Metal prices move up in July but decline slightly in August

The metal and mineral sub-index of Scotiabank rose slightly in July but the overall commodity price index dropped by a further 3.7% that month, the bank said in its latest monthly update. The all-items index was affected by sharply lower forest product and agricultural prices and a small decline in oil and gas prices.

Metal prices, which have been trading in a narrow range, moved lower in August, senior economist Patricia Mohr said. “Copper prices at US$1.03 per lb. and nickel at US$3.56 per lb. remain at profitable levels, while prices for zinc, lead and aluminum cover no more than average cash costs for Western world producers,” she said.

“Nickel has been buoyed by the strength of U.S. aircraft orders, continuing solid demand for stainless steel in Taiwan and Korea, and London Metal Exchange inventories which remain low compared with other base metals. However, stainless steel demand has waned in Europe and could slow in Japan later this year.”

The all-items index is off by 10.9%, and the metals sub-index is down by 12.8%, from one year ago.

The all-commodity index tracks export prices of a variety of Canadian commodities, which are weighted according to their 1984 export values, except crude oil where the value of net exports is used.