Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Commodities Comment
Smaller suppliers China’s iron ore salvation
Feature article
ƒ China’s phenomenal appetite for iron ore continued in 2010, with a further
70mt of crude steel output growth necessitating the twelfth consecutive year
of growth in seaborne trade. While a domestic ore production rebound came
to the rescue, this was not enough on its own – further salvation come from
smaller, non-traditional suppliers sought out in a basic need to balance the
books. With seaborne supply growth set to disappoint again this year and
domestic production now flat out, China’s immediate need for any iron units
available will push further focus onto the smaller-scale supply regions in 2011.
Latest news
ƒ Base metals showed limited movement on Thursday with mixed
macroeconomic information. The big story of the day was copper breaching
the $10,000/t barrier for the first time ever during early trading, however it
couldn’t hold this level and closed down 0.1% on the day. LME stocks
continued to rise with the notable exception of nickel, down 672t on the day
and 2,172t year to date, reflecting and apparent demand boost as the
stainless steel cycle turned.
ƒ After a phenomenal rise in the last two months of 2010, US steel scrap prices
have started to turn down over the past week. The latest Platts Midwest
shredded scrap assessment fell $20/l.ton to $455/t, however still 31% above
end October levels. With this tending to act as a good lead indicator for US
flat-rolled steel prices, we reiterate that US steel prices are potentially nearing
a peak, however there is still a degree of catch-up to come in Asia and
Europe.
ƒ The passing of Cyclone Yasi to the north of the main ports in Queensland has
spared them from significant damage, and shiploading operations are
expected to restart in the next couple of days. The focus is now shifting to the
base metal mines in the west of the state, where heavy rains are expected.
ƒ Steel Business Briefing reports that the Egyptian crisis has halted steel
production throughout the country, with port facilities also out of operation.
This is likely to remain the case while the unrest persists, with rapid currency
fluctuations and closure of banks making payment processes impossible.
Egypt is the second largest steel producing country in Africa, with output of
6.68 million tonnes last year.
ƒ Equinox Minerals plans to expand annual copper production at its Lumwana
mine in Zambia to 260,000 tonnes by 2015 from 146,690 tonnes last year,
subject to feasibility studies. A final decision is expected in early 2012.
ƒ Reuters has reported that a combination of high demand and drought
conditions could cause Chile to face an energy shortage by mid-year. Energy
and Mining Minister Laurence Golborne suggested rationing may be required
if a lack of water at key hydroelectric facilities constrained generation
capability. With the mining industry a big user, this could further impact
copper supply, given our expectation that Chile supplies 33% of global mine
output and 27% of output growth in 2011.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Commodities Comment
Smaller suppliers China’s iron ore salvation
Feature article
ƒ China’s phenomenal appetite for iron ore continued in 2010, with a further
70mt of crude steel output growth necessitating the twelfth consecutive year
of growth in seaborne trade. While a domestic ore production rebound came
to the rescue, this was not enough on its own – further salvation come from
smaller, non-traditional suppliers sought out in a basic need to balance the
books. With seaborne supply growth set to disappoint again this year and
domestic production now flat out, China’s immediate need for any iron units
available will push further focus onto the smaller-scale supply regions in 2011.
Latest news
ƒ Base metals showed limited movement on Thursday with mixed
macroeconomic information. The big story of the day was copper breaching
the $10,000/t barrier for the first time ever during early trading, however it
couldn’t hold this level and closed down 0.1% on the day. LME stocks
continued to rise with the notable exception of nickel, down 672t on the day
and 2,172t year to date, reflecting and apparent demand boost as the
stainless steel cycle turned.
ƒ After a phenomenal rise in the last two months of 2010, US steel scrap prices
have started to turn down over the past week. The latest Platts Midwest
shredded scrap assessment fell $20/l.ton to $455/t, however still 31% above
end October levels. With this tending to act as a good lead indicator for US
flat-rolled steel prices, we reiterate that US steel prices are potentially nearing
a peak, however there is still a degree of catch-up to come in Asia and
Europe.
ƒ The passing of Cyclone Yasi to the north of the main ports in Queensland has
spared them from significant damage, and shiploading operations are
expected to restart in the next couple of days. The focus is now shifting to the
base metal mines in the west of the state, where heavy rains are expected.
ƒ Steel Business Briefing reports that the Egyptian crisis has halted steel
production throughout the country, with port facilities also out of operation.
This is likely to remain the case while the unrest persists, with rapid currency
fluctuations and closure of banks making payment processes impossible.
Egypt is the second largest steel producing country in Africa, with output of
6.68 million tonnes last year.
ƒ Equinox Minerals plans to expand annual copper production at its Lumwana
mine in Zambia to 260,000 tonnes by 2015 from 146,690 tonnes last year,
subject to feasibility studies. A final decision is expected in early 2012.
ƒ Reuters has reported that a combination of high demand and drought
conditions could cause Chile to face an energy shortage by mid-year. Energy
and Mining Minister Laurence Golborne suggested rationing may be required
if a lack of water at key hydroelectric facilities constrained generation
capability. With the mining industry a big user, this could further impact
copper supply, given our expectation that Chile supplies 33% of global mine
output and 27% of output growth in 2011.
No comments:
Post a Comment