7th February 2025
*Coal*
The downward trend persisted, with continued weakness in the physical Newcastle market weighing on swaps. Physical Newcastle cargoes for March 2025 loading traded $1.50 lower than yesterday’s level, generating further selling interest in short-dated NEWC swaps.
Meanwhile, European gas prices continued to climb, with the front-month contract rising another 2.5%. However, this upward momentum in gas failed to support API2 swaps, which declined in tandem with NEWC.
*Brent Crude Oil*
The crude oil market saw a modest rebound today, breaking a three-day losing streak, as the U.S. announced stricter sanctions on Iranian exports. Despite the upward movement, prices remain under pressure due to rising U.S. production. Ongoing U.S.-China trade tensions also weighed on sentiment, with Beijing imposing tariffs on American oil, LNG, and coal in retaliation for recent U.S. measures. However, the impact is expected to be limited, given China’s relatively small imports of U.S. energy products. As of 16:07 GMT, Brent crude is trading at $74.48, up 0.28% for the day.
*Dutch TTF Natural Gas*
Dutch TTF natural gas prices climbed higher today, driven by a combination of factors. A renewed cold snap from the ‘Beast from the East’ weather system and concerns over dwindling supplies have made it increasingly challenging to replenish natural gas stocks ahead of next winter. As of 16:23 GMT, Dutch TTF gas is trading at €55.73, up 2.95% for the day.
*Iron Ore*
Iron ore futures gained ground today, supported by stronger demand for finished steel products. The benchmark 62% Fe iron ore futures for March delivery on the SGX rose 1.35% to $106.23. Similarly, Dalian iron ore futures moved higher, with the most-traded I2505 contract closing at 817 yuan/mt, up 0.86% for the day.
Market activity remained moderate, with traders adjusting sales based on prevailing trends while steel mills purchased cautiously. Inquiries declined compared to the past two days. In Shandong, mainstream transaction prices for PB fines remained steady at 805-808 yuan/mt, unchanged from yesterday. In Tangshan, PB fines transaction prices edged up slightly to 820-825 yuan/mt, an increase of 0-5 yuan/mt from the previous session.
According to SMM data as of February 7, total inventory at 35 ports stood at 149.91 million mt, up 4.63 million mt from pre-holiday levels and 23.65 million mt higher year-on-year. The daily port pick-up volume of imported ore averaged 2.584 million mt, reflecting a decline of 610,000 mt from pre-holiday levels and 350,000 mt lower year-on-year. The Chinese New Year holiday prompted steel mills to pause restocking, causing a sharp drop in port pick-up volumes and a noticeable build-up of port inventories. Looking ahead, post-holiday restocking by steel mills is expected to increase port pick-up activity, potentially leading to a drawdown in inventories.
*Copper*
Copper prices hit a three-month high today as market participants assessed the initial exchange of tariffs between the U.S. and China. Optimism that the trade tensions may be less severe than previously feared, coupled with strong demand in the U.S., supported the metal’s gains. A significant premium remains between COMEX and LME copper contracts. As of 16:37 GMT, LME 3-month copper is trading at $9,398/mt, up 1.55% for the day.
In the Chinese market, downstream copper rod enterprises are gradually resuming production after the holiday, though in-plant inventories remain ample. Post-holiday social inventories continue to build. According to SMM data as of Thursday, February 6, copper inventories in major regions nationwide increased by 107,300 mt from pre-holiday levels to 273,100 mt. This is 12,600 mt lower than the 285,700 mt recorded after last year’s holiday. Overall trading activity remains subdued.
