Commodities broker Sucden Financial has released its Quarterly Base Metals Report, which analyses and forecasts prices for aluminium, copper, lead, nickel, tin and zinc.
With the global economic outlook worsening, worries about the euro and the difficulty of forecasting real demand for commodities, Sucden is bearish on most base metals in the short term – except for copper and tin.
However, Sucden also expects more investors to move into metals. The broker noted an increased interest in metals derivatives, driven by high liquidity, and that zinc, especially, has been subject to speculation at the Shanghai Futures Exchange.
Aluminium, too, has been tied up to a large extent in financing deals, leading to stocks in London Metal Exchange warehouses being at a high level.
In 2009 LME stocks were equal to around 13% of global aluminium consumption. They have been falling since by a couple of percentage points, but Sucden said “the...