Supply/Demand Balance and Stocks

摘要

The most important indicator of the short-term balance of the market is the total of producers' and LME stocks, referred to in this report as "identified stocks". From 1997 to early 2001 identified stocks were continuously below the level previously considered normal. For most of 2001 stocks were at normal levels, as cuts in production closely matched the weakening consumption. From the beginning of 2002 stocks increased further and moved above normal by mid 2002. Until the early part of 2004 stocks were very close to normal, at about 37 days' consumption. The picture was confused in early 2004 by a build-up of unreported stocks, but high demand through 2004 left stocks significantly below normal from about September 2004. Stocks remained at the same low level relative to normal throughout most of 2005. Late in 2005 LME stocks started to rise as high cash prices drew metal to the market from unrecorded stocks, but this was reversed in the early months of 2006. In 2006 identified stocks continued falling further below normal, but started to rise late in the year. In early 2007 they remained about 1.1 million tonnes below normal.