The State of Nickel, Aluminum and Copper ETFs

March 5th at 12:00pm by Tom Lydon

If you were among those biting their nails about China’s belt-tightening, you may be able to let them grow back. The country said today that they were keeping fiscal policy on the loose side, helping spur demand for metals exchange traded funds (ETFs). 

China’s Premier Wen Jaibo is keeping the country on an light monetary stance while maintaining an active fiscal policy. The statements turned investors positive on China and reinforced the belief that the juggernaut will continue to be a major consumer of metals, reports Michael Taylor and Rebekah Curtis for Reuters. [A Guide to Metals ETFs.]

China is just one part of the base metals equation, albeit a large one. Let’s take a look at the big picture:

Nickel. The slump in nickel prices has been supplanted by stronger demand and low stock prices since the lows of last March. Price and volume recovery will depend upon patterns changing in both supply and demand in various parts of the world, says Metal Miner. Actual nickel production may  fall behind demand as the stainless steel industry increases usage, reports Anna Stabum for BusinessWeek. [What Influences Metals Prices?]

  • iPath DJ AIG Nickel ETN (NYSEArca: JJN)

Aluminum. Overall, the outlook for aluminum is improving, as prices and demand have both waned. The Australian on The Wall Street Journal reports aluminum prices are 55% higher than they were last year at this time.

  • iPath DJ-AIG Aluminum ETN (NYSEArca: JJU)

Copper. Copper scrap is now selling at all-time highs as high-grade electrolytic copper wire scrap, which feeds about 40% of world smelters of the metal, tends to become scarce as the Snowpocalypse delays collection, reports Anna Stabum for BusinessWeek.

Chile’s earthquake and numerous aftershocks could keep copper prices higher if transportation and production disruptions continue to be issues.

  • iPath DJ-UBS AIG Copper ETN (NYSEArca: JJC)

For more stories about metals, visit our metals and mining category.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

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