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Commodities Briefing - Category | Metals and Minerals more

Precious metals- a hedge against volatility in paper currency

Posted on 22 December 2014 by VRS  |  Email |Print

The observation of modern finance through the lens of sound money requires an onion peeler. Each time I imagine onions, I think of my soft contact lens patients; the ones who abuse them. I think of the patients who wear them too long or through periods of mild irritation or redness and practice poor hygiene.
Soft contact lenses mask normal corneal sensitivity. They act like tiny onion goggles. With soft lenses in place, one can literally chop onions and not feel the normal irritating sensation at all. The problem is they tend to be the last to know about the trouble………………………………………..Full Article: Source

Iron Ore Price Outlook Cut 33% by Australia as Glut Expands

Posted on 22 December 2014 by VRS  |  Email |Print

Australia cut its iron ore price estimate for next year by 33 percent as surging output in the world’s top exporter outpaces Chinese demand growth, adding to a surplus.
Prices will average $63 a metric ton, the Department of Industry said today. That compares with $94 a ton forecast in September by the Bureau of Resources and Energy Economics, which is now part of the department. The commodity is set to average about $88 this year, today’s quarterly report says………………………………………..Full Article: Source

World Crude Steel production rises to 131Mt in Nov

Posted on 22 December 2014 by VRS  |  Email |Print

World crude steel production for the 65 countries reporting to the World Steel Association (worldsteel) was 131 million tonnes (Mt) in November 2014, a 0.1% increase compared to November 2013.
China’s crude steel production for November 2014 was 63.3 Mt, a slight decrease of -0.2% compared to November 2013. Elsewhere in Asia, Japan produced 9.2 Mt of crude steel in November 2014, a decrease of -1.1% compared to November 2013. South Korea produced 5.9 Mt of crude steel in November 2014, up by 5.5% on November 2013………………………………………..Full Article: Source

Bullish reversal in miners but metals remain in question

Posted on 22 December 2014 by VRS  |  Email |Print

The gold and silver stocks have put in a bullish weekly reversal but gold and silver have not confirmed it. The interplay between the metals and the shares has been complicated in recent weeks.
Gold and silver are charted below in weekly candle format. Before this week the metals looked bullish. Each tested support and rebounded strongly towards resistance. However, both metals gave back much of the recent gains. Bulls would say they are correcting and still in position to test resistance. Bears would say the metals failed to reach resistance and are headed to new lows………………………………………..Full Article: Source

Credit Suisse cuts 2015 gold price, bullish on zinc

Posted on 19 December 2014 by VRS  |  Email |Print

“Gold prices we see as stabilized at current levels,” said the Credit Suisse Global Metals & Mining Team, “we now expect a $1,100-$1,300/oz trading range, we reduce our gold price forecast for 2015 to $1,225/oz and our long term price from $1,250/oz from $1,300/oz.”
“We see gold price supported at the $1,200/oz level by a lower mine supply and continued global physical investment demand,” the analysts advised. However, they observed, “We see potentially bearish factors for the gold market including the bullish consensus USD outlook and market expectations for higher rates in balance with more bullish fundamental factors that drove gold from 2002-2008; shrinking mine supply, central bank buying and Asian demand.”……………………………………….Full Article: Source

Iron demand falls to the wayside

Posted on 19 December 2014 by VRS  |  Email |Print

Iron ore prices and shipping costs fell to the lowest levels in five years amid signs China’s slowing growth is sapping demand for cargoes just as the world’s largest mining companies press on with raising output and spur a glut.
The rate to ship the steel-making commodity on a Capesize vessel to Qingdao, China from Tubarao, Brazil slid 4.9% to $11.86 a ton today, the lowest since Jan. 8, 2009, data from the Baltic Exchange in London show. Iron ore delivered to Qingdao fell to $68.05 a ton yesterday, the lowest since June 3, 2009, according to Metal Bulletin Ltd………………………………………..Full Article: Source

Gold Miners ‘Don’t Think Price Will Fall’, Hedging ‘Still Isolated’

Posted on 18 December 2014 by VRS  |  Email |Print

Gold Miners are still not hedging their future production despite the recent price-drop to new 4.5-year lows, says the latest expert analysis, as zero interest rates and falling energy prices are deterring forward sales to lock in current prices. “There is not yet compelling evidence to indicate an extended rise in the volume of hedging by gold miners,” says Matthew Piggott, senior precious metals analyst at Thomson Reuters GFMS, introducing the consultancy’s Q3 2014 report for French investment bank and bullion market maker Societe Generale on Tuesday.
Growing 57 tonnes by weight in the first 9 months of 2014, the global gold mining hedgebook – the amount of unmined production effectively sold in advance to lock in prices – fell between July and October, says GFMS, dropping some 6 tonnes as new output was delivered to meet existing contracts…………………………………….Full Article: Source

PGMs Seen Gaining Upward Momentum By End Of 2015; More Supply Deficits Expected

Posted on 18 December 2014 by VRS  |  Email |Print

Platinum group metals might start slowly but eventually should gain upside momentum in 2015, with most analysts expecting rises for the year. Large existing above-ground stockpiles, potential for higher U.S. interest rates and a stronger U.S. dollar are expected to provide obstacles in the early part of 2015. But eventually, further supply/demand deficits are expected to help the market tick higher.
Platinum could remain under pressure early in the year, said Bart Melek, head of commodity strategy with TD Securities. While the market is already in a supply/demand deficit, there are nevertheless considerable inventories already built up. Further, Europe’s economy remains soft, especially important to platinum since it is required for auto catalysts in the diesel-powered vehicles popular on the continent…………………………………….Full Article: Source

Aluminium sector unveils new global sustainability standard

Posted on 18 December 2014 by VRS  |  Email |Print

BMW Group and Nestlé Nespresso are among 28 organisations to have collaborated on a new standard to improve the environmental, social and governance performance of the aluminium industry.
The Aluminium Stewardship Initiative (ASI) Performance Standard, due to be released in early 2015, will address key issues around the production and maintenance of aluminium throughout its value chain and includes plans to reduce its greenhouse gas (GHG) emissions…………………………………….Full Article: Source

Lead Touches Two-Year Low as Metals Fall Before Fed

Posted on 18 December 2014 by VRS  |  Email |Print

Lead prices dropped to a 28-month low on concern that demand will ebb in China, the world’s largest consumer, while some industrial metals fell on concern that the Federal Reserve is moving closer to boosting interest rates.
Yesterday, a Chinese manufacturing gauge in December fell to a seven-month low, a report showed. The Fed ends a two-day meeting today. Sixty-eight percent of economists surveyed by Bloomberg News said policy makers will drop a pledge to keep rates near zero percent for a “considerable time.” Nickel and tin prices dropped in London…………………………………….Full Article: Source

World Copper Price Continues Fall

Posted on 18 December 2014 by VRS  |  Email |Print

International copper price continued fall and aluminum price touched two-month low on December 1 due to weak manufacturing data of China , the world largest metal consumer, and further decline of oil price.
Dragged by new order and price index decrease, the HSBC China Manufacturing PMI dropped to lower than 50 in December, which was the first time the index dropped to lower than 50 in seven months. Three-month aluminum closed down 0.81% at USD 1,906.50 per ton at the LME; it touched USD 1,900.75 earlier, a two-month low…………………………………….Full Article: Source

Iron ore hits new low after weakest China imports in 16 years

Posted on 18 December 2014 by VRS  |  Email |Print

The iron ore price reached a fresh five-and-half-year low on Wednesday after surprisingly weak imports by top consumer China. The CFR 62% Fe 2% Al benchmark import price at the port of Qingdao tracked by The SteelIndex declined 20c to $69.10 a tonne, the lowest since June 1, 2009.
The price of the steelmaking raw material is down just under 50% since the start of the year. Fears of a deteriorating outlook for China, buyer of nearly 70% of the world’s seaborne cargoes, intensified after customs data showed a 15% plunge in November iron ore imports to 67.4 million tonnes…………………………………….Full Article: Source

Copper to gain on supply constraints

Posted on 17 December 2014 by VRS  |  Email |Print

The metal may inch towards $6,950/tonne. Base metals have witnessed a lot of ups and downs this year due to geo-political tensions arising out Russia -Ukraine standoff in the first half, followed by faltering growth in China during the second half.
Although efforts have been made by the People’s Bank of China, they have not been enough to contain the falling trend in base metals. In addition to this, the euro zone, possibly, slipping into a third recession since the resurfacing of financial crisis, has been a matter of concern……………………………………..Full Article: Source

When Rare Earths, Graphite, Lithium, and Uranium go to war they insure the peace and create the future

Posted on 17 December 2014 by VRS  |  Email |Print

We all know that individual, as well as institutional investors have only one goal, which is to make a return on their investment (a profit). This is not the purpose of government nor should it be.
However it should be the goal of government to spend money wisely and, if that is so, then to spend some of the money it receives from its taxpayers on the research and development of technologies that have applications not only to the military (providing the security function of government) but also to the civilian economy for maintaining and improving public health and the general quality of life of that government’s citizens…………………………………….Full Article: Source

How “Green” is Lithium?

Posted on 17 December 2014 by VRS  |  Email |Print

The market for battery electric and hybrid vehicles is growing slowly but steadily – from 0.4% in 2012 to 0.6% in 2013 and 0.7% in 2014 (year-to-date) in the United States alone.
Consumers buy these vehicles despite lower gas prices out of a growing conscience and concern for the environment. With this strong attraction to alternative energy, grows the demand for lithium, which is predominantly mined and imported from countries like Bolivia, Chile, China and Argentina……………………………………..Full Article: Source

Chinese rare earth giant born

Posted on 17 December 2014 by VRS  |  Email |Print

China’s leading rare earth producer – Inner Mongolia Baotou Steel Rare-Earth (Group) Hi-Tech Co. to give its full name – is set to further tighten its grip on the industry. Baotou’s giant mine in Bayan Obo, Inner Mongolia near Baotou City, produces the bulk of the world’s rare earths and does so as a byproduct of iron ore mining.
SMM reports Baotou will merge with five smaller rare earth firms to establish the China North Rare Earth Group Co. Baotou will acquire shareholdings in Baotou Feida Rare Earth Co., Baotou Jinmeng Rare Earth Co., Baotou Hongtianyu Rare Earth Magnets Co., Wuyuan Runze Rare Earth Co., and Xinyuan Rare Earth Hi-Tech & New Material Co……………………………………..Full Article: Source

What’s the Metals Price Forecast for 2015?

Posted on 16 December 2014 by VRS  |  Email |Print

That’s what everyone always wants to know. But no one will ever find out. Let’s say a patient who smokes a pack of cigarettes a day enters a medical office and asks the doctor, “When will I get cancer?” The doctor’s response is likely to include recommendations to schedule regular office visits and to alter the patient’s habits – because, of course, the answer to the patient’s question is simply unknowable.
In that vein, if you’re about to download our latest report – “2015 Metal Buying Outlook” – in the hopes of gaining an exact price forecast for the metals you buy 6 months or even 1 year from now, you may be disappointed. However, what we can give you is even more valuable………………………………………Full Article: Source

More Consolidation of Chinese Rare Earths Producers

Posted on 16 December 2014 by VRS  |  Email |Print

China Tibet online reported that in the most recent developments regarding consolidation of the rare earths industry in China, Baogang Rare Earth Group announced it would change its name to China North Rare Earth Group Co. Ltd after making “significant progress” merging with five smaller companies in north China’s Inner Mongolia Autonomous Region and Gansu Province.
As quoted in the publication: Boasting a mine with the world’s biggest reserve of rare earth, BREG dominates the Chinese market of light rare earth products, and is a leading rare earth producer and processor globally………………………………………Full Article: Source

Australia Sees Iron-Ore at $60 as Commodities Hit Budget

Posted on 15 December 2014 by VRS  |  Email |Print

Australia estimates iron ore will trade at about $60 a metric ton as the biggest slump in the nation’s terms of trade since records began more than 50 years ago deepens the budget deficit.
The price of the material used to make steel has almost halved this year and slumped to a five-year low of $68.49 a ton last month, according to data compiled by Metal Bulletin Ltd. That compares with a $92 projection in the budget, Treasurer Joe Hockey said………………………………………..Full Article: Source

Miners lose billions in commodity plunge

Posted on 15 December 2014 by VRS  |  Email |Print

Miners have lost hundreds of billions in revenue from the fall in commodity prices this year, according to a new analysis, underlining the pressure facing an industry that has responded to the tougher backdrop by slashing costs.
The total market value of the seven raw materials tracked by CRU, a consultancy, has fallen $200bn from last year. The index includes thermal coal, iron ore, metallurgical coal, metallurgical coke, phosphate rock, potash and bauxite………………………………………..Full Article: Source

Zinc Rebounds With Base Metals as Dollar Retreats

Posted on 12 December 2014 by VRS  |  Email |Print

Zinc rebounded along with most industrial metals as the dollar headed for the longest losing streak since July, making commodities priced in greenbacks more attractive to investors. Zinc climbed as much as 0.6 percent after falling to the lowest since June yesterday.
The Bloomberg Dollar Spot Index, which measures the greenback against 10 major currencies, retreated 0.1 percent to 1,110.81, dropping for a fourth day. Factory-gate deflation in China, the biggest metals consumer, deepened last month and consumer prices climbed at the slowest pace since 2009, signaling room for further monetary easing………………………………………..Full Article: Source

Aluminium slips, other base metals up

Posted on 12 December 2014 by VRS  |  Email |Print

Aluminium slipped while some other base metals eked out modest gains on Thursday after diverging signals about global growth from China and the United States. Zinc sunk to a near six-month low before rebounding and closing firmer while aluminium touched an eight-week low.
The Chinese economy faces downward pressure next year, state media cited the government as saying after its Central Economic Work Conference. “I think the macro outlook is dire in a general sense, so that’s why I think we’re drifting lower,” said trader Tom Laverman at ING Bank in Amsterdam………………………………………..Full Article: Source

BHP moves away from iron ore to focus on new darling: copper

Posted on 12 December 2014 by VRS  |  Email |Print

Global mining giant BHP Billiton has decided to move away from iron ore and direct upcoming investment to new copper projects, in an effort to meet demand from China, its main customer.
“As we go forward, we’re likely to invest a lot more in copper than we are in iron ore,” chief executive officer Andrew Mackenzie was quoted as saying by Bloomberg. The miner plans to boost copper sales to China more than iron ore and will invest in mines in Chile, Peru, South Australia and North America, adds the report………………………………………..Full Article: Source

Gold forecasts for 2015 - Scotiabank mining panel

Posted on 11 December 2014 by VRS  |  Email |Print

The most direct question to Scotiabank’s gold panel came from the audience at the end of a wide-ranging discussion of the gold market at the bank’s recently held mining conference: where would the price of gold go by the end of 2015?
Most of the panel cringed at the request, but nonetheless made their wagers (or almost so). Andy Montano, ScotiaMocatta director, went first. “If I give you a forecast, I guarantee you one thing it will be wrong,” he said. Still, he added, “I would say right where we are now.”……………………………………….Full Article: Source

Investor risk-off mood help recovery in precious metals

Posted on 11 December 2014 by VRS  |  Email |Print

A risk-off tone prevailed in financial markets overnight, helped along by further falls in oil prices, a sharp correction in Chinese equities yesterday and an announcement of a snap election in Greece. The precious metals complex recovered strongly as a USD sell off fuelled a strong rally in gold and other precious metals markets.
Investors were seen buying up gold in reaction to a sell-off in the Chinese equity markets following a week of gains, as well as news on the tightening of credit conditions in China. News out yesterday said the People’s Bank of China took measures to tighten liquidity by imposing stricter collateral rules on short-term loans; there was also talk of an imminent decrease in reserve requirements………………………………………..Full Article: Source

Glencore forecasts copper deficit

Posted on 11 December 2014 by VRS  |  Email |Print

An expected copper surplus may not materialise next year, according to Glencore, the third-biggest producer of copper in the world. Strong Chinese demand and expected mining disruptions could lead to a deficit of up to 1.8m tonnes, Telis Mistakidis, head of copper at Glencore, said at the company’s investor day in London on Wednesday.
“We don’t see the surplus,” Mr Mistakidis said. “Every time we’ve come toward this so-called glut it kind of disappears.” Copper prices have fallen 12 per cent year to date on worries of falling Chinese demand and rising supplies. Most analysts and consultants are forecasting a surplus in the copper market in 2015………………………………………..Full Article: Source

Roubini Global Predicts Sub-$60 Iron Ore Amid Massive Surplus

Posted on 11 December 2014 by VRS  |  Email |Print

Iron ore may drop to less than $60 a metric ton next year as the largest mining companies press on with raising supply, deepening a glut just as demand growth in China falters, according to Roubini Global Economics LLC.
The commodity will average $65 a ton in 2015, with weaker prices in the first half before a recovery as some higher-cost capacity is closed, Director of Commodities Helen Henton said in an interview. While producers won’t fare well in an environment of falling prices, it does make sense for low-cost suppliers to keep expanding in the expectation that less-competitive mines will be shuttered, she said………………………………………..Full Article: Source

Copper Risess to Highest in a Week on Copper-Mine Strike

Posted on 10 December 2014 by VRS  |  Email |Print

Copper futures rose to the highest in more than a week as prospects for a strike at a mine in Peru sparked supply concerns. Workers at the Antamina mine in Peru plan to stop work tomorrow at midnight over pay and bonuses, said Jorge Juarez, a union leader. The site, owned by BHP Billiton Ltd. and Glencore Plc, is the world’s sixth-biggest source of the metal by capacity, according to the International Copper Study Group.
“Strikes are always in general supportive for prices when the news first breaks,” Edward Meir, an analyst at INTL FCStone Inc. in New York, said in a telephone interview. “If the market senses the strike is sticking because supplies really start actually decreasing and you see pressure on inventories, then it becomes something serious.”……………………………………….Full Article: Source

Why Now Is The Time To Buy This Hated Commodity

Posted on 09 December 2014 by VRS  |  Email |Print

The recent plunge in oil prices is just the latest bit of bad news for investors in commodities. Slumping Chinese demand for iron ore, copper and many other items has led to a forgettable year for metals as well. Even the safe havens of gold and silver are losing their luster.
Few expect a rapid price rebound for many commodities in 2015 as producers must reckon with too much capacity installed a few years ago. It could be a year or two before the current pullback in mining and exploration leads supply to fall back below demand. Jim Rogers, a perma-bull on commodities , can only muster deep enthusiasm for agricultural commodities these days………………………………………..Full Article: Source

Copper in London Rebounds Before China Imports, Exports

Posted on 08 December 2014 by VRS  |  Email |Print

Copper rebounded before data forecast to show both exports and imports contracted for a second month in China, the world’s largest user of industrial metals. The metal rose as much as 0.3 percent in London after falling for the third time in four days on Dec. 5. China’s exports grew 8 percent in November while imports expanded 3.8 percent, slower than trade figures for the previous month.
U.S. employers added 321,000 workers to nonfarm payrolls last month, beating all projections in a separate survey of economists before the figures on Dec. 5………………………………………..Full Article: Source

Low iron ore price turning up heat on Australian miners

Posted on 08 December 2014 by VRS  |  Email |Print

Australia’s Atlas Iron and Mt Gibson Iron on Friday were forced to lay off workers and introduce austerity measures in an attempt to ride out a sharp slide in iron ore prices. Mt Gibson, whose Koolan Island mine was closed last week because of a flooding incident, said it did not know when it might reopen.
Both companies, along with Fortescue Metals , were started in the last decade’s boom-era rush to dig new mines, but are now cracking under the weight of low ore prices. Once-hefty margins that made millions for early investors are disappearing, replaced by short sellers betting things will only get worse………………………………………..Full Article: Source

Are the big iron ore miners ‘doing a China’?

Posted on 08 December 2014 by VRS  |  Email |Print

For many years China dominated the markets in many strategic metals and minerals through over-producing, driving down prices and putting Western producers out of business. One only has to look at a listing of such metals and minerals where China is still the dominant global supplier to see how this has worked out.
However, more recently, China has been finding itself somewhat stretched in maintaining output for many of these and has been restricting supplies to global markets, perhaps to stimulate price rises and bring its increasingly uneconomic, and often seriously polluting, mines on to a more profitable basis, although officially it is to preserve supplies for domestic industry………………………………………..Full Article: Source

Rare Earth Metals Price Forecast: Will Cerium, Yttrium Demand Boost Future Prices?

Posted on 05 December 2014 by VRS  |  Email |Print

As MetalMiner‘s monthly Rare Earths MMI steadied at a value of 23 in December, we put the Rare Earths “Celebrity Deathmatch” between Jack Lifton and Dudley Kingsnorth on hold. Some interest-piquing information surrounding the rare earth metals price outlook and forecast has come to our attention, via our friend (and Lifton’s colleague) Gareth Hatch of Technology Metals Research.
Recently Gareth covered the rare earths outlook on his blog, specifically from the comprehensive, no-stones-unturned viewpoint of Ryan Castilloux of Adamas Intelligence (573 report pages’ worth!). “2014 marks the dawn of a cautious revival for the rare earth industry,” Castilloux said in a video produced by Hatch and TMR………………………………………..Full Article: Source

Mining giants look at US copper deal

Posted on 05 December 2014 by VRS  |  Email |Print

Mining titans BHP Billiton and Rio Tinto were last night poised to secure the green light to jointly develop North America’s biggest copper mine as part of a deal with the US Government. The miners were expected to be granted land in southeast Arizona presently owned by the government as part of a land swap negotiation buried deep within the pages of a complex defence bill.
The BHP-Rio joint venture has said mining could start at the Arizona site as early as 2020 and have estimated it could cater for a quarter of America’s copper demand………………………………………..Full Article: Source

Platinum market deficit seen at 885,000 oz in 2014-WPIC

Posted on 04 December 2014 by VRS  |  Email |Print

The platinum market is expected to see a shortfall of 885,000 ounces this year, a report by the World Platinum Investment Council (WPIC) estimated on Wednesday, as a strike in major producer South Africa reduced supply.
The above-ground stocks of the metal that have helped cushion prices from the impact of the tightening market are expected to have declined significantly. Platinum prices are down 11 percent this year despite a third straight yearly deficit. The WPIC, which commissioned the report from consultancy SFA (Oxford), said it sees above-ground platinum inventories, excluding exchange-traded funds, metal held by exchanges, and industry working inventories, at 2.56 million ounces at year-end………………………………………..Full Article: Source

Scotiabank’s Patricia Mohr favours base metals in 2015

Posted on 04 December 2014 by VRS  |  Email |Print

I’m a little bit more optimistic for the base metals. In fact, I think when you look at the average prices this year you’ll discover that prices late this year are actually higher for most of the base metals than they were late last year. The one exception to that is copper, which is a little lower than it was in late 2013.
If you look at zinc, it was trading at about US$1 per lb. on Dec. 1, and the LME official cash settlement price at the end of 2013 was US89.03¢ per lb. Aluminum is averaging US95¢ per lb. this year and in December 2013 it averaged US78.8¢. Nickel is averaging US$7.30 per lb. and it was US$6.30 per lb. in December 2013. So many of the base metals, with the exception of copper, have actually edged up this year and it’s on fundamentals and despite vey lackluster global economic conditions………………………………………..Full Article: Source

Copper bounces off four-year low

Posted on 02 December 2014 by VRS  |  Email |Print

Copper futures have closed higher, reversing earlier losses, as a weaker US dollar offset pressure from disappointing manufacturing data from China. The most actively traded contract, for March delivery, rose US5.2c, or 1.8 per cent, to settle at $US2.8980 a pound on the Comex division of the New York Mercantile Exchange.
A weaker greenback, which retreated against a basket of international currencies, pushed copper prices higher. The ICE Dollar Index fell 0.4 per cent to 87.96 after Moody’s cut Japan’s credit rating by one notch………………………………………..Full Article: Source

US sheet steel buyers hunting for price direction after Thanksgiving holiday

Posted on 02 December 2014 by VRS  |  Email |Print

The US sheet steel market remained stable but sluggish Monday as buyers sought price direction following last week’s Thanksgiving holiday. One buyer said he believes the hot-rolled base price is at or close to bottom at about $630/st. Thickness extras, freight and other ancillary items are being discounted to keep base prices firm, he said.
“How much does it cost — hypothetically — to slow down a mill to run 16 gauge [coil] when it’s not full?” he said. “The whole expense is time on the mill — but if the mill is running low, there’s no real expense. Maybe a little roller wear, but that’s hard to quantify as well. Those are free things to give away and make a deal.”……………………………………….Full Article: Source

The 2015 Metals Outlook Series: Nickel

Posted on 02 December 2014 by VRS  |  Email |Print

The story of nickel is finally one of stability. Since 2005 the me­tal has been wracked by skyrocketing highs and sharp declines that have caused massive job losses and uncertainty that has seen an exodus from the sector by many of the larger players.
Much of this was due to a fall in stainless steel demand, working inversely to the growing demand for construction steel. IBISWorld put it succinctly: “Nickel prices, having reached unprecedented highs prior to the global financial crisis, plummeted as global economic growth slumped in subsequent years.”……………………………………….Full Article: Source

Iron’s big three remain bullish as prices tumble

Posted on 02 December 2014 by VRS  |  Email |Print

Australia’s three major iron ore producers, BHP Billiton, Rio Tinto and Fortescue Metals, are feeling the pressure of the slump in the commodity’s price this year. During the past week all have gone on the offensive to convince the investment community that the problems are not of their own making, and that they have strategies to mitigate the downside to earnings.
With the price in freefall, investment banks and their commodity experts are updating their outlooks at increasingly closer intervals. At the start of the year the general consensus – to the extent there is one – was a price of about $US100 ($119) per tonne, they are now closer to $US70 a tonne. The outlyers are far lower. For the most part this exercise is not rocket science, rather the forecasters are just following the price down. ……………………………………….Full Article: Source

Is Copper The Next Commodity Shoe To Drop?

Posted on 01 December 2014 by VRS  |  Email |Print

Black Friday was certainly a dark day for copper and many other commodities that were dragged down by oil’s 10 percent plunge after OPEC decided not to cut production to bolster prices.
Friday’s 3.79 percent decline brought copper’s total loss for the week to 6.7 percent, putting an end to copper’s streak of relative resilience in the face of the broader commodities bust. Now is the time to ask, “is copper the next commodity shoe to drop?”……………………………………….Full Article: Source

Miners ‘Covering Their Eyes’ on China’s Commodity Cliff

Posted on 01 December 2014 by VRS  |  Email |Print

After spending $1 trillion since 2002 on projects to feed China’s commodity boom, the world’s mining companies have a lot riding on their biggest customer.
While commodities may be trading at five-year lows, the heads of three top miners BHP Billiton Ltd. (BHP), Vale SA (VALE3) and Rio Tinto Group (RIO) last week all backed China, the world’s second-biggest economy, to keep buying increasing amounts of their products deep into the next decade. Not everyone agrees………………………………………..Full Article: Source

How JPMorgan struck gold with copper: Andy Home

Posted on 28 November 2014 by VRS  |  Email |Print

December 2010 and the copper market was booming. On the London Metal Exchange (LME), three-month metal was charging to the then all-time high of $9,550 per tonne, and front-month spreads were tightening.
LME reports at the time showed a single entity controlling over half of all eligible LME stocks, leading to a frenzy of speculation as to just who was squeezing the copper market. JPMorgan was “outed” in the media as the controlling hand, which only fuelled further the whirl of speculation, given the same bank was proposing to launch an exchange-traded fund backed by physical copper……………………………………Full Article: Source

A copper bullion story

Posted on 28 November 2014 by VRS  |  Email |Print

A tip of the hat to John Kemp for drawing our attention to the latest from Reuters’ base-metals’ reporter Andy Home, who provides some much needed perspective on the nature of cartels in commodities. Namely, the fact they’re probably endemic.
Case in point, in December 2010 when the copper market was booming, LME reports showed that a single entity controlled over half of all eligible LME stocks, leading to speculation that someone was squeezing the market……………………………………Full Article: Source

Industrial metals beat wider slump

Posted on 28 November 2014 by VRS  |  Email |Print

Miners have watched iron ore sink precipitously this year to a five-year low. That has been repeated for oil and coal, as expectations of global demand have weakened.
Yet despite slower growth in China, the world’s largest consumer of commodities, analysts say demand remains robust for some industrial metals, which are set to benefit from any long-term shift towards more private investment and consumption……………………………………Full Article: Source

Deutsche Bank Shutters Precious Metal Trading Amid Cuts

Posted on 28 November 2014 by VRS  |  Email |Print

Deutsche Bank AG (DBK), Europe’s biggest investment bank, is exiting physical trading of precious metals as it scales back its securities unit to improve returns. Some parts of the business may be shifted to other units of Deutsche Bank and the firm will continue to trade derivatives linked to precious metals, a London-based spokesman for the bank.
Global banks are exiting or paring back their commodities arms as regulators order them to increase buffers for potential trading losses and avoid a repeat of taxpayer-funded rescues. Deutsche Bank’s move is part of an overhaul of its securities unit to help boost profitability and increase the proportion of capital on its balance sheet by shrinking assets……………………………………Full Article: Source

Rio Tinto iron ore exports to rise if miner approves new Pilbara project

Posted on 28 November 2014 by VRS  |  Email |Print

Rio Tinto’s controversial policy of expanding exports in a depressed iron ore market faces a litmus test on Friday, when the miner is expected to approve more than $US1 billion ($1.17 billion) in spending for a new iron ore mine in the Pilbara.
Despite months of criticism from takeover suitor Glencore and the Western Australian Premier, Deutsche analyst Paul Young said he still expected Rio to approve construction of the greenfields Silvergrass mine in the Pilbara, as part of efforts to lift iron ore exports to more than 330 million tonnes in 2015……………………………………Full Article: Source

Iron ore prices - Where’s the bottom?

Posted on 28 November 2014 by VRS  |  Email |Print

As the daylight hours shorten and winter chill takes hold of the iron ore mines and surrounding communities in the Labrador Trough, it’s as good a symbol as any of the deep freeze that is engulfing the global iron ore market, as spot prices continue to head south. Back in October, Cliffs Natural Resources said it would permanently close its Wabush iron ore mine on the Labrador side of the Trough, after having laid off some 500 workers in February when it first idled the mine.
And now Cliffs says it has failed in its attempts to find investment partners for the US$1.2-billion expansion of its Bloom Lake iron ore mine on the Quebec side of the Trough — an expansion that the struggling major said was needed to make the Bloom Lake mine financially viable……………………………………Full Article: Source

Reasons to be optimistic about aluminium in 2015 – Hydro

Posted on 28 November 2014 by VRS  |  Email |Print

World aluminium demand outside China is expected to have grown 3-4% over the course of this year and to grow by the same amount in 2015, Norwegian aluminium producer Norsk Hydro has said.
The company will therefore look to “create value in a tightening aluminium market” by working to become “bigger, better and greener”, it said on its annual capital markets day on Thursday November 27. Global aluminium markets are expected to remain tight, which will lead to higher all-in metal prices and improved earnings for producers, Hydro said……………………………………Full Article: Source

Copper Falls to Eight-Month Low on U.S. Equipment Orders

Posted on 27 November 2014 by VRS  |  Email |Print

Copper futures fell to an eight-month low as orders for business equipment unexpectedly dropped in the U.S., the world’s second-biggest consumer of the metal. Orders for non-military capital goods excluding aircraft declined 1.3 percent in October, a government report showed today. Economists in a Bloomberg survey expected a 1 percent gain. A slump in energy futures damped the outlook for some commodities.
“The lower oil prices cast a shadow on metals as well,” Richard Fu, the director for Asian commodity trading at Newedge Group SA in London, said in a note…………………………………..Full Article: Source

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