BIR World Mirror on Non-Ferrous Metals - Issue August/September 2015

Confidence at a premium in China

This summer wasn’t a good time for a vacation for most of us. The bubble bursting in China’s stock market, a prospect I had brought up in the last few issues, became a reality. Indeed, it fell off a cliff from 5000 points to below 2700 at one point, from where it had risen in October 2014. How could this happen? Or perhaps we should rephrase the question: what made the stock price soar when the economy was winding down?

Then, Beijing devalued the Chinese currency by 5% from RMB 6.12 to the US dollar to RMB 6.41 without any prior announcement, such that all importers suffered another 5% loss on top of already falling prices.

Both these developments triggered today’s very depressed market. Inventories are mounting in almost all Chinese importers’ yards while consumers are lacking confidence in the economy as well as in the leaders in Beijing. They are afraid that Beijing may devalue the RMB again without any warning.

From this issue, we have added a South East Asia report to our Mirror, which will help our members to get to know this emerging region in the non-ferrous market.

I hope to see you at the BIR World Recycling Convention in Prague.

by David Chiao
Uni-All Group Ltd (USA)
President of the Non-Ferrous Metals Division
7th September 2015

Read the full market report in our members' area.