COBALT October 2018

The cobalt price halted its decline of recent months with the September average price of US$66,334/t up 6.6% month on month. This is well below the month-average high of US$90,421/t that was reached on the back of speculative activity in May.

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OIL & GAS FOCUS October 2018

Gas in all regions was on an upwards price trajectory at the end of September as markets headed into the northern autumn season. Prices of Canadian heavy crude sold as WCS hit a high of US$55.27/bbl in May, but finished September at US$37.50/bbl.

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LNG October 2018

Over the next 18 months global prices are expected to correct, particularly under the influence of increased pipeline supplies into Europe. In the US, the forecast price increase is in response to new liquefaction capacity that will be coming online in the US, drawing on domestic stocks. East Asian prices are forecast to increase by 8-15%, but upside risk remains.

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METALLURGICAL COAL November 2018

Positive price movements continued in October, fuelled by supply disruptions caused by the force majeure declared at Peabody’s North Goonyella mine, with spot prices increasing from a low of US$202/t to end the month at US$219/t. Metallurgical coal prices are expected to remain well supported throughout the December Quarter, driven by the continued outage at North Goonyella, port congestion and extended maintenance at Dalrymple Bay and Hay Point, as well as the potential impacts from the impending Queensland wet season.

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OIL REFINERIES October 2018

The short-term products market will be characterised by the upward movement of crude oil prices and the shift towards complexity, as refiners reconfigure units downstream of distillation. This is to provide greater depth of conversion to achieve increased light-fuel yields.

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THERMAL COAL November 2018

Analysing October, the average spot price for premium Newcastle 6300 thermal coal fell for the fourth month straight to reach US$108/t, down 5.3% month on month. Prices steadily declined throughout the month, with the weaker yuan incentivising Chinese end users to source product from the domestic market. China’s domestic coal production has also increased in September–October to take advantage of the rise in demand and favourable domestic pricing, causing additional end users to revert to domestic cargoes.

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IRON ORE November 2018

In the short term we expect the Chinese government will act to support the economy against impacts of the trade dispute with the US. AME expects global iron ore demand to grow by 4.1% and 1.3% in 2018 and 2019 respectively. Global iron ore supply is expected to grow by 2.2% in 2018 and outpace demand at 2.4% growth in 2019.

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STEEL October 2018

Steel demand growth in China is expected to end 2018 up by 4.7%, supported by growth in the real estate market despite efforts to reduce leverage, while government support for the economy to counter to the effects of the trade dispute with the US is expected to provide upside in the near-term.

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COPPER November 2018

Copper prices over the year have remained elevated with the refined copper market in a deficit of 283kt, 64kt higher than 2017. The deficit has widened as annual demand growth of 1.9% outpaces production growth of 1.7%. Demand growth has been kept positive in 2018 by China, who is reporting higher output in consumer durables.

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NICKEL October 2018

A finished nickel market deficit of 142kt is forecast in 2018 on continued strong demand growth of 6.9% to 2.34Mt and production growth of 6.7%. In 2019, the market is forecast to return to balance with a small finished nickel surplus of 26kt.

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ZINC & LEAD November 2018

Price growth over the year has been muted, particularly in the second half of 2018, driven chiefly by waning downstream demand from galvanisers, which stems from ongoing trade disputes between the US and its trading partners.

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ALUMINIUM November 2018

In October, the aluminium price declined 5.3% to US$1,943/t (US88.1¢/lb). This is below the level seen prior to Rusal sanctions, US import tariffs and alumina supply concerns unsettled the market earlier in the year. Price declines are linked to concern over US-China trade tensions generating a general slowdown in commodity markets as traders take a more cautious approach. Prices outside China averaged US$2,031/t (US92.1¢/lb), relatively steady month on month.

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