Copyright © 2006 by Ana Minerva Bonilla Updated: August 29, 2006 12:37
Reprinted by permission at http://theweekendminer.com
THE WEEKEND MINER
Rediscovering American Mineral Resources
THOUGHTS FROM THE “OLD MINER”
Where Do I Get Information On Metal Prices
Close behind questions related to our use of GPS coordinates, is the question “Where can I get current metal prices”? The answer, as usual, varies, with the metal or mineral you are looking for. While I am not really an expert on this subject, I will try to give you what I know about basic sources of information.
The first group would be the metals traded on the major international exchanges. The first such exchange to cover would be the “grand daddy of them all”, the London Metal Exchange. Metals traded via an “open outcry system”, are Aluminum, High Grade (pure) and Alloy, which is roughly a 380 and a special North American alloy called NASAAC, also roughly 380 – just a different location; Copper; Lead; Nickel; Tin and Zinc. Also traded are an “LME Index” and a couple of types of plastic, which have been recently added. They have a website at www.lme.com which will give you prices as of yesterday’s close. Unless you are trading, that should be plenty current; and, its free. Live data is available, at a price.
Navigating the site, especially the home page is not easy. Old alchemist’s (today called apothecary) symbols are used to identify the metals, and the logic tree is sometimes a little hard to understand – but then it is British. If you place you cursor on the symbols a pop-up label will show you what they are. From left to right they represent Aluminum Alloy (world), Aluminum (pure), Copper, Lead, the LME Index, NASAAC, Nickel, Tin, Zinc, and a couple plastics, Polypropylene and Linear Low-Density Polyethylene.
Getting to the pricing is a little complex. First, click on one of the symbols, say Copper, which is the medieval female symbol, the mirror of Venus. This will take you to the Copper Metal Page, where you find prices for the last completed day of trading. To get historical data; on the Metal Page, click on Market Data, in the box, to the upper left. That takes you to a Market Data page. On the Market Data page, click on View LME Data. That takes you to a page called Free LME Data. There click on Daily Stocks and Prices: Metals, which is sort of in the upper middle of the page. That gives you the last completed (closing) day pricing for all of the metals on the London Metal Exchange. You can go back as far as about the current calendar year, sometimes longer, by going to the bottom of the page and selecting the date you want.
I don’t know how much you know about pricing on the Exchanges, but you will notice a number of different prices. There are “Cash”, “3-Month”, “15-month” and “27-month” prices. Cash or Settlement is the basis that a person pays for Copper in the Market. I say “basis” because there is often a “Delivery Premium” of a few cents added to the price of the Copper cathode.
The “3-month” price has the interesting history. I have been told the following as truth, by people who should know; and, on that basis, I relate it to you. The London Metal Exchange was founded in the mid-to-late1870’s, initially as a market for Tin and shortly thereafter, for Copper. At that time it took a ship carrying Straits Tin about three months to get from Malaysia to England via the southern tip of Africa; the Cape of Good Hope. For Copper, the three-month period also was about the time it took to get from Chile and Peru to England, via Cape Horn, South America. If it was known when a ship was supposed to sail with a cargo, it could be sold on that theoretical sailing day in London, for delivery upon arrival, three months later. The date of delivery became known as the “prompt” date.
The fact that metal has an extended “shelf life” allowed the sale of future cargoes one and two years in advance. Add the three months to one and two years and you get the time period of the “future contracts”. This logic wouldn’t work as well for agricultural goods as the focus period here was “the next harvest”. For the metals however, it worked and continues to work well.
There are other things on the LME website that may be of interest. There is a list of the LME warehouses around the world, LME-approved assayers, a description of the specifications of metals traded, a nice history of the LME (a lot better, but a lot longer than mine), and a number of other interesting items.
In the United States we have our own exchanges, called the NYMEX (New York Mercantile Exchange) and the COMEX (Commodity Exchange of New York), which have merged in the last few years. The merged exchange trades Copper, Silver, Gold, Crude Oil, Gasoline, Heating Oil, Natural Gas, Propane, and some variations of these. You can access the data at www.nymex.com . The home page of the NYMEX is a little easier to use. Under the picture of the trading floor, the commodities handled are divided into two groups, Energy and Metals. The metals are on the right, in blue-gray background, boxes. If you place your cursor on an individual box, what it is shows up just beneath the row of boxes. Some of these symbols are pretty logical. The stack of ingots is Gold, the knife and fork is Silver, the three rolls (I never have quite figured out what that is) are Copper, the can is Aluminum, the thing that looks like a CD is Platinum, and the thing on the right – which looks sort of like a battery, is Palladium.
To get current and recent pricing history, go to the boxes just under Market Data Overview, in the upper right part of the page. As you place your cursor on each of them, just below a small price graph appears. Prices for some of the major commodities and their change since the prior close are shown just below.
If you go to the boxes under the picture of the trading floor and click on the box for the individual metal (or energy product) it will give you more data on the metal than most of us want. It is a great resource though, and it’s free.
Why two different exchanges? Probably there are many reasons, but three major ones are: time zones, accessibility and different products.
New York, whatever your opinion of the city is, is a major financial center. The financial community needed an exchange that was open during the working hours in New York. Since London is 5 or 6 hours ahead of New York, depending on Daylight Savings Time, getting up at 3:00 AM for the open of the LME wasn’t real popular with the “9 to 5 financial types”; so, they started their own exchange. Having it local, right in the New York Financial District made it easy to access. The Exchanges mostly trade different products, with Copper and Aluminum being exceptions, as they are traded on both.
There are other ways to get the data, without having to pay for it, along with news concerning the various major metals. Three of my favorite websites are www.kitco.com , www.basemetals.com , and www.thebulliondesk.com . These sites are loaded with data (and advertising) and you can spend hours on them reading industry articles and the like. An interesting thing on Kitco: go to the bottom of the page and hit “sell prices”. It takes you to a page where you can sell silver and gold, in coin, bullion and other forms, and gives you current paying prices.
For those of you who like “the printed form”, there are three I really like and use, but these are expensive. You might want to check with your local library to see if they have any of them. Platt’s Metals Week and Platt’s Metals Daily, which comes in both a LME Close and COMEX Close edition, contain weekly and/or daily prices, depending on which one you use. They contain Exchange prices for the traded metals and “Market” prices for other metals, like Cobalt, Ferromolybdenum, Selenium, etc. There is another, called Metal Bulletin, with a distinctly European focus, that is also very good. Ferrous, or iron an steel oriented, prices are in a daily paper called American Metal Market, along with various types of scrap and Exchange prices for the traded metals. This is pretty much the “Scrap Dealers Bible” when it comes to the Market prices for scrap.
What I don’t like about these publications though, is that many of their prices are developed by a phone survey of Market Participants, whose identity and quoted prices are unknown to the public. I really like the “open outcry”, sort of a public auction, used by the Exchanges. Someday, with computers we might be able to develop an on-line auction house facility for all of these metals and take some of the mystery out of pricing. Until then, these are probably the best tools we have.
These are but a few of the sources; they are the ones I use the most however. With the “Internet” data abounds – if you can find it. I hope this helps.