Sustained improvement in demand: A key factor for upsides in metal stocks

The outlook seems less grim but there is still a question-mark around sustainable improvement in demand

Signs of green shoots in China’s trade data has led analysts tracking industrial metals to be cautiously optimistic about demand recovery. Refined copper imports rose 2 per cent year-on-year (Y-o-Y) to the highest levels since December 2021, China’s trade data for November 2023 showed. Steel and iron ore inventories are low and aluminium exports were up on a Y-o-Y-basis for the first time in calendar year 2023 (CY23). As the inventory for heating purposes piled up, China’s coal imports surged 35 per cent Y-o-Y.

Higher Chinese steel exports could temporarily lower global steel prices. But it may also be a