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Bullish case for palladium price fading

Posted on 25 June 2015 by VRS  |  Email |Print

The bullish case for palladium appears to be fading, with the metal dropping back below $700 and speculators pulling out en masse. When gold and silver were struggling in 2014, investors increasingly turned to palladium – its fundamentals looked strong given growing Chinese demand for cars and a supply deficit that was set to widen after a five-month strike in South Africa.
The metal climbed from $696 in February to a peak of $911.50 in September and net longs on Nymex struck their highest since records began in 1986 at 30,090 contracts. Supporting the price was a 1.4-percent fall in supply of newly refined palladium to 9 million ounces in 2014 from 2013, CPM Group noted this week………………………………………..Full Article: Source

Copper Caps Biggest Two-Day Rally in Seven Weeks on China

Posted on 25 June 2015 by VRS  |  Email |Print

Copper futures capped the biggest two-day rally in seven weeks as the government took steps to expand credit in China, the world’s top consumer of industrial metal. China’s cabinet moved to scrap a rule that caps lending by commercial banks at 75 percent of their deposits.
Premier Li Keqiang is trying to reshape the banking industry as part of an effort to support long-term economic growth. On Tuesday, copper jumped 1.7 percent, the most since April 30. “Within the context of China, more stimulus is being introduced,” Michael Turek, the head of base metals at BGC Partners Inc. in New York, said……………………………………….Full Article: Source

Miners can make money at $1,200/oz gold

Posted on 24 June 2015 by VRS  |  Email |Print

Gold has traded this year in a range close to $1,200/oz. Do you expect gold to maintain this range for the rest of the year? Yes. Our 2015 outlook is $1,250/oz, and thereafter we project a flat outlook to manifest a more agnostic view on the commodity. We employ this approach as it facilitates greater correlation between cash flow expectations and our view of operational performance.
What are the factors keeping gold at $1,200/oz? We see gold demand support predominantly arising from Asia, particularly in India and China, but also note recent rhetoric from Russia outlining the potential of increasing the country’s metal inventory………………………………………..Full Article: Source

Bullish case for palladium price fading

Posted on 24 June 2015 by VRS  |  Email |Print

The bullish case for palladium appears to be fading, with the metal dropping back below $700 and speculators pulling out en masse. When gold and silver were struggling in 2014, investors increasingly turned to palladium – its fundamentals looked strong given growing Chinese demand for cars and a supply deficit that was set to widen after a five-month strike in South Africa.
The metal climbed from $696 in February to a peak of $911.50 in September and net longs on Nymex struck their highest since records began in 1986 at 30,090 contracts. Supporting the price was a 1.4-percent fall in supply of newly refined palladium to 9 million ounces in 2014 from 2013, CPM Group noted this week………………………………………..Full Article: Source

South Africa’s Rhodium Mining Boom Sends Prices Tumbling 35%

Posted on 24 June 2015 by VRS  |  Email |Print

The end of labor strikes in South Africa’s mining industry is increasing rhodium production at the fastest pace in two decades and cutting prices. The metal, used to control toxic emissions from cars, dropped 35 percent since August to a 18-month low of $955 an ounce, according to data from Johnson Matthey Plc. South Africa may boost output by 25 percent this year after three years of declines, according to the London-based firm, which makes about a third of the world’s catalytic converters.
“Rhodium is looking very bearish,” David Jollie, head of research at Mitsui & Co. Precious Metals Inc., said by phone from London on Monday. “Buyers are taking the view that if they wait, prices will come to them.”……………………………………….Full Article: Source

Morgan Stanley Commodity Outlook Lifts Vale as Ibovespa Declines

Posted on 24 June 2015 by VRS  |  Email |Print

Morgan Stanley’s improved forecast for steel sparked a rally in Vale SA, the world’s largest iron-ore producer. The Ibovespa retreated as Petroleo Brasileiro SA wiped out its earlier advance. Vale extended this month’s gain after the New York-based firm said construction plans in China, Brazil’s top trading partner, will boost demand for the steelmaking ingredient.
A Goldman Sachs Group Inc.’s report predicting lower prices for iron ore had sent the shares down on Monday. “Iron ore has somehow stabilized after all that pessimism,” Otavio Vieira, who helps oversee 250 million reais ($80.5 million) as a partner at Fides Asset Management, said by phone from Rio de Janeiro………………………………………..Full Article: Source

The Potential Impact Of Easing Indonesian Nickel Export Restrictions On Vale

Posted on 24 June 2015 by VRS  |  Email |Print

Vale is a diversified mining company and the world’s largest iron ore producer. Though iron ore sales account for a majority of the company’s revenues, Vale also has interests in the mining of base metals, particularly copper and nickel.
Vale is among the world’s largest producers of nickel, and prices of the metal can have a significant impact upon the company’s stock price. Nickel is mainly used in the production of stainless steel. With demand for stainless steel mainly correlated with industrial activity, prices of the metal have suffered due to weakness in Chinese economic growth………………………………………..Full Article: Source

East China steel mills cut ferrous scrap prices further on weak rebar

Posted on 24 June 2015 by VRS  |  Email |Print

Steel mills in eastern China have lowered ferrous scrap buying prices further this week as rebar prices continue to drop. Jiangsu Shagang Group, the biggest scrap user in China, cut its buying price Yuan 30/mt ($5/mt) Monday, its fourth reduction in June for a total Yuan 110/mt, a company source said.
After the latest adjustment, Shagang will pay Yuan 1,340/mt ($216/mt), including 17% VAT, delivered to Zhangjiagang in Jiangsu province for heavy melting scrap of 6 mm and above thick. “The main reason why we cut scrap prices is continuously falling rebar prices,” said the company source………………………………………..Full Article: Source

Gold mine cost cutting not allaying margin falls – GMP

Posted on 23 June 2015 by VRS  |  Email |Print

An analyst’s report from GMP points to declining profit margins among the world’s top and mid-tier gold miners. Some interesting research from analysts at Canadian headquartered GMP Securities builds on a theme we covered here in these pages around six weeks ago. This suggested that, if anything, the cost cutting programmes entered into by most major and mid-tier gold mining companies may have largely gone as far as they can go.
Indeed in its latest mid-year report the Canadian brokerage and investment bank points out that despite some seemingly effective cost cutting, profit margins have been continuing to fall regardless………………………………………..Full Article: Source

Platinum Slammed by Supplies, Dollar

Posted on 23 June 2015 by VRS  |  Email |Print

Glut of platinum comes partly from South African rand’s sharp depreciation against the dollar. A strong dollar is pressing down on platinum. The precious metal, whose uses range from car-exhaust filters to jewelry, tumbled to a six-year low on Monday, weighed down by a surge in supplies that stems in part from the South African currency’s sharp depreciation against the U.S. dollar.
Last year, a mineworkers’ strike crippled output in South Africa, the world’s biggest platinum producer. The speed of the industry’s recovery, stoked by the South African rand falling to a 14-year low against the dollar in early June, has taken investors and analysts aback………………………………………..Full Article: Source

Zinc Price Forecast: Still the Strongest of a Weak Metals Field

Posted on 23 June 2015 by VRS  |  Email |Print

Zinc remains the best-performing metal of all of the industrial metals. And though zinc fundamentals tell a mixed story – industrial-buying organizations should watch the dollar and commodities markets closely for a more likely price scenario for zinc.
The arguments supporting growing demand include detailed information recently collected by the International Lead and Zinc Study Group, suggesting 2015 demand for refined zinc will exceed supply by 151,000 metric tons. But this new deficit forecast has been revised down because of weaker-than-expected Chinese imports of refined zinc………………………………………..Full Article: Source

China’s removal of molybdenum export tax boosts moly metal, scrap trade

Posted on 23 June 2015 by VRS  |  Email |Print

China’s May 1 removal of export taxes on molybdenum products has boosted its exports of moly metal and scrap and left moly oxide and ferromoly markets largely unaffected, sources said Monday. The lifting of the 5% export tax on 99.9% moly metal had an immediate impact, with supply in China tightening as demand for exports surged, mainly from Europe.
June cargoes supplied by around 20 Chinese producers had sold out by end May and July cargoes were already fully booked this week, with the earliest supply currently seen available for August, a South Korean trader said………………………………………..Full Article: Source

All eyes on Greece for base metals’ movement

Posted on 22 June 2015 by VRS  |  Email |Print

Base metals are likely to remain sideways in the coming weeks due the fear of a default by Greece and weakening demand from China, the world’s largest consumer. Euro zone leaders have convened an emergency meeting on Monday to try to avert a Greek default and achieve a resolution with creditors. Meanwhile, bank withdrawals accelerated resulting into falling government’s revenue as Athens and other international creditors remained deadlocked over the debt deal.
Also, weakness in Chinese demand has created a pressure on base metals. Consequently, copper prices fell by 3.83 per cent last week to settle on Friday at $5,663 a tonne. Nickel and aluminium also moved down by 3.56 per cent and three per cent to end the week at $12,600 a tonne and $1,650.5 a tonne, respectively. Other metals also followed suit………………………………………..Full Article: Source

Asian ferrosilicon spot prices steady amid thin trade

Posted on 19 June 2015 by VRS  |  Email |Print

Spot prices of 75%-Si ferrosilicon in Asia held steady this week amid thin trade, industry sources said Thursday. Platts assessed the Chinese spot price for 75%-Si ferrosilicon at $1,210-$1,250/mt FOB China Thursday, unchanged from the previous week, while the Japanese spot import price was kept steady at $1,160-$1,220/mt CIF Japan Thursday.
Chinese producers said supply in the domestic market remained tight on production stoppages in the country, providing some support to the domestic price, while overseas buying interest stayed weak, exerting pressure on export offers………………………………………..Full Article: Source

Iron ore price hits a wall of steel

Posted on 19 June 2015 by VRS  |  Email |Print

The iron ore price fell for the fourth straight day, down 2.2 per cent overnight on Thursday, showing signs that its recent rally is weakening as Chinese steel prices fall to record lows on weak demand. The benchmark iron ore price for immediate delivery to Qingdao port in China has fallen 6.2 per cent to $US61.51 a tonne from last week’s high of $US65.61.
Westpac economist Robert Rennie said Chinese rebar prices had more of an effect on iron ore than iron ore on rebar, and that relationship had diverged in May when iron ore rallied 12 per cent while steel prices fell as construction activity in China slowed………………………………………..Full Article: Source

Is Copper Price Overshooting on Downside? SMM Interviews

Posted on 18 June 2015 by VRS  |  Email |Print

Copper price has posted sharp falls, and the SHFE copper lost 4.64% following a five-day losing streak. Is the red metal overshooting on the downside? Will its outlook turn less pessimistic for the long run? “Some negative factors may have been priced in and it is possible that price fall in H2 can be not as sharp as we had expected, but outlook is still bearish overall,” said analyst from Everbright Futures told SMM.
Chief analyst of COFCO Futures agreed, saying that although downward room may be limited on the horizon following the plunge, weak market fundamentals mean prospect for the market in H2 should remain pessimistic………………………………………..Full Article: Source

China’s aluminum import premiums rangebound at $90-$110/mt CFR

Posted on 18 June 2015 by VRS  |  Email |Print

The Platts Chinese import premiums for Good Western aluminum remained rangebound this week at $90-$110/mt CFR plus LME cash, amid a prevailing lack of import interest. Offers CIF Shanghai and ex-bonded warehouse Shanghai were heard Wednesday at $120-$140/mt, but no trades were reported as buyers anticipated further falls in the near term.
“Everyone is waiting for the third quarter contract talks in Japan to settle, as talking levels are all around $100/mt and below now, so they expect premiums to fall further,” a Shanghai-based trader said. Another Shanghai-based trader said Japan spot premiums are also now trading below $100/mt, “so all signs are pointing downwards for Q3 as well…we might get clearer direction next week.”……………………………………….Full Article: Source

Iron ore miners look beyond current price rebound with concern

Posted on 18 June 2015 by VRS  |  Email |Print

As iron ore prices slumped to the lowest level since the financial crisis in March, Andrew Forrest, the chairman and founder of Australian miner Fortescue Metals Group, floated a controversial idea at a business dinner in Shanghai.
The Perth-born entrepreneur, known as “Twiggy” to many in the industry, said the top producers of the steelmaking ingredient should agree to an output cap, effectively inviting the world’s largest publicly listed miners to form an Opec-style cartel………………………………………..Full Article: Source

‘Glass half empty’ in base metals

Posted on 17 June 2015 by VRS  |  Email |Print

Copper hit a new three-month low overnight and analysts don’t see near-term catalysts for the red metal. London Metal Exchange copper dropped 1.8% overnight to $US5784 per tonne, its lowest point since March.
According to ANZ Research, there has been some improvement in Chinese macro conditions in the past month, but signals were still mixed. Copper slumped to a five-year low in January, but has recovered due to supply interruptions. “However, a lack of subsequent indications of strong demand has seen the rally in copper prices peter out over the past month,” ANZ said………………………………………..Full Article: Source

Platinum Prices Hit Six-Year Low

Posted on 16 June 2015 by VRS  |  Email |Print

Platinum prices fell to a six-year low on Monday on concerns over growing supplies of the precious metal. Platinum for July delivery, the most actively traded contract, closed down 0.8% at $1,088.60 a troy ounce on the Comex division of the New York Mercantile Exchange, the lowest settlement since March 18, 2009.
Investors are worried about platinum stockpiles, which are growing as miners in South Africa ramp up output following a five-month strike in 2014. South Africa is the world’s largest producer of the metal, and Barclays estimated platinum production from the country is on track to hit a five-year high in 2016………………………………………..Full Article: Source

South African mining unions going for gold

Posted on 15 June 2015 by VRS  |  Email |Print

From June 22, all eyes will be on South Africa’s gold mining sector as wage negotiations kick off. It is no secret that the whole mining industry has endured a rough couple of years, and more so in the gold sphere, where deposits are becoming increasingly scarce and expensive to discover as companies are having to dig deeper to find gold.
On top of that, the gold price has fallen a long way from it’s a peak of $1,900 an ounce in 2011, nowadays hovering around $1,200 per ounce, and has resulted in many mines having to either be closed or sold off, as companies try to stay afloat. In South Africa, those problems are magnified by rising input costs, with fuel, intermittent electricity, and now wages, set to become more expensive………………………………………..Full Article: Source

Uranium miners feeling confident about the future, even if prices keeping a lid on current growth

Posted on 15 June 2015 by VRS  |  Email |Print

Confidence among players in the uranium industry is high on the back of some favourable tailwinds, but the uranium price is keeping a lid on the number of projects operating at the moment.
China, a country that now shares a free trade agreement with Australia, is predicted to have over 50 new nuclear reactors by 2020, according to a research report from investment bank JP Morgan. Free trade deals with Japan and Korea and the trade negotiations with India also hold a lot of potential for Australian uranium miners………………………………………..Full Article: Source

Copper holds strong as base metals fall

Posted on 15 June 2015 by VRS  |  Email |Print

Most base metals fell on Friday, weighed down by uncertainty over Greek debt talks. However copper prices held steady, in hopes of improving demand in top metals consumer China. Zinc and lead hit their lowest levels in more than two months on inflows of inventories into warehouses, increasing concern about potential oversupply.
During most of the day a strong dollar also pressured the market, but the US currency rebounded late in the European session. ‘The stronger dollar, after Chancellor Merkel’s comments about the euro, and worries about Greece, are the major reasons for the generally weaker tendency on the market,’ said Eugen Weinberg, head of commodity research at Commerzbank in Frankfurt……………………………………….Full Article: Source

Checking in With Gold Miners ETFs

Posted on 12 June 2015 by VRS  |  Email |Print

Rising interest rates are believed to be a death knell for gold, but the SPDR Gold Shares is up 2.7% over the past 90 days, a period in which 10-year Treasury yields have surged 17.5%.
Although GLD and its gold ETF brethren have defied interest rate logic, investors are not waiting around to see how long that trend will last. GLD has lost more than $26 million in assets under management this year, but second-quarter departures from the fund total $1.2 billion, enough to knock GLD from the ranks of the 10 largest ETFs………………………………………..Full Article: Source

Are Precious Metals A Good Investment Right Now?

Posted on 11 June 2015 by VRS  |  Email |Print

There has never been consensus in the investment community as to whether or not Gold and precious metals are a worthwhile investment. Theoretically, what makes Gold, Silver, Platinum and Palladium precious is that their value is not only driven by their practical uses, but also by their role as a store of value and an investment. For example, let’s take the grand-daddy of them all: Gold.
Warren Buffett, in a famous Harvard speech in the late 90s, said, “Gold gets dug out of the ground in Africa or someplace. Then we melt it down, dig another hole, bury it again and pay people to stand around guarding it. Anyone watching from Mars would be scratching their head.” As arguably the most successful investor of the 20th century, his is not an opinion to take lightly………………………………………..Full Article: Source

Positioning For the Price Turn in Precious and Base Metals

Posted on 11 June 2015 by VRS  |  Email |Print

The last several years have been anything but pleasant for mining investors. Gold’s precipitous fall from $1900/oz in 2011 to $1190/oz today impacted even the most carefully structured portfolios. As well, the global price declines pounded the value of base metal stocks.
Case in point: the price of nickel has fallen over 75% since it touched $24 per pound in 2007 and has resulted in several promising nickel companies disappearing. What is the best cure for low prices? Low prices………………………………………..Full Article: Source

Copper prices above $6,000/t despite improved availability

Posted on 11 June 2015 by VRS  |  Email |Print

The metal was last at $6,049 per tonne, up $79 increase on Tuesday’s close and a one-week high. After a slow start, business picked up, with around 6,500 lots changing hands on Select so far. Stocks fell a net 2,800 tonnes to 308,025 tonnes while cancelled warrants fell 9,550 tonnes to 86,775 tonnes, raising on-warrant material to 221,250 tonnes, up 6,750 tonnes.
Further monetary easing in China – Beijing doubled the quota allowing its provinces to swap debt for bonds to two trillion yuan – provided support to the complex. Still, many market participants were expecting additional stimulus measures after a recent run of negative data………………………………………..Full Article: Source

Ferrous scrap prices remained stable in Eastern China

Posted on 10 June 2015 by VRS  |  Email |Print

The rising iron ore prices have forced many steel mills in Eastern China to keep their ferrous scrap buying prices stable. The prices remained almost flat during the past week. The purchasing price for heavy melting scrap with thickness 6mm and above by Shagang Group remained at Yuan 1,450 per mt, inclusive of VAT delivered to Zhangjiagang.
The scrap purchasing prices remained unchanged from the previous week. It must be noted that Jiangsu Shagang Group had lowered the purchasing prices by Yuan 20 per mt during the week prior to this. Yonggang Group in the same province also kept its buying price unchanged for deliveries to Zhangjiagang. Earlier in May this year, the company had cut its scrap purchasing prices twice………………………………………..Full Article: Source

Copper Caps Longest Rally in Five Weeks on China Stimulus Bets

Posted on 10 June 2015 by VRS  |  Email |Print

Copper futures capped the longest rally in five weeks as easing inflation bolstered the case for more economic stimulus in China, the world’s biggest metal consumer. Consumer prices rose 1.2 percent in May, Chinese government data showed Tuesday. That compared with the 1.3 percent median estimate in a Bloomberg survey and the 1.5 percent gain in April.
The producer-price index fell 4.6 percent. Copper posted a third straight gain, the longest streak since May 1. “Inflation indicators signaled that policy makers have the latitude to introduce more stimulus measures without having inflation scares at this point,” Mike Dragosits, a senior commodity strategist at TD Securities in Toronto, said……………………………………….Full Article: Source

LME puts its foot on the high-speed pedal to attract volume

Posted on 10 June 2015 by VRS  |  Email |Print

In the global race among bourses to attract trading volume, metals exchanges are increasingly dealing with a counterparty that has become controversial in equity markets: the “black box”, or computer-driven, trading programme.
The London Metal Exchange wants to broaden access to its electronic trading platform, and recently outlined plans to make it easier for non-UK based traders to access the system. To encourage participants to trade in greater volumes, the exchange is offering fee rebates………………………………………..Full Article: Source

Gold And Silver Price: Too Many Are Still Getting It Wrong

Posted on 09 June 2015 by VRS  |  Email |Print

Americans labor under the misguided belief that they have freedom, and by extension, freedom of choice. This simply is not true. Corporations are dictating more and more how Americans live, what to think, what to eat, and more. Google is a perfect example of what was once a superior search engine-turned-government-tool-for-propaganda.
Searches have been sanitized to provide only that information the corporate federal government wants you to know, and no more. It used to be the will of one in this country was protected against the majority. You can no longer find any references to this line of thinking when one Googles “rights for the will of one.”……………………………………….Full Article: Source

Fundamental factors to the fore for PGMs – Citi

Posted on 09 June 2015 by VRS  |  Email |Print

The differing market fundamentals of platinum and palladium are more important to its direction that their relationship to the dollar, Citi said. The bank would favour going long on palladium and short on platinum over the next six months, it said in a weekly report. Platinum recently traded at $1,097/1,102 per ounce, up $5 on Friday’s close, while palladium was $2 higher at $749/755.
Reduced expectations for a deficit in platinum this year are weighing on the metal, it said. It sees a rebound in mine supply of close to 20 percent in volumes this year, limiting its projection of a 2015 market deficit to 327,000 ounces – a level easily filled by above-ground stocks………………………………………..Full Article: Source

Iron rally ‘on borrowed time’

Posted on 09 June 2015 by VRS  |  Email |Print

Iron ore imports by China contracted in May from April and the same month a year earlier, highlighting weakening demand in the largest buyer as Goldman Sachs Group repeated a forecast for a rally in prices to reverse.
Cargoes fell 12 percent from April to 70.87 million metric tons, and were 8.4 percent lower than a year earlier, according to customs data on Monday. That’s the lowest monthly total since February. Adjusted for the number of days in the month, the imports in May were at the slowest pace since November………………………………………..Full Article: Source

Gloves are off for the global mining industry

Posted on 09 June 2015 by VRS  |  Email |Print

2014 was expected to be a tough fight for the global mining industry with commodity prices down and short-term volatility increasing. The initial scorecard for the largest 40 miners was mixed and now the gloves are off for the industry with widespread government intervention, internal industry conflicts and rising shareholder activism, according to PwC’s annual Mine report.
According to new analysis of the largest 40 miners from PwC, the industry trimmed spending and largely managed expectations through higher production and unexpected help from currency devaluations and lower input costs, despite continued headwinds from weak commodity prices………………………………………..Full Article: Source

U.S. Is Awash in Glut of Scrap Materials

Posted on 08 June 2015 by VRS  |  Email |Print

American companies have complained for the past year that the headwinds of a strong dollar and a slowing Chinese economy are hurting their earnings. For sellers of scrap metal, used cardboard boxes, and other waste, those headwinds are more like a hurricane.
Waste has long been a major U.S. export, providing material to be melted in foreign steel mills or made into new paper products. But the strength of the dollar has made American waste pricier abroad, cutting demand in China, Turkey and other markets………………………………………..Full Article: Source

Commodity prices weigh heavily on top 40 mining giants

Posted on 05 June 2015 by VRS  |  Email |Print

The tough fight faced by the global mining industry in 2014 would escalate into a brawl this year as mining companies worldwide struggled to emerge from depressed markets, PwC’s Africa Mining Centre of Excellence head Michal Kotze said on Thursday. Widespread government intervention, significant conflicts surrounding strategy debates and other internal industry conflicts, “huge” competition, weakening commodity prices with increasing short-term volatility and rising shareholder activism had left industry on the ropes.
A reduction in capital spend, somewhat higher production and “unexpected help” from currency devaluations and lower input costs had assisted the mining industry to “manage expectations” during 2014 despite continued headwinds from weak commodity prices, the latest PwC ‘Mine’ report showed. ……………………………………….Full Article: Source

What’s ahead for copper, coal, iron ore and China according to Joy Global

Posted on 05 June 2015 by VRS  |  Email |Print

“While global economic growth improved through the first four months of the calendar year, other economic and commodity indicators painted a mixed picture about the strength of end markets,” wrote Joy Global. Chinese growth cooled to 7.0 percent, which is the lowest level in six years. China has implemented significant monetary stimulus efforts in the form of reductions in both the reserve requirement ratio and lending rates over the last several months.
Although global growth is still expected to be just over 3 percent this year supporting demand for mined commodities, there are several macroeconomic pressures that could increase and materially impact the growth profile………………………………………..Full Article: Source

Gold mining contributed $171 bln to global economy in 2013 – WGC

Posted on 04 June 2015 by VRS  |  Email |Print

The gold mining industry contributed more than $171 billion to the global economy in 2013, according to a new report from the World Gold Council. But weaker prices and lower production in 2015 do not necessarily mean that this figure will drop, the WGC’s John Mulligan said in an interview.
Large-scale commercial gold mining in the 47 countries that account for more than 90 percent of the world’s production contributed $81 billion to the economy in direct gross value added (GVA) and around $171 billion indirectly, the WGC said. GVA measures the contribution to the economy of each individual producer, industry or sector………………………………………..Full Article: Source

Economic value of gold mining fell 16% on 2013 price slide

Posted on 04 June 2015 by VRS  |  Email |Print

Gold mining’s economic value worldwide sank 16 percent in 2013 as prices tumbled by the most on record, according to an industry lobby for the precious metal. Gross value added, a gauge of the industry’s activity, was $83.1 billion in 2013, or $171.6 billion including the value of goods and services from outside businesses such as suppliers, the World Gold Council said in a report published Wednesday.
Gold mining’s economic contribution is up almost seven-fold since 2000 as output and the value of the metal climbed. Prices increased to a peak of $1,900 an ounce in 2011 from $272 an ounce at the end of 2000. Gold was $1,193 an ounce at 3:55 p.m. in Johannesburg on Tuesday. It dropped 28 percent in 2013………………………………………..Full Article: Source

How to Make a Portfolio of Precious Metals

Posted on 04 June 2015 by VRS  |  Email |Print

Precious metals deserve a spot in any balanced portfolio. As a hedge against the possibility of rampant inflation or currency debasement, it’s hard to find a better asset class. If you’re looking to add precious metals to your portfolio, or build a portfolio based strictly on precious metals, you have many options to choose from. Let’s take a closer look at precious metals in general, and then how to add precious metal exposure to a portfolio.
Understanding precious metals: Precious metals are defined by their rarity and their tendency to be non-reactive, which makes them expensive and limits their industrial use. There are more than a dozen different precious metals in total, including mercury, beryllium, and indium. However, for investing purposes, there are really only three worth considering: gold, silver, and platinum………………………………………..Full Article: Source

Nickel price drops after inventories rise; firm dollar weighs

Posted on 04 June 2015 by VRS  |  Email |Print

Nickel slid on Wednesday after inventories rose to a fresh record, while a stronger dollar weighed on some base metal prices ahead of an options expiry. Nickel was the biggest price mover on the London Metal Exchange (LME) after exchange stocks MNISTX-TOTAL jumped to an all-time peak of 470,118 tonnes, rising 13 percent this year.
Three-month LME nickel, which failed to trade in official open outcry activity, was bid down 1.1 percent at $12,910 a tonne after rising a half percent in the previous session. “Some of the warehouse arrivals in nickel appear to be linked to financing deals,” said Robin Bhar, head of metals research at Societe Generale in London………………………………………..Full Article: Source

BHP Billiton warns of oversupply on metals, hitting mining sector

Posted on 04 June 2015 by VRS  |  Email |Print

Commodity company shares are under pressure after the world’s biggest miner warned than oversupply and low prices were likely to carry on for a prolonged period. BHP Billiton chief executive Andrew Mackenzie told a meeting of senior executives and politicians in Australia (as reported by Reuters):
Incremental supply, induced during periods of higher prices, will take longer to absorb and this means over-supply may persist for some time. BHP and rival Rio Tinto have been criticised for expanding their iron ore production despite a slump in the metal’s price………………………………………..Full Article: Source

Will Chinese stimulus be able to revive metals’ fortunes?

Posted on 03 June 2015 by VRS  |  Email |Print

Post 2012, base metals have witnessed a dismal performance. China – the biggest consumer of base metals – has been losing steam rapidly. Growth levels have dropped to the lowest in 24 years. Prime reason for flagging growth in the world’s second largest economy is declining industrial production which increased at its slowest pace in March 2015.
Not only this, gloomy economic scenario just worsens as retail sales, a sign of consumer demand, rose at the slowest rate in nearly a decade and land purchases by developers, a major source of revenue for China’s heavily indebted local governments, fell 32 per cent in the first three months of 2015………………………………………..Full Article: Source

Iron Ore Trading in China Climbs to Record as Price Advances

Posted on 03 June 2015 by VRS  |  Email |Print

Trading of iron ore derivatives on China’s Dalian Commodity Exchange climbed to a record last month as prices increased. Volume jumped 33 percent in May from a month earlier to 24.86 million contracts, or 2.49 billion metric tons, according to bourse data. The previous all-time high was set in April. Compared with a year earlier the volume more than tripled.
Iron ore prices advanced in May as port stockpiles in China contracted. The world’s biggest consumer of metals and energy is seeking to expand its role in setting benchmark raw-material prices. A priority for the Dalian bourse this year is boosting the influence of its prices on global trade, according to Chen Wei, head of industrial commodities………………………………………..Full Article: Source

Metal Funds Rule Commodities in May as Traders Bet on Gains

Posted on 01 June 2015 by VRS  |  Email |Print

Investors are buying into industrial-metal funds at a faster pace than any other commodity, underscoring optimism about the health of the global economy. U.S. exchange-traded products backed by the metals attracted $71.1 million in May, putting flows on track for the biggest monthly increase since 2012, according to data compiled by Bloomberg as of Wednesday.
The extra funds represent a 22 percent increase in market value, more than other commodity groups such as agriculture and energy. Money managers are betting that China’s efforts to kickstart its slowing economy, including three interest-rate cuts in six months, will succeed in increasing demand for raw materials………………………………….Full Article: Source

Is cobalt the commodity of the future?

Posted on 29 May 2015 by VRS  |  Email |Print

If the vision of Elon Musk comes to fruition, cobalt will become an important commodity for the mining industry in the future. The billionaire genius recently unveiled Powerwall, a home battery that give homeowners the ability to get off the commercial power grid entirely by storing surplus electricity generated from solar panels during the day or from the utility grid when rates are low.
Unlike Tesla’s electric cars, Musk has stated Powerwall will use a more powerful battery consisting of nickel, manganese and cobalt. If the home battery takes off like many people expect it to (there are 38,000 reservations for the home battery pack so far), Tesla may require up to 10,000 tons per year of cobalt………………………………..Full Article: Source

Copper, aluminium recover from losses on dollar

Posted on 29 May 2015 by VRS  |  Email |Print

Copper and aluminium recovered from recent losses on Thursday as the dollar weakened against the euro and optimism grew over a Greek debt deal, but some analysts were cautious over whether gains could be sustained due to plentiful supplies. Most other base metals also rebounded from a recent downturn that had been partly due to a stronger dollar, which makes commodities priced in the U.S. currency more expensive to buyers using other currencies.
The euro has gained against the dollar after Greece expressed confidence this week it will soon seal a cash-for-reforms deal. “We’ve had a bit of a bounce this morning. One of the reasons is because the dollar has stopped appreciating, in the short term at least,” said Stephen Briggs, metals strategist at BNP Paribas in London…………………………………Full Article: Source

Iron Ore Surges on Declining Stockpiles in China

Posted on 29 May 2015 by VRS  |  Email |Print

The price of iron ore rose to its highest level in nearly three months, as declining stockpiles at China’s major ports sparked concerns about a temporary shortage of the raw material. A benchmark price for iron ore, published by The Steel Index, rose to US$62.60 a metric ton on Wednesday, up 0.8% from Tuesday and its highest level since March 2. The price is up 9% from a week earlier.
Iron-ore stockpiles in China have been dwindling as steelmakers build up their stores of the raw material, resulting in limited availability for some types of ore, analysts say. Inventories at the country’s port facilities last week declined to 84.9 million tons, from 86.6 million tons the week earlier, according to data provider Mysteel. Port stocks were roughly 100 million tons at the start of 2015…………………………………Full Article: Source

Mining Sector Still Sluggish

Posted on 29 May 2015 by VRS  |  Email |Print

EY’s Canadian Mining Eye index fell 1% in Q1 2015, compared to a 12% decline in Q4 2014. With a weak global macroeconomic backdrop, most players are working on controlling expenses, as declining grades will put continued pressure on costs.
The Canadian Mining Eye tracks Canadian mining sector performance of 100 TSX and TSXV mid-tier and junior companies with market capitalizations at the end, broadly falling between CDN$2.1 billion and CDN$160 million…………………………………Full Article: Source

Copper hits month low on China, supply rise hits aluminium

Posted on 28 May 2015 by VRS  |  Email |Print

Copper hit a one-month low on Wednesday due to concerns about the economic outlook for big metals consumer China, while aluminium fell to its lowest in a year on rising production. Aluminium is in oversupply with a huge stock overhang, and output has continued to rise this year, with the latest industry figures showing daily average production rising to 68,500 tonnes in April.
Norwegian producer Norsk Hydro said it would increase aluminium output by 35,000 tonnes per year. “Although LME stocks are falling there’s (still) a lot of aluminium around and (then) we see large increases in production. Aluminium needs a deficit to erode overhead stocks,” Fastmarkets head of research William Adams said…………………………………….Full Article: Source

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