The Week in Metals (and Other Commodities)

Had enough yet, Mexico? This week, the Trump administration let up a bit and fixed its trade imbalance crosshairs on Germany. Yes, Germany, the country that brings you BMWs, Oktoberfest steins, lederhosen and dirndls and, according to National Trade Council Head Peter Navarro, an artificially low euro that it uses to dominate Europe and take advantage of exports to the U.S. Our own Stuart Burns points out that European economists have been saying the same thing about Germany and the euro for years.

The Tale of Klaus’ Bad Luck

Sometimes our lives are defined not by how well we deal with the cards that are dealt us, but by the cards themselves. For never was there a tale more full of woe than that of noble, honest Klaus Kleinfeld, who became Alcoa’s CEO just as global aluminum prices started to tank. Noble, honest Klaus worked hard to eke out profits in a bad commodity environment and even positioned Alcoa, and himself, to be liberated from the violent swings of commodity prices by investing in value-added aerospace and automotive products.

Kleinfeld even left Alcoa when the value-add business, Arconic, was spun off. Then commodity aluminum took off and the new Alcoa, Corp. is riding high … while activist Arconic investors are plotting was to sack poor honest, noble Klaus. Wait, were you expecting a happy ending? Ha, ha, ha, welcome to commodity metals!

The Philippines Cracks Down on Miners … Again

Speaking of new governments changing the trade landscape, President Rodrigo Duterte isn’t done flipping the script in the Philippines yet. His environment minister shut down more nickel mines this week and, in the process, threatened supply and pushed prices of the stainless steel active ingredient higher.

Approval of DAPL Would Help Access for Non-Oil Commodities

The two U.S. Senators from North Dakota said this week that the Dakota Access Pipeline is “days, not weeks” from approval by the U.S. Army Corps of Engineers. While them’s fightin’ words to the protestors who’ve spent most of the last year trying to block it, they’re music to the ears of producers of metals, grains and other commodities that can’t beg, borrow, steal or even hitch a ride on the last train out of town for their products. Oil companies have been monopolizing the tanker cars out of the Bakken shale for the last two years. So much for keeping it in the ground, eh?

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