Standard Chartered comments:
- While costs will have fallen for many producers operating in countries wherecurrencies have depreciated versus the USD, there remains little flexibility on the supply-side of base-metal markets, with only aluminium offering a clear risk from spare primary smelting capacity.
- Moreover, we project deficits for the majority of the complex in 2015, so prices should be trading above the cost curves to incentivise producer investment.
- Over the longer term, supply-side investment may benefit, but the dividend in terms of production growth will not likely be felt until the end of this decade at the earliest.
The material has been provided by InstaForex Company – www.instaforex.com