoY growth in the previous ten days. Meanwhile, local steel stock increased 8.3% over the period (15.5% above the 2022 level, as of 20 February), which implies that domestic demand for steel remains soft. To recap, China has recently published strong financing data for January (historically, the most important month). That, in our view, might support domestic construction activity and, hence, demand for industrial metals in 2023 (e.g. steel and base metals)
#steel
https://metals-wire.com/sector/Steel
Morning Bites (part 2)
🏗China’s excavator sales fell 33% YoY in January (domestic + export), after the 30% YoY drop in December. We note that the decline was sharper than envisaged by the previous estimate from SteelOrbis. Meanwhile, domestic excavator sales shrank 59% YoY, after the 60% YoY fall in December, amid the Covid-19 effects and unfavourable market conditions. The still weak domestic sales imply no short-term recovery in the stagnating Chinese real estate segment. However, the country’s strong liquidity injections data for January might add support to the local demand for industrial metals in 2023, in our view
📈Russia’s gold output dropped 9.6% YoY in January, after the 9.3% YoY growth in December, according to Rosstat. Overall, some slowdown in Russia's production (~9% of global gold mined output) is favourable for our positive view on the yellow metal's price, bolstered by the strong prospects for demand
#steel #gold
https://metals-wire.com:3000/news-reports
🏗China’s excavator sales fell 33% YoY in January (domestic + export), after the 30% YoY drop in December. We note that the decline was sharper than envisaged by the previous estimate from SteelOrbis. Meanwhile, domestic excavator sales shrank 59% YoY, after the 60% YoY fall in December, amid the Covid-19 effects and unfavourable market conditions. The still weak domestic sales imply no short-term recovery in the stagnating Chinese real estate segment. However, the country’s strong liquidity injections data for January might add support to the local demand for industrial metals in 2023, in our view
📈Russia’s gold output dropped 9.6% YoY in January, after the 9.3% YoY growth in December, according to Rosstat. Overall, some slowdown in Russia's production (~9% of global gold mined output) is favourable for our positive view on the yellow metal's price, bolstered by the strong prospects for demand
#steel #gold
https://metals-wire.com:3000/news-reports