00:00I was just wondering whether with Lunar New Year, a key source of demand for many of these metals
00:05that are listed behind me is actually dissipated because many of those retail buyers and the buyers
00:11coming through from China are actually on holiday now. Yeah, we've actually seen retail buying
00:18has been quite strong, but certainly the holidays do have an effect across all our markets actually
00:25because China is such a key component, particularly in copper, etc. And we also have this problem this
00:31time of year. We don't really get data in January because of New Year and then February. So we're
00:36really in a bit of a around actual demand indicators, etc. We're in a bit of a hole at the
00:41moment where
00:42we don't really get a good idea of how demand is going to be really until March.
00:49So I want to talk to you about, you know, some of the supply demand dynamics that are taking
00:54place. And copper, I think, is a very interesting one. This is, you know, I was reading up about
01:01some of the pieces that my colleagues put up together. Inventories and stockpiles have actually
01:06been growing and we're looking at the highest level of stockpiles since last March. So you combine
01:11the backdrop of higher inventory alongside the fact that, you know, your typical marginal buyer is
01:18going to be out for the next 10 days or so. And do you see room for perhaps more downward
01:23pressure
01:24to be exerted on copper at this point? And it's quite simply that the rally has run its course.
01:31It's certainly possible. And clearly, there's been a lot of focus on the rise of inventories.
01:37The thing with inventories today is you also have to look where they are. And the majority of them
01:43today sit in the States. We've had a massive rise in COMEX inventories where copper has been dragged to
01:49the States by the threat of tariffs. We don't have tariffs, but the threat that they might come in
01:54has made people move copper to the States just in case they do. And we've had COMEX pricing higher.
02:00So whilst inventories overall look higher than they've been for a while or visible inventories,
02:06many are in the States. And I think a lot of copper has been moved there and therefore is more
02:11visible,
02:12frankly. So counter to that is obviously you've had the States talk about building strategic stockpiles
02:20and China countered that the same, but they might do as well. And they do have a
02:25strategic reserve bureau whose job is to do that. So there is obviously on the other hand speculation
02:31that we might have countries building stockpiles of copper and therefore these inventories can rise,
02:37but they're not available to the market. Okay, that's interesting. So sort of restrictions being
02:44put up. To what extent is the move that we're seeing in many of these precious and industrial
02:51metals also dictated by macro and the flight away from the USD, you know, rotation under the surface and
03:00S&P away from some AI sectors towards materials. How much of that do you think is driving some of
03:06the
03:06most recent performance? I think if you look year to date, there's definitely that is part of the
03:12part of the reason we've seen this performance year to date. You know, simply put, we've seen
03:17in the equity markets, it's been the large companies who have performed well. And that's normally a signal
03:23you've got generalist money looking to rotate that money tends to go to the big liquid names, first of
03:29all. And we've seen in oil mining agriculture, we've seen those names doing quite well. So it's
03:36definitely, you know, the market saying I want somewhere that won't be affected by AI or only
03:41positively. And clearly, metals mining resources generally, you can't AI them away. So we've
03:49definitely seen that move. The question, of course, we face now is, are we in the early stages of that
03:55move? Or is that something that's happened? I think when we look at the fundamentals of our
04:00markets, they're still pretty positive. We're seeing good growth come through around the world.
04:05We obviously need to see how China performs coming out of New Year. But I think, yeah,
04:10this move in some ways, we would say, well, we sort of expected it to come because valuations
04:15weren't that high. And the market's looking for places which aren't under threat, but also offer
04:20good value. Yeah. So, George, it's also been a big week for reports for earnings coming through
04:29from some of the big miners, BHP and Safagasta, some of the names that have come through. How much of
04:34their results have driven purely by the run up in prices that we've seen in copper?
04:43Copper price rises have certainly helped. And we saw good results yesterday from
04:47Antifagasta and BHP. They both beat on results and cash flow, etc. We've got all the majors
04:54reporting this week, Glencore, Rio, Anglo, Tech are all coming through later this week and
04:59we'd probably expect to see the same. I think if there's a theme, and BHP really highlighted that,
05:05is that precious metals byproducts have been a really important driver of earnings. And these,
05:12you know, often in copper miners, people ignore them, but they do have,
05:15many have significant gold, silver byproducts. BHP highlighted it by actually even selling a silver
05:21stream on one of their mines that they have a minority stake in Peru at Antimena to Wheaton
05:28for 4.3 billion upfront, plus ongoing payments. So, that was done really just to highlight the
05:36question we have is why BHP actually needs that cash. The net debt is under control with this and
05:43other infrastructure they've sold. They appear to be building up cash and net debt is going to be
05:48be way below their target range. Yeah.
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