Weekly Mining Commentary

Author: Sid Rajeev, Head Of Research

Global equity indices remained relatively flat last week.

Among mainstream metals, nickel was the best performer, as inventory levels fell sharply on the SHFE (Shanghai).

Week-over-Week (May 3, 2021) and Year-over-Year (May 3, 2021)

Source: MarketWatch

LME Inventory (May 3, 2021) and SHFE Inventory(Apr 30, 2021)

Source: FRC/SHFE

Valuations of gold producers were down 5% WoW; base metal producers were down 1%.

Gold Producers and Base Metal Producers

Source: S&P Capital IQ & FRC

Among the top 15 hardest hit nations, only India reported a WoW increase in new COVID-19 cases last week. Five countries had reported increases in the prior week. Only 9.2% of India’s population has received a dose of vaccine. At current rates, we expect India to take 10 more months to vaccinate 50% of its population.

 

Daily New Cases in the U.S., Turkey, Colombia, India, U.K., Mexico

Source: https://www.worldometers.info/coronavirus/

Highly vaccinated nations such as the U.S., the U.K., and Israel, continued to report flat or declines in new cases. 44.0% of the U.S. population has received vaccinations (at least one dose) vs 41.9% at the same time last week. This compares to 50.8% in the U.K. (up from 49.6%), and 33.6% in Canada (up from 29.2%). Approximately 2,300 Canadians have contracted the virus two weeks after receiving their first dose of vaccine, or 1.3% of new cases since the vaccine rollout began. We believe this data clearly indicates the success of vaccines.

We continue to estimate that 50% of the U.S. population will be vaccinated by June. At current rates, we estimate that Germany/France/Italy are expected to reach 50% by July/August. South American countries are expected to hit 50% by October.

Share of people who received at least one dose of COVID-19 vaccine, May 2, 2021

Source: https://www.worldometers.info/coronavirus/

We are maintaining our metals price forecasts. As shown below, we expect gold and nickel to outperform other metals in H2-2021.

Weekly Mining Commentary

Author: Sid Rajeev, Head Of Research

Source: https://www.researchfrc.com/weekly-mining-commentary-65