Price Forecasts

Metals Market Outlook, 2012-2013
Supply, Demand, Inventories, Institutional Demand, Prices

Frederick R. Demler, Ph.D.
Global Head, LME Metals
INTL FCStone Inc. | www.intlfcstone.com
Disclaimer
This presentation is issued by FCStone LLC. FCStone LLC is an affiliate of INTL
FCStone (Europe) Limited IFEL, a company registered under the laws of England &
Wales with its head office at Moor House, 1st Floor, 120 London Wall, EC2Y 5ET,
United Kingdom and which is authorised and regulated by the Financial Services
Authority. FCStone LLC and IFEL are subsidiaries of INTL FCStone Inc. IFEL is a
Category 1 ring dealing member of the London Metal Exchange LME and offers
LME products through its affiliate FCStone LLC, from its New York office, pursuant
to Part 30.10 of the rulebook of the Commodities Futures Trading Commission
(CFTC), relating to the offer and sale of foreign futures and options contracts to
customers located in the United States by firms located in the United
Kingdom. Commodity trading involves risks, and you should fully understand those
risks prior to trading. Neither the information, nor any representation shall be
construed as an investment advice or an offer to buy or sell futures, options on
futures, or any OTC products. The presentation also contains information provided
to us by third parties such as the World Bureau of Metal Statistics, Consensus
Economics, ILZSG, IAI, LME, CME, SHFE, and Barclay Hedge. Whilst we have
taken all reasonable steps to ensure the information is in this presentation is correct,
neither FCStone LLC or IFEL offers any warranty as to the accuracy or
completeness of the information, nor is any liability assumed by us for the use of
any information contained herein.
2
Summary
Industrial metals, after going through a period of high volatility,
have consolidated in largely sideways to downward trending trading
ranges. The underlying macro-economic fundamentals show
divergent regional trends-- China remains an important net buyer of
copper and to a lesser extent nickel, but overall Chinese
consumption has slowed.
Primary capacity is building, but planned and unplanned
production cuts have limited output for copper (involuntary),
aluminum (voluntary) and tin, but for zinc, lead, and nickel, overall
throughput is surging. Inventories are falling in copper, nickel, and
tin, but rising in aluminum, lead, and zinc. Institutional investing,
which eased in 2011, has since recovered and is approaching a
record high.
3
Summary
Overall, we project a modest economic recovery with industrial
production rising 2% to 3% over the next two years. Chinese
industrial production will slow to 10% to 12%, but will still be strong
compared to other countries. The US will lead Western economies,
Europe will slip into recession and then recover, while Japan will
rebound from the Tsunami curtailed slowdown last year.
Metals consumption growth will accelerate from the 2011 pace,
with reasonable gains in 2013. Primary capacity builds, already in
the pipeline, will add to supply, but cutbacks and unanticipated
losses will limit growth. Chinese imports will remain at high levels in
copper, as well as in nickel and tin, contributing to tighter global
supply-demand balances that will persist in both 2012 and 2013.
*INTL FCStone estimates/projections
4
Summary
Institutional demand (fund buying) will continue to grow over the
foreseeable future as investors diversify their portfolios with
alternative investments and as advisors make the case for holding
real assets amid what they will profess to be a continuation of the
commodity super-cycle.
The projected fundamental balances, combined with growing
institutional demand, favor copper and tin, followed by lead;
aluminum is neutral, while zinc and nickel could struggle.
Economic Outlook
This section of the page should be blank except when footnotes are present.
G-3 Industrial Production

30%
25%
20%
China
15%
10%
5%
0%
-5%
-10%
-15%
US
-20%
WE
-25%
JP
-30%
G-3
-35%
'08
7
'09
'10
'11
'12
Global IP/Economic Outlook

Global Economy (G-3)
Global industrial economy IP forecast: +2.1% 12 & +2.9% 13 vs +2% in 2011
United States
Recovery shows some momentum with jobless rate improving, GDP expanding, and consumer
spending rising. Although business investment has slowed, the PMI and new orders are firming and
underpin moderate industrial production growth. IP forecast: +3.1% 12 & +3.1% 13
Japan
Post-earthquake rebuild should support the industrial sectors but exports have slowed raising broader
questions of economic expansion. That said, the PMI is above 50, consumer confidence and spending
has improved, and the labor markets are firming : IP forecast: +3.7% 12 & +3.8% 13
Eurozone
Sovereign debt concerns, social unrest, a lack in confidence that austerity measures will be
implemented, debt downgrades, fiscal tightening, a weak labor market and slowing domestic growth
makes recession likely and threaten the broader American and Asian economies. The ECB injecting
liquidity and refraining from rate hikes has provided support
GR: mg and cap goods production and retail sales dn, but PMI over 50 and labor market improving
UK: labor market, retail sales weak, PMI improving, quantitative easing planned
Eurozone IP forecast: -0.4% 12 & +1.9% 13
China
Economic growth slowing with weakness in the West and a softening in real estate, but PMI >50,
monetary easing (lower reserve ratio) & fiscal stimulus expected; underlying buying in the metals
sectors has slowed considerably (partly seasonal) ; IP Forecast :slows from 12%/13% to 11%/12%
G-3, China Industrial Prod Outlook

30%
25%
20%
15%
10%
5%
0%
-5%
-10%
-15%
-20%
-25%
-30%
-35%
-40%
US
JP
China
2008
2009
2010
2011
2012
2013
'08
9
WE
G-3
'09
'10
US
-2.6%
-11.6%
4.4%
4.4%
3.1%
3.1%
WE
-0.6%
-14.7%
5.8%
4.1%
-0.4%
1.9%
'11
JA
-1.5%
-22.9%
16.6%
-2.6%
3.7%
3.8%
'12
W World
-1.7%
-16.1%
8.8%
2.0%
2.1%
2.9%
China
13.0%
11.2%
15.6%
13.8%
12.0%
11.0%
'13
Price, Spread Review
10
LME Price Review

$10,000
$3,200
$9,000
$3,000
$8,000
copper
$2,800
$2,600
$7,000
$2,400
$6,000
$2,200
$5,000
$4,000
11
$2,000
$1,800
$3,000
$1,600
$2,000
$1,400
$1,000
$1,200
aluminum
LME Price Review

$3,900
$3,600
$4,500
$3,300
$4,000
zinc
$3,500
lead
$3,000
$2,700
$2,400
$3,000
$2,100
$2,500
$1,800
$2,000
$1,500
$1,500
$1,200
$900
'06
'07
'08
2
'1
'05
1
'1
'04
0
'1
'03
9
'0
8
'0
$40,000
7
'0
$33,000
nickel
$45,000
6
'0
$50,000
5
'0
$38,000
4
'0
$55,000
3
'0
$300
2
'0
$500
1
'0
$600
0
'0
$1,000
tin
$28,000
$35,000
$23,000
$30,000
$25,000
$18,000
$20,000
$15,000
$13,000
$10,000
$8,000
$5,000
$0
$3,000
'00
12
'01
'02
'03
'04
'05
'06
'07
'08
'09
'10
'11
'12
'00
'01
'02
'09
'10
'11
'12
LME Spread Review

$200
$100
-$100
$150
copper
$100
-$300
aluminum
$50
$0
-$500
-$50
-$700
-$900
-$100
Cash-3M
3M-15M
-$150
-$200
-$1,100
13
-$250
Cash-3M
3M-15M
LME Spread Review

$100
$100
$50
$0
$0
zinc
-$100
lead
-$50
-$200
-$100
-$300
-$150
-$400
-$200
-$250
-$500
Cash-3M
3M-15M
Cash-3M
-$300
-$600
3M-15M
-$350
-$700
'99
'00
'0 1
' 02
' 03
' 04
' 05
' 06
'07
'0 8
' 09
' 10
' 11
' 12
' 06
'07
'08
' 09
'10
'11
' 12
$200
$0
$0
nickel
-$2,000
tin
-$200
-$4,000
-$400
-$600
-$6,000
-$800
-$8,000
Cash-3M
3M-15M
3M-15M
-$1,200
-$10,000
'99
14
Cash-3M
-$1,000
'00
'01
'02
'03
'04
'05
'06
'07
'08
'09
'10
'11
'12
'99
'00
' 01
' 02
' 03
' 04
' 05
Price Seasonals
104
107
copper
103
zinc
105
103
102
101
101
99
97
100
95
J
105
99
103
98
Average
Trend Adj
101
97
J
J
99
101
lead
97
95
J
99
107
105
103
101
97
99
aluminum
95
95
93
15
nickel
97
*Average of 1973-2009
Consumption Trends
16
Consumption Trends
US
copper
50%
WE
JP
RoW
China
120%
100%
80%
30%
10%
US
JP
China
WE
RoW
60%
40%
20%
-10%
0%
-20%
-30%
-40%
-50%
17
-60%
aluminum
Consumption Trends
50%
45%
40%
35%
30%
zinc
20%
lead
25%
10%
15%
0%
5%
-10%
-5%
-20%
-15%
-30%
WW
China
China
WW
-25%
-40%
200
6
US
WE
JP
RoW
China
130%
nickel
110%
90%
70%
' 07
' 08
' 09
' 10
' 11
80%
tin
60%
United States
Japan
China
West Europe
Rest World
40%
50%
20%
30%
0%
10%
-20%
-10%
-40%
-30%
-50%
-60%
200 6
18
200 7
2 00 8
2 009
2 010
2 011
2006
2007
2008
2009
2010
2011
' 12
Consumption Forecasts
30%
25%
20%
DD - IP
Consumption
* DD = Demand/Consumption
IP = Industrial Production
15%
20%
10%
15%
5%
10%
0%
5%
-5%
0%
-10%
-5%
-15%
-10%
-20%
copper
25%
30%
DD - IP
Consumption
20%
Ind Prod
15%
20%
10%
5%
10%
0%
-5%
0%
-10%
-15%
-10%
aluminum
-20%
-20%
-25%
'98
19
'01
'04
'07
'10
'13
Consumption Forecasts
30%
DD - IP
Consumption
Ind Prod
45%
zinc
35%
20%
20%
15%
10%
10%
0%
5%
-10%
0%
25%
lead
10%
5%
0%
-5%
-10%
15%
-15%
5%
-20%
DD - IP
Consumption
Ind Prod
-30% -10%
-5%
'03
'04
'05
'06
'07
'08
'09
'10
'11
'12
'03
'13
20%
15%
-5%
28%
nickel
18%
'04
'05
-20%
-25%
'06
'07
'08
'09
'10
'11
'12
'13
20%
20%
16%
15%
12%
tin
10%
10%
8%
8%
5%
5%
-2%
4%
0%
0%
-5%
0%
-12%
-4%
-10%
-8%
-15%
-5%
-22%
-32% -12%
-10%
'97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13
20
-20%
' 97 '98 ' 99 ' 00 '01 ' 02 '03 '04 '05 '06 ' 07 ' 08 '09 ' 10 ' 11 '12 '13
Production Trends
21
Production Trends
14,000
Refined
Mine
copper
13,500
13,000
12,500
12,000
26000
25000
11,500
24000
23000
11,000
22000
21000
20000
19000
18000
17000
aluminum
22
16000
Cap
Prod
Production Trends
8,000
2,250
7,750
2,200
7,500
zinc
7,250
lead
2,150
Mine
Refined
5,400
5,200
2,100
7,000
2,050
6,750
2,000
6,500
1,950
6,250
1,900
Mine
6,000
1,850
Refined
5,750
1,800
' 00
' 01
' 02
'03
'04
'05
' 06
' 07
'08
'09
'10
'11
'12
1850
4,800
4,600
4,400
'04
'05
'06
'07
'08
'09
'10
'11
240
220
nickel
1750
5,000
tin
200
1650
Mine
Refined
180
1550
1450
160
1350
Mine
Refined
1250
140
120
1150
200 2
23
200 3
2 004
2 005
2006
2007
2008
200 9
201 0
2 01 1
2 012
'97
'98
'99
'00
'01
'02
'03
'04
'05
'06
'07
'08
'09
'10
'11
Capacity Builds
1,200
copper
zinc
1,000
800
600
Oceana
Europe
Asia
LAmer
NAmer
Africa
400
200
0
-200
-400
-600
'00
'01
'02
'03
'04
'05
'06
'07
'08
'09
'10
'11
lead
600
500
400
300
Oceana
Europe
Asia
LAmer
NAmer
Africa
200
100
aluminum
0
-100
-200
-300
'00
'01
'02
'03
'04
'05
'06
'07
'08
'09
'10
'11
nickel
200
150
100
Column 12
Oceana
Europe
Asia
LAmer
NAmer
Africa
50
0
-50
-100
-150
-200
'01
24
'02
'03
'04
'05
'06
'07
'08
'09
'10
'11
'12
'13
'14
Copper Costs, and Prices

$10,000
$9,000
$8,000
$7,000
$6,000
$5,000
10000
current price
$4,000
$3,000
8000
$2,000
70th percentile
$1,000
6000
$0
4000
2000
Costs 2010
Costs 2009
0
-2000
25
Cost Pressures
2500
aluminum
2000
3500
1500
Costs 2010
Costs 2009
3000
1000
2500
zinc
500
2000
25000
0%
10%
20%
30%
40 %
50%
60%
70%
80 %
90%
100%
Percentile
20000
1500
Costs 2011
Costs 2010
Costs 2009
1000
Percentile
15000
Costs 2010
Costs 2009
10000
5000
0
0%
10%
20 %
30%
40%
50%
60%
70 %
80%
90%
-5000
nickel
-10000
26
Percentile
100%
China,
East-West Trade
27
Chinas Net Metal Trade

(Exports Imports)
50,000
0
-50,000
-100,000
-150,000
-200,000
-250,000
-300,000
-350,000
-400,000
2006
2007
2008
Tons
60,000
40,000
20,000
0
-20,000
-40,000
-60,000
-80,000
-100,000
-120,000
2006
2009
2010
2011
2012
100,000
50,000
0
-50,000
-100,000
-150,000
-200,000
-250,000
-300,000
-350,000
-400,000
2006
2012
60,000
50,000
40,000
30,000
20,000
10,000
0
-10,000
-20,000
-30,000
-40,000
2006
2008
Tons
0
2009
2007
2008
2010
2011
2009
2010
2011
2012
2010
2011
2012
2010
2011
2012
Lead
Tons
Zinc
2007
Aluminum
Tons
Copper
2007
2008
2009
Nickel
3,000
Tin
-10,000
1,000
-20,000
-30,000
-1,000
-40,000
-3,000
-50,000
2006
28
2007
2008
2009
2010
2011
2012
2006
2007
2008
2009
China, Production-Consumption
9,000
3,500
Net Ref Trade
3,250
Consumption
3,000
7,000
Refined Prod
2,750
6,000
Mine Prod
8,000
copper
2,500
2,250
2,000
5,000
1,750
4,000
1,500
1,250
3,000
1,000
2,000
750
500
1,000
250
0
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
20,000
18,000
Production
Consumption
16,000
14,000
12,000
10,000
8,000
6,000
4,000
aluminum
29
2,000
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
East to West Trade

6000
100
Russia
5000
4000
Others
80
China
60
Net Sales
40
20
3000
copper
2000
0
-20
1000
zinc
-40
-60
'9 '9 '9 '9 '9 '0 '0 '0 '0 '0 '0 '0 '0 '0 '0 '1 '1 '1
5
8
9
2
5
8
9
1
2
6
7
0
1
3
4
6
7
0
-1000
800
700
13
'11
'12
'10
'09
'08
'07
'06
'05
'04
'03
'02
'01
'00
'99
'98
'97
'96
'95
'94
'93
'92
'91
'90
-2000
lead
600
500
400
2,000
aluminum
300
200
100
1,000
0
-100
'9
0
'9
2
'9
4
'9
6
'9
8
'0
0
'0
2
'0
4
'0
6
'0
8
'1
0
400
-1,000
300
nickel
200
-2,000
East X (Russia)
East M (China)
-3,000
Net Trade
100
0
-100
-200
East Exports to West (Russia)

East Imports from West (China)
Net Trade (Exports from East)
-300
-4,000
30
'89 '90 '91 '92 '93 '94 '95'96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09'10 '11 '12
'1
2
Inventory Balances
31
Inventory Trends, Weeks Usage

Producer
Consumer
copper
Stocks
3000
Comex
400
3500
16
Weeks Use
LME
2500
K tonnes
SHFE
300
200
11
2000
6
1500
weeks use
500
1000
1
100
500
0
-4
9000
22
Stocks
aluminum
8000
7000
5,000
Weeks
17
4,000
LME
Comex
3,000
IPAI
Shang
2,000
Stocks, kt
6000
12
5000
4000
7
3000
2000
1000
1,000
0
0
32
-3
Weeks Usage
6,000

1,400
Producer
Consumer
1,200
LME
zinc
14
Stocks
2,000
Mrchnt
1,000
16
2,500
12
Weeks Use
SHFE
800
10
1,500
600
1,000
400
4
500
200
2
0
0
'88 '90 '92 '94 ' 96 '98 ' 00 ' 02 '04 '06 ' 08 ' 10
450
400
350
300
250
200
Producer
Consumer
Merchant
LME
SHFE
lead
1,000
11
Stocks
Weeks Use
900
10
9
800
8
700
600
lead
150
500
100
400
50
300
5
4
3
0
-50
33
200
'00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '1
'
'8 1 '8'12
2
4 86
1
'8
8
'9 '9
2
0
'9 '9
6
4
'9
8
'0
0
'0
2
'0
4
'0
6
'0
8
'1 '1
2
0
600
160
LME
Prod
Cons
140
120
500
400
35
W
eeksU
sage
180
Stocks,ktonnes

30
25
20
100
300
80
15
60
200
10
40
nickel
20
100
0
'1
7
'0
4
'0
1
'0
8
'9
5
'9
2
'9
9
'8
6
'8
3
'8
0
'8
35,000
7
'7
40,000
4
'7
45,000
1
'7
'91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12
70
tin
16
Total
60
tin
LME
14
Weeks
12
50
30,000
10
25,000
40
8
20,000
30
6
15,000
20
10,000
10
5,000
0
'90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12
34
2
0
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Supply-Demand Outlook
35
Copper Market Outlook

2009
current ratio: 5.1 wks

price: $8,360
United States
Europe
Japan
Other (West)
Refined Consumption
IP
DD - IP
2010
2011
-18.5% 6.9%
1.1%
-19.5% 11.4% -8.5%
-26.1% 21.1% -8.8%
-4.4% -2.0% -5.4%
10,141 10,662 10,071
-13.5% 5.1%
-5.5%
-16.1% 8.8%
2.0%
2.6%
-3.6% -7.6%
2012
2013
9,990
-0.8%
2.1%
-2.9%
10,379
3.9%
2.9%
1.0%
$10,000
Mine Production
East to West Trade
Total Supply
$9,000
$8,000
$7,000
2000s
$6,000
1990s
$5,000
1980s
$4,000
1970s
Reported Balance
Stocks
Stocks Usage Ratio
$3,000
$2,000
$1,000
1
36
4 5 6 7 8 9 10 11 12 13 14 15 16
Stocks/Consumption (weeks)
12,866 13,062 12,996 13,548 14,238

-2,051 -1,862 -1,708 -2,324 -2,347
10,399 10,672 10,470 10,086 10,377
-14.0% 2.6%
-1.9% -3.7%
2.9%
278
-111
-18
-164
1,067
5.5
956
4.7
938
4.9
941
4.9
777
3.9
Aluminum Market Outlook

2009

price: $2,175
2010
2011
2012
2013
Total Consumption 18,847
22,016
22,824 23,341 24,529
% Chg
-15.9%
16.8%
3.7%
2.3%
5.1%
IP
DD-IP
-16.1%
0.3%
8.8%
8.1%
2.0%
1.6%
2.1%
0.2%
2.9%
2.2%
Total Production
19,281
20,037
-8.2%
3.9%
6.2%
0.9%
5.5%
5,384
5,350
$3,000
$2,800
2000s
1990s
$2,600
1980s
$2,400
1970s
$2,200
Net E-W Balance
3,141
4,892
5,273
$2,000
Total Supply
22,422
24,929
26,555 26,853 27,997
Reported Balance
Reported Stocks
1,777
6,485
17
6,502
648
7,150
330
7,480
431
7,911
Weeks Use
17.7
15.3
16.3
16.7
16.9
$1,800
$1,600
$1,400
$1,200
$1,000
$800
5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22
(Stocks/Shipments) Weeks
37
21,282 21,469 22,647
Zinc Market Outlook

2009

price: $2,080
$4,500
2000s
$4,000
2010
2011
2012
2013
Consumption
% Chg
IP
DD - IP
5,783 6,678
-16.2% 15.5%
-16.1% 8.8%
-0.1% 6.7%
6,746
1.0%
2.0%
-1.0%
6,964
3.2%
2.1%
1.1%
7,272
4.4%
2.9%
1.5%
Mine Production
7,370
-3.0%
6,144
-8.0%
7,678
4.2%
6,770
10.2%
7,855
2.3%
6,971
3.0%
7,882
0.4%
7,011
0.6%
7,998
1.5%
7,219
3.0%
E/W Trade
Supply
(215)
5,929
137
6,907
162
7,133
145
7,156
163
7,382
Reported Balance
Stocks
Weeks Use
270
1,097
9.9
376
1,473
11.5
311
1,784
13.8
195
1,980
14.8
24
2,004
14.4
Refined Prod
1990s
$3,500
1980s
$3,000
$2,500
$2,000
$1,500
$1,000
$500
3
38
4 5
8 9 10 11 12 13 14 15 16
Lead Market Outlook
2000s
$3,300
1990s
$2,800
1980s
2010
4,987
6.1%
8.8%
-2.6%
2011
4,948
-0.8%
2.0%
-2.8%
2012
4,985
0.7%
2.1%
-1.3%
2013
5,075
1.8%
2.9%
-1.1%
Mine
Refined
E-W Trade
Supply
2,011
4,790
5
4,795
-9.3%
2,040
4,948
85
5,033
5.0%
2,088
4,845
86
4,931
-2.0%
2,123
4,864
84
4,948
0.3%
2,142
4,916
82
4,999
1.0%
Balance
Stocks
Weeks Use
83
389
4.3
60
449
4.7
193
642
6.8
97
739
7.7
12
750
7.7
Consumption
% Chg
IP
DD-IP

price: $2,125
$3,800
2009
4,699
-10.4%
-16.1%
5.7%
$2,300
$1,800
$1,300
$800
$300
2
39
Nickel Market Outlook

current ratio: 15 wks
price: $21,300
50,000
2000s
1990s
1980s
46,000
42,000
Nickel Price $/lb
38,000
34,000
30,000
26,000
22,000
2009
2010
2011
2012
2013
WW Consumption
735
916
885
890
927
% Chg
IP Growth
Consumption - IP
-23%
-16%
-7%
25%
9%
16%
-3%
2%
-5%
1%
2%
-1%
4%
3%
1%
WW Mine Production
941
1,103
1,246
1,414
1,535
WW Refined Production
FFS Trade
787
2
824
86
872
22
944
20
1,019
20
WW Total Supply
789
910
894
964
1,039
Apparent Balance
Unreported Balance
53
26
-7
-15
10
-56
74
-56
112
-63
Reported Balance
Reported Stocks
80
264
-22
242
-46
196
18
214
49
263
Weeks Cosumption
Weeks Deliveries
18.7
24.7
13.8
18.1
11.6
14.7
12.5
16.2
14.8
18.9
18,000
14,000
10,000
6,000
2,000
4
40
10
12
14
Weeks Usage
16
18
20
Tin Market Outlook

2009
2010
2011
2012
2013
167
-15%
-16%
1%
209
25%
9%
17%
184
-12%
2%
-14%
181
-1%
2%
-4%
188
4%
3%
1%
Mine
Refined
East to West Trade
Government Sales
Total Supply
174
191
-15
0
176
170
202
-9
0
194
167
211
-29
0
182
164
215
-28
0
187
163
214
-28
0
187
Reported Balance
Total Stocks
Weeks Usage
14
46
14.4
-11
35
8.8
-4
31
8.9
-4
28
8.2
-2
25
7.0
Consumption
% Chg
IP
DD-IP

price: $24,250
$35,000
$30,000
$25,000
$20,000
$15,000
$10,000
$5,000
$0
5
41
10
11
13
14
16
Funds and LME Volumes
42
LME Client Volumes: Funds vs Trade

excludes broker crosses
90
80
Funds
70
Trade/Other
60
50
40
30
20
10
funds account for 60+% of client volumes
0
'90
43
'91
'92
'93
'94
'95
'96
'97
'98
'99
'00
'01
'02
'03
'04
'05
'06
'07
'08
'09
'10
'11 '12e
Global Hedge/Macro Funds, $b AUM

Hedge Funds: hedge equity/bond exposures, long or short
$140
Macro
$3,000
Hedge
$120
$2,500
$100
$2,000
$80
$1,500
$60
$1,000
$40
$500
$20
$0
$0
'90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11
44
CTA Assets, $b AUM

Commodity Trading Advisors: registered, trend following, F&O
$350
Agricultural Traders
Diversified Traders
Discretionary Traders
$300
Currency Traders
Financial/Metal Traders
Systematic Traders
45%
$250
0%
5%
$200
$150
5%
$100
14%
31%
$50
$0
90 91 92 93 94 95 96 97 98 99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11
45
Index Funds, $b AUM

Index of Commodities, Commodity Super Cycle, diversification
$250
$200
GSCI
DJ-UBS
Rodgers
Merrill Lynch
Average
Energy
67%
28%
44%
60%
50%
Agric
22%
39%
35%
24%
30%
PrecM
3%
14%
7%
4%
7%
wtd avg
IndusM
8%
18%
14%
13%
13%
GSCI
DJ-UBS
Rodgers
Oppenheimer
Average
Copper
48.2%
42.5%
4.0%
2.4%
24.3%
Alum
28.9%
29.1%
4.0%
2.6%
16.2%
Zinc
7.2%
13.5%
2.0%
0.1%
5.7%
Nickel
9.6%
15.0%
1.0%
0.6%
6.6%
Lead
6.0%
0.0%
2.0%
0.5%
2.1%
$150
$100
$50
$0
90 91 92 93 94 95 96 97 98 99 '00'01'02'03'04'05'06'07'08'09'10'11'12e
46
ETF/ETN Assets, $b AUM

ETF/ETN:
$200
$180
$160
ETF/ETN Assets ($b)

Industrial Metals
Energy
Industrial Metals
Agriculture
Global
Precious Metals
3%
$2.25
$1.75
10%
4%
$140
$120
$100
$80
$60
$40
$20
$0
1%
$1.25
82%
$0.75
$0.25
-$0.25
12
1
Q 1
1
4
Q 1
1
3
Q 1
1
2
Q 1
1
1
Q 0
1
4
Q 0
1
3
Q 0
1
2
Q 0
1
1
Q 9
0
4
Q 9
0
3
Q 9
0
2
Q 9
0
1
Q 8
0
4
Q 7
0
3
Q 8
0
2
Q 8
0
1
Q 7
0
4
Q 7
0
3
Q 7
0
2
Q 7
0
1
Q 6
0
4
Q 6
0
3
Q 6
0
2
Q 6
0
1
Q
47
Industrial Metals, Fund Allocations, $b

Macro
CTA
'03
'05
Index
ETF/ETN
$60
$50
$40
$30
$20
$10
$0
'00
48
'01
'02
'04
'06
'07
'08
'09
'10
'11
'12
Funds, AUM $b
CTAs
Hedge Funds
$2,500
$350
$325
$2,250
$300
$275
$2,000
$250
$1,750
$225
$200
$1,500
$175
$1,250
$150
$1,000
2006
$125
2006
2007
2008
2009
2010
2011
2012
2007
$175
$150
$125
$100
$75
$50
49
2007
2008
2009
2009
2010
2011
2012
2010
2011
2012
Index Funds
Macro Funds
2006
2008
2010
2011
2012
$275
$250
$225
$200
$175
$150
$125
$100
$75
$50
2006
2007
2008
2009
Funds and Metals Pricing
50
Copper Prices,
Fundamental & Fund Impact
copper prices, fund index ($AUM, metals)
copper stocks, weeks use
10,000
9,000
8,000
-15
Copper Prices
Funds $ Index
Weeks Use
7,000
-12
-9
-6
6,000
-3
5,000
0
4,000
3,000
2,000
1,000
'94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12
51
Aluminum Prices,
aluminum prices, fund index ($AUM, metals)
aluminum stocks, weeks use

-1
3,500
3,000
Aluminum Prices
Funds $ Index
Weeks Use
2,500
5
2,000
1,500
1,000
'94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12
52
Zinc Prices,
zinc prices, fund index ($AUM, metals)
zinc stocks, weeks use

-4
5,500
5,000
4,500
Zinc Prices
Funds $ Index
Weeks Use
4,000
-2
0
3,500
2
3,000
2,500
2,000
6
1,500
1,000
500
'94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12
53
Lead Prices,
lead prices, fund index ($AUM, metals)
lead stocks, weeks use
5,000
4,500
4,000
-4
Lead Prices
Funds $ Index
Weeks Use
-2
3,500
-1
3,000
2,500
2,000
1,500
1,000
500
'94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12
54
-3
Nickel Prices,
nickel prices, fund index ($AUM, metals)
70,000
60,000
50,000
nickel stocks, weeks use
Nickel Prices
Funds $ Index
Weeks Use
40,000
30,000
20,000
10,000
0
'94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12
55
-30
-27
-24
-21
-18
-15
-12
-9
-6
-3
0
3
6
9
12
Tin Prices,
tin prices, fund index ($AUM, metals)
35,000
30,000
25,000
tin stocks
Tin Prices
Funds $ Index
LME Stocks
-50,000
-40,000
-30,000
-20,000
20,000
-10,000
15,000
0
10,000
10,000
20,000
5,000
30,000
40,000
'94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12
56
Economic and Metals Summary

1. Moderate Economic Growth

2% to 3% in the West; China expands by 10% to 12%
2. Metals consumption growth accelerates from 2011 pace

3. Primary capacity builds globally, but production
cuts/losses limits supply build
4. Chinese imports remain at high levels
5. Supply-demand balances generally tighter for 2013
6. Institutional demand recovers bolstering prices
7. Copper and tin followed by lead expected to trade firm,
nickel and zinc soft, and aluminum steady.
57
Base Metals, Price Outlooks
58
2011 Q1
2011 Q2
2011 Q3
2011 Q4
2011 Avg
Copper
$9,651
$9,152
$8,992
$7,436
$8,808
Alum
$2,500
$2,603
$2,400
$2,087
$2,398
Zinc
$2,395
$2,254
$2,226
$1,897
$2,193
Lead
$2,604
$2,558
$2,462
$1,984
$2,402
Nickel
$26,903
$24,298
$22,069
$18,221
$22,873
Tin
$29,910
$28,923
$24,796
$20,805
$26,109
2012 Q1
2012 Q2
2012 Q3
2012 Q4
2012 Avg
$8,367
$8,800
$8,250
$8,600
$8,504
$2,196
$2,350
$2,250
$2,300
$2,274
$2,047
$2,100
$2,000
$1,900
$2,012
$2,119
$2,150
$2,200
$2,300
$2,192
$19,984
$20,000
$17,500
$16,500
$18,496
$23,225
$25,000
$24,000
$25,000
$24,306
2013 Q1
2013 Q2
2013 Q3
2013 Q4
2013 Avg
$8,850
$9,350
$8,850
$9,100
$9,038
$2,400
$2,300
$2,200
$2,300
$2,300
$1,800
$1,900
$1,900
$1,800
$1,850
$2,300
$2,200
$2,250
$2,250
$2,250
$17,500
$18,000
$17,500
$16,500
$17,375
$26,000
$27,000
$26,000
$27,000
$26,500
Reuters Price Forecasts (January 2012)

2012
$8,262
$2,239
$2,062
2013
$8,731
$2,458
$2,340
$2,201
$2,492
$19,956
$21,695
$22,319
$24,427
Outlook Summaries
59
Copper Outlook
Copper consumption rebounds 2010, eases 2011; expected to hold

steady in 2012, firm in 2013
Significant mine capacity builds in 2012, 2013 but grade declines, labor
losses, phased startups, and output restraint w/ cutbacks; scrap tight
China imports surge (arb helps) but likely to slow, although remain high
with strong China consumption
LME inventories decline, Shanghai stocks up (overall, up), balanced
market in 2011 and 2012, followed by deficit in 2013
Expansion in fund investment supports prices
Spreads steady, seasonals bullish, then bearish, bullish technical trend
Prices expected to hold steady near term, correct this summer, but
economic rebound, improving supply demand fundamentals and
speculative demand support prices in late 2012 and 2013
60
New/Expanded Copper Capacity

Asia
Glogow Gleboki, Yangla, Duobaoshan, Ivanhoe, Jabal
Sayid, Various Mines
North America
Morenci, Cananea, Andalcollo, Rosemont Ranch
South America
Los Pelambres, Cananea, Andina, Escondida, Toquepala,
Salobo, Gaby Sur, Antamina
Europe
Aitik
Africa
Lumwana, Chambishi, Konkola
Oceania
Ernest Henry, Cadia Hill East, Olympic Dam
61
Copper Quarterly Supply-Demand Outlook

11Q4
12Q2
12Q3
12Q4
13Q1
13Q2
13Q3
13Q4
Refined Consumption 2,353 2,542 2,625

-9.6% -3.2% -1.8%
2,428
0.4%
2,395
1.8%
2,617
2.9%
2,717
3.5%
2,537
4.5%
2,508
4.7%
1.1% 2.0% 2.6% 1.7% 2.0%

-10.7% -5.2% -4.5% -1.3% -0.2%
2.6%
0.3%
2.9%
0.6%
3.0%
1.5%
3.1%
1.5%
United States
Europe
Japan
Other (West)
IP
DD - IP
6.7%
-23.0%
-22.1%
-2.8%
Mine Production
3,407
3,267
3,349
3,371
3,560
3,418
3,504
3,545
3,771
East to West Trade
-770
-577
-547
-581
-619
-581
-582
-591
-593
2,327 2,477 2,535 2,514 2,560 2,536

-16.2% -9.6% -9.4% -3.5% 10.0% 2.4%
2,573
1.5%
2,583
2.7%
2,685
4.9%
Total Supply
62
12Q1
Reported Balance
-86
17
-103
40
50
-130
-199
155
Stocks
938
955
852
891
941
812
612
622
777
Stocks Usage Ratio
4.9
5.0
4.5
4.7
4.9
4.2
3.1
3.2
3.9
Aluminum Outlook
Aluminum consumption rebounds 2010 and 2011 with economy, moderate

growth expected in 2012, 2013
Primary capacity builds, but recent cutbacks globally (America, Europe,
Australia, and Russia/China) with cost increases/pressures and prices soft
China consumption and production surge; Russian output high, trade balance
(surplus) widens with Russian exports
Inventories grow to record levels (in tonnes and near a record in weeks
usage); surplus markets forecast for 2012 and 2013
Funds investment recovers; further portfolio diversification expected
supporting prices
Spreads wide, bearish seasonals, bullish technical trend
Prices expected to firm near term w cutbacks, but excess stocks keep a cap
on prices longer term; econ rebound & spec demand support provide a floor
63
New/Expanded Alum Capacity
Asia
Korba, Jharsuguda, Mahan
China
Liancheng, Pingguo, Tuoketuo Datang, Zhaqi,
Yinchuan/Ningdong, Zhongning, Qinghai Xinye, Qinghai
Xinheng, Xinyuan, Nanshan, Weiqiao, Chiping Xinjiang,
Dongyuan Qujing
Middle East
Abu Dhabi, Qatar
64
Alum Supply-Demand Outlook

Shipments
65
Production
Inventories
Wks
K Tons
% Chg
IP
DD-IP
Prod-kt
% Chg
Prod-kt
Chg
Use
2011
20,052
15.4%
8.8%
6.6%
20,037
3.9%
5,877
(15)
15.3
2011Q1
4,737
-0.9%
4.9%
-5.8%
5,177
7.2%
6,318
440
15.9
2011Q2
5,654
12.2%
0.6%
11.6%
5,316
6.9%
5,979
(338)
15.1
2011Q3
5,548
10.4%
1.5%
8.9%
5,389
6.8%
5,820
(159)
14.7
2011Q4
4,765
-8.5%
1.1%
-9.7%
5,400
4.0%
6,455
635
16.3
2011
20,704
3.3%
2.0%
1.2%
21,282
6.2%
6,455
578
16.3
2012Q1
4,976
5.0%
2.0%
3.0%
5,346
3.3%
6,825
370
16.8
2012Q2
5,569
-1.5%
2.6%
-4.1%
5,362
0.9%
6,618
(207)
16.3
2012Q3
5,561
0.2%
1.7%
-1.5%
5,374
-0.3%
6,431
(187)
15.9
2012Q4
5,034
5.6%
2.0%
3.7%
5,388
-0.2%
6,785
353
16.7
2012
21,139
2.1%
2.1%
0.0%
21,469
0.9%
6,785
330
16.7
2013Q1
5,177
4.0%
2.6%
1.4%
5,562
4.0%
7,170
385
16.8
2013Q2
5,810
4.3%
2.9%
1.4%
5,685
6.0%
7,045
(125)
16.5
2013Q3
5,881
5.8%
3.0%
2.7%
5,695
6.0%
6,859
(186)
16.1
2013Q4
5,348
6.2%
3.1%
3.1%
5,705
5.9%
7,216
357
16.9
2013
22,215
5.1%
2.9%
2.2%
22,647
5.5%
7,216
431
16.9
Zinc Outlook
66
Zinc consumption slows 2011, moderate increases in 2012 and 2013 with
economic recovery (but concerns in Europe and China)
Mine capacity builds globally, refined production increases (cutbacks in

time); but not enough in near term
China shifts from export to importer with consumption surging & production
flattens; trade balance shifts from net exports to net imports
Market oversupplied, recent LME and SHFE builds, surpluses forecast for
2012; better balance in 2013
Funds investment recovers; further portfolio diversification into commodities

expected supporting prices
Spreads in contango, bearish seasonals, market oversold
Prices expected to correct near term, but surplus weighs on prices; market
finds support from modest economic growth and institutional buying
New/Expanded Zinc Capacity

Europe
Neves-Corvo, Ozernoye, Almagrera
Africa
Qued Amizour, Perkoa
Asia
Rampura-Agucha, Shaimerden, Duddar, Khandiza
North America
Bracemac-Macleod, Tennesee
South America
Penasquito, Iscaycruz
Oceania
Century, Mt Isa/Hilton
67
Zinc Supply-Demand Outlook

11Q4
12Q1
12Q2
12Q3
12Q4
13Q1
13Q2
13Q3
13Q4
1,720
6.3%
1.1%
5.2%
1,760
3.9%
2.0%
1.9%
1,794
5.0%
2.6%
2.4%
1,652
1.8%
1.7%
0.1%
1,757
2.1%
2.0%
0.2%
1,823
3.6%
2.6%
0.9%
1,871
4.3%
2.9%
1.4%
1,732
4.8%
3.0%
1.8%
1,845
5.0%
3.1%
1.9%
Mine Production 1,965

2.5%
Refined Prod
1,780
2.9%
1,961
1.1%
1,769
1.8%
1,984
0.1%
1,726
0.2%
1,971
0.1%
1,735
0.2%
1,966
0.1%
1,782
0.1%
1,992
1.5%
1,821
3.0%
2,014
1.5%
1,747
1.2%
1,999
1.4%
1,820
4.9%
1,994
1.4%
1,831
2.7%
E/W Trade
Supply
75
1,855
37
1,806
34
1,760
35
1,771
38
1,820
38
1,860
39
1,786
43
1,863
43
1,873
Reported
Balance
Stocks
Weeks Use
(20)
1,784
13.8
55
1,839
13.8
(31)
1,807
13.5
112
1,920
14.4
60
1,980
14.8
27
2,007
14.4
(97)
1,910
13.7
92
2,002
14.4
2
2,004
14.4
Consumption
% Chg
IP
DD - IP
68
Lead Outlook
69
Lead consumption soft in 2010, 2011; modest growth in 2012, 2013
Moderate mine capacity, production builds 2010 and 2011; modest

increases in 2012, 2013
China shifts from export to importer with consumption surging &

production cuts; balanced market last couple years
Inventories grow, surplus markets in 2010, 2011; oversupply expected

in 2012 shifting to better balance in 2013
Funds investment recovers; further portfolio diversification into

commodities expected supporting prices
Spreads in contango, neutral to bearish seasonals, nearby technical

trend down
Prices expected to correct (rise) short term, but longer term, surplus
supply-demand balance weighs on pricing. Economic recovery and
institutional buying supports prices
New/Expanded Lead Capacity

Europe
Qued Amizour
Africa
Black Mountain
Asia
Sindesar Khurd, Duddar
North America
Sweet Water
South America
San Cristobal, Penasquito
Oceania
Mt Isa, Century, Magellan, Endeavor, Rasp
70
Lead Supply-Demand Outlook

11Q4 12Q1
1,230 1,227
-5.3% 0.4%
1.1% 2.0%
-6.4% -1.6%
12Q2
1,259
1.7%
2.6%
-1.0%
12Q3 12Q4
1,258 1,241
0.0% 0.9%
1.7% 2.0%
-1.7% -1.1%
13Q1
1,249
1.9%
2.6%
-0.8%
13Q2
1,281
1.7%
2.9%
-1.2%
13Q3 13Q4
1,281 1,264
1.8% 1.8%
3.0% 3.1%
-1.3% -1.3%
Mine
Refined
E-W Trade
Supply
524
1,197
18
1,215
-2.0%
523
1,217
21
1,239
2.0%
534
1,221
21
1,242
0.3%
533
533
1,218 1,208
21
21
1,239 1,229
-0.3% -0.8%
532
1,239
21
1,261
2.6%
542
1,248
20
1,268
0.6%
535
533
1,221 1,208
20
21
1,241 1,229
-2.1% -1.0%
Balance
Stocks
Weeks Use
-36
642
6.8
54
696
7.3
26
723
7.6
38
776
8.0
11
787
8.1
Consumption
% Chg
IP
DD-IP
71
9
732
7.7
7
739
7.7
-20
767
7.9
-17
750
7.7
Nickel Outlook
72
Nickel consumption rebounds 2010, slows 2011, moderate growth

expected in 2012, 2013 with economic recovery
Significant primary capacity builds in next couple years, but output

somewhat restrained w/ cutbacks/delays.
China imports remain high with consumption surging; trade balance

shifts sharply
Inventories decline 2010 and 2011, surplus forecast for 2012 and 2013
Funds investment recovers; further portfolio diversification into

commodities expected supporting prices
Spreads easing, seasonals bullish, then weak, technical trend up
Prices expected to hold steady/firm near term, longer term supply

fundamentals negative, but moderate economic growth, steady
Chinese demand, and institutional buying provide support
New/Expanded Nickel Capacity

Europe
Talvivaara, Pobuskoye
Africa
Selebi-Phikwe, Ambatovy, Nkomati
Asia
Caldag
North America
Nickel Rim South, Vale-Inco Ontario, Voiseys Bay
South America
Barro-Alto, Onca Puma, Santa Rita
Oceania
Forrestania, Goro, Koniambo, SLN/Eramet, Ramu River
73
Nickel Supply-Demand Outlook

11Q4
WW Consumption 207
12Q2
238
12Q3
218
12Q4
210
12Q1
230
12Q2
246
12Q3
228
12Q4
222
% Chg
-9%
-2%
2%
2%
1%
3%
3%
5%
6%
IP Growth
1%
2%
3%
2%
2%
3%
3%
3%
3%
-10%
-4%
-1%
0%
0%
0%
0%
2%
3%
WW Mine Production
341
342
350
359
364
372
378
392
393
WW Refined Production
229
228
233
240
242
247
251
262
260
234
234
238
245
247
252
256
267
265
Apparent Balance
27
28
37
21
39
43
Unreported Balance
-34
-5
-14
-19
-18
-14
-16
-17
-16
Reported Balance
-7
-14
19
-7
22
26
Reported Stocks
167
171
157
166
185
192
186
208
234
Weeks Consumption
9.9
10.1
9.3
9.8
10.8
11.2
10.7
11.8
13.2
Weeks Deliveries
14.7
15.3
13.9
14.6
16.2
16.8
16.0
17.7
19.7
Consumption - IP
FFS Trade
WW Total Supply
74
12Q1
225
Tin Outlook
Tin consumption rebounds 2010, eases 2011; moderate growth expected

2012 and 2013 with economic recovery
Despite primary production builds, output restrained w/ cutbacks
China shifts from export to importer with consumption surging & production
flattening; trade balance shifts
Inventories decline, deficit market expected in 2012 and 2013
Funds investment recovers; further portfolio diversification into commodities
will support prices
Spreads tightening, bullish seasonals, bullish technical trend but
overbought
Prices expected to remain firm with tight market balance, supply restraint,
economic recovery, and institutional buying
75
Tin Supply-Demand Outlook

11Q4
12Q1
12Q2
12Q3
12Q4
12Q1
12Q2
12Q3
12Q4
45.3
45.2
45.7
44.6
45.6
46.5
47.1
46.4
47.7
-11.2%
-5.1%
-1.1%
-0.1%
0.6%
2.8%
3.0%
4.0%
4.7%
1%
2%
3%
2%
2%
3%
3%
3%
3%
DD-IP
-12%
-7%
-4%
-2%
-1%
0%
0%
1%
2%
Mine
42.2
40.3
40.9
40.7
41.7
40.3
40.2
40.7
41.7
Refined
56.8
52.3
54.2
53.4
54.6
53.1
53.1
53.6
54.6
East to West Trade
-13.7
-7.3
-7.3
-7.0
-6.3
-6.5
-6.8
-7.1
-7.2
Government Sales
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
0.0
Total Supply
43.2
45.0
46.9
46.4
48.3
46.6
46.3
46.5
47.4
Reported Balance
-8.8
-2.8
0.0
-0.5
-0.4
-0.7
-1.1
-0.1
-0.4
Total Stocks
31.4
28.4
28.5
28.0
27.6
26.9
25.8
25.7
25.3
Weeks Usage
9.0
8.2
8.1
8.2
7.9
7.5
7.1
7.2
6.9
Consumption
% Chg
IP
76

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Metals Market Outlook, 2012-2013

Supply, Demand, Inventories, Institutional Demand, Prices

INTL FCStone Inc. | www.intlfcstone.com

*INTL FCStone estimates/projections

G-3 Industrial Production

Global IP/Economic Outlook

*INTL FCStone estimates/projections

Global industrial economy IP forecast: +2.1% 12 & +2.9% 13 vs +2% in 2011

Eurozone IP forecast: -0.4% 12 & +1.9% 13

G-3, China Industrial Prod Outlook

*INTL FCStone estimates/projections

Price, Spread Review

LME Price Review

LME Price Review

LME Spread Review

LME Spread Review

Copper Costs, and Prices

Chinas Net Metal Trade

East to West Trade

East Exports to West (Russia)

Inventory Trends, Weeks Usage

Inventory Trends, Weeks Usage

Inventory Trends, Weeks Usage

Copper Market Outlook

current ratio: 5.1 wks

12,866 13,062 12,996 13,548 14,238

Aluminum Market Outlook

current ratio: 16.3 wks

Total Consumption 18,847

22,824 23,341 24,529

Net E-W Balance

26,555 26,853 27,997

21,282 21,469 22,647

Zinc Market Outlook

current ratio: 13.9 wks

Lead Market Outlook

current ratio: 7.1 wks

Nickel Market Outlook

Nickel Price $/lb

Tin Market Outlook

current ratio: 8.2 wks

Funds and LME Volumes

LME Client Volumes: Funds vs Trade

funds account for 60+% of client volumes

Global Hedge/Macro Funds, $b AUM

CTA Assets, $b AUM

Index Funds, $b AUM

ETF/ETN Assets, $b AUM

ETF/ETN Assets ($b)

Industrial Metals, Fund Allocations, $b

Funds and Metals Pricing

copper stocks, weeks use

aluminum stocks, weeks use

zinc stocks, weeks use

lead stocks, weeks use

nickel stocks, weeks use

Economic and Metals Summary

1. Moderate Economic Growth

2. Metals consumption growth accelerates from 2011 pace

Base Metals, Price Outlooks

Reuters Price Forecasts (January 2012)

Copper consumption rebounds 2010, eases 2011; expected to hold

New/Expanded Copper Capacity

Copper Quarterly Supply-Demand Outlook