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MARKET MOVEMENTS:

--Brent crude oil rose 0.5% at $78.98 a barrel.

--European benchmark gas rose 3.8% to EUR 45.25 a megawatt hour.

--Gold futures were flat at $1,998.20 a troy ounce.

--LME three-month copper futures fell 1% to $8,913.00 a metric ton.

--Wheat futures edged down 0.5% to $6.89 a bushel.

TOP STORY:

Ford Invests in $4.5 Billion Indonesia Facility to Secure Nickel for EV Batteries

Ford Motor Co. is investing in a $4.5 billion nickel processing facility in Indonesia as the auto maker seeks to secure a supply of key minerals used in electric-vehicle batteries.

The project also involves PT Vale Indonesia TBK, which controls a large nickel-mining area on Indonesia's Sulawesi island, and China's Zhejiang Huayou Cobalt Co., a leading refiner.

"This framework gives Ford direct control to source the nickel we need -- in one of the industry's lowest-cost ways," Lisa Drake, Ford's vice president of EV industrialization, said in a statement.

Commercial operations at the facility, which will use a process called High-Pressure Acid Leaching, are expected to begin in 2026. Ford says the factory will help it secure raw materials to achieve its target of producing approximately two million electric vehicles that year.

OTHER STORIES:

China's Consumers Extend Economic Rebound From Pandemic

A gauge of activity in China's services sector reached its highest level in more than a decade in March, a sign that Chinese consumers are heading back to stores and restaurants, powering an economic recovery following the end of almost three years of strict Covid-19 controls.

The reading represents a promising signal for the global economy, which is depending on Chinese consumers to prop up growth this year as their counterparts in the U.S. and Europe battle rising interest rates, high inflation and the prospect of a squeeze on lending following turmoil in the banking sector.

Highlighting those pressures, a similar barometer of activity this month in China's manufacturing sector edged lower as Western demand for Chinese exports faded.

Though the initial signs are promising, economists are unsure how durable the recovery in Chinese consumption will be. Chinese households are emerging from the pandemic with bulging savings but weak housing and job markets as well as sluggish growth in incomes, raising doubts about whether consumption can take over from exports and government and real-estate investments as the engines of Chinese growth.

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Coal Prices Fall, While Use of Wind Power, Solar Energy Leaps Forward

Coal prices have come crashing down from last year's records.

Central Appalachian coal has been trading at $88.80 a short ton, down 57% from the record $205.55 at the start of the year.

Cash prices for thermal coal mined from northern Appalachia and the Illinois Basin -- two places where a lot of exported coal originates -- have fallen more than half since September, when Europe was stocking up for winter. Futures for coal that is shipped around the Pacific from an Australian export facility have made a similar plunge.

Coal markets are highly influenced by those for natural gas, which is also burned to generate electricity. As with coal, natural-gas inventories that looked alarmingly low last summer recovered thanks to unusually warm winter weather that obviated a lot of demand for heating.

Natural-gas futures for May delivery ended Thursday at $2.104 per million British thermal unit, down 63% from a year ago.

Even after the decline in coal prices, varieties produced in the eastern U.S. have lately cost between $3.10 to $3.55 per million BTUs, according to the Energy Information Administration. That suggests that coal prices might have to fall further to regain competitiveness with natural gas.

MARKET TALKS:

Palm Oil Ends Lower, Snapping Four-Day Rally

1023 GMT - Palm-oil prices ended the Asian trading session lower, snapping consecutive gains in the first four days of the week. The decline followed weakness in similar agricultural commodities such as soybean oil, which fell overnight on the Chicago Board of Trade. Analysts reckon the recent rally has triggered some profit-taking pressure. But many remain optimistic over the edible oil's near-term price outlook, citing expected output weakness and potential supply concerns. The Bursa Malaysia Derivatives contract for June delivery fell MYR30 to MYR3,758.00 a ton. (yifan.wang@wsj.com)

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Rio Tinto's Peru Deal Could Help it Spread Project Risk

0911 GMT - Rio Tinto shares edge 0.1% higher after the miner said it planned to form a joint venture with First Quantum Minerals to develop the La Granja copper project in Peru. Miners have become more cautious about major investment in projects since the last commodity boom ended so badly, with companies drowning in debt, AJ Bell says. "Sharing the costs via a joint venture is one way to spread the risks," Bell's investment director Russ Mould writes. "The market seems to like the deal, but as with everything in mining, it will be a long and expensive journey before any copper is extracted from the deposit on a commercial scale." (philip.waller@wsj.com)

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Oil Ticks Down Ahead of PCE Data

0743 GMT - Oil prices ticked lower ahead of a gauge of inflation looked to by Federal Reserve policymakers to shape their outlook on interest rates. Brent crude inches down 0.3% to $78.33 a barrel while WTI declines 0.2% to $74.25 a barrel. The Personal Consumption Expenditures index is due for release at 1230 GMT and is expected to show price pressures eased month on month but remained steady on year. A stronger-than-expected reading could raise concerns that the Fed will need to keep monetary policy tighter for longer. (william.horner@wsj.com)

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Copper Prices to Be Bolstered by Low Inventories, China Rebound

0729 GMT - Low inventories of copper in London Metal Exchange warehouses and growing demand from China is likely to boost prices this year, according to Fitch Solutions. Fitch is boosting its annual price forecast for 2023 to $9,000 a metric ton from $8,500 a ton, it says in a note. Prices on Friday sat at $8,964 a ton in London. Rising demand from China as the country emerges from Covid-19 lockdowns and a weaker U.S. dollar are likely to act as tailwinds for copper, the research firm says. This, added to the fact that LME warehouse inventories are sitting at multi-year lows, means prices should remain elevated. That said, countries slipping into recession and jitters around banking are likely to cap prices, Fitch says. (yusuf.khan@wsj.com)

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Metals Mixed Ahead of PCE Inflation Data

0719 GMT - Metal markets are mixed after having taken a breather this week, following prices whipsaws for much of the month triggered by banking turmoil. Three-month copper is down 0.4% to $8,964 a metric ton while nickel is up 0.4% to $23,100 a ton. Gold is inching 0.3% higher to $2,002.30 a troy ounce. PCE inflation data is due later today, which although usually plays "third fiddle" to PPI and CPI, it is the Federal Reserve's preferred inflation gauge Peak Trading Research says in a note. Peak adds that its outcome "will provide clues as to whether the Fed can pause [interest rate hikes] in May." (yusuf.khan@wsj.com)

Write to Barcelona Editors at barcelonaeditors@dowjones.com

(END) Dow Jones Newswires

March 31, 2023 07:55 ET (11:55 GMT)

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