Declining metals prices contributed to a lower all-commodity price index in April, Scotiabank reported from Toronto. The index fell by 0.9% in April after a slight gain in March.
Gold, sulphur and coal prices declined in April. “Base metal prices also moved significantly lower in May and probably have not yet bottomed,” said senior economist Patricia Mohr.
While copper and nickel are at profitable levels, aluminum, zinc and lead prices cover no more than average cash costs for Western world producers, Mohr said.
“LME inventories of aluminum and zinc have risen to record highs and the market is probably anticipating a marked slowdown in economic growth in Germany and Japan. Strong metal consumption in these countries partly offset weaker North American and United Kingdom demand earlier in the year,” she said.
The metals and minerals sub-index fell slightly in April from March and is off by 5.7% from one year ago.
Mohr said industrial commodity prices (forestry, metals and oil and gas) all moved lower in April, offsetting a gain in agricultural prices.
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