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Ardent Listener
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 Posted - 11/19/2006 : 18:23:34
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Base Metals To Forge Ahead In 2007
Demand from China key factor in pricing structure.
By Perrine Faye, Agence France-Presse
Oct. 12, 2006 -- Base metal prices will remain high next year but expanding mining production will limit gains, according to analysts gathered in London. This year has witnessed record price levels for copper, aluminum, zinc -- and most recently nickel and lead -- as global production across the base metals complex has failed to satisfy enormous demand from China.
Demand from the U.S. and Europe has also proved buoyant, but China was key to the demand picture for base metals.
Global metals demand is predicted to climb by 4.0% in 2007, compared with between 5% and 5.5% this year. Stockpiles meanwhile have fallen to critically low levels in 2006, as frequent strikes by workers at vital mines in Canada, Chile and New Caledonia have combined to create massive production deficits.
However, the fundamentals of supply and demand could soon change, analysts at LME Week warned. Mining companies are this year ploughing more than $7 billion into exploration, according to estimates from Societe Generale. That compared with a combined annual exploration budget of less than $2 billion in 2002.
New mines coming onstream over the course of the next year are expected to meet increased global demand for copper, aluminum and zinc, and could even result in production surpluses for lead and tin. However, nickel will remain mired in a production deficit. That is because of the current boom in demand for stainless steel, where the manufacturing process absorbs a hefty 65% of nickel supplies.
China is regarded as vital to demand growth because it consumes one fifth of total global supplies of copper and zinc. It also accounts for almost 30% of steel demand and 40% of iron ore, according to data from UBS.
Deutsche Bank analysts predict that China will import a staggering 20 million tons of copper in 2020, compared with just 3 million this year. And by 2010, Chinese consumption of aluminum will be so high that it will be no longer be self-sufficient and the country will need to import the metal for the first time since 2001.
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If you can conceive it and believe it, you can achieve it. -Napoleon Hill
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Ardent Listener
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4841 Posts |
Posted - 11/19/2006 : 18:27:30
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AFX News Limited
Iron ore prices seen up next year despite China pressure to curb rises - Numis
11.15.2006, 11:09 PM
SYDNEY (XFN-ASIA) - China will be closely monitoring iron ore contract negotiations for next year but further price increases are likely as supplies remain tight, London-based stockbroker Numis Corp said.
In a report, it said given the backdrop of growing demand for the ore, it is unlikely that producers will be willing to accept a price decrease.
It noted China is pushing hard to develop its own internal iron ore supplies but the iron content of domestic supplies is low compared to that of Australian or Brazilian iron ore.
In the latest year, contract negotiations for imports of iron ore to China were protracted and heated as China's steel mills argued against price increases, while major suppliers demanded an increase.
Eventually producers won a 19 pct increase for lump and fines iron ore products, following a 71.5 pct rise the year before.
The major suppliers of exported iron ore are BHP Billiton, Rio Tinto and Brazil's Companhia Vale do Rio Doce (CVRD).
China is the world's largest consumer of the metal.
Numis said the key major producers account for a combined total of 70 pct of global iron ore export sales.
It added that China's iron ore imports from January-October this year rose 22 pct year-on-year to 269.12 mln tons.
Numis said China's imports have recently surged due to stockpiling in northern China ahead of winter.
' We feel that the Chinese may try to build further inventory over the next 2-3 months ahead of the
next contract period (2007 contract starts in April) in order to use inventory as leverage during negotiations,' it said.
bruce.hextall@xfn.com
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If you can conceive it and believe it, you can achieve it. -Napoleon Hill |
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479 Posts |
Posted - 11/19/2006 : 18:33:59
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We don't know the future, but we must guess anyway.
China has not had a post-communist recession yet.
China is overdue for a recession, in my opinion.
Many things could slow the demand for metals, including:
1. A deep recession in the USA
2. A mild recession world wide.
3. An unforseen calamity.
None of us know what will come.
I buy metals as a LONG TERM hedge against inflation. I am not alone in doing so.
I have the luxury of not having to care too much about the short term volitility. I use the dips as buying opportunities.
People like me who buy during the dips help to moderate that volitility and smoothe out the ups and downs.
Fundamentally, I am a Malthusian. Exponential growth is not possible. Malthus was right about that.
A billiard ball dropped from 1,362 feet (height of the South Tower) in a
vacuum would require 9.22 seconds to hit the ground. How then did the
towers collapse in 10 seconds and 11.4 seconds, and why has not one
member of the mainstream media insisted on honest answers from the
government in this regard?
"The individual is handicapped by coming face to face with a conspiracy
so monstrous [that] he cannot believe it exists."
- J. Edgar Hoover |
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Ardent Listener
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USA
4841 Posts |
Posted - 11/19/2006 : 18:36:17
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--------------------------------------------------------------------------------
Thursday, November 16, 2006
2007 iron ore price rise to be under 10 percent
A Reuters report today suggests that the 2007 iron ore price increase will be under ten percent. World iron ore prices increased by 19 percent in early 2006, after a jump of over 70 percent in early 2005, fuelled by demand from China.
The prediction of a less than 10 percent rise is from POSCO. It comes just before the annual price negotiations which commence later this month.
For Reuters report, see You must be logged in to see this link.
blogger@steelonthenet.com
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If you can conceive it and believe it, you can achieve it. -Napoleon Hill |
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Ardent Listener
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4841 Posts |
Posted - 11/19/2006 : 20:27:14
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$25.9 billion deal creates copper giant
PrintE-mailDisable live quotesRSSDigg itDel.icio.usRelated Blog Posts & ArticlesBy MarketWatch
Last Update: 8:40 PM ET Nov 19, 2006
SAN FRANCISCO (MarketWatch) -- Freeport-McMoRan Copper & Gold Inc. agreed to acquire rival copper producer Phelps Dodge Corp. in a $25.9 billion cash-and-stock transaction to create North America's largest copper company, according to a media report Sunday.
Freeport (FCX : Freeport-McMoRan Copper & Gold Inc.
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57.40, +1.24, +2.2%) , based in New Orleans, said its offer is valued at $126.46 per share, marking a sizeable premium over Phelps Dodge's (PD : Phelps Dodge Corporation
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95.02, +0.14, +0.1%) Friday closing price of $95.02, The Wall Street Journal reported in its online edition. See Wall Street Journal story (subscription required).
Freeport said it is offering $88 in cash and 0.67 share for each Phelps Dodge share, the Journal reported, and will finance the deal's cash portion, some $18 billion, with debt.
The Phelps Dodge acquisition will be immediately accretive to Freeport's earnings, the company told The Journal, and it will seek to pay down the incurred debt as quickly as possible from the cash flows of the combined company.
The merger of two major copper producers continues the recent streak of big-ticket mining deals, as the industry's biggest players scramble to secure companies with large production and new mine developments, The Journal said..
The deal amounts to a large bet on the long-term sustainability of high metals prices, according to the report. Before this latest mining deal, some industry players had thought the industry's consolidation cycle had possibly abated in light of recent weakness in the price of copper, The Journal reported, noting copper prices have dropped more than 20%, trading at about $3.07 a pound Friday.
Long-held concerns that copper supplies could fall short of demand have been offset by a growing sense that supplies appear sufficient, The Journal reported, adding that industry costs have climbed sharply in recent years amid high energy prices and equipment and labor shortages.
The current copper price remains very high by historical standards, and provides strong earnings and cash flows to most mining companies, according to the report.
Freeport President and Chief Executive Richard Adkerson and Phelps Dodge Chairman and Chief Executive Steven Whisler said they have for years discussed the complements that could be attained by a combination of the companies, The Journal said.
Adkerson said the acquisition allows Freeport to branch out, The Journal said, noting Freeport operates the huge and highly profitable Grasberg copper and gold mine in Indonesia.
Phelps Dodge has geographically diverse mining operations in North America and South America and development projects such as a copper mine in Congo that stand to boost the combined companies' metal production by about 25% over the next three years, The Journal said.
Adkerson argued copper prices are likely to remain strong because of strong economic development in China and other fast-growing countries, and the continued lack of large new mine developments, The Journal said.
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pencilvanian
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USA
2209 Posts |
Posted - 11/21/2006 : 19:42:38
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Metals prices to remain bullish during 2007 – BarCap
Metals prices will remain bullish during 2007, supported by low inventories, a falling dollar and strong oil prices, Barclays Capital said Tuesday.
Commodity prices remain driven by tight supply and demand fundamentals, an increase in mining costs and hedge fund activity, Gerald Baker told delegates at the Mines & Money conference, forecasting an average cash copper price of $7,725 a metric ton for 2007, which exceeds most other analysts' forecasts.
Currently LME prices for three-month delivery are trading at around $6,870/ton.
The pitfalls for the market's direction would be a downward revision for growth in the Organization for Cooperation and Development, particularly for the U.S., where a further slowdown in the housing market would remain key for the copper market.
"There is also concern for a downturn in economic growth in China, where copper and nickel imports have fallen and there has been some evidence of copper substitution with aluminium," Baker said.
Barclays forecasts gold prices to average $595 a troy ounce for next year, while pegging average cash prices at $2,738/ton for aluminium and $30,375/ton for nickel.
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Ardent Listener
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Posted - 11/22/2006 : 19:28:02
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Copper in Shanghai Gains on Drop in Stocks, Improved Outlook
By Xiaowei Li
Nov. 22 (Bloomberg) -- Copper futures in Shanghai rose from a three-month low after inventories tracked by the London Metal Exchange fell and as domestic supply of the metal for immediate delivery remains tight. Aluminum increased too.
LME inventories of copper fell 100 tons, or 0.06 percent, to 157,925 tons, the exchange said yesterday. Stockpiles of the metal in Shanghai Futures Exchange warehouses declined 10 percent last week to a six-and-a-half month low of 31,576 tons.
`` We foresee stockpiles will continue to fall in the near term as low prices have spurred buying from both users and speculators,'' Shen Jianyun, a trading manager at the China International Futures (Shanghai) Co., said.
Copper for delivery in January rose as much as 1,400 yuan, or 2.2 percent, to 63,840 yuan ($8,117) a ton on the Shanghai Futures Exchange. The contract, which slumped 8.7 percent last week to a three-month low, traded at 63,700 yuan at the market's midday break, up 2.0 percent.
Metal for immediate delivery in Changjiang, Shanghai's biggest spot market, rose as much as 930 yuan, or 1.4 percent, to 65,530 yuan a ton today.
Shanghai aluminum rose as much as 230 yuan, or 1.2 percent, to 20,120 yuan and traded at 20,040 yuan at midday.
Supplies remain tight in China's domestic market, resulting in a substantial premium in the price of copper for immediate delivery. The premium for cash prices, or the so-called backwardation, now stands over 1,000 yuan.
Copper for three-month delivery on the London Metal Exchange yesterday rose $140, or 2 percent, to $6,980 a ton. The contract, which dropped to a five-month low last week, traded $50 down at $6,930 a tone at 11:32 a.m. Shanghai time.
Investors say bullish sentiment in the metals market was underscored by this week's announcement that Freeport-McMoRan Copper & Gold Inc. will buy fellow copper producer Phelps Dodge Corp. for $25.9 billion in the biggest mining takeover ever.
Citigroup, the biggest U.S. bank, said yesterday the ``super cycle'' in metals it forecast more than 18 months ago is still intact and the so-called fundamentals of supply and demand will keep prices above historical averages.
To contact the reporter for this story: Xiaowei Li in Shanghai at Xli12@bloomberg.net
Last Updated: November 21, 2006 23:08 EST
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Ardent Listener
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Posted - 11/23/2006 : 16:12:21
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Nickel Advances to Highest in 19 Years on London Metal Exchange
By Saijel Kishan and Chanyapr0n Chanjaroen
Nov. 23 (Bloomberg) -- Nickel rose to its highest in at least 19 years in London after a report showed stockpiles may decline, reducing supply of the metal used in stainless steel. Zinc was among other metals that also advanced.
Inventory monitored by the LME booked and scheduled for future delivery to buyers, known as canceled warrants, rose 330 metric tons, or 29 percent, to 1,560 tons, the exchange said today in a daily report.
``Canceled warrants have risen, which have been beneficial to the market,'' said David Thurtell, a London-based metals analyst at BNP Paribas. ``Liquidity is thin because of the holidays in Japan and the U.S.''
Nickel for delivery in three months on the LME gained $1,600, or 5.2 percent, to $32,750 a ton, the highest since at least 1987, and $125 more than the previous 19-year high set on Oct. 20. Nickel traded at that level as of 3:50 p.m. local time.
LME nickel inventory dropped 150 tons to 6,480 tons, the exchange said today. The stocks have slumped 70 percent in the past year. Demand will beat supply by 40,000 tons in 2006, Societe Generale forecast earlier this month.
Consumption of nickel grew this year in line with global stainless steel production. Stainless-steel makers may increase output 14 percent this year to 27.8 million tons, the International Stainless Steel Forum said last month.
Zinc, the metal used to galvanize steel, rose close to a record as declining stockpiles showed that production still lags behind demand. It gained $100, or 2.3 percent, to $4,460 a ton on the LME. Zinc traded at a record $4,580 on Nov. 10.
Rising Zinc Use
Inventory monitored by the exchange dropped 1.2 percent to 87,925 tons, the lowest since April 1991. Consumption exceeded output by 167,000 tons in the nine months to September on increased demand from China, the world's largest consumer of the metal, the World Bureau of Metal Statistics said yesterday.
``Continued declines in stockpiles are positive for zinc,'' said Roy Carson, a London-based trader at Triland Metals Ltd., one of 11 companies dealing on the LME's floor. ``I'm looking for the metal to test previous highs.''
China's zinc use increased 29 percent during January to September, the Hertfordshire, England-based WBMS said. Consumers have tapped stockpiles to fill the production shortfall, and inventory has plunged 80 percent in the past year.
The supply tightness for zinc created a situation on the LME known as a backwardation. Zinc for immediate delivery was $82 more expensive than the benchmark-three month price as of yesterday, almost double the $42 gap on Nov. 21, showing buyers are paying more if they need metal urgently.
In a market with ample supplies, longer-dated contracts trade higher than nearby ones due to storage and interest costs.
Prices of zinc for immediate delivery may rise to $5,400 a ton around January due to the supply shortfall, Michael Lewis, head of commodities research at Deutsche Bank AG, said Nov. 10.
The U.S. is closed today and tomorrow for Thanksgiving, Japan is also closed today.
Among other LME-traded metals, copper rose $92, or 1.3 percent, to $6,992 a ton, and lead added $16 to $1,549. Aluminum gained $15 to $2,690 and tin advanced $75 to $10,000.
To contact the reporters on this story: Saijel Kishan in London at skishan@bloomberg.net or; Chanyapr0n Chanjaroen in London at cchanjaroen@bloomberg.net
Last Updated: November 23, 2006 11:12 EST
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If you can conceive it and believe it, you can achieve it. -Napoleon Hill |
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 11/23/2006 : 18:54:54
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French Court Orders Halt to Building at New Caledonia Nickel Plant
A court in France has ordered that the Goro Nickel company in New Caledonia stop building part of its nickel plant in the territory's south for environmental reasons.
It has issued the injunction on request of the Kanak group, Rheebu Nuu, which had sought a complete halt to the two-billion US dollar plant amid fears that discharges from the nickel processing could cause lasting pollution of the land area and the lagoon.
The injunction orders Goro Nickel to stop the construction of the waste storage site within 48 hours under threat of a daily 40,000 US dollar fine.
The judges in Paris said while the project complies with New Caledonian laws, some issues have to be first decided by administrative authorities.
The Goro project currently employs about 3,000 people, including hundreds of Filipinos.
It was launched by the Canadian company Inco, which last month was taken over by CVRD of Brazil.
……………..(Tighter supply/reduced refining=higher prices.)
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Ardent Listener
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Posted - 11/24/2006 : 10:58:19
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Copper Prices Gain Most in a Month on Indian Smelter Shutdown
By Millie Munshi
Nov. 24 (Bloomberg) -- Copper prices in New York rose the most in a month after Hindalco Industries Ltd., India's biggest refiner of the metal, shut a smelter, triggering supply concerns.
Before today, the price of copper in New York had gained 54 percent this year, partly because of supply disruptions from Chile to Indonesia. Hindalco closed the smallest of its three plants after declining ore supplies reduced processing and refining charges, Chief Financial Officer Sunirmal Talukdar said.
``The partial closure of the big smelting complex is certainly giving strength to prices today,'' said Stephen Briggs, a London- based analyst at Societe Generale. ``It won't result in a huge disruption, though. The supply bottleneck is at the mine level, not at the smelter.''
Copper futures for March delivery jumped 9.9 cents, or 3.2 percent, to $3.235 at 9:41 a.m. on the Comex division of the New York Mercantile Exchange. A close at that price would mark the biggest percentage gain since Oct. 16. The exchange was closed yesterday for the U.S. Thanksgiving Day holiday.
Copper reached a record $4.04 a pound in mid-May. A futures contract is an obligation to buy or sell a commodity at a set price for delivery by a specific date.
Copper for delivery in three months gained $170, or 2.4 percent, to $7,150 on the London Metal Exchange. Prices gained 1.2 percent yesterday and are up 3.9 percent this week, snapping a four-week slide.
The metal, traded in dollars, also gained strength after the U.S. currency fell to its lowest in 19 months against the euro.
``After such a big fall in the dollar, you're bound to see prices move up,'' Briggs said.
To contact the reporter on the story: Millie Munshi in New York at mmunshi@bloomberg.net
Last Updated: November 24, 2006 09:44 EST
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If you can conceive it and believe it, you can achieve it. -Napoleon Hill |
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Ardent Listener
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Posted - 11/24/2006 : 16:30:02
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November 24, 2006
“Mr. Silver’s” Bullish Case for Commodities
Issue #611
by Dr. Mark Skousen
Dear Investment U Reader,
Over 600 well-heeled investors showed up last week at the New Orleans Investment Conference, the first in two years due to hurricane damage.
There were dozens of mining companies on exhibit, and commodity investing was all the rage.
I ran into Ross Beaty, chairman of Pan American Silver (Nasdaq: PAAS), who has amassed a fortune in silver and other Canadian mining stocks. I’ve known Ross for many years; he appears forever young. Here’s what “Mr. Silver” had to say…
The Million Dollar China Secret Wall Street Isn’t Sharing
One well-respected company has created a successful, non-invasive system for treatment of nature’s deadliest disease... and they are already making tens of millions of dollars on this technology. This treatment technology is one of the biggest breakthroughs in medical history and one of the most amazing money-making opportunities I've seen in 26 years as a leading investment analyst.
With net profits rising more than fourfold in the last three years, this is a story you'd naturally expect the major brokerage firms would have their clients stampeding into. But -- brace yourself -- it's not happening... yet.
This is one of the greatest investment opportunities of my lifetime. Investors who get in now position themselves to get very wealthy. Very quickly.
Wall Street isn’t going to be able to keep this million dollar “China Secret” quiet much longer. I urge you to get this FREE Special Report, to learn how to take advantage of this situation today.
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Commodities Are Headed Higher
Beaty gave me three reasons the bull market in commodities is bound to continue over the next decade. “Today’s correction is not the end of the commodity bull market,” he insisted. Here’s why…
1. The China-India Factor: Beaty travels regularly to Asia. He predicts that Asia – especially the two big nations of China and India – is the dominant influence in the global economy today. “The United States no longer drives commodity demand, Asia does!” he explained. The U. S. is not the engine it once was, and now represents only 30% of demand for base commodities like copper and aluminum. “When it comes to commodity demand, who cares about the U.S.? Only Asia matters!”
2. A Decline In the U.S. Dollar: Beaty admitted that oil, gold and other commodities are priced in dollars, but he insisted that the dollar can only get weaker over the next 10 years. “The trend is clearly downward,” he stated. But what about Fed policy? The U.S. may not carry the weight it once had in terms of economic demand, but it still controls the supply of U.S. dollars around the world. I pointed out to Ross that the U.S. dollar has been strengthening lately against the euro and yen, especially now that the U.S. is raising interest rates. He reluctantly agreed with my analysis. [Note: I have just learned that the money supply, M2, has started growing rapidly again at a 7% clip, so inflation may be back soon… and a declining dollar!]
3. Supply Constraints: Beaty said that global production of commodities across the board is showing signs of topping out. It’s not just peak oil, but peak copper, gold, aluminum, zinc, and other commodities. “The discovery rates are falling,” he said. “Everywhere, mines are being depleted and mining companies are producing lower grade base metals.” If this trend continues, it will squeeze production levels for many years, and force prices to skyrocket.
But what about technological breakthroughs, which allow us to use less commodities and be more efficient? For example, we use 50% less energy in our automobiles since 1985. Beaty agreed that there will be new technologies, but at the same time, there will be limits to expanding supply. “Even the new hybrid cars use four times more copper!”
Beaty has been right so far. Look at the five-year chart of the base commodities index, which includes aluminum, copper, zinc, nickel and lead.
Source: You must be logged in to see this link.
Commodity prices and stocks are advancing again. If you haven’t bought, now’s the time to get aboard, especially in the companies paying dividends: Freeport-McMoRan (NYSE: FCX), Southern Copper (NYSE: PCU) and Goldcorp (NYSE: GG).
Good trading, AEIOU,
Mark
________________________
If you can conceive it and believe it, you can achieve it. -Napoleon Hill |
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 11/24/2006 : 20:05:16
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While this is from a commentary section and not a news section, it does seem to make sense.
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Getting in Ahead of the Bull Market Upturn
Excerpt
.......Prices were too high (short term) in many commodities; this does not mean the boom is over.
China has apparently been supplying copper to the LME to cool prices so that can afford to buy what they need
without blowing their own inflation through the roof.
This is a new market force however they cannot keep this price management up for long, there is a real economic pressure from their demand pull inflation so they try to “manage” the situation as best they can under difficult circomestances.
Reports have noted LME copper stocks up 50%, sensational news
… really?
As you see below stocks are way down in 5 year terms,
only 3.5 days supply of copper at these so called “inflated” stock levels.
Nickel… always tight, lead extremely low stock, still tight.
Prices even at this current level are very profitable for many companies which will continue to earn huge profits and bolster balance sheets. This will cause continuation of the rally, a bumpy ride with wonderful investment potential for experienced traders who thrive in times of volatility.
(Charts wouldn't paste, sorry)
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Edited by - pencilvanian on 11/24/2006 20:14:19 |
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 11/24/2006 : 20:10:36
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Nickel soars on supply worries
Halt ordered on part of Goro site
Price surges to 19-year high
Nov. 24, 2006. 08:00 AM
LISA WRIGHT
BUSINESS REPORTER
Nickel soared to a 19-year high amid supply fears after a French court ordered Inco Ltd. to halt construction on part of its massive Goro nickel project in New Caledonia due to environmental concerns.
But Toronto-based Inco, which was taken over last month by Brazilian mining giant CVRD, said work continues on the $2 billion (U.S.) site's waste storage facility despite the injunction issued in Paris this week to cease work in that area or face daily fines of $40,000.
"We're still waiting to receive the full judgment, and then we'll have to analyze that to assess the full impact," Inco spokesman Steve Mitchell said.
"Construction is still continuing as usual," he added.
Local Kanak activist group Rheebu Nuu was seeking a complete shutdown of the planned mine project and hydrometallurgical plant located on the French-controlled island territory in the South Pacific amid concerns that waste from nickel processing could pollute area land and water.
Goro was forced to suspend work in April following incidents of vandalism and continued attempts to push for an indefinite halt to the project, which has been mired for years in numerous delays and cost overruns.
Nickel shot up yesterday on the latest Goro news as inventories continue to hover near critically low levels and a report showed stockpiles of the metal used in stainless steel may decline further in coming months.
Goro is one of the few key projects coming on stream in the next few years in the critically tight global nickel market.
The long-awaited nickel-cobalt project is seen as a cornerstone of Rio de Janeiro-based Companhia Vale do Rio Doce's Asia-Pacific expansion plans.
"The market sees this as one more piece of evidence that it will be delayed another year, probably into 2009," said analyst Ray Goldie of Salman Partners in Toronto.
"Once it's on stream, it will represent more than 4 per cent of the world's nickel supply and 8 per cent of the world's cobalt, so a delay would be very significant."
Goro is now scheduled to enter production around the middle of 2008 — revised recently from its previous 2007 start date — and ramp up to its 60,000-ton annual designed capacity over the following two years.
Nickel for delivery in three months on the London Metals Exchange rose $1,600 to reach $32,750 a tonne, or $14.87 a pound yesterday, the highest since 1987 and $125 more than the previous 19-year high set last month.
It closed up $1,400 to $32,550 a tonne.
The Paris judgment followed months of strikes and protests over the rising cost of living and the use of expatriate labour in the local nickel industry. Goro construction employs 3,000 people.
Inco, however, is not concerned that the court injunction will mean further delays at Goro.
"The ruling relates to an application on a number of environmental and technical claims they made. The court dismissed all but one of those claims," said Mitchell, referring to the latest court ruling.
The judges in Paris said that while the project complies with New Caledonian laws, some issues have to be addressed first by administrative authorities.
Nickel inventory on the LME dropped 150 tonnes to 6,480 tonnes yesterday. Stockpiles have slumped 70 per cent this year.
Escalating costs and industrial and community relations problems were behind Inco's decision to suspend work on the project for two years until restarting in 2004.
Officials from CVRD visited Inco's regional headquarters in Brisbane, Australia, earlier this month to hear Goro's updated cost and timetable estimates after Inco said in July that costs are likely to exceed its forecast.
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Copper in Shanghai Rises to Two-week High on Falling Stockpiles
By Xiaowei Li
Nov. 24 (Bloomberg) -- Copper prices in Shanghai rose to the highest in two weeks as stockpiles of the metal in warehouses in China fell to their lowest in almost 18 months. Aluminum also rose to a one-week high.
Copper inventories in Shanghai Futures Exchange warehouses fell 14 percent to 27,141 metric tons, the lowest since June 2, 2005. Aluminum stocks plunged 34 percent to 17,293 tons. Copper prices in China, the world's biggest user of the industrial metal, fell 8.7 percent last week to a three-month low.
``Users who stepped up buying at lower prices will probably have to draw on stockpiles as China lowered imports,'' said Shen Haihuai, vice president of Maike Futures Co. before the release of the latest weekly inventory data.
Copper for delivery in January on the Shanghai Futures Exchange rose 1,770 yuan, or 2.8 percent, to settle at 65,690 yuan ($8,363), the highest since Nov. 11. The contract has gained 7.1 percent since reaching a three-month low of 61,310 yuan on Nov. 17.
Metal for immediate delivery in Changjiang, Shanghai's biggest spot market, rose as much as 300 yuan, or 0.5 percent, to 65,180 yuan a ton today,
China's imports of copper and copper products, the driving force behind an 83 percent rise in the metal's price in the past year, fell 22 percent in the first 10 months of 2006 to 1.7 million tons, the Beijing-based customs office said Nov.8.
Chinese production of copper, used to make wire and pipes, rose 8.9 percent in October from a year earlier, the National Bureau of Statistics said today.
Copper output increased to 248,000 tons last month, it said in an e-mailed statement. Output rose 20 percent to 2.41 million tons in the first 10 months of this year, compared with the same period last year, it said.
Shanghai aluminum rose 220 yuan, or 1.1 percent, to 20,280 yuan, the highest in a week.
On the London Metal Exchange, copper for delivery in three months rose $70, or 1 percent, to trade at $7,050 at 3:43 p.m. Shanghai time.
A futures contract is an obligation to buy or sell a commodity at a fixed price for a specific delivery date.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 11/24/2006 : 20:29:17
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Vedanta Resources' Indian unit to buy Congo copper mine for 2 bln usd
Hindustan Zinc Ltd (HZL), controlled by Vedanta Resources PLC, is set to enter into the copper sector by purchasing an unexplored copper mine in Congo with an investment of 2 bln usd, said the Indian daily Business Standard.
The report added that the acquisition would be mainly funded through internal funds, but HZL did not rule out the possibility of a follow-on offering to partially fund the project.
The report quoted sources within the Vedanta group as saying that the government of Congo is 'keen on the deal' as the civil war in Congo has hit its economy badly, and highest level talks are on between the two parties. 'The Congo government will get a royalty from this mine,' one source was quoted as saying, adding that the deal is likely to be finalised within the next 4-5 months.
The report added that HZL, the world's fourth-largest lead-zinc mining company, is likely to invest close to 90 bln rupees in the project over the next 2 years, which includes a smelter plant worth 20 bln rupees.
The Vedanta group holds about 65 pct in HZL, and it recently said it intends to use the proceeds of the NYSE listing of its unit, Sterlite Industries Ltd, to buy the remaining stake in HZL from the government of India.
This will push up prices…..
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Chile Pelambres copper output to fall if dam halted
Output at Chilean copper mine Los Pelambres, controlled by London-listed Antofagasta PLC (ANTO.LN), will fall if the Supreme Court halts construction of a tailings dam, El Diario Financiero reported Tuesday, quoting unnamed sources.
Earlier this month, an appellate court upheld a claim presented by farmers against the award of some permits by a Chilean water authority in November 2005 for certain aspects of the construction of the Mauro tailings dam at the Pelambres mine.
The mine's existing tailings dam, called Quillayes, is almost at capacity and likely will need to be replaced by 2009, the newspaper reported, citing unnamed sources.
The mining company filed an appeal against the ruling on Tuesday, and the case is expected to go before the Supreme Court.
If the high court rules against the water rights, the company's expansion plans likely will fall through, the sources told the newspaper.
This year, the mine is expected to produce some 320,000 tons of copper.
If its expansion plans, including the new Mauro dam, go forward without any hitches, output should be around 360,000 tons of copper a year in 2008.
Pelambres produced 333,837 tons of copper and 8,710 tons of molybdenum in 2005, according to data released by the Consejo Minero mining trade group. It also produced small amounts of gold and silver.
This too…..
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Copper prices gain most in a month on Indian smelter shutdown
Copper prices in New York rose the most in a month after Hindalco Industries Ltd., India's biggest refiner of the metal, shut a smelter, triggering supply concerns.
Before today, the price of copper in New York had gained 54 percent this year, partly because of supply disruptions from Chile to Indonesia. Hindalco closed the smallest of its three plants after declining ore supplies reduced processing and refining charges, Chief Financial Officer Sunirmal Talukdar said.
"The partial closure of the big smelting complex is certainly giving strength to prices today," said Stephen Briggs, a London- based analyst at Societe Generale. "It won't result in a huge disruption, though. The supply bottleneck is at the mine level, not at the smelter."
Copper futures for March delivery jumped 9.9 cents, or 3.2 percent, to $3.235 at 9:41 a.m. on the Comex division of the New York Mercantile Exchange. A close at that price would mark the biggest percentage gain since Oct. 16. The exchange was closed yesterday for the U.S. Thanksgiving Day holiday.
Copper reached a record $4.04 a pound in mid-May. A futures contract is an obligation to buy or sell a commodity at a set price for delivery by a specific date.
Copper for delivery in three months gained $170, or 2.4 percent, to $7,150 on the London Metal Exchange. Prices gained 1.2 percent yesterday and are up 3.9 percent this week, snapping a four-week slide.
The metal, traded in dollars, also gained strength after the U.S. currency fell to its lowest in 19 months against the euro.
"After such a big fall in the dollar, you're bound to see prices move up," Briggs said.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 11/24/2006 : 20:31:47
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Largest copper mine company in Zambia suffers production losses
The largest copper mine company in Zambia lost 4,120 tons of copper production due to a pollution-led closure earlier this month, The Post reported on Friday.
The local newspaper quoted spokesperson of Konkola Copper Mines (KCM) Sam Equamo as saying on Thursday that during the closure from Nov. 6 to 16, KCM lost 352 tons of copper production a day, which translated into 3,520 tons.
"And between Nov. 17 to 20 we lost 200 tons per day which is 600 (tons) in total," he said.
Equamo said KCM is putting in place all necessary measures to ensure that similar spillage will not occur in the future.
"We are being closely monitored by the ECZ (Environmental Council of Zambia) and the mine safety department and we are also putting in our own measure to make sure this doesn't happen again, " he said.
ECZ, Nkana Water and Sewerage Company, local farmers and individuals have indicated they will sue KCM for damages caused by the pollution.
Earlier this month a KCM tailings pipeline in Copperbelt Province burst and polluted the Kafue River that led to disturbing of the normal supply of water to residents in the province.
Several people fell sick after eating dead fish that were poisoned by the polluted water.
KCM, jointly owned by the Zambian government and Indian mining firm Vedanta Resources, which has a majority stake and is managing the mines, suspended production of copper at its Nchanga plant following the closure of its tailings leach plant.
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Ardent Listener
Administrator
USA
4841 Posts |
Posted - 11/26/2006 : 16:03:15
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Metals hit historic highs & oil gains, but farm commodities retreat
LONDON: The price of nickel and platinum hit historic highs this week, while other dollar-sensitive metals such as gold, silver and copper also posted strong gains.
After coming under pressure early in the week, oil prices also advanced, while commodities like sugar, coffee, cocoa, wool and rubber retreated. Cereals and soya were stronger, however.
Base Metals: Base metals rose, with nickel hitting a new peak since its first quotation in 1979, supported by low global supplies and the weak dollar.
The price of nickel climbed Friday to 33,500 dollars per tonne on the electronic platform of the London Metal Exchange (LME), the world’s premier non-ferrous metals market. It has now surged by 150 percent since the start of the year.
“In thinner than usual trading conditions because of the US Thanksgiving holiday, base metals extended their recovery from the recent lows, with zinc and nickel leading the charge higher helped by a weaker dollar,” UBS bank analyst Robin Bhar said.
Since base metals are traded in dollars, a weaker greenback boosts demand, and prices especially if supplies are limited. “LME base metals were all higher in quiet trade, with many market participants away until Monday because of the US Thanksgiving holiday,” according to Michael Davies, analyst at Sucden brokerage house. “Leading the way was nickel, which set a new all time high as stocks remained at extremely low levels,” he said.
Other metals also gained. Copper surpassed 7,000 dollars per tonne and tin topped 10,000 dollars. On the LME, the price of copper for delivery in three months was 7,040.50 dollars per tonne Friday, up from 6,690 dollars a week ago. Aluminum was 2,695 dollar per tonne, up from 2,615 dollars.
Zinc was quoted at 4,514.50 dollars per tonne, up from 4,080 dollars. Nickel rose to 33,400 dollars per tonne from 29,395 dollars last week. Tin was 10,075 dollars per tonne, up from 9,700 dollars.
Lead was quoted at 1,580 dollars per tonne, up from 1,494 dollars.
Platinum and Palladium: The price of platinum also hit a record this week amid rumors about the possible launch of an exchange traded fund (ETF) for platinum, with palladium following in its wake.
“We don’t know if and how it’s going to happen,” according to Stephen Briggs, analyst at Societe Generale.
The platinum market has been in deficit since 1999. Output is expected to hit seven million ounces in 2006, or 20,000 ounces below demand.
Though palladium also made gains, its climb was slowed by excess production for the sixth year in a row this year.
“Palladium looks set to remain within its 305-30 dollar range as above ground stockpiles cap the metals upside potential,” according to James Moore, of The Bullion Desk. On the London Platinum and Palladium Market (LPPM), an ounce of platinum was worth 1,192 dollars Friday evening.
Gold: In the wake of the weaker dollar, gold traded Friday at 640.30 dollars, its highest level since September 6.
“In the absence of strong fundamentals support at current price levels the future path of the euro and US dollar is likely to remain a key theme in the gold market over the next few months,” said Costanza Jacazio, an analyst at Barclays.
On the London Bullion Market, an ounce of gold traded for 639.50 dollars at Friday evening’s fixing, compared with 620.50 dollars the preceding week.
Silver: With the weak dollar, the price of silver surged to 13.49 dollars an ounce Friday in London, the highest level since May 17, when its price of 15.22 dollars was in turn its highest level in 15 years.
“I remain bullish towards silver with investors and speculators still keen buyers, while base metal gains add background support,” said Moore of The Bullion Desk. Silver is both a precious and industrial metal, which explains why base metal movements affect its price. On the London Bullion Market, silver traded at 13,37 dollars per ounce at the Friday fixing, compared with 12.75 dollars a week ago.
Oil: Following a week of fluctuations, prices finished higher because of export problems in Alaska and Nigeria. Movements tended to be exacerbated with slower trading because of the Thansgiving holiday in the United States. Prices began the week lower before rebounding by more than 1.30 dollar on Tuesday, as bad weather interrupted exports from Alaska.
However, the suspension of some exports from the Italian group ENI in Nigeria on Friday following a new separatist attack, sent prices back upward.
The increase in prices is curbed however by lingering skepticism over the intentions of the Organization of Petroleum Exporting Countries. OPEC was at pains to convince the market that it will follow through on a pledge to reduce output by 1.2 million barrels per day in November, and reduce it again in December.
In London, a barrel of Brent North Sea crude for January delivery traded at 60.07 dollars on Friday, compared with 58.99 dollars from the previous Friday.
In New York, a barrel of crude for January delivery traded at 59.88 dollars in electronic trading, up from 58.97 dollars the previous week.
Grains and Soya: Prices rebounded amid slower trading during the short holiday week in the United States. “For the most part, it was positive this week, mainly because of a good demand for corn and soy bean, both domestically and on the export side,” said Joe Victor, an analyst at Allendale.
He did not expect demand for corn and soy bean to weaken as the United States accounts a large portion of world supply. “For wheat it’s different, because France, Russia, Canada, India have good supplies,” he added. “Every month of the year with the exception of February there’s a major world supplier harvesting wheat.”
On the Chicago Board of Trade (CBoT), which closed for the Thanksgiving holiday but reopened briefly on Friday, December wheat contracts traded at 4.92 dollars the bushel, against 4.69 dollars a week ago.
The December contract for corn traded at 3.66 dollars, compared with 3.48 dollars a week ago in Chicago, and soy beans for January delivery stood at 6.79 dollars, up from 6.54 dollars.
On the LIFFE, the price of a tonne of wheat for January delivery traded at 97.75 pounds, compared with 97.0 pounds a week ago.
Wool: The market price of wool declined again, partly because the Australian dollar gained against its US counterpart, making wool more expensive overseas.
The Eastern index an average of Australian prices in Sydney, Melbourne and Fremantle retreated by 2.1 percent this week in Australia, the world’s top producer. The Eastern index closed Thursday at 8.26 Australian dollars per kilogram, down from 8.44 dollars the previous week. In Britain, the Wooltops index traded at 455 pence Thursday, the same as a week earlier. afp
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 11/27/2006 : 19:22:06
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The Daily Pfennig 11/27/06: Data Week...
Excerpt, commentary worth remembering……..
………..Gold and silver are also taking liberties with the dollar, as I've said all along... Dollar weakness leads to metals strength... I signed off last Wednesday talking about the recovery in the base metals...
So, let me see if I have this right...
Base metals on the rise...
Precious metals on the rise...
And there are still people out there saying the bull market in commodities is finished?
HAHAHAHAHAHAHAHA!
What a bunch of DOLTS!
Obviously, not commodity bull market historians!
............I couldn’t have put it any better myself.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 11/28/2006 : 19:25:17
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Copper Futures in Shanghai Gain for 4th Day on Lower Stockpiles
By Xiaowei Li
Nov. 27 (Bloomberg) -- Copper futures in Shanghai rose for a fourth straight day, to a two-week high, as reduced stockpiles in warehouses in China and lower imports renewed supply concerns for the metal used in wires and pipes. Aluminum also rose.
Copper inventories in Shanghai Futures Exchange warehouses fell 14 percent last week to 27,141 metric tons, the lowest since June 2, 2005. Inventories have slumped 59 percent since they peaked at 65,919 tons in the week of June 19, because users have had to draw on stocks as China's imports of copper and copper products fell 22 percent in the first 10 months of 2006.
``We see supply is tight in China's spot market, resulting in a substantial premium in cash contracts, which is the major support to prices of futures contracts in the domestic market,'' said Wang Zheng, a trader at the Shanghai Continent Futures Co.
Copper for delivery in January rose 1,430 yuan, or 2.2 percent, to settle at 67,120 yuan ($8,559) a ton on the Shanghai Futures Exchange, the highest settlement price since Nov. 10.
Metal for immediate delivery in Changjiang, Shanghai's biggest spot market, rose as much as 3,450 yuan, or 5 percent, to 68,630 yuan a ton today,
Shanghai aluminum rose 210 yuan, or 1 percent, to settle at 20,490 yuan, the highest since Nov. 11. Aluminum stockpiles in warehouses in China slumped 34 percent last week to 17,293 tons.
China's demand for base metals was expected to hold up well next year as the nation's economy expands, Wang said.
Growth was unlikely to slow ``sharply'' next year with consumer spending and industrial production rising, Yao Jingyuan, chief economist of the National Bureau of Statistics, said yesterday.
Copper for three-month delivery on the London Metal Exchange gained $35, or 0.5 percent, to $7,190 a ton at 3:50 p.m. Shanghai time.
A futures contract is an obligation to buy or sell a commodity at a fixed price for a specific delivery date.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 11/29/2006 : 18:47:53
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China may use yearend lull to coax down copper; nickel to stay strong – Numis
China is keen to bring rising copper prices under control, and may take strategic market positions during the end-year lull to help control prices for the metal, Numis Securities said.
'Thin trading on the LME over Christmas could make the market vulnerable to manipulation from key consumers, like the Chinese, who could make a concerted effort to reduce prices in this environment. The danger is that the bulls could decimate anyone who dares to short the market and this threat could keep speculators away,' Numis said in a research note.
Copper rose back over 7,000 usd per ton to 712 on the London Metal Exchange as the US currency continues to slide, the note said.
Late last year, a trader with China's State Reserve Bureau (CRB) took major short positions on London copper, resulting in extensive losses for the bureau.
'While copper prices should fall against rising inventory levels,
a falling US dollar serving to maintain price levels.
We are beginning to feel that metals prices could remain strong until the year-end rather than weakening through the Christmas period, and in this environment, prices could simply probably drift before gaining new momentum in the new year,' the note added.
Numis also said prices for nickel are hitting new record levels, reaching 33,350 usd per ton this morning in London as record production and demand for stainless steel holds inventory levels down.
'Expectations for further production and demand growth in stainless steel in China indicate that (nickel) prices could rise further, helped along by a weaker US dollar,' the note said
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 11/30/2006 : 20:11:45
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Nickel rises, heads for fifth monthly gain on dwindling stocks
Nickel rose in London, heading for a fifth straight monthly gain, on speculation that supply will remain tight after two mining projects were delayed.
Stockpiles of nickel tracked by the London Metal Exchange have plunged 81 percent in 2006 to 6,726 metric tons, equal to less than two days of global usage. BHP Billiton Ltd. said today that its Ravensthrope nickel mine will take up to a year longer to develop. Last week, Cia. Vale do Rio Doce said it will start up the Goro mine in 2008, a year later that previously planned.
"This will certainly keep prices high," Andrew Mitchell, a nickel analyst at Surrey, England-based metals consulting company Brook Hunt, said by telephone.
Nickel for delivery in three months on the LME gained $1,050, or 3.2 percent, to $33,750 a ton as of 1:31 p.m. local time. A close at the level would mean a 10 percent gain this month, following a 4.3 percent increase in October. A futures contract is an obligation to buy or sell a commodity at a fixed price for a specific delivery date.
Prices of the metal, mostly used in stainless steel, have more than doubled this year as demand from steelmakers expanded, forcing consumers to tap into stockpiles.
Ravensthrope is in Western Australia. Lower-than-expected labor productivity and late delivery of materials and equipment rope will increase costs by 64 percent to $2.2 billion and delay its start-up until the first quarter of 2008, Melbourne-based BHP said.
Goro, on the Pacific island of New Caledonia, is the largest nickel mine being built. The project has suffered from vandalism, local protests over environmental concerns and ballooning costs.
Brook Hunt's Mitchell said there will be a 5,000-ton supply shortfall this year. He will revise his market forecast for next year to show a shortfall, from a surplus previously. He also expects a larger deficit in 2008.
Copper for delivery in three months on the LME gained $35 to $7,045 a ton. The contract headed for a second straight monthly decline. On the Comex division of the New York Mercantile Exchange, the March contract added 2.75 cents to $3.181 a pound.
Among other LME-traded metals, aluminium rose $20 to $2,720 a ton and zinc increased $45 to $4,385. Lead was $20 higher at $1,660 a ton and tin climbed $220, or 2 percent, to $10,570.
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Copper mill in Seymour to close in '07
A copper mill that opened for business 157 years ago will be shutting down next year.
Some 50 employees of New Haven Copper Co. were told Tuesday the company will close this spring. The decision came just weeks after town and state officials met with representatives from its Missouri-based parent company, Olin Corp.
The company on Main Street is a small-scale mill that processes copper strips. The company was acquired by Olin in June 2001.
A statement released by Olin on Tuesday said reduced industry demand for copper and copper-alloy strip products, plus cost increases, contributed to the decision to close the plant.
"I was just hoping the state would come in and offer a lot more assistance than they offered," First Selectman Robert J. Koskelowski said. "I'm very disappointed."
While workers will be offered job training, Koskelowski said a number of them are in their 50s. "That's a tough age to have to retrain," he said.
In addition to state and federal funding that could be available for job training, workers could also qualify for extended federal unemployment benefits, said state Sen. Louis C. DeLuca, R-Woodbury, whose district includes Seymour.
Olin had been based in Norwalk until it moved its headquarters to a St. Louis suburb nearly two years ago.
More recently, the company renewed the Winchester firearms license with Herstal Group, which closed the historic Winchester plant in New Haven.
A local bidder had sought the license in hopes of retaining some firearms manufacturing in the Elm City.
.........(Its when the workers lose their jobs, thats when it really hurts, especially when we are talking about older workers.
Still, small mills can't compete against large mills since costs per unit are reduced for a large operation.
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30 November 2006
Global refined market now firmly in surplus: WBMS, ICSG
Reports released last week by two widely respected analytical and consulting groups showed the global refined copper market to be firmly in surplus.
A report released November 22 by the World Bureau of Metal Statistics said the market recorded a surplus of 228,000 mt in the first nine months of 2006, more than double the surplus recorded one month previously.
Reported stocks in global exchanges have increased by 57,000 mt since December 2005.
No allowance was made in the consumption calculation for unreported stock changes, the WBMS said.
Mine production for the period was 11 million mt,
fractionally lower than in the first nine months of 2005,
with supply problems in Mexico and Indonesia dampening global output and counteracting the effects of increases in Africa and Kazakhstan. Refined production was 13.04 million mt, which is 6% above the comparable 2005 total.
Chinese output rose by 372,000 mt, while Indian, Zambian and Japanese production all rose by 101,000 mt, 68,000 mt, and 107,000 mt, respectively, compared with the comparable months of 2005, according to WBMS estimates.
Consumption in the January-September period was 12.81 million mt,
which was almost 2% higher than the previous year.
Chinese consumption fell by 6.9% to 2.61 million mt due to lower demand for imported copper.
Output of Chinese semi manufactures reportedly rose by 6.9% in the January-September period compared with the first nine months of 2005, WBMS said.
The calculated apparent demand data excludes any releases from Chinese government stockpiles or any other unreported stocks.
A report released earlier in the week by the International Copper Study Group put the apparent surplus in the refined market at about 88,000 mt in August,
decreasing to about 3,000 mt after making seasonal adjustments.
ICSG attributed the higher monthly surplus mainly to weaker copper usage during the traditional summer holiday period.
The apparent refined copper balance for the first eight months of 2006, including revisions to previous data, indicated a production surplus of about 84,000 mt and, when seasonally adjusted, a surplus of 134,000 mt. This compares with a production deficit of 233,000 mt (seasonally adjusted 174,000 mt) for the same period in 2005, the ICSG said.
Like the WBMS, the ICSG did not take into account changes in China's SRB stocks, which are unreported and which might affect calculation of China's apparent consumption.
"Although the apparent usage of refined copper in China showed signs of recovery in August,
world usage was affected by seasonal factors
that led to weak demand in Japan and the European Union-15, both dropping to the lowest level of the year,
and a depressed market in the US," the ICSG said in the report. Despite weaker demand in August, ICSG data for the first eight months of 2006 indicate that world refined usage increased by about 3% compared with usage in the first eight months of 2005.
Regionally, total European usage increased by 12% in January-August 2006 compared with that in January-August 2005,
with the EU-15 being the main driver with an apparent usage increase of 16%.
Usage in Asia was down by 1.4%, with growth in Japan (5.8%) and India (3.7%) being more than offset by a decrease of 6.9% in China.
Usage in the US was flat.
On the supply side,
world mine production in August was reduced by a strike at the Escondida mine in Chile, the largest copper mine in the world.
Owing to this and previous disruptions to production,
world mine production for the first eight months of the year was essentially unchanged from that in the same period of 2005 (up by 0.3%): Concentrate production was down by 0.7%, and SX-EW production was up by 4.7%.
Global mine capacity utilization decreased to an average of 85.8% from an average of 87.6%
in the same period of 2005.
Total world refined production increased by 5.9% in the first eight months of 2006 compared with that of the same period of 2005:
Primary production was up by 4.9% and secondary production (from scrap) was up by 13%.
Refined capacity utilization averaged 83.2%, up from 80.4% in the same period of 2005. With the exception of Chile (-1.6%), all major producing countries increased their production [China (21%), Japan (11%), US (5.5%), Russia (1.8%) and India (30%)].
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 12/03/2006 : 21:21:50
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Goldman Sachs raises '07 forecasts for nickel, zinc, platinum prices on supplies
Goldman Sachs Group Inc., the most profitable investment bank in Wall Street history, increased its 2007 forecasts for nickel, zinc and platinum prices, saying supplies are "tighter." The bank also rated Xstrata Plc a "best buy idea."
Prices of nickel, used in stainless steel, will average $25,000 a metric ton next year, Goldman Sachs analysts led by Peter Mallin-Jones in London wrote in a report dated yesterday. That's a 33 percent increase from the previous estimate.
"Stainless-steel related demand for nickel has likely played a significant role in depleting nickel inventories this year," the analysts said. Supplies will lag behind demand by 20,000 tons this year, and the deficit will persist to next year, they said.
A strike at Eramet SA's Doniambo unit in New Caledonia, the world's largest ferronickel plant, has contributed to declining supplies as deliveries have dropped 8.5 percent since the strike started on Sept. 25, New York-based Goldman Sachs said.
Prices will average $17,750 a ton in 2008, before dropping to $15,000 tons in 2009, the bank said.
Shares of Xstrata, which acquired Canadian nickel producer Falconbridge Ltd. in September, are "underpriced," Goldman Sachs said. The Falconbridge acquisition has transformed Zug, Switzerland-based Xstrata into a global diversified miner and offers "the most potential upside" among the stocks the analysts covered, the bank said.
The analysts raised their share-price target for Xstrata 40 percent to 3,165 pence. Xstrata shares have gained 93 percent in the past year and were at 2,341 pence as of 10:12 a.m. in London.
The $17 billion purchase of Falconbridge, the world's fourth-largest nickel producer by 2005 output, also helped Xstrata to be the world's fourth-largest copper producer.
Zinc, Platinum
Goldman Sachs increased its zinc-price forecast 49 percent, saying the metal will average $4,298 a ton, peaking in the first quarter when prices are expected to average $4,520 a ton.
"Demand for galvanized steel looks strong currently, driving strong demand for zinc metal," the analysts said. Zinc is mostly used to galvanize steel. Prices will average $3,323 a ton in 2008 and $1,900 a ton in the following year.
The bank kept its 2007 forecasts for copper and aluminium unchanged at $5,875 a ton and $2,425 a ton, respectively. Aluminium will be in a surplus of 125,000 tons next year on rising production of alumina, the raw material used to produce the metal. Copper's oversupply is projected to be 230,000 tons next year, the analyst said.
The platinum market is also tighter than what the analysts previously expected, they said. Prices will average $1,225 an ounce next year, 11 percent higher than the previous estimate. Prices will average $1,085 an ounce in 2008 and $1,000 in 2009.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 12/03/2006 : 21:30:06
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China importing low grade nickel
China is importing very low grade nickel ores in an effort to reduce its exposure to the current record high prices for the element, Numis Securities said.
Numis said China was using ores with 1.5-2 pct nickel content to make pig iron with four pct nickel, which can then be used to make stainless steel.
'The economics of doing this reportedly work when nickel prices are over 15,000 usd per ton although we are amazed to hear of such low grade nickel ores being transported so far,' Numis said in the research note.
'High prices are causing substitution where possible, but this is limited.'
Nickel prices have performed strongly due to demand from stainless steel manufacturers and a lack of supply and inventory. In addition, some major mines have had delays in bringing on new capacity, the note said.
Nickel prices reached a record 34,100 usd per ton this week in London
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LME nickel climbs to fresh all-time high on supply concerns, dollar: Analysis
Three-month nickel at the London Metal Exchange extended its recent strength to hit another all-time high Friday, driven by the weakness in the dollar and supply concerns, analysts said.
"The weaker U.S. dollar is supportive to prices but the announcement this week that the Ravensthorpe mine would delay its production into 2008 from the second quarter of 2007 is causing a flurry of analysts to revise their supply/demand deficit projections," a base metals analyst said.
Global miner BHP Billiton said Thursday that costs at its Ravensthorpe nickel project have increased by $860 million to $2.2 billion. In addition, BHP said lower-than-expected labor productivity and late delivery of some materials and equipment mean the target date for first metal from Ravensthorpe is now the first quarter of calendar 2008 compared with the original startup in the second quarter of 2007.
"Ravensthorpe is expected to produce 50,000 tons a year nickel and 1,400 tons a year cobalt in a mixed intermediate product, which will be processed at the company's Yabulu nickel refinery. BHP Billiton blamed the delays on lower-than-expected labor productivity and late delivery of some materials and equipment," said Jim Lennon of Macquarie Bank.
However, "the project's been flagged for some time as having problems sourcing equipment and labor, so there's always been room for some slippage in its timetable," said Robin Bhar of UBS.
"Implications of this news is that the deficit we had for 2007 of 5,000 metric tons is now likely to increase to about 30,000 tons and for 2008 a deficit of about 20,000 tons is projected, from a roughly balanced market," Bhar added.
At present, nickel stocks remain at critically low levels, falling by 660 tons to 6,066 tons Friday, according to LME warehouse data.
Meanwhile, other supply fears continue to hang over the market in part due to a strike at Eramet's (13175.FR) New Caledonian operations, where around 50 tons a day of metal have been lost since the action began on Sept. 25.
The strike isn't directed at Eramet, the world's fifth-largest nickel producer, but instead is a general action by the New Caledonian Confederated Union of Workers to protest against living costs. New Caledonia is a French-controlled South Pacific island.
Also impacted by the strike is Brazilian mining giant Companhia Vale do Rio Doce's (RIO) Goro nickel project. The manager of the project said Tuesday the French Pacific territory has instructed it to continue work on a waste storage facility as it considers an appeal against a Paris-issued order to cease work.
Last week, a French court dismissed an injunction filed by local activist group Rheebu Nuu to halt the $3 billion project altogether on environmental grounds but gave Goro two days to stop land clearing for a residue disposal area or face daily fines of EUR30,000.
Meanwhile, CVRD Chief Executive Roger Agnelli was recently quoted as saying the project's new cost estimate is close to $3 billion, compared with $2.15 billion previously, and its startup is estimated for late 2008 from mid-2008 previously.
"We're in an extremely tight situation as the supply is just not there," said the base metals analyst. There is nothing to stop nickel prices from going higher right now, the analyst noted, adding weakness in the dollar adds further upward momentum.
LME nickel traded to a fresh all-time high of $34,400 a metric ton Friday, as the U.S. dollar remains severely under pressure against the euro at 20-month lows.
Michael Davies of Sucden Research noted in a report saying "a weaker dollar can make dollar denominated base metals cheaper to foreign investors, but a collapsing dollar could mean the value of the metal would depreciate relative to other currencies."
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 12/04/2006 : 18:19:34
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Chile: Repair of Collahuasi mine may reduce copper production
A key mill at Chile's 425,000-metric-ton-a-year Collahuasi copper mine may be taken off for repairs lasting around 70 days from January, which could cut production by up to 30,000 tons, the chief executive officer of Collahuasi's operating company said.
"We have not made a firm decision when we will do the repair but we're not ruling out January 2007 as a possibility," Collahuasi CEO Thomas Keller told.
Collahuasi is a 100%-owned subsidiary of London-listed Xstrata Plc, Anlgo American Plc, which each hold 44% in the mine, and a Japanese consortium headed by Mitsui & Co. Ltd.
The $8-million repair to one of the mine's three SAG mills, which accounts for 45%-50% of ore throughput, has been on the cards since the mill's motor broke down in 2005, Keller said.
"The motor broke down in 2005 and underwent a temporary repair, so a replacement of the unit has been planned since and we have contingent repair contract with ABB. The difficult part is to decide when to do it, which depends on copper market conditions and production conditions," Keller said.
A period of high ore grades in the mine plan would help to offset production losses but Keller declined to outline likely future ore grading.
"Key to our decision when to do the repair will be ore grades," Keller said.
He said there was limited capacity to shift ore to Collahuasi's other two mills during an outage, which could amount to a production loss of 100,000 tons of copper concentrate, the precursor to refined metal.
An Xstrata spokeswoman confirmed there was a problem with one of the mills and that it would be taken off for repairs at some point.
"The copper concentrate market has been tight for the past two years and this shutdown could be quite important while the market is perceived to be pretty tight," copper analyst Peter Kettle at consultancy CRU said.
"There is a lot of new smelter capacity coming on stream but not much new mine capacity over the next year so the market will remain in favor of miner," Kettle said.
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 12/08/2006 : 21:48:40
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Base metals prices to pull back in 2007: JP Morgan
Base metals may pull back during 2007, but supply conditions should allow so-called "small-cap" metals such as lead, zinc and nickel to outperform the "large-cap" metals such as copper and aluminium, say strategists with J.P. Morgan in a report released this week.
Due to still-low global inventories in base metals, with the declining trend continuing in markets such as zinc and nickel, the sector initially could "grind higher until a demand shock materializes, or the supply response becomes more forceful," said J.P. Morgan.
These scenarios are likely to be events that occur in the second half of the year, the company said.
Generally, said J.P. Morgan, the "sudden shocks" to the supply chain during much of 2006 should be lower in the coming year, with many key labor negotiations having been concluded and mine expansion during the four-year bull market now beginning to deliver metal. Also, global manufacturing is losing some momentum, although prices so far have not been hurt badly due to a consensus view the world is in for a "soft landing," said J.P. Morgan.
"That soft landing may well turn out to be the case, but should we still be losing global manufacturing momentum in three months time, then the price implications for the metals are necessarily more serious than we have seen to date," the company added.
This is because any further softness, coupled with increased mining, would likely result in persistent inventory accomeulations, said J.P. Morgan.
The small-cap metals such as nickel, zinc and lead have prompted J.P. Morgan to update its forecasts for 2007.
"Our general expectation, however, is for 2007 to be
a very poor year for base metals as they experience a year where enough time has passed for expanded mining production to become meaningful,
a year in which China continues to take steps to cap areas of irrational fixed investment,
a year in which the U.S. starts off on a weak footing with the risk that it may not be a short-term phenomenon,
and a year in which investment passion for metals will unlikely be more aggressive than it was in 2006," said the company.
J.P. Morgan's average per-ton price forecasts for 2007 include
$2,280 in aluminium, versus an estimate of $2,570 for 2006;
$5,700 in copper after $6,700 in 2006;
$22,000 for nickel after $22,900 in 2006;
$3,088 in zinc versus $3,210 in 2006;
$1,164 in lead versus $1,260 in 2006;
and $7,800 in tin versus $9,040 in 2006.
As 2006 winds down, base metals are caught between negative demand implications –
such as a softening U.S. economy with weakness in metals-usage areas such as autos and housing –
and the positive impact of a falling U.S. dollar, pointed out J.P. Morgan.
"The metals that are showing stable or falling LME (London Metal Exchange) inventories are receiving the full benefit of the weaker dollar, while those which are experiencing rising inventories – helped along by a weaker U.S. dollar – are performing worse than their peers."
...........(Reminder, Predictions by so called "experts" are like wheather predictions, beyond a few weeks it really is anybody's guess.
How often have 'experts' been right?
One famous stock picker once said "I wish I was right 51% of the time.") |
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pencilvanian
1000+ Penny Miser Member
USA
2209 Posts |
Posted - 12/11/2006 : 20:51:14
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Commentary, yes, still, good to consider
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Plunge in US economy doesn't mean commodity bear
As the year rushes through the last month, the speculation about commodity bull run has surfaced again. There are many who think the commodities are a spent lot from now on, and there are those who think commodities bear phase is on at least for coming half a decade. The most common refrain for all these forecasters is that the US economy is likely to slow down - or even enter recession - and thus the Americans will not be able to buy as many goods from China as they are doing currently. And this will bring down the growth of China, and thus a drastic fall in the price of commodities.
While this is true that the US economy is surely going to go through a dampener of sorts, and the Americans are going to reduce their imports by a fraction, there is not much chance of China suffering on this count alone.
First of all as I have explained in my earlier write-ups, China is making deep inroads in the markets of most other countries,
and is reducing its export dependence of the US.
For example, the way the trade volumes are expanding between China and India,
it is a matter of time before China emerges the largest trading partner for India,
displacing the US.
Besides, the claim that the falling US economy will reduce Chinese commodity consumption discounts one very important factor:
that of China's internal demand.
The Chinese growth story continues to amaze one and all.
China has been growing at more than 7% per annum for more than a decade, and during last couple of years this rate has escalated to above 10%. The World Bank on November 14 raised its estimate for China's 2007 economic growth for a second time in four months. The World Bank said China's economy may expand 9.6 percent next year after advancing 10.4 percent in 2006. Certain other experts have claimed that China 's growth rate during the current year may be as high as 10.7 percent. In case this looks a tall order, let us remember that during the second quarter the growth rate was an astonishing 11.3%.
Such a fast-paced economy has created a huge middle class in the country.
And this middle class is not like the old-fashioned rich who took pride in saving money.
The nouveau rich in Shanghai and Beijing love to splurge.
These people are also aided and abetted by their government which encourages people to spend.
"The government's policy", according to a Chinese economist, "to boost consumption will show better results next year." said Yao Jingyuan, chief economist of the National Bureau of Statistics, recently in Beijing.
According to him the government was serious about promoting consumer spending and that it should make a "greater contribution to economic growth, even though investment may slow amid the government's curbing measures."
Simultaneously, the government is doing everything to bolster the income of its citizens. Recently the government raised minimum worker compensation and increased welfare spending to get households to spend more and make the economy
less dependent
on investment and exports .
To add fuel to the fire, the government is encouraging microcredit development to boost employment. China's central bank is planning to establish a long-term re-employment system by perking up the microcredit enterprise.
It is noteworthy that the government of China has always given great importance to the employment
- a reason why it is dithering on the issue of revaluation of Yuan - and has never avoided the attempt to any solution that guarantees to mitigate the job scarcity.
Towards this end, China's financial institutions this year have distributed 7.45 billion Yuan in microcredit during the period January-September, which helped many laid-off people find new work. To make its reach even more comprehensive, the government is planning to rein in the services of Dr. Muhammad Yunus, the winner of the 2006 Nobel Peace Prize, and the founder of the microcredit phenomenon in Bangladesh.
It is a foregone conclusion that if these steps are taken with honesty, they will bear fruitful results.
The rural poverty will be tackled with greater efficiency and China will be able to create yet another layer of society which has spendible moolah.
Of course, already more sections of the Chinese society are having better access to increased income.
Take for example the farming community.
Unlike in India - where the farmers in many regions are committing suicide - the farmers in China are faring well.
Bumper crops are being churned out year after year and agriculture continues to add significantly to the country's GDP.
China's farm produce exports reached 24.56 billion dollars in the first ten months of the year and are expected to exceed 30 billion dollars by the end of the year, according to a recent report by the Chinese Ministry of Commerce.
This growth story is not a year old phenomenon.
From 2001 to 2005, China's export of farm produce grew at an average annual rate of 11.65 percent, ranking the fifth in the world, according to figures from the World Trade Organization.
Half a decade of sustained growth means the benefits of agricultural reforms are penetrating the lower layers of Chinese society.
These figures suggest that the growth rate of the country's farm produce exports was 12.7 percent in the ten months. It also proves that somewhere the farmers would be benefiting, and thus shall have extra moolah to spend on necessities/luxuries.
What all this shows is that the presumption about commodity prices crashing just because the US reduces its imports from China by 2% or 5% may be a bit far-fetched.
So the commodity prices may come down a bit in 2007,
but that may well be due to the increased capacity coming on stream or dwindling investor interest rather than the appreciation of Yuan by 3-5% or a similar fall in the Chinese exports.
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n/a
deleted
479 Posts |
Posted - 12/11/2006 : 22:35:37
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Penn:
Thank you for continuing to post here.
The big qwestion about Chinese demand for commodities, seems like a very ripe issue.
I've always wondered WHEN the Chinese would be confident enough in their own economy to be able to blow off the USA.
.................................................
A billiard ball dropped from 1,362 feet (height of the South Tower) in a
vacuum would require 9.22 seconds to hit the ground. How then did the
towers collapse in 10 seconds and 11.4 seconds, and why has not one
member of the mainstream media insisted on honest answers from the
government in this regard?
"The individual is handicapped by coming face to face with a conspiracy
so monstrous [that] he cannot believe it exists."
- J. Edgar Hoover |
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