Australia's giant gold and copper producer, OZ Minerals Ltd., has shared plans of boosting the output at its key Prominent Hill mine in South Australia over the coming year, and for the purpose is looking to speed up the underground expansion of the operation.
"Our immediate focus is targeting higher mill throughput for 2010, unit cost containment and margin improvement at Prominent Hill. Good progress has been made on the underground feasibility study at Prominent Hill and, with a positive outcome and board approval, we plan to fast track development to maximize value from the asset", shared the Melbourne based company in an official statement to the Australian stock exchange.
The announcement has been a part of the drive initiated by Chief Executive Officer Terry Burgess, which came to light last month after a 100-day strategic review he ordered. After being appointed CEO in August, Mr. Burgess had shared that to increase the output of gold and copper is of top priority to him.
OZ Minerals was, until recently, the world's second-largest miner of zinc, a unit which was affected by sales of the company's $1.6 Billion worth of mines, a step taken to cut debts. The firm has shared that with the new cash, it has every intention of buying new operations.
To take its boost of copper and gold project further, OZ Minerals has revealed that it is looking to form a joint venture with IMX Resources. The former will be buying the latter's 26.1 million shares, which would give OZ a 15% stake in IMX.
Source: Top News
Monday, November 30, 2009
NTPC Searching For More Indonesia Coal Blocks
India's state-run National Thermal Power Corporation (NTPC) today said it has identified three more coal blocks in Indonesia for acquisition.
"We have identified 2-3 more coal mines in Indonesia," NTPC Chairman and Managing Director R S Sharma told reporters here. It has appointed Macquarie as consultant for the same.
NTPC has already acquired a coal mine in Indonesia. During the current financial year, the total coal requirement of NTPC is 150 million tonnes, out of which the company would be importing 12.5 million tonnes.
Source: Business Standard
"We have identified 2-3 more coal mines in Indonesia," NTPC Chairman and Managing Director R S Sharma told reporters here. It has appointed Macquarie as consultant for the same.
NTPC has already acquired a coal mine in Indonesia. During the current financial year, the total coal requirement of NTPC is 150 million tonnes, out of which the company would be importing 12.5 million tonnes.
Source: Business Standard
Sunday, November 29, 2009
South Korea To Invest In Rare Metals
Reuters reports that South Korea will invest KRW 300 billion to develop technologies and raise self sufficiency rates of rare metals such as lithium and magnesium by 2018.
The statement said that in the private sector, POSCO will invest KRW trillion in 5 sectors including rare metals, non ferrous metals, carbon materials, future new materials and recycling through 2018. LS Nikko will spend KRW 500 billion in expanding production of rare metals by 2020. Local demand on rare metals has been rising sharply along with the growth of future advanced businesses including LCD and hybrid cars.
It said that "Through the investment the government aims to raise the self sufficiency rates of rare metals from current 12% to 80% by 2018."
South Korea SK Energy said that in October it would supply lithium ion batteries for a hybrid electric vehicle project for Daimler unit Mitsubishi Fuso, joining the competition with early movers in the sector including LG Chem and Samsung SDI.
The statement said that as part of the investment POSCO will set up a magnesium refining plant to produce 10,000 tonnes per year from 2011 and 100,000 tonnes from 2014 in an eastern province of Kangwon, which accounts for 40% of magnesium ingots buried in the country, to reduce imports of magnesium ingots.
Source: Steel Guru
The statement said that in the private sector, POSCO will invest KRW trillion in 5 sectors including rare metals, non ferrous metals, carbon materials, future new materials and recycling through 2018. LS Nikko will spend KRW 500 billion in expanding production of rare metals by 2020. Local demand on rare metals has been rising sharply along with the growth of future advanced businesses including LCD and hybrid cars.
It said that "Through the investment the government aims to raise the self sufficiency rates of rare metals from current 12% to 80% by 2018."
South Korea SK Energy said that in October it would supply lithium ion batteries for a hybrid electric vehicle project for Daimler unit Mitsubishi Fuso, joining the competition with early movers in the sector including LG Chem and Samsung SDI.
The statement said that as part of the investment POSCO will set up a magnesium refining plant to produce 10,000 tonnes per year from 2011 and 100,000 tonnes from 2014 in an eastern province of Kangwon, which accounts for 40% of magnesium ingots buried in the country, to reduce imports of magnesium ingots.
Source: Steel Guru
Work To Start On $2bn WA Iron Ore Mine
Construction of a $1.8 billion iron ore project in the West Australia's Mid-West will officially get underway today.
Gindalbie Metals' Karara project, east of Geraldton, is one of the first large scale mining projects to get off the ground in the iron ore rich region.
The Premier Colin Barnett has joined company executives and representatives from the mining and resources sector for the official ground breaking ceremony at the site this morning.
The mine is expected to generate up to 1500 construction jobs and about 500 permanent positions once in production.
The mine is being developed as a 50/50 joint venture between Gindalbie and China's second largest steel producer Ansteel.
Earlier this year the Federal Government approved a deal to allow Ansteel to increase its stake in the West Australian miner to 36 per cent.
It is expected that construction of the mine could be completed as early as next year, with production tipped to commence by 2011.
Source: ABC Australia
Gindalbie Metals' Karara project, east of Geraldton, is one of the first large scale mining projects to get off the ground in the iron ore rich region.
The Premier Colin Barnett has joined company executives and representatives from the mining and resources sector for the official ground breaking ceremony at the site this morning.
The mine is expected to generate up to 1500 construction jobs and about 500 permanent positions once in production.
The mine is being developed as a 50/50 joint venture between Gindalbie and China's second largest steel producer Ansteel.
Earlier this year the Federal Government approved a deal to allow Ansteel to increase its stake in the West Australian miner to 36 per cent.
It is expected that construction of the mine could be completed as early as next year, with production tipped to commence by 2011.
Source: ABC Australia
Friday, November 27, 2009
Canadian Minister Speaks Of North Ontario Mine Developments
Minister of Northern Development and Mines Michael Gravelle spoke Thursday about a major development in the area's mining sector.
Earlier this week, media reported that Ohio-based Cliffs Natural Resources has agreed to purchase and develop the rare chromite deposits in the Ring of Fire, north of Nakina.
Cliffs’ plans on building an open pit mine at the site, plus a railway to get the material to a processing plant near Thunder Bay. Gravelle said the Ministry of Northern Development, Mines and Forestry is interested in the process moving forward.
He said there are tremendous opportunities for the chromite deposit, which can be mixed with iron to become ferrochrome, a key ingredient used in the manufacturing of stainless steel.
The purchase of the chromite deposits from Freewest Resources is still pending. It is anticipated the development could produce upwards of $800,000 tonnes of chromite each year.
Cliffs expects to invest about $800-million in the project.
Source: TB Newswatch
Earlier this week, media reported that Ohio-based Cliffs Natural Resources has agreed to purchase and develop the rare chromite deposits in the Ring of Fire, north of Nakina.
Cliffs’ plans on building an open pit mine at the site, plus a railway to get the material to a processing plant near Thunder Bay. Gravelle said the Ministry of Northern Development, Mines and Forestry is interested in the process moving forward.
He said there are tremendous opportunities for the chromite deposit, which can be mixed with iron to become ferrochrome, a key ingredient used in the manufacturing of stainless steel.
The purchase of the chromite deposits from Freewest Resources is still pending. It is anticipated the development could produce upwards of $800,000 tonnes of chromite each year.
Cliffs expects to invest about $800-million in the project.
Source: TB Newswatch
Chromex Takes Stake In Zimbabwe Mine
Chromex Mining a chrome mining company focused in Southern Africa, has concluded a binding Heads of Agreement to acquire 49 percent of Falvect Mining.
Falvect, a company owned and operating in Zimbabwe was acquired for a nominal consideration.
Under the terms of the acquisition, Chromex will have the exclusive right to co-develop all Falvect chrome concessions in the Shurugwi region and tribute agreements in the Ngezi area.
Chromex will market all the chrome products produced from those operations.
“In return, the company will provide working capital into Falvect and funding for the development of current projects and any additional acquisitions in Zimbabwe, which is host to significant high grade chrome ore deposits.
“A technical review of the contained mineralisation will commence once final agreements have been concluded,” said Chromex.
In line with the development of its business, Chromex is already investigating the economics of setting up beneficiation facilities in Zimbabwe.
Source: Zimbabwe Telegraph
Falvect, a company owned and operating in Zimbabwe was acquired for a nominal consideration.
Under the terms of the acquisition, Chromex will have the exclusive right to co-develop all Falvect chrome concessions in the Shurugwi region and tribute agreements in the Ngezi area.
Chromex will market all the chrome products produced from those operations.
“In return, the company will provide working capital into Falvect and funding for the development of current projects and any additional acquisitions in Zimbabwe, which is host to significant high grade chrome ore deposits.
“A technical review of the contained mineralisation will commence once final agreements have been concluded,” said Chromex.
In line with the development of its business, Chromex is already investigating the economics of setting up beneficiation facilities in Zimbabwe.
Source: Zimbabwe Telegraph
Thursday, November 26, 2009
WISCO Formally Takes 13 Per Cent Stake In Centrex
China's third largest steel group, Wuhan Iron & Steel (Group) Co (WISCO) has formally moved to a 13.04% equity stake in South Australia iron ore developer, Centrex Metals Limited (ASX code: "CXM") for A$9.7 million (net of expenses).
40,399,599 ordinary shares in Centrex were placed with WISCO this week at a price of A$0.25 per share.
The placement represents the first part of an up to $271 million investment by WISCO in Centrex, after the Australian Foreign Investment Review Board ("Board") approved the joint development of a series of iron ore projects and a deep water port on South Australia's Eyre Peninsula.
The placement expands Centrex's current total number of ordinary shares on issue from 269.3 million to around 309.7 million.
Under the agreements approved by FIRB, additional to the share placement, WISCO will:
• Unconditionally pay A$78 million directly to Centrex for a 60% stake in the iron ore rights over five of Centrex's seventeen mineral tenements. [The A$78 million is payable in two components. The first of which (A$52 million) is expected during December 2009 and the second (A$26 million) is payable on the one year anniversary of the first payment].
• Pay a further A$108 million directly to Centrex if/when progressive JORC Inferred iron resource milestones are achieved.
• In addition, sole fund the first A$75 million of iron-only exploration and development across the five tenements, working towards the development of two, five million tonne magnetite concentrate operations.
• Form a separate 50/50 joint venture for the development of a Cape size capable deep water port at Sheep Hill on the east coast of the Eyre Peninsula.
Centrex Chairman, Mr David Lindh, said:
"The placement by WISCO builds upon the strong foundations Centrex has set in place this year, via a series of strategic joint venture investments by our Chinese business partners in our magnetite assets and iron exploration rights.
"This, combined with the gaining of key approvals for Centrex's own 100% owned hematite project at Wilgerup, also on Eyre Peninsula, positions the Company as a future player in the iron ore industry and South Australian economy."
40,399,599 ordinary shares in Centrex were placed with WISCO this week at a price of A$0.25 per share.
The placement represents the first part of an up to $271 million investment by WISCO in Centrex, after the Australian Foreign Investment Review Board ("Board") approved the joint development of a series of iron ore projects and a deep water port on South Australia's Eyre Peninsula.
The placement expands Centrex's current total number of ordinary shares on issue from 269.3 million to around 309.7 million.
Under the agreements approved by FIRB, additional to the share placement, WISCO will:
• Unconditionally pay A$78 million directly to Centrex for a 60% stake in the iron ore rights over five of Centrex's seventeen mineral tenements. [The A$78 million is payable in two components. The first of which (A$52 million) is expected during December 2009 and the second (A$26 million) is payable on the one year anniversary of the first payment].
• Pay a further A$108 million directly to Centrex if/when progressive JORC Inferred iron resource milestones are achieved.
• In addition, sole fund the first A$75 million of iron-only exploration and development across the five tenements, working towards the development of two, five million tonne magnetite concentrate operations.
• Form a separate 50/50 joint venture for the development of a Cape size capable deep water port at Sheep Hill on the east coast of the Eyre Peninsula.
Centrex Chairman, Mr David Lindh, said:
"The placement by WISCO builds upon the strong foundations Centrex has set in place this year, via a series of strategic joint venture investments by our Chinese business partners in our magnetite assets and iron exploration rights.
"This, combined with the gaining of key approvals for Centrex's own 100% owned hematite project at Wilgerup, also on Eyre Peninsula, positions the Company as a future player in the iron ore industry and South Australian economy."
China Coal Imports To Rise By 170 Per Cent In 2009
According to the statistics released by China's General Administration of Customs on November 23, China's coal imports for October totalled 11.1 million mt, up 220 percent year on year. From January to October inclusive, China's total coal imports reached 96.83 million mt. Thus, the country's coal imports in 2009 look certain to break the 100 million mt barrier; it is estimated that the import volume for the year will reach 109.08 million mt, marking an increase of around 170 percent year on year. Meanwhile, some analysts have commented that, since the coal prices in the international market are likely to grow faster than prices in the domestic market, China's coal imports will show a reduction next year.
From the fourth quarter of 2008, world energy demand slumped significantly due to the economic recession, with international coal prices falling down from high levels. By the end of March 19 this year, the spot price of Australian BJ steam coal had dropped to $61.5/mt from the peak level of $190.95/mt on July 3, 2008. With the Chinese coal prices consistently higher than the international levels, China's coal imports have soared dramatically in 2009, while the export volume has indicated a rapid decline.
According to the latest figures from the National Bureau of Statistics, China's raw coal production amounted to 2.42 billion mt in the January-October period, up 11.4 percent compared with the same period last year. If no great changes are seen in the last two months of this year, overall domestic coal production will reach 2.9 billion mt for the whole year. Taking the net import volume into consideration, apparent coal consumption in China is expected to approach 3 billion mt in 2009.
Source: Alibaba
From the fourth quarter of 2008, world energy demand slumped significantly due to the economic recession, with international coal prices falling down from high levels. By the end of March 19 this year, the spot price of Australian BJ steam coal had dropped to $61.5/mt from the peak level of $190.95/mt on July 3, 2008. With the Chinese coal prices consistently higher than the international levels, China's coal imports have soared dramatically in 2009, while the export volume has indicated a rapid decline.
According to the latest figures from the National Bureau of Statistics, China's raw coal production amounted to 2.42 billion mt in the January-October period, up 11.4 percent compared with the same period last year. If no great changes are seen in the last two months of this year, overall domestic coal production will reach 2.9 billion mt for the whole year. Taking the net import volume into consideration, apparent coal consumption in China is expected to approach 3 billion mt in 2009.
Source: Alibaba
Wednesday, November 25, 2009
Chambishi Delays Cobalt Production
Zambia's largest cobalt producer, Chambishi Metals will delay its ramp-up to full output until cobalt prices rise to $22 per pound from the current $18 per pound, the firm said on Wednesday.
Chambishi, which is owned by Enya Holdings of the United Kingdom, had forecast output at 3,400 tonnes of cobalt in 2009 from 2,500 tonnes in 2008 before it suspended operations, which were restarted this month.
Chief Executive Officer, Derek Webbstock said although suppliers in the Democratic Republic of Congo (DRC) had delivered cobalt concentrates, the processing plant would restrict operations to the leaching unit until prices ticked up.
"We will only restart the furnace where we can produce ferro-alloys from slag once the prices reach the previous levels of $22 per pound," Webbstock told Reuters.
"If I can get material of a higher grade then I can restart the furnace because the output depends on the quality of the material. We are presently not getting any raw materials for the furnace from the DRC," Webbstock said.
Operations at Chambishi were suspended last December and placed on care and maintenance due to losses the company suffered after metal prices fell and costs rose owing to the global economic slowdown.
Webbstock could not state the current output, saying he needed to reconcile the figures in the first week of December.
Webbstock said Chambishi would not use the local raw materials from the Nkana slag dump, 359 km north-west of Lusaka at the current price because the slag was of low grade.
"We are producing the current cobalt from the leaching circuit. It is cheaper for us because we are not using electricity. The furnace remains an opportunity for the future," Webbstock said.
Chambishi would start processing copper concentrates after China Nonferrous Metals Mining Corporation (CNMC) unit, Luanshya Copper Mines (LCM) restarted output, Webbstock said.
Chambishi had forecast B-grade copper output of 20,000 tonnes in 2009.
Chambishi was previously owned by LCM, a joint venture of Bein Stein Group Resources (BSGR) and International Mineral Resources (IMR).
Source: Reuters
Chambishi, which is owned by Enya Holdings of the United Kingdom, had forecast output at 3,400 tonnes of cobalt in 2009 from 2,500 tonnes in 2008 before it suspended operations, which were restarted this month.
Chief Executive Officer, Derek Webbstock said although suppliers in the Democratic Republic of Congo (DRC) had delivered cobalt concentrates, the processing plant would restrict operations to the leaching unit until prices ticked up.
"We will only restart the furnace where we can produce ferro-alloys from slag once the prices reach the previous levels of $22 per pound," Webbstock told Reuters.
"If I can get material of a higher grade then I can restart the furnace because the output depends on the quality of the material. We are presently not getting any raw materials for the furnace from the DRC," Webbstock said.
Operations at Chambishi were suspended last December and placed on care and maintenance due to losses the company suffered after metal prices fell and costs rose owing to the global economic slowdown.
Webbstock could not state the current output, saying he needed to reconcile the figures in the first week of December.
Webbstock said Chambishi would not use the local raw materials from the Nkana slag dump, 359 km north-west of Lusaka at the current price because the slag was of low grade.
"We are producing the current cobalt from the leaching circuit. It is cheaper for us because we are not using electricity. The furnace remains an opportunity for the future," Webbstock said.
Chambishi would start processing copper concentrates after China Nonferrous Metals Mining Corporation (CNMC) unit, Luanshya Copper Mines (LCM) restarted output, Webbstock said.
Chambishi had forecast B-grade copper output of 20,000 tonnes in 2009.
Chambishi was previously owned by LCM, a joint venture of Bein Stein Group Resources (BSGR) and International Mineral Resources (IMR).
Source: Reuters
CISA Begins Preparations for 2010 Benchmark Talks
On November 23, the China Iron and Steel Association (CISA) vice chairman Luo Bingsheng disclosed that the preparations for the iron ore contract negotiations for 2010 have started, while adding that in the meantime the CISA was actively making efforts to facilitate the formulation of iron ore import qualifications for Chinese enterprises.
Mr. Luo said that the 2010 iron ore negotiation had entered a pre-negotiation phase as both the supply and demand sides had carried out preliminary exchanges of ideas on the future supply and demand situation.
As regards the views on iron ore prices for the coming year, the Chinese side thinks that there will not be much room for an increase in iron ore prices from overseas miners; meanwhile, the three iron ore giants and some investment banks consider that market demand for iron ore and other raw materials will grow following the overall recovery of steel demand in China and across the world.
Since the month of October, spot prices of iron ore have again been climbing up slowly, breaking $100/mt in November, much higher than the annual long-term agreement prices reached between Rio Tinto and Nippon Steel. This is closely linked to the disorder in China's import ore market, commented Luo Bingsheng. It is in this context, he said, that the CISA is now reexamining the iron ore import qualifications of Chinese enterprises together with other authorities.
Source: Alibaba
Mr. Luo said that the 2010 iron ore negotiation had entered a pre-negotiation phase as both the supply and demand sides had carried out preliminary exchanges of ideas on the future supply and demand situation.
As regards the views on iron ore prices for the coming year, the Chinese side thinks that there will not be much room for an increase in iron ore prices from overseas miners; meanwhile, the three iron ore giants and some investment banks consider that market demand for iron ore and other raw materials will grow following the overall recovery of steel demand in China and across the world.
Since the month of October, spot prices of iron ore have again been climbing up slowly, breaking $100/mt in November, much higher than the annual long-term agreement prices reached between Rio Tinto and Nippon Steel. This is closely linked to the disorder in China's import ore market, commented Luo Bingsheng. It is in this context, he said, that the CISA is now reexamining the iron ore import qualifications of Chinese enterprises together with other authorities.
Source: Alibaba
Tuesday, November 24, 2009
Russian Steel Output Down In October
According to the data released by the Russian Federation Federal State Statistics Service, metallurgical production in Russia in October 2009 down by 0.1% YoY while in the January to October period a drop of 19.3 YoY.
In October Russia crude steel production up by 14.6% YoY to 5.5 million tonnes increased by 3.5% MoM. In October, Russia produced 4.1 million tonnes of pig iron and blast furnace ferroalloys up by 21%YoY and 3.1% MoM, 4.5 million tonnes of billets up by 24.3%YoY and down by 0.2%MoM, 2.6 million tonnes of long products up by 13.9%YoY and up by 2.9 MoM and 2.1 million tonnes of flat rolled products up by 33.9%YoY and down 2.2%MoM. The above flat rolled production figure includes 700,000 tonnes of cold rolled up by 13.9%YoY, and 1.4 million tonnes of hot rolled up by 47.1%YoY.
In October 2009 Russia produced 548,000 tonnes of rolled products from low alloyed steel down by 22.1%YoY, 303,000 tonnes of coated sheet and tinplate down by 5.7% YoY, 61,900 tonnes of cold rolled steel strip up by 30.6% YoY, 64,700 tonnes of bent steel sections down by 11.7% YoY and 27,500 tonnes of wire rod down by 21.7% YoY.
Source: Steel Guru
In October Russia crude steel production up by 14.6% YoY to 5.5 million tonnes increased by 3.5% MoM. In October, Russia produced 4.1 million tonnes of pig iron and blast furnace ferroalloys up by 21%YoY and 3.1% MoM, 4.5 million tonnes of billets up by 24.3%YoY and down by 0.2%MoM, 2.6 million tonnes of long products up by 13.9%YoY and up by 2.9 MoM and 2.1 million tonnes of flat rolled products up by 33.9%YoY and down 2.2%MoM. The above flat rolled production figure includes 700,000 tonnes of cold rolled up by 13.9%YoY, and 1.4 million tonnes of hot rolled up by 47.1%YoY.
In October 2009 Russia produced 548,000 tonnes of rolled products from low alloyed steel down by 22.1%YoY, 303,000 tonnes of coated sheet and tinplate down by 5.7% YoY, 61,900 tonnes of cold rolled steel strip up by 30.6% YoY, 64,700 tonnes of bent steel sections down by 11.7% YoY and 27,500 tonnes of wire rod down by 21.7% YoY.
Source: Steel Guru
Monday, November 23, 2009
World Steel Production Rises In October
Production of crude steel, a key breakbulk cargo, in the 66 countries that report to the World Steel Association increased 3 percent from September to October, or to 112,177 million metric tons from 108,816 mmt.
However, total global steel production for the ten months through October lagged 13.5 percent, reaching only 982,143 mmt compared to 1,135,544 during the same period of 2008.
Chinese steel production during the first ten months of 2009 was 472,474 mmt, an increase of 10.5 percent over the same period in 2008. China’s ten-month 2009 total accounted for 48 percent of the global total for the period.
Japan accounted for about 7 percent of the global total; Russia, about 5 percent; India, about 5 percent; the U.S., about 5 percent; South Korea, about 4 percent; and the EU, about 11 percent.
From September to October 2009, Chinese production increased slightly, to 51,747 tons from 51,711. European Union steel production was up slightly from September to October, to 14,126 mmt from 13,307. North American production was also up slightly, to 5,921 mmt from 5,776 mmt, according to the WSA.
Source: Journal Of Commerce
However, total global steel production for the ten months through October lagged 13.5 percent, reaching only 982,143 mmt compared to 1,135,544 during the same period of 2008.
Chinese steel production during the first ten months of 2009 was 472,474 mmt, an increase of 10.5 percent over the same period in 2008. China’s ten-month 2009 total accounted for 48 percent of the global total for the period.
Japan accounted for about 7 percent of the global total; Russia, about 5 percent; India, about 5 percent; the U.S., about 5 percent; South Korea, about 4 percent; and the EU, about 11 percent.
From September to October 2009, Chinese production increased slightly, to 51,747 tons from 51,711. European Union steel production was up slightly from September to October, to 14,126 mmt from 13,307. North American production was also up slightly, to 5,921 mmt from 5,776 mmt, according to the WSA.
Source: Journal Of Commerce
Coal India To Develop Abandon Mines
State-owned Coal India (CIL) plans to start mining from 18 abandoned mines through joint venture route to bridge demand-supply gap of the dry fuel, the Rajya Sabha was told today.
These mines have an estimated 1.6 billion tonnes reserves and the mining is likely to start next year.
"Coal India has proposed to re-open, salvage and operate 18 identified abandoned underground mines," Coal Minister Sriprakash Jaiswal informed Rajya Sabha in a written reply today.
"For selection of joint venture partners having technical expertise and financial capabilities, global expression of interest was invited. Twelve responses were received out of which ten have been short listed who are eligible to bid for the tender," he said.
He added that state-owned PSU has also sought certain permission/clarifications from the Coal Ministry concerning sale of coal to such joint venture partners in order to make the proposal encouraging for the prospective bidders.
Out of these 18, six are housed in Eastern Coalfields, eight in Bharat Coking Coal and four in Central Coalfields.
Source: Business Standard
These mines have an estimated 1.6 billion tonnes reserves and the mining is likely to start next year.
"Coal India has proposed to re-open, salvage and operate 18 identified abandoned underground mines," Coal Minister Sriprakash Jaiswal informed Rajya Sabha in a written reply today.
"For selection of joint venture partners having technical expertise and financial capabilities, global expression of interest was invited. Twelve responses were received out of which ten have been short listed who are eligible to bid for the tender," he said.
He added that state-owned PSU has also sought certain permission/clarifications from the Coal Ministry concerning sale of coal to such joint venture partners in order to make the proposal encouraging for the prospective bidders.
Out of these 18, six are housed in Eastern Coalfields, eight in Bharat Coking Coal and four in Central Coalfields.
Source: Business Standard
Cliff Resources To Buy Canada's Freewest
US iron-ore and coal miner Cliffs Natural Resources has agreed to buy Montreal-based chromite junior Freewest Resources Canada, the two companies announced on Monday.
Freewest is exploring in Canada's 'Ring of Fire' district, an emerging multi-metal exploration district in the James Bay Lowlands of Ontario, which is getting increasing intention from investors, and where the company has confirmed chromite and vanadium discoveries.
Last month, Freewest received an unsolicited takeover offer from rival Noront Resources, which is also active in the Ring of Fire, but Freewest rejected the offer of one Noront share for four Freewest shares as too low and “highly opportunistic”.
The company's board has, however, unanimously agreed to support and recommend the offer from Cliffs, of the share equivalent of C$0,55 a share, or a total of C$118-million.
Cliffs, which already owns 6,9% of Freewest shares, plus warrants which could increase its holding to 9,75%, will receive Freewest's three Ring of Fire properties – the Black Thor and Black Label projects, plus the company's 50% share in the adjacent Big Daddy joint venture.
The US group plans to build a mine producing between one-million and two-million tons a year of high-grade chromite ore, which would be processed into 400 000 t to 800 000 t of ferrochrome.
The company said it believes the three deposits are the “highest quality deposits” in the Ring of Fire district, and would provide a significantly long mine life and expansion potential.
“Ferrochrome is imported by the world's fastest growing steel markets and many countries have categorized it as a strategic resource,” said Cliffs CEO Joseph Carrabba.
“In addition to furnishing the raw-material needs of carbon steel producers, we will become a supplier to producers of stainless steel.”
The final share ratio for the transaction will be determined based on the volume-weighted average price of Cliffs' shares for the five days ending on the third trading day before the effective date of the acquisition.
On top of the Cliffs stock, Freewest shareholders will also receive one share, worth C$0,15 each, in a 'new Freewest' which will be spun out to hold the company's other properties.
The 'new' Freewest will trade on the TSX Venture Exchange, and will have assets in New Brunswick and Quebec. Its main focus will be on the Clarence Stream gold property in New Brunswick.
"We believe this transaction is clearly superior to the proposal put forward by Noront," Freewest CEO Mackenzie Watson said in a statement.
"It will provide Freewest shareholders with highly-liquid shares in a company with a market capitalisation in excess of $5-billion, while allowing New Freewest to continue as a well-financed exploration company focused on the high-grade Clarence Stream gold property and an attractive suite of early-stage exploration properties."
Cliffs mines coal and iron ore in the US and Australia, and also has a 30% stake in the Amapá iron-ore project, in Brazil.
Source: Mining Weekly
Freewest is exploring in Canada's 'Ring of Fire' district, an emerging multi-metal exploration district in the James Bay Lowlands of Ontario, which is getting increasing intention from investors, and where the company has confirmed chromite and vanadium discoveries.
Last month, Freewest received an unsolicited takeover offer from rival Noront Resources, which is also active in the Ring of Fire, but Freewest rejected the offer of one Noront share for four Freewest shares as too low and “highly opportunistic”.
The company's board has, however, unanimously agreed to support and recommend the offer from Cliffs, of the share equivalent of C$0,55 a share, or a total of C$118-million.
Cliffs, which already owns 6,9% of Freewest shares, plus warrants which could increase its holding to 9,75%, will receive Freewest's three Ring of Fire properties – the Black Thor and Black Label projects, plus the company's 50% share in the adjacent Big Daddy joint venture.
The US group plans to build a mine producing between one-million and two-million tons a year of high-grade chromite ore, which would be processed into 400 000 t to 800 000 t of ferrochrome.
The company said it believes the three deposits are the “highest quality deposits” in the Ring of Fire district, and would provide a significantly long mine life and expansion potential.
“Ferrochrome is imported by the world's fastest growing steel markets and many countries have categorized it as a strategic resource,” said Cliffs CEO Joseph Carrabba.
“In addition to furnishing the raw-material needs of carbon steel producers, we will become a supplier to producers of stainless steel.”
The final share ratio for the transaction will be determined based on the volume-weighted average price of Cliffs' shares for the five days ending on the third trading day before the effective date of the acquisition.
On top of the Cliffs stock, Freewest shareholders will also receive one share, worth C$0,15 each, in a 'new Freewest' which will be spun out to hold the company's other properties.
The 'new' Freewest will trade on the TSX Venture Exchange, and will have assets in New Brunswick and Quebec. Its main focus will be on the Clarence Stream gold property in New Brunswick.
"We believe this transaction is clearly superior to the proposal put forward by Noront," Freewest CEO Mackenzie Watson said in a statement.
"It will provide Freewest shareholders with highly-liquid shares in a company with a market capitalisation in excess of $5-billion, while allowing New Freewest to continue as a well-financed exploration company focused on the high-grade Clarence Stream gold property and an attractive suite of early-stage exploration properties."
Cliffs mines coal and iron ore in the US and Australia, and also has a 30% stake in the Amapá iron-ore project, in Brazil.
Source: Mining Weekly
Baosteel Celebrates Aquila Stake
A hand over ceremony between Baosteel and Australian Aquila Resources took place in Beijing Monday morning. According to the agreement, Baosteel will take a 15 percent stake in Aquila.
China's biggest steelmaker, Baosteel, was given the green light by the governments of both countries to acquire up to a 19.99 percent stake in coking coal and iron ore company Aquila Resources. The acquisition cost 286 million Australian dollars in new shares.
Luo Bingsheng, Deputy Director China Iron & Steel Association, said, "We think it should be based on the enterprise's behavior. Enterprises did this based on their requirements. We should support their work. There is one thing we want to stress, for China, the imported iron ore price must implement the unified price. The iron ore price should strictly adhere to the standard and requirement reached by Baosteel and the three largest mining companies. "
Aquila is a comprehensive mining corporation in west Australia. Its operation consists of iron ore, coal and manganese. The annual future production volume of iron ore is expected to reach 20 million tons, 6 million tons of coal and 1 million tons of manganese.
Xu Lejiang, Chairman BaoSteel Group, said, "This is not only good for Baosteel, but it also avoids risks, and creates a win-win situation for both sides pursuing long-term returns."
Dai Zhihao, the vice president of Baosteel Group will join Aquila's board. It is the Foreign Investment Review Board's fourth approval of a Chinese investment in the mining sector in the past three weeks.
Source: CCTV (video also available)
China's biggest steelmaker, Baosteel, was given the green light by the governments of both countries to acquire up to a 19.99 percent stake in coking coal and iron ore company Aquila Resources. The acquisition cost 286 million Australian dollars in new shares.
Luo Bingsheng, Deputy Director China Iron & Steel Association, said, "We think it should be based on the enterprise's behavior. Enterprises did this based on their requirements. We should support their work. There is one thing we want to stress, for China, the imported iron ore price must implement the unified price. The iron ore price should strictly adhere to the standard and requirement reached by Baosteel and the three largest mining companies. "
Aquila is a comprehensive mining corporation in west Australia. Its operation consists of iron ore, coal and manganese. The annual future production volume of iron ore is expected to reach 20 million tons, 6 million tons of coal and 1 million tons of manganese.
Xu Lejiang, Chairman BaoSteel Group, said, "This is not only good for Baosteel, but it also avoids risks, and creates a win-win situation for both sides pursuing long-term returns."
Dai Zhihao, the vice president of Baosteel Group will join Aquila's board. It is the Foreign Investment Review Board's fourth approval of a Chinese investment in the mining sector in the past three weeks.
Source: CCTV (video also available)
POSCO To Build Magnesium Refining Plant
POSCO said yesterday it is likely to build a "magnesium refining plant" in Gangwon Province.
"It is almost certain that we will sign an MOU with Gangwon Province to build a magnesium refining plant," said Kim Dong-wan, a POSCO spokesman.
The world's fourth-largest steelmaker has a magnesium sheet manufacturing plant in Suncheon, South Jeolla Province, supplying small magnesium parts for makers of handsets, notebooks and MP3 players.
POSCO also plans to make magnesium sheets for lighter bicycles in the Suncheon plant.
POSCO and Gangwon Province are now in talks to decide on the amount of the investment, he said.
The steelmaker's move comes as the company has been aggressively widening its revenue streams in the materials business to seek new growth engines.
"POSCO's steel output is now 33 million tons a year, but it is expected to stop expanding the capacity when the figure reaches 40 million. POSCO is already turning its eyes to other businesses in the local market," said Choi Moon-sun, an analyst with Korea Investment & Securities.
"I think POSCO will tap the bicycle business very aggressively with magnesium products," he said.
POSCO recently agreed with Kazakhstan's UKTMP to jointly establish a titanium slab manufacturing firm to produce titanium in Ust-Kamenogorsk, eastern Kazakhstan.
If the titanium slabs are shipped to POSCO in Korea to make titanium coil, Korea will become the world's fourth country to produce titanium-based coil after Japan, Russia and the United States, the steelmaker said.
On Sept. 1, POSCO established the ferromanganese manufacturing company POS-HiMetal to enter the ferromanganese manufacturing business.
The company plans to start the construction of a plant in April next year and complete the construction in September 2011, to produce 75,000 tons of highly pure ferromanganese a year, POSCO said.
Source: Korea Herald
"It is almost certain that we will sign an MOU with Gangwon Province to build a magnesium refining plant," said Kim Dong-wan, a POSCO spokesman.
The world's fourth-largest steelmaker has a magnesium sheet manufacturing plant in Suncheon, South Jeolla Province, supplying small magnesium parts for makers of handsets, notebooks and MP3 players.
POSCO also plans to make magnesium sheets for lighter bicycles in the Suncheon plant.
POSCO and Gangwon Province are now in talks to decide on the amount of the investment, he said.
The steelmaker's move comes as the company has been aggressively widening its revenue streams in the materials business to seek new growth engines.
"POSCO's steel output is now 33 million tons a year, but it is expected to stop expanding the capacity when the figure reaches 40 million. POSCO is already turning its eyes to other businesses in the local market," said Choi Moon-sun, an analyst with Korea Investment & Securities.
"I think POSCO will tap the bicycle business very aggressively with magnesium products," he said.
POSCO recently agreed with Kazakhstan's UKTMP to jointly establish a titanium slab manufacturing firm to produce titanium in Ust-Kamenogorsk, eastern Kazakhstan.
If the titanium slabs are shipped to POSCO in Korea to make titanium coil, Korea will become the world's fourth country to produce titanium-based coil after Japan, Russia and the United States, the steelmaker said.
On Sept. 1, POSCO established the ferromanganese manufacturing company POS-HiMetal to enter the ferromanganese manufacturing business.
The company plans to start the construction of a plant in April next year and complete the construction in September 2011, to produce 75,000 tons of highly pure ferromanganese a year, POSCO said.
Source: Korea Herald
China's Coal Imports Treble In October
China's coal imports rose 219.5 percent from a year earlier to 11.14 million tonnes in October, official customs data showed on Monday.
The volume, however, was 11.2 percent lower than in September, Reuters calculations showed. China's coal imports hit a record high of 16.07 million tonnes in June.
China, the world's largest coal producer and consumer, has become a net coal importer this year and its appetite for imported coal is expected to stay strong in coming months despite monthly ups and downs, traders said.
A clampdown on small miners and frequent mine closures as a result of mine blasts has made domestic supply tight and imports attractive.
China's coal exports declined 20 percent from a year earlier to 2.05 million tonnes in October, customs data showed.
Imports of coking coal soared to 2.12 million tonnes, up 556 percent from a year earlier.
Source: Alibaba
The volume, however, was 11.2 percent lower than in September, Reuters calculations showed. China's coal imports hit a record high of 16.07 million tonnes in June.
China, the world's largest coal producer and consumer, has become a net coal importer this year and its appetite for imported coal is expected to stay strong in coming months despite monthly ups and downs, traders said.
A clampdown on small miners and frequent mine closures as a result of mine blasts has made domestic supply tight and imports attractive.
China's coal exports declined 20 percent from a year earlier to 2.05 million tonnes in October, customs data showed.
Imports of coking coal soared to 2.12 million tonnes, up 556 percent from a year earlier.
Source: Alibaba
Sunday, November 22, 2009
Meteorex Sees Higher Copper Output From Congo Mine
Reuters quotes South African miner Metorex as saying that its Ruashi mine in the Democratic Republic of Congo could produce 36,000 tonnes copper per year and up to 5,000 tonnes of cobalt in the long term.
Metorex said in a statement that the mine produced 2,512 tonnes of copper and 274 tonnes of cobalt in October up from 2,345 tonnes of copper and 272 tonnes of cobalt in the previous month.
Mr Terence Goodlace CEO of Metorex said that metal production was expected to be 20,000 tonnes of copper cathode and 1,756 tonnes of contained cobalt for the 8 months to June 2010 at its Ruashi mine.
Metorex, which also operates the Chibuluma copper mine in Zambia and is selling its stake in a fluorspar mine in South Africa, said that increases in copper and cobalt prices drove revenues higher. The company said that the total costs had reduced to USD 2,800 per tonne of copper produced and improved efficiencies was expected to result in a further reduction in costs. It said that mining costs were expected to rise at Ruashi due to increased stripping requirement at one of the pits.
The company said that it would investigate further opportunities to mine for copper and enhance processing at its open pit and underground mines. The planned sale of 55% stake in the Vergenoeg flourspar mine in South Africa for USD 60 million was on track for completion during December 2009.
Source: Steel Guru
Metorex said in a statement that the mine produced 2,512 tonnes of copper and 274 tonnes of cobalt in October up from 2,345 tonnes of copper and 272 tonnes of cobalt in the previous month.
Mr Terence Goodlace CEO of Metorex said that metal production was expected to be 20,000 tonnes of copper cathode and 1,756 tonnes of contained cobalt for the 8 months to June 2010 at its Ruashi mine.
Metorex, which also operates the Chibuluma copper mine in Zambia and is selling its stake in a fluorspar mine in South Africa, said that increases in copper and cobalt prices drove revenues higher. The company said that the total costs had reduced to USD 2,800 per tonne of copper produced and improved efficiencies was expected to result in a further reduction in costs. It said that mining costs were expected to rise at Ruashi due to increased stripping requirement at one of the pits.
The company said that it would investigate further opportunities to mine for copper and enhance processing at its open pit and underground mines. The planned sale of 55% stake in the Vergenoeg flourspar mine in South Africa for USD 60 million was on track for completion during December 2009.
Source: Steel Guru
Nanjing Sees 10 Per Cent Iron Ore Price Hike
According to Mr Yang Siming, chairman and CEO of Nanjing Steel Group, the benchmark iron ore price for fiscal 2010 is likely to gain 5% to 10% as iron ore miners still take the lead over the supply and demand chain.
He said that nevertheless, the picture may be changed in a few years if foreign iron ore projects invested by Chinese companies start commercial production which would drag down the iron ore price sharply.
Source: Steel Guru
He said that nevertheless, the picture may be changed in a few years if foreign iron ore projects invested by Chinese companies start commercial production which would drag down the iron ore price sharply.
Source: Steel Guru
Friday, November 20, 2009
Illinois Coal Mine To Close By End Of Year
An underground southern Illinois coal mine will close by the end of the year.
Knight Hawk Coal says the 50 workers at the Royal Falcon mine near the boundary of Franklin and Jackson counties will be offered transfers to the company's Prairie Eagle site near Cutler, in nearby Perry County.
Knight Hawk blames the closure on difficult mining conditions and geological problems at the site.
Work at the Royal Falcon mine began in January 2008.
Source: Chicago Tribune
Knight Hawk Coal says the 50 workers at the Royal Falcon mine near the boundary of Franklin and Jackson counties will be offered transfers to the company's Prairie Eagle site near Cutler, in nearby Perry County.
Knight Hawk blames the closure on difficult mining conditions and geological problems at the site.
Work at the Royal Falcon mine began in January 2008.
Source: Chicago Tribune
NMDC To Produce Iron Ore From Hematite Rocks
National Mineral Development Corporation (NMDC) is all set to break new grounds in iron ore mining.
The country’s largest iron ore miner will shortly be giving India a new technology for commercial extraction of iron ore from banded hematite jasper (BHJ) and banded hematite quartzite (BHQ) rocks, which are naturally mined along with the ore during normal mining operations.
Huge layers of these rocks thus pile up at the mine sites, which now will be put to commercial use.
“We are close to developing the technology — in another six months we should be ready with the technology viability report, which we are preparing with a consultant,” Mr Rana Som, Chairman and Managing Director, told Business Line.
The company, which produces about 30 million tonne of iron ore, plans to set up the first beneficiation plant with a capacity of three lakh tonnes a year at an estimated cost of Rs 100 crore, which will actually demonstrate the commercial viability of the technology.
This forms part of the company’s efforts to optimise iron ore production to meet the anticipated spurt in domestic demand. It has lined up a capital expenditure programme of Rs 2,500 crore to increase the capacity of its ore production to 50 million tonne by 2014, out of which about 85% will be for the domestic steel industry.
BHJ and BHQ rocks contain lesser quantities of iron ore and hence cannot be directly used in steel making. BHJ rocks, for example, contain about 40% iron ore and only if they are purified and enriched to 65% they can be charged in a pellet plant.
“Roughly, 100 kg of BHJ rock can yield 30 kg (30%) of iron ore if enriched to 65% level, which is what our technology is about,” said a senior official of NMDC’s R&D Department, which is actually developing the technology.
Although the company had explored different beneficiation methods, it ultimately zeroed in on spiral separation method to transform the rocks into useable iron ore.
As far as availability of this resource is concerned, the company faces no problems. As of now, some 12-14 million tonne of these two banded rocks are piled up as huge mountains of mineral wealth at its Donamalai mine site.
NMDC’s R&D unit, which operates as a separate profit centre, spent Rs 20 crore last fiscal. Its technology development projects include a pilot plant facility for production of carbon free sponge iron powder from blue dust, another mineral that is naturally mined along with iron ore operations.
It has also established lab scale technology for production of nano iron powder using blue dust in collaboration with Moscow State Institute of Steel and Alloys — the major applications of nano-structured iron powder are in electro-magnetic, automobile, computer, pain, coating, pharmaceutical and chemical industries.
Source: The Hindu Business Line
The country’s largest iron ore miner will shortly be giving India a new technology for commercial extraction of iron ore from banded hematite jasper (BHJ) and banded hematite quartzite (BHQ) rocks, which are naturally mined along with the ore during normal mining operations.
Huge layers of these rocks thus pile up at the mine sites, which now will be put to commercial use.
“We are close to developing the technology — in another six months we should be ready with the technology viability report, which we are preparing with a consultant,” Mr Rana Som, Chairman and Managing Director, told Business Line.
The company, which produces about 30 million tonne of iron ore, plans to set up the first beneficiation plant with a capacity of three lakh tonnes a year at an estimated cost of Rs 100 crore, which will actually demonstrate the commercial viability of the technology.
This forms part of the company’s efforts to optimise iron ore production to meet the anticipated spurt in domestic demand. It has lined up a capital expenditure programme of Rs 2,500 crore to increase the capacity of its ore production to 50 million tonne by 2014, out of which about 85% will be for the domestic steel industry.
BHJ and BHQ rocks contain lesser quantities of iron ore and hence cannot be directly used in steel making. BHJ rocks, for example, contain about 40% iron ore and only if they are purified and enriched to 65% they can be charged in a pellet plant.
“Roughly, 100 kg of BHJ rock can yield 30 kg (30%) of iron ore if enriched to 65% level, which is what our technology is about,” said a senior official of NMDC’s R&D Department, which is actually developing the technology.
Although the company had explored different beneficiation methods, it ultimately zeroed in on spiral separation method to transform the rocks into useable iron ore.
As far as availability of this resource is concerned, the company faces no problems. As of now, some 12-14 million tonne of these two banded rocks are piled up as huge mountains of mineral wealth at its Donamalai mine site.
NMDC’s R&D unit, which operates as a separate profit centre, spent Rs 20 crore last fiscal. Its technology development projects include a pilot plant facility for production of carbon free sponge iron powder from blue dust, another mineral that is naturally mined along with iron ore operations.
It has also established lab scale technology for production of nano iron powder using blue dust in collaboration with Moscow State Institute of Steel and Alloys — the major applications of nano-structured iron powder are in electro-magnetic, automobile, computer, pain, coating, pharmaceutical and chemical industries.
Source: The Hindu Business Line
New Iron Ore Projects May Suppress Prices
A bonanza in new iron ore mining projects may herald lower prices in coming years as capacity begins to catch up with rising Asian demand, according to a long-time industry watcher.
Fat Prophets resource analyst Nick Raffan said he sees parallels between the current flurry of investment in new and expanded mines aimed at satisfying China's iron ore hunger and the rush to meet Japanese coal orders in the late 1970s from new mines in Queensland, the Hunter Valley in NSW and elsewhere.
The latter surge led to an over-supply and subsequent price slump for the energy source that lasted decades.
''Traditionally, miners have never been able to stop themselves eventually from over-producing,'' said Mr Raffan. ''It's in their nature.''
Australia remains dependent on commodities for more than half its exports, with shipments to China of iron-ore and related concentrates alone worth $22.1 billion in 2008-09, according to the Department of Foreign Affairs and Trade. Apart from helping to narrow Australia's trade gap, rising commodity prices and volumes bolster state and federal coffers.
In volume terms, Australia exported 323.3 million metric tonnes of iron ore and pellets to China in 2008-09, according to the Australian Bureau of Agricultural and Resource Economics.
While Mr Raffan acknowledges the strength of the current up-swing in iron ore as Asian economies - particularly China's - rebound from last year's slump, he says there is a risk miners in Australia and elsewhere are increasing production too quickly.
As of October, investments in Australia to expand or develop resources totalled $112.5 billion, ABARE numbers said this week. Iron ore mining or infrastructure capex projects accounted for about 15 per cent of that total, with nearly 40 additional projects under consideration.
Nor is Australia alone in undertaking large investments to expand capacity. Vale, the Brazilian competitor to BHP Billiton and Rio Tinto, said last month it will spend $US12.9 billion ($14 billion) to raise production and exports, including funding two new iron ore mines.
Bloomberg reports Vale expects to export 140 million tons of iron ore to China this year.
Meanwhile China, which is producing about half the world's steel, is investing in mining capacity of its own. Projects include mines in Australia, Africa and South America.
Mr Raffan doesn't think the additional Brazil's output, nor China's own investments, is on the minds of local resource project developers.
''I think everyone sees things through rose-coloured glasses at the moment," he said.
BHP Billiton's chief executive officer Marius Kloppers reiterated his company's confidence in China's demand for resources holding up.
In a speech this week to the Lowy Institute, Mr Kloppers said China would build 50,000 skyscrapers over the next 20 years, or 600 times the number Sydney now has.
Also fuelling China's resource hunger will be further urbanisation, with the country expected to have 220 cities of more than one million people by 2030, compared with Europe's total of 35 now.
Such confidence in China's growth is helping to nudge iron ore prices higher after a drop of about a third last year.
Spot prices for iron ore recently climbed to $US104 a tonne, while a consensus of analysts polled by Bloomberg forecasts the contract price for iron ore - about $US60 a tonne before freight - to rise by 14 per cent next year.
While China's economic growth this year has surprised on the upside, some analysts are raising doubts about its reliance once massive state spending and directed lending subside.
Credit Suisse, a Swiss bank, points to signs that the economy is losing some momentum, comparing China's yearly industrial production rate with the PMI new orders index - a gauge of manufacturing activity.
China's industrial production rose 16.1 per cent in the year to October year-on-year, from 13.9 per cent the month before, according to the latest figures. The PMI new orders index, though, fell in October to 57.6 from 58.
''Going forward, if Chinese banks only lend at a RMB 200-250 billion ($32-40 billion) per month pace, we will see fixed asset investment growth slow, consistent with less support for commodity prices,'' said Credit Suisse analyst Damien Boey.
An export recovery may help China if its banks slow lending to avoid asset bubbles, he said. ''But certainly, growth will not be as good as it was post-first half stimulus,'' he said.
Mine Life senior analyst Gavin Wendt said he's not as pessimistic on prices as some, but based on the influx of new mining projects, ''it's getting harder to see the same price run-ups.''
''The rising price trajectory is going to flatten off even as the demand continues to increase from China and India,'' he said.
The price for ore will move in a range between $US80-$US120 per tonne over the next couple of years, Mr Wendt said, easing in the long term to a $US80-$US100 range as new production comes on-stream.
Mr Wendt said the Chinese lining up to partner with Australian miners are trying to ensure price stability in the years to come by expanding sources of production as the Japanese did with coal beginning in the 1980s.
The dim views don't accord with those of Macquarie Bank analyst Jim Lennon, Bloomberg News reported today.
Mr Lennon predicts global commodity demand will have a steady recovery next year, with China leading consumption.
China accounted for about 50 per cent of global commodity demand this year, up from about a third a year ago, Lennon said at a conference in Hong Kong.
Metal prices have rallied 81 per cent this year in London on Chinese purchases, and as a weaker dollar and expectations that the world is poised to recover from its worst recession since World War II stoked demand. Investors raised holdings in commodities to the highest levels in at least three years, BOfA Merrill Lynch Global Research said.
''The leap in demand for commodities in China this year has been quite staggering,'' Lennon said. ''You can see where these commodities are going by the increase in production in China of goods like autos.''
Steel production in China this year may jump to 570 million metric tons, up from about 500 million tons last year, Lennon said. Macquarie's forecast compares with the 565 million tons predicted by the China Iron & Steel Association yesterday.
Source: Sydney Morning Herald
Fat Prophets resource analyst Nick Raffan said he sees parallels between the current flurry of investment in new and expanded mines aimed at satisfying China's iron ore hunger and the rush to meet Japanese coal orders in the late 1970s from new mines in Queensland, the Hunter Valley in NSW and elsewhere.
The latter surge led to an over-supply and subsequent price slump for the energy source that lasted decades.
''Traditionally, miners have never been able to stop themselves eventually from over-producing,'' said Mr Raffan. ''It's in their nature.''
Australia remains dependent on commodities for more than half its exports, with shipments to China of iron-ore and related concentrates alone worth $22.1 billion in 2008-09, according to the Department of Foreign Affairs and Trade. Apart from helping to narrow Australia's trade gap, rising commodity prices and volumes bolster state and federal coffers.
In volume terms, Australia exported 323.3 million metric tonnes of iron ore and pellets to China in 2008-09, according to the Australian Bureau of Agricultural and Resource Economics.
While Mr Raffan acknowledges the strength of the current up-swing in iron ore as Asian economies - particularly China's - rebound from last year's slump, he says there is a risk miners in Australia and elsewhere are increasing production too quickly.
As of October, investments in Australia to expand or develop resources totalled $112.5 billion, ABARE numbers said this week. Iron ore mining or infrastructure capex projects accounted for about 15 per cent of that total, with nearly 40 additional projects under consideration.
Nor is Australia alone in undertaking large investments to expand capacity. Vale, the Brazilian competitor to BHP Billiton and Rio Tinto, said last month it will spend $US12.9 billion ($14 billion) to raise production and exports, including funding two new iron ore mines.
Bloomberg reports Vale expects to export 140 million tons of iron ore to China this year.
Meanwhile China, which is producing about half the world's steel, is investing in mining capacity of its own. Projects include mines in Australia, Africa and South America.
Mr Raffan doesn't think the additional Brazil's output, nor China's own investments, is on the minds of local resource project developers.
''I think everyone sees things through rose-coloured glasses at the moment," he said.
BHP Billiton's chief executive officer Marius Kloppers reiterated his company's confidence in China's demand for resources holding up.
In a speech this week to the Lowy Institute, Mr Kloppers said China would build 50,000 skyscrapers over the next 20 years, or 600 times the number Sydney now has.
Also fuelling China's resource hunger will be further urbanisation, with the country expected to have 220 cities of more than one million people by 2030, compared with Europe's total of 35 now.
Such confidence in China's growth is helping to nudge iron ore prices higher after a drop of about a third last year.
Spot prices for iron ore recently climbed to $US104 a tonne, while a consensus of analysts polled by Bloomberg forecasts the contract price for iron ore - about $US60 a tonne before freight - to rise by 14 per cent next year.
While China's economic growth this year has surprised on the upside, some analysts are raising doubts about its reliance once massive state spending and directed lending subside.
Credit Suisse, a Swiss bank, points to signs that the economy is losing some momentum, comparing China's yearly industrial production rate with the PMI new orders index - a gauge of manufacturing activity.
China's industrial production rose 16.1 per cent in the year to October year-on-year, from 13.9 per cent the month before, according to the latest figures. The PMI new orders index, though, fell in October to 57.6 from 58.
''Going forward, if Chinese banks only lend at a RMB 200-250 billion ($32-40 billion) per month pace, we will see fixed asset investment growth slow, consistent with less support for commodity prices,'' said Credit Suisse analyst Damien Boey.
An export recovery may help China if its banks slow lending to avoid asset bubbles, he said. ''But certainly, growth will not be as good as it was post-first half stimulus,'' he said.
Mine Life senior analyst Gavin Wendt said he's not as pessimistic on prices as some, but based on the influx of new mining projects, ''it's getting harder to see the same price run-ups.''
''The rising price trajectory is going to flatten off even as the demand continues to increase from China and India,'' he said.
The price for ore will move in a range between $US80-$US120 per tonne over the next couple of years, Mr Wendt said, easing in the long term to a $US80-$US100 range as new production comes on-stream.
Mr Wendt said the Chinese lining up to partner with Australian miners are trying to ensure price stability in the years to come by expanding sources of production as the Japanese did with coal beginning in the 1980s.
The dim views don't accord with those of Macquarie Bank analyst Jim Lennon, Bloomberg News reported today.
Mr Lennon predicts global commodity demand will have a steady recovery next year, with China leading consumption.
China accounted for about 50 per cent of global commodity demand this year, up from about a third a year ago, Lennon said at a conference in Hong Kong.
Metal prices have rallied 81 per cent this year in London on Chinese purchases, and as a weaker dollar and expectations that the world is poised to recover from its worst recession since World War II stoked demand. Investors raised holdings in commodities to the highest levels in at least three years, BOfA Merrill Lynch Global Research said.
''The leap in demand for commodities in China this year has been quite staggering,'' Lennon said. ''You can see where these commodities are going by the increase in production in China of goods like autos.''
Steel production in China this year may jump to 570 million metric tons, up from about 500 million tons last year, Lennon said. Macquarie's forecast compares with the 565 million tons predicted by the China Iron & Steel Association yesterday.
Source: Sydney Morning Herald
Thursday, November 19, 2009
China Steel To Maintain Australia Coal Imports
Zhong Yuemin, executive vice president from China Steel Co.(CSC) claimed on November 17 that the company’s 75% of coal demand would be imported from Australia.
He also said that CSC still hoped to achieve the diversity of the coal resource, however, in view of issues such as shipping cost, supply stability and port facilities, coupled with the port congestion in Queensland of Australia, the company will continue to maintain the aforesaid ratio.
According to the annual report from CSC, the imports of the company’s steel-making coking coal reduced by 5.1% to 8.1mln tons in 2008 from that in 2007. Although the data has not been announced in 2009, Zhong Yuemin stated that coking coal imports may keep the same level in 2009 as 2008.
He also said that CSC’ s 77.4% and 15% of coal demand imported from Australia and Canada correspondingly and 90% of coal purchased though long-term contract.
CSC has four blast furnaces into operation, with a total capacity of 10mln tons annually.
Dragon Steel Corporation, the company’s wholly-own subsidiary is building two 2.5mln tons of blast furnaces, one of which is estimated to put into production in February of 2010.
Zhong Yuemin pointed out, CSC has started to build coal inventory for the aforesaid blast furnaces, and planned to use coking coal furnaces by the end of this month to supply steel-making blast furnaces coal.
However, the coal imports of CSC will not rise sharply, as the company will suspend its No.1 blast furnace for six-month maintenance from the January of 2010, with 1.9mln tons annual capacity.
He added that if all things go well, the company’s coal imports may rise in H2 of 2010.
Calculated by revenue, CSC is the largest steel manufacturing enterprise in Taiwan.
Source: Alibaba
He also said that CSC still hoped to achieve the diversity of the coal resource, however, in view of issues such as shipping cost, supply stability and port facilities, coupled with the port congestion in Queensland of Australia, the company will continue to maintain the aforesaid ratio.
According to the annual report from CSC, the imports of the company’s steel-making coking coal reduced by 5.1% to 8.1mln tons in 2008 from that in 2007. Although the data has not been announced in 2009, Zhong Yuemin stated that coking coal imports may keep the same level in 2009 as 2008.
He also said that CSC’ s 77.4% and 15% of coal demand imported from Australia and Canada correspondingly and 90% of coal purchased though long-term contract.
CSC has four blast furnaces into operation, with a total capacity of 10mln tons annually.
Dragon Steel Corporation, the company’s wholly-own subsidiary is building two 2.5mln tons of blast furnaces, one of which is estimated to put into production in February of 2010.
Zhong Yuemin pointed out, CSC has started to build coal inventory for the aforesaid blast furnaces, and planned to use coking coal furnaces by the end of this month to supply steel-making blast furnaces coal.
However, the coal imports of CSC will not rise sharply, as the company will suspend its No.1 blast furnace for six-month maintenance from the January of 2010, with 1.9mln tons annual capacity.
He added that if all things go well, the company’s coal imports may rise in H2 of 2010.
Calculated by revenue, CSC is the largest steel manufacturing enterprise in Taiwan.
Source: Alibaba
Zinc Demand Falls Heavily
World demand for zinc, a key coating metal, is down 8.6% and close to a record low this year and renewed purchasing may be slow. Upshot: "Zinc prices are at a crossroads," writes commodities blogger Sandeep Daga, a financial advisor at Standard Bank in London. His meaning: Prices will either increase 15% in 2010 or fall 22% from this year's expected average.
"It's been a tumultuous year for both the global economy and the zinc market," according to a Brook Hunt analysis by Andrew Young, who says the "recession has resulted in permanent cuts to zinc demand in many countries." So, while production has plummeted, global inventories have built to a four-year high this quarter. And, despite the slight forecast recovery in zinc demand in 2010, which could result in consumption growing by 4.9%, another substantial inventory surplus is forecast. "If further output cuts do not occur," says Young, "refined market surpluses along with excessive increases in stocks could be sustained until 2013."
So, how much longer, questions Daga, can LME cash prices be supported at the latest three-month average of 85¢/lb? How much longer will fund managers pour money into zinc futures? How much longer will speculators be emboldened by the restart of some idled global galvanizing capacity in industrialized nations?
There will be considerable variation in the path of recovery ahead, according to economists. "In terms of zinc," Young says, "this means that in regions such as North America and Europe, the permanent closure of car plants will result in a permanent reduction in the demand for galvanized steel, die cast parts and other zinc-bearing products." As a result, Brooks Hunt is forecasting that this year's U.S. zinc consumption will total 900,000 metric tons, its lowest level since 1982. Western Europe's use is forecast to be 1.7 million metric tons, its lowest level since 1987, while consumption in Japan is projected to fall to 417,000 metric tons, its lowest level since 1966.
Galvanized sheet demand has passed its low point and will rise in coming months but the recovery will be weak, says economist Paul Robinson at Global Insight in Washington. "Inventory is at low levels and there is some restocking occurring; nevertheless, the improvement will be paltry compared with recovery from the earlier declines, with most consuming sectors not reaching old levels of output until 2012 or later." China is recovering faster than North America, he says, with Europe and Japan recovering slower.
Bob Garino, director of commodities for the Institute of Scrap Recycling Industries in Washington and a Purchasing.com blogger, says "investor interest, not supply/demand fundamentals, has been the principal driver behind higher slab zinc prices" this year. Analyst Jim Lennon at Macquarie Research in London agrees, noting that weak purchasing by the industrialized nations—primarily the members of the Organization for Economic Cooperation and Development (OECD)—continues to outweigh demand from emerging markets.
Equity analysts are projecting sustained strong LME zinc prices in coming months. Some analysts foresee a 2010 price average as high as 95¢ while the consensus forecast is an average 81¢/lb. That's up from an 85¢ average in 2008. But, "the bull run in base metals prices is showing signs of wavering," agrees analyst Andrew Young at Brook Hunt in London. "The realization that China is unlikely to continue its high level of imports of zinc and other base metals has caused uncertainty on the London Metal Exchange (LME) and prices have lost momentum." And that's why some analysts are forecasting a 2010 LME price average as low as 63¢.
Zinc metal demand has dropped 10.8% to 6.02 million metric tons through July, according to the International Lead & Zinc Study Group, while production has dropped 8% globally this year to 6.31 million metric tons. The consensus forecast has global zinc consumption for the year contracting by 8.6% to 10.24 million metric tons, the lowest annual level since 2003.
Next year, as the world emerges from recession, global use should rise 5.9% to 10.84 million metric tons. However, there is debate among analysts whether the zinc market will tighten in 2010. An early Barclays Capital report suggested that zinc might be one of the key base metal beneficiaries of fiscal spending packages. But the projected end-demand for coated steel has since ebbed in later commentaries. Lennon at Macquarie Research, for example, expects a meaningful increase in global zinc demand in 2010 as long as OECD economies "continue to recover amid robust emerging market growth," although he admits "continued deterioration of the U.S. commercial real estate market poses downside risk to this forecast."
According to an HSBC Group report from London, smelter utilization has dropped from 83% in 1998 to 77.2% in 2009 as mines have been closed and refining capacity idled in an attempt to bring supply and demand back into balance. However, analyst Edward Meir at MF Global in New York says the zinc metal market "still seems comfortably supplied" since demand isn't that strong and overall global stocks will be 1.27 million metric tons by the end of 2010, equivalent to six weeks of consumption.
Lennart Evrell, CEO of Boliden, Europe's second-largest zinc producer, points out that monthly LME cash prices have risen 56% this year as usage has outpaced production. China, which consumes more of the industrial metal than Europe and the U.S. combined, hasn't shown signs of slowing zinc-coated steel needs for building projects. However, Evrell tells Bloomberg in an interview in Stockholm that he is "personally ... concerned about China" and whether the country can sustain its rate of growth.
Excess supply is an issue since the world surplus is expected to reach 750,000 metric tons this year, almost three times what it was a year ago. According to calculations by Brook Hunt, the surplus will stay in excess of 450,000 metric tons next year "and act as a drag on the zinc price." Reason: Leading economic indicators suggest that the U.S. and other major economies have, as Young writes, "started down the long road to recovery," but actual industrial activity remains sluggish.
Justin Lennon, senior analyst for Mitsui Bussan Commodities in London, says steel mill closures outside of China severely impacted zinc consumption through mid-2009. Some restarts began in the third quarter based on expectations of customer restocking. Stocks in Europe are reported to remain high by historic standards and failed to draw down during the summer.
It is true that demand for zinc appears to be improving in early autumn in OECD countries. However, the recent restart of steel capacity may be "too quick, too soon," Daga says in the recent posting on SeekingAlpha.com. So, he suggests the zinc bull market could fade away in the face of ample supplies if the growth in demand for zinc-coated steels fails to gather momentum.
In the U.S., for example, analysts may have misread the market because of a blip in demand for galvanized sheet steel caused by a temporary increase in auto production to support sales that have since faded. Another key market, higher infrastructure spending, is showing stodgy growth. In Europe, the only noticeable improvement in galvanized sheet demand has come from the automotive market since no significant infrastructure spending is planned by European governments. It is Chinese demand for zinc that has remained strong from sustained fixed asset investment and construction sector recovery.
A buyer-member of the Linked-In online community answers a Purchasing.com question, "How easy is it to buy zinc these days?," by responding: "Will you report that speculators pushed prices up or will you say the dollar and its purchasing power simply fell, vis-Ã -vis other currencies? I'd go with the latter."
His commentary continues that "over time, demand/supply fundamentals are the driving force that determines price. When the dollar finally does stop falling and its purchasing power stabilizes—unless world demand (based on usage) picks up dramatically— I suggest a softening zinc market."
On the other hand, speculators believe that won't occur since China soon may be shutting smelters as part of the pollution-control efforts caused by the lead poisoning outbreak in Shaanxi province. China has one of the largest zinc ore reserves in the world and has been expanding zinc smelting operations.
What It Means to Buyers:
•Almost 5% stronger zinc demand in 2010 will cause production to expand as well.
•Mined output and refined zinc output will rise by an estimated 2%.
•However, another year of surplus of around 455,000 metric tons is forecast.
•The zinc market price will be buoyed by investment fund interest in futures trading
Zinc market records surplus in January to July 2009
The World Bureau of Metal Statistics says the zinc market was in surplus by 134,000 metric tons during January to July 2009 which compares with a surplus of 83,000 metric tons recorded in the same period one year earlier. Reported stocks rose by 183,000 metric tons with almost all of the increase recorded at London Metal Exchange (LME) warehouses. Other Bureau findings:
LME stocks represented 45% of the global total. The global demand total included a higher than expected apparent demand figure for China. According to Chinese customs data, imports for each of the latest six months were the highest monthly totals on record and it is likely that some of this material is bound for stockpiles and thus the actual global surplus is probably much more than headline figures indicate. Much of the Chinese imports originate from other Asian countries. Exports reported by Japan, South Korea and Taiwan confirm the Chinese imports.
Mine production was, at 6.50 million metric tons, 5% lower than the first seven months of 2008. Refined production fell by 513,000 metric tons to 6.26 million metric tons, with European Union countries registering a decline of 304,000 metric tons. North American Free Trade Agreement (NAFTA) regional output fell by just under 14%.
World demand was 564,000 metric tons lower than in January to July 2008. Chinese apparent demand was 2,745,000 metric tons which is 45% of the global total. No allowance is made in the consumption calculation for unreported stock changes.
Source: Purchasing.com
"It's been a tumultuous year for both the global economy and the zinc market," according to a Brook Hunt analysis by Andrew Young, who says the "recession has resulted in permanent cuts to zinc demand in many countries." So, while production has plummeted, global inventories have built to a four-year high this quarter. And, despite the slight forecast recovery in zinc demand in 2010, which could result in consumption growing by 4.9%, another substantial inventory surplus is forecast. "If further output cuts do not occur," says Young, "refined market surpluses along with excessive increases in stocks could be sustained until 2013."
So, how much longer, questions Daga, can LME cash prices be supported at the latest three-month average of 85¢/lb? How much longer will fund managers pour money into zinc futures? How much longer will speculators be emboldened by the restart of some idled global galvanizing capacity in industrialized nations?
There will be considerable variation in the path of recovery ahead, according to economists. "In terms of zinc," Young says, "this means that in regions such as North America and Europe, the permanent closure of car plants will result in a permanent reduction in the demand for galvanized steel, die cast parts and other zinc-bearing products." As a result, Brooks Hunt is forecasting that this year's U.S. zinc consumption will total 900,000 metric tons, its lowest level since 1982. Western Europe's use is forecast to be 1.7 million metric tons, its lowest level since 1987, while consumption in Japan is projected to fall to 417,000 metric tons, its lowest level since 1966.
Galvanized sheet demand has passed its low point and will rise in coming months but the recovery will be weak, says economist Paul Robinson at Global Insight in Washington. "Inventory is at low levels and there is some restocking occurring; nevertheless, the improvement will be paltry compared with recovery from the earlier declines, with most consuming sectors not reaching old levels of output until 2012 or later." China is recovering faster than North America, he says, with Europe and Japan recovering slower.
Bob Garino, director of commodities for the Institute of Scrap Recycling Industries in Washington and a Purchasing.com blogger, says "investor interest, not supply/demand fundamentals, has been the principal driver behind higher slab zinc prices" this year. Analyst Jim Lennon at Macquarie Research in London agrees, noting that weak purchasing by the industrialized nations—primarily the members of the Organization for Economic Cooperation and Development (OECD)—continues to outweigh demand from emerging markets.
Equity analysts are projecting sustained strong LME zinc prices in coming months. Some analysts foresee a 2010 price average as high as 95¢ while the consensus forecast is an average 81¢/lb. That's up from an 85¢ average in 2008. But, "the bull run in base metals prices is showing signs of wavering," agrees analyst Andrew Young at Brook Hunt in London. "The realization that China is unlikely to continue its high level of imports of zinc and other base metals has caused uncertainty on the London Metal Exchange (LME) and prices have lost momentum." And that's why some analysts are forecasting a 2010 LME price average as low as 63¢.
Zinc metal demand has dropped 10.8% to 6.02 million metric tons through July, according to the International Lead & Zinc Study Group, while production has dropped 8% globally this year to 6.31 million metric tons. The consensus forecast has global zinc consumption for the year contracting by 8.6% to 10.24 million metric tons, the lowest annual level since 2003.
Next year, as the world emerges from recession, global use should rise 5.9% to 10.84 million metric tons. However, there is debate among analysts whether the zinc market will tighten in 2010. An early Barclays Capital report suggested that zinc might be one of the key base metal beneficiaries of fiscal spending packages. But the projected end-demand for coated steel has since ebbed in later commentaries. Lennon at Macquarie Research, for example, expects a meaningful increase in global zinc demand in 2010 as long as OECD economies "continue to recover amid robust emerging market growth," although he admits "continued deterioration of the U.S. commercial real estate market poses downside risk to this forecast."
According to an HSBC Group report from London, smelter utilization has dropped from 83% in 1998 to 77.2% in 2009 as mines have been closed and refining capacity idled in an attempt to bring supply and demand back into balance. However, analyst Edward Meir at MF Global in New York says the zinc metal market "still seems comfortably supplied" since demand isn't that strong and overall global stocks will be 1.27 million metric tons by the end of 2010, equivalent to six weeks of consumption.
Lennart Evrell, CEO of Boliden, Europe's second-largest zinc producer, points out that monthly LME cash prices have risen 56% this year as usage has outpaced production. China, which consumes more of the industrial metal than Europe and the U.S. combined, hasn't shown signs of slowing zinc-coated steel needs for building projects. However, Evrell tells Bloomberg in an interview in Stockholm that he is "personally ... concerned about China" and whether the country can sustain its rate of growth.
Excess supply is an issue since the world surplus is expected to reach 750,000 metric tons this year, almost three times what it was a year ago. According to calculations by Brook Hunt, the surplus will stay in excess of 450,000 metric tons next year "and act as a drag on the zinc price." Reason: Leading economic indicators suggest that the U.S. and other major economies have, as Young writes, "started down the long road to recovery," but actual industrial activity remains sluggish.
Justin Lennon, senior analyst for Mitsui Bussan Commodities in London, says steel mill closures outside of China severely impacted zinc consumption through mid-2009. Some restarts began in the third quarter based on expectations of customer restocking. Stocks in Europe are reported to remain high by historic standards and failed to draw down during the summer.
It is true that demand for zinc appears to be improving in early autumn in OECD countries. However, the recent restart of steel capacity may be "too quick, too soon," Daga says in the recent posting on SeekingAlpha.com. So, he suggests the zinc bull market could fade away in the face of ample supplies if the growth in demand for zinc-coated steels fails to gather momentum.
In the U.S., for example, analysts may have misread the market because of a blip in demand for galvanized sheet steel caused by a temporary increase in auto production to support sales that have since faded. Another key market, higher infrastructure spending, is showing stodgy growth. In Europe, the only noticeable improvement in galvanized sheet demand has come from the automotive market since no significant infrastructure spending is planned by European governments. It is Chinese demand for zinc that has remained strong from sustained fixed asset investment and construction sector recovery.
A buyer-member of the Linked-In online community answers a Purchasing.com question, "How easy is it to buy zinc these days?," by responding: "Will you report that speculators pushed prices up or will you say the dollar and its purchasing power simply fell, vis-Ã -vis other currencies? I'd go with the latter."
His commentary continues that "over time, demand/supply fundamentals are the driving force that determines price. When the dollar finally does stop falling and its purchasing power stabilizes—unless world demand (based on usage) picks up dramatically— I suggest a softening zinc market."
On the other hand, speculators believe that won't occur since China soon may be shutting smelters as part of the pollution-control efforts caused by the lead poisoning outbreak in Shaanxi province. China has one of the largest zinc ore reserves in the world and has been expanding zinc smelting operations.
What It Means to Buyers:
•Almost 5% stronger zinc demand in 2010 will cause production to expand as well.
•Mined output and refined zinc output will rise by an estimated 2%.
•However, another year of surplus of around 455,000 metric tons is forecast.
•The zinc market price will be buoyed by investment fund interest in futures trading
Zinc market records surplus in January to July 2009
The World Bureau of Metal Statistics says the zinc market was in surplus by 134,000 metric tons during January to July 2009 which compares with a surplus of 83,000 metric tons recorded in the same period one year earlier. Reported stocks rose by 183,000 metric tons with almost all of the increase recorded at London Metal Exchange (LME) warehouses. Other Bureau findings:
LME stocks represented 45% of the global total. The global demand total included a higher than expected apparent demand figure for China. According to Chinese customs data, imports for each of the latest six months were the highest monthly totals on record and it is likely that some of this material is bound for stockpiles and thus the actual global surplus is probably much more than headline figures indicate. Much of the Chinese imports originate from other Asian countries. Exports reported by Japan, South Korea and Taiwan confirm the Chinese imports.
Mine production was, at 6.50 million metric tons, 5% lower than the first seven months of 2008. Refined production fell by 513,000 metric tons to 6.26 million metric tons, with European Union countries registering a decline of 304,000 metric tons. North American Free Trade Agreement (NAFTA) regional output fell by just under 14%.
World demand was 564,000 metric tons lower than in January to July 2008. Chinese apparent demand was 2,745,000 metric tons which is 45% of the global total. No allowance is made in the consumption calculation for unreported stock changes.
Source: Purchasing.com
Iluka Commences Production At New Zircon Project
Iluka Resources' Jacinth-Ambrosia zircon mineral sands mine in South Australia has commenced production ahead of schedule.
Capital expenditure on the project is expected to be less than $390 million, compared with an approved budget of $420 million, Iluka said in a statement.
With last month's completion of the Murray Basin Stage 2 project in Victoria, Iluka said it has now concluded its current major capital expenditure program.
Source: The Australian
Capital expenditure on the project is expected to be less than $390 million, compared with an approved budget of $420 million, Iluka said in a statement.
With last month's completion of the Murray Basin Stage 2 project in Victoria, Iluka said it has now concluded its current major capital expenditure program.
Source: The Australian
Vale Wants To Start Iron Ore Benchmark Talks
The Australian reports that Brazilian miner Vale wants to start annual benchmark negotiations for 2010-2011 iron ore prices this month.
When asked whether Vale would begin the annual iron ore negotiations this month or next, Mr Renato Neves president of Vale International and global iron ore director of Vale said that he hoped negotiations would start this month.
Mr Neves wouldn't comment on pricing for next year but he said the sea borne iron ore market is expected to return to a very tight situation in 2010.
He added that Vale was operating close to full capacity after restarting mines that had been shutdown due to weak demand stemming from the economic downturn.
The world's three largest iron ore miners namely Vale, and Anglo Australian diversified miners BHP Billiton and Rio Tinto traditionally have negotiated annual benchmark prices for iron ore with the world's largest steelmakers, which are typically Chinese. The annual benchmark negotiations, however, broke down this year after China failed to reach an agreement with the three iron ore miners. The miners have been selling iron ore to China on provisional contracts or through the fast growing spot market instead.
When asked whether Vale would begin the annual iron ore negotiations this month or next, Mr Renato Neves president of Vale International and global iron ore director of Vale said that he hoped negotiations would start this month.
Mr Neves wouldn't comment on pricing for next year but he said the sea borne iron ore market is expected to return to a very tight situation in 2010.
He added that Vale was operating close to full capacity after restarting mines that had been shutdown due to weak demand stemming from the economic downturn.
The world's three largest iron ore miners namely Vale, and Anglo Australian diversified miners BHP Billiton and Rio Tinto traditionally have negotiated annual benchmark prices for iron ore with the world's largest steelmakers, which are typically Chinese. The annual benchmark negotiations, however, broke down this year after China failed to reach an agreement with the three iron ore miners. The miners have been selling iron ore to China on provisional contracts or through the fast growing spot market instead.
SAIL Re-Tenders Tasra Coal Project
Steel Authority of India has re-tendered the four-million-tonne Tasra open-cast coking coal mine redevelopment project in Jharkhand.
Five companies have submitted techno-economic bids to be evaluated for inviting the financial bids within a month, according to sources.
Apart from the development of the proposed mine, the project includes setting up a pithead coal beneficiation plant (washery) and facilitating rehabilitation and resettlement of people from the proposed mine site. Central Mine Planning and Design Institute (CMPDIL) and Crisil are offering consultancy to SAIL for project planning and tendering.
The project – considered difficult due to dense human settlement at the proposed mining site – was tendered once. Two firms, Sainik Mining and G S Atwal, were short-listed for submitting financial bids.
Though Sainik later emerged as the lowest bidder, SAIL felt that the quotations were ‘abnormally high’ and decided to re-tender the entire project.
Initially the steel major considered splitting the resettlement and rehabilitation and, mine development-cum-installation of washery projects for greater clarity on price bids. However SAIL decided to club bothin a single contract.
According to a SAIL source, Sainik Mining and G S Atwal have once again participated in the latest tendering process.
“The techno-economic bids for Tasra project were opened today. Five companies including Sainik and Atwal have participated in the re-tendering process,” a source said.
Source: The Hindu Business Line
Five companies have submitted techno-economic bids to be evaluated for inviting the financial bids within a month, according to sources.
Apart from the development of the proposed mine, the project includes setting up a pithead coal beneficiation plant (washery) and facilitating rehabilitation and resettlement of people from the proposed mine site. Central Mine Planning and Design Institute (CMPDIL) and Crisil are offering consultancy to SAIL for project planning and tendering.
The project – considered difficult due to dense human settlement at the proposed mining site – was tendered once. Two firms, Sainik Mining and G S Atwal, were short-listed for submitting financial bids.
Though Sainik later emerged as the lowest bidder, SAIL felt that the quotations were ‘abnormally high’ and decided to re-tender the entire project.
Initially the steel major considered splitting the resettlement and rehabilitation and, mine development-cum-installation of washery projects for greater clarity on price bids. However SAIL decided to club bothin a single contract.
According to a SAIL source, Sainik Mining and G S Atwal have once again participated in the latest tendering process.
“The techno-economic bids for Tasra project were opened today. Five companies including Sainik and Atwal have participated in the re-tendering process,” a source said.
Source: The Hindu Business Line
Vargon Re-Starts Ferrochrome Furnace
Etikrom has re-started one of its four furnaces at its Swedish subsidiary, Vargon has re-started one of its four furnaces and that furnace will only operate at 50% capacity. Therefore, Vargon will be operating at about 20% of its total capacity of about 230,000 tonnes per year.
The main reason to turn on that furnace is to avoid the freezing on heat recovery system and produce hot water for the community due to the contractual obligations of hot water to Vattenfall Power Company to avoid the big penalties during the upcoming winter season.
Source: Steel Guru
The main reason to turn on that furnace is to avoid the freezing on heat recovery system and produce hot water for the community due to the contractual obligations of hot water to Vattenfall Power Company to avoid the big penalties during the upcoming winter season.
Source: Steel Guru
Wednesday, November 18, 2009
Jharkhand Renews SAIL Iron Ore Lease
In a big setback for private steel companies, the Jharkhand government has written to Steel Authority of India Ltd (SAIL), agreeing to renew the Buddhaburu lease — part of the Chiria iron ore belt — having reserves of 810 million tonnes.
SAIL Chairman S K Roongta said there were a number of breakthroughs in the long dialogue with the Jharkhand government, with the help of the central government. Apart from the Buddhaburu lease, another lease of 200 million tonnes would also be renewed, he said, while discussions would be held for the remaining one billion tonnes of Chiria reserves, linked to the public sector steel major’s new project.
SAIL wants to erect a new steel unit of 12-million tonne capacity in Jharkhand. Typically, a 12-million tonne unit would require 600 million tonnes of iron ore.
Chiria is Asia’s largest iron ore belt, with two billion tonnes of reserves.
Roongta said earlier the Jharkhand government had refused to transfer the lease to SAIL after IISCO got merged with the company. The leases were actually held by IISCO.
However, nine leases have now been transferred to SAIL. Roongta said the other lease, which was very small, would also be transferred.
The settlement would be a big blow for private companies eyeing Chiria. The world’s largest steel maker, ArcelorMittal, signed an agreement with the Jharkhand government in 2005 to set up a mega steel unit and was assured of supply from Chiria by the state government.
In addition, JSW Steel, Tata Steel and Essar Steel were all eyeing the disputed leases of Chiria after they were cancelled by the Jharkhand government.
In the interim, most of the private companies bagged prospecting licences (PLs). JSW Steel, Tata Steel and Essar Steel bagged PLs for the Ankua block, part of Chiria but not under the SAIL lease area. ArcelorMittal was allocated a mining lease for the Karampada iron ore deposit, with estimated reserves of 65 million tonnes, much below its requirement.
While Chiria would take care of SAIL’s iron ore needs, for coking coal the company is eyeing acquisitions in Australia, New Zealand and Mozambique. It wants 30-40 per cent assured supply for coking coal.
SAIL would be adding nine million tonnes of production capacity to its existing 13 million tonnes by 2012. The cost of expansion would be Rs 60,000 crore for capacity as well as value addition.
Source: Business Standard
SAIL Chairman S K Roongta said there were a number of breakthroughs in the long dialogue with the Jharkhand government, with the help of the central government. Apart from the Buddhaburu lease, another lease of 200 million tonnes would also be renewed, he said, while discussions would be held for the remaining one billion tonnes of Chiria reserves, linked to the public sector steel major’s new project.
SAIL wants to erect a new steel unit of 12-million tonne capacity in Jharkhand. Typically, a 12-million tonne unit would require 600 million tonnes of iron ore.
Chiria is Asia’s largest iron ore belt, with two billion tonnes of reserves.
Roongta said earlier the Jharkhand government had refused to transfer the lease to SAIL after IISCO got merged with the company. The leases were actually held by IISCO.
However, nine leases have now been transferred to SAIL. Roongta said the other lease, which was very small, would also be transferred.
The settlement would be a big blow for private companies eyeing Chiria. The world’s largest steel maker, ArcelorMittal, signed an agreement with the Jharkhand government in 2005 to set up a mega steel unit and was assured of supply from Chiria by the state government.
In addition, JSW Steel, Tata Steel and Essar Steel were all eyeing the disputed leases of Chiria after they were cancelled by the Jharkhand government.
In the interim, most of the private companies bagged prospecting licences (PLs). JSW Steel, Tata Steel and Essar Steel bagged PLs for the Ankua block, part of Chiria but not under the SAIL lease area. ArcelorMittal was allocated a mining lease for the Karampada iron ore deposit, with estimated reserves of 65 million tonnes, much below its requirement.
While Chiria would take care of SAIL’s iron ore needs, for coking coal the company is eyeing acquisitions in Australia, New Zealand and Mozambique. It wants 30-40 per cent assured supply for coking coal.
SAIL would be adding nine million tonnes of production capacity to its existing 13 million tonnes by 2012. The cost of expansion would be Rs 60,000 crore for capacity as well as value addition.
Source: Business Standard
Brazil To Raise Share Of Seaborne Iron Ore Market
Brazil will raise its share in the global seaborne iron-ore market more quickly than top exporter Australia in the next four years as Vale SA and Cia. Siderurgica Nacional SA expand output, Credit Suisse’s Etienne Lacroix said.
Brazil will boost exports of the steelmaking ingredient by 21 percent next year to 354.9 million metric tons, Lacroix, a New York-based Credit Suisse analyst, said in an interview yesterday. That compares with export growth of 8.5 percent to 421.6 million tons in Australia, he said. Brazilian export growth will outpace Australia’s at least until 2013, he said.
China will lead rising demand for iron ore as economic growth prompts steelmakers to rebuild stockpiles of the mineral after the global crisis that started last year. Total seaborne iron-ore demand will rise 10 percent next year to 1.02 billion tons and may reach 1.24 billion tons in 2013, Lacroix said.
Brazilian annual exports of iron ore may reach 443.3 million tons in 2013, while Australia may ship 549.6 million tons, he said.
Nacional Minerios SA, the mining unit of CSN, plans to invest $1.3 billion in two iron-ore pellet plants in Brazil set to start up in 2012 and 2014 to produce a combined 12 million tons a year, Charles Putz, chief executive officer of the unit, said yesterday.
Vale, the world’s biggest iron-ore producer, said Oct. 21 that it plans to invest $9.03 billion in Brazil next year to expand iron-ore, nickel and potassium output and start producing steel slabs in a joint venture with ThyssenKrupp AG.
Source: Bloomberg
Brazil will boost exports of the steelmaking ingredient by 21 percent next year to 354.9 million metric tons, Lacroix, a New York-based Credit Suisse analyst, said in an interview yesterday. That compares with export growth of 8.5 percent to 421.6 million tons in Australia, he said. Brazilian export growth will outpace Australia’s at least until 2013, he said.
China will lead rising demand for iron ore as economic growth prompts steelmakers to rebuild stockpiles of the mineral after the global crisis that started last year. Total seaborne iron-ore demand will rise 10 percent next year to 1.02 billion tons and may reach 1.24 billion tons in 2013, Lacroix said.
Brazilian annual exports of iron ore may reach 443.3 million tons in 2013, while Australia may ship 549.6 million tons, he said.
Nacional Minerios SA, the mining unit of CSN, plans to invest $1.3 billion in two iron-ore pellet plants in Brazil set to start up in 2012 and 2014 to produce a combined 12 million tons a year, Charles Putz, chief executive officer of the unit, said yesterday.
Vale, the world’s biggest iron-ore producer, said Oct. 21 that it plans to invest $9.03 billion in Brazil next year to expand iron-ore, nickel and potassium output and start producing steel slabs in a joint venture with ThyssenKrupp AG.
Source: Bloomberg
Baosteel Signs Indian Ferrochrome Contract
Shanghai Baosteel Group (Baosteel) subsidiary Baosteel Resources has signed its first foreign long-term ferrochrome contract with India's Ferro Alloys Corp (FACOR Group), Baosteel announced November 17.
Tuesday, November 17, 2009
Wuhan To Source Iron Ore From Venezuela
Chinese leading steel maker WUHAN IRON & STEEL GROUP said on Monday that it had entered into a long-term iron ore contract with CORPORACION VENEZOLANA DE GUAYANA (CVG), the only iron ore producer in Venezuela. This is the first iron ore contract to be implemented at Chinese prices, signalling that China's iron ore purchase prices need not be restricted by the world's top three suppliers, BHP BILLITON COMPANHIA VALE DO RIO DOCE, and the RIO TINTO GROUP, said the Chinese steel maker.
Chinese steel makers and the top three suppliers have failed to reach a price agreement this year, as the China Iron and Steel Association, a semi-government body representing Chinese steel mills, insisted on a favorable price.
Under the contract, Wuhan Iron & Steel was given a pre-emptive right to an expanded ore supply once CVG completed its capacity expansion.
Source: Trading Markets
Chinese steel makers and the top three suppliers have failed to reach a price agreement this year, as the China Iron and Steel Association, a semi-government body representing Chinese steel mills, insisted on a favorable price.
Under the contract, Wuhan Iron & Steel was given a pre-emptive right to an expanded ore supply once CVG completed its capacity expansion.
Source: Trading Markets
Vulcan Buys Finland Plant
Perth explorer Vulcan Resources has fast-tracked its path to production, buying a large copper and nickel processing plant near its Finland tenements.
Vulcan, which is in the middle of a corporate merge with Universal Resources, said it had bought the plant from the bankruptcy estate of a Finnish subsidiary of Canadian miner, Belvedere Resources.
The plant has the capacity of 350,000 tonnes a year though can be upgraded to 600,000 tpa. It is 45km from Vulcan's Kylylahti deposit. Vulcan reported that the plant was on care and maintenance and estimated the cost to refurbish and upgrade at about $10 million.
Vulcan also bought an additional 3.3 million tonnes of copper-nickel-cobalt resources in the Kylylahti area, bring its total resource in the area to 15.6 million tonnes.
Vulcan managing director Dr Alistair Cowden said the purchase of the plant was a ``cornerstone asset'' to build on after the company's merger with Universal.
``The possession of built and permitted processing infrastructure is an important step in the path to development and towards our aim of building a mid-tier base metal miner.'' he said.
The move also gives Vulcan: A processing plant; an 8.1 million tonne copper-nickel-cobalt deposit that has a completed feasibility study; a 3.2 million tonne nickel-copper-cobalt resource; three more deposits with 35km of the plant; and exploration targets in two further nickel-copper deposits.
The company said it will now review and update its feasibility study for the Kylylahti project to incorporate the plant. It aims to make a development decision before mid-2010.
Source: Perth Now
Vulcan, which is in the middle of a corporate merge with Universal Resources, said it had bought the plant from the bankruptcy estate of a Finnish subsidiary of Canadian miner, Belvedere Resources.
The plant has the capacity of 350,000 tonnes a year though can be upgraded to 600,000 tpa. It is 45km from Vulcan's Kylylahti deposit. Vulcan reported that the plant was on care and maintenance and estimated the cost to refurbish and upgrade at about $10 million.
Vulcan also bought an additional 3.3 million tonnes of copper-nickel-cobalt resources in the Kylylahti area, bring its total resource in the area to 15.6 million tonnes.
Vulcan managing director Dr Alistair Cowden said the purchase of the plant was a ``cornerstone asset'' to build on after the company's merger with Universal.
``The possession of built and permitted processing infrastructure is an important step in the path to development and towards our aim of building a mid-tier base metal miner.'' he said.
The move also gives Vulcan: A processing plant; an 8.1 million tonne copper-nickel-cobalt deposit that has a completed feasibility study; a 3.2 million tonne nickel-copper-cobalt resource; three more deposits with 35km of the plant; and exploration targets in two further nickel-copper deposits.
The company said it will now review and update its feasibility study for the Kylylahti project to incorporate the plant. It aims to make a development decision before mid-2010.
Source: Perth Now
Monday, November 16, 2009
China Iron Ore Imports Show Steep Fall
China's iron ore imports in October were 45.47 million tons, down 19.08 million tons or 30% from the previous month, according to statistics released by the General Administration of Customs.
However, iron ore imports in October were 48.5% more than in the same month of last year.
Market analysts have said that the month-on-month plunge in iron imports in October was due to a decline in steel prices in August and September and that the country's iron ore imports will rebound as iron ore prices have been rising since mid-October.
In the first ten months of this year, China's iron ore imports increased 36.8% year on year to 514.81 million tons, while the cost of the iron ore imports fell 24.7% to US$40.37 billion.
China's steel exports were 2.71 million tons last month, up 9.7% from September, reflecting growth for the fifth consecutive month.
Source: Alibaba/China Knowledge
However, iron ore imports in October were 48.5% more than in the same month of last year.
Market analysts have said that the month-on-month plunge in iron imports in October was due to a decline in steel prices in August and September and that the country's iron ore imports will rebound as iron ore prices have been rising since mid-October.
In the first ten months of this year, China's iron ore imports increased 36.8% year on year to 514.81 million tons, while the cost of the iron ore imports fell 24.7% to US$40.37 billion.
China's steel exports were 2.71 million tons last month, up 9.7% from September, reflecting growth for the fifth consecutive month.
Source: Alibaba/China Knowledge
NMDC Sees Iron Ore Prices At $75 - 80 A Tonne
State-run NMDC Ltd, India's largest iron ore producer, expects spot prices to stablise at $75-$80 per tonne on a free-on-board basis in the near-term on renewed Chinese demand, Chairman Rana Som said.
"This price trend should continue due to project growth in the Chinese steel industry," Som told reporters on Monday, on the sidelines of an event, where the company signed a memorandum of understanding for developing a limestone mine with state-run Steel Authority of India (SAIL.BO). Iron-ore prices rose above $100 a tonne with freight this month for the first time since mid-August, though prices have remained weak for the most part of this calendar year.
Som said the prices have stabilised for now.
China, the world's largest steel maker, is expecting production to remain robust, which has improved the prospects for iron ore, the main ingredient in steel making.
NMDC sells most of its about 30 million tonne output to domestic steelmakers. Som said in the 2010/11 fiscal year, iron-ore prices may firm up from the current levels on the back of Chinese demand.
"Apart from China, Japan is also on the path of recovery, though Europe is not showing distinct signs of recovery," Som said. NMDC had asked the federal railways for some additional wagons to help transport iron-ore supplies to steel plants following damages to a 274 km-long pipeline in Chattisgarh state in central India in June.
Source: Reuters
"This price trend should continue due to project growth in the Chinese steel industry," Som told reporters on Monday, on the sidelines of an event, where the company signed a memorandum of understanding for developing a limestone mine with state-run Steel Authority of India (SAIL.BO). Iron-ore prices rose above $100 a tonne with freight this month for the first time since mid-August, though prices have remained weak for the most part of this calendar year.
Som said the prices have stabilised for now.
China, the world's largest steel maker, is expecting production to remain robust, which has improved the prospects for iron ore, the main ingredient in steel making.
NMDC sells most of its about 30 million tonne output to domestic steelmakers. Som said in the 2010/11 fiscal year, iron-ore prices may firm up from the current levels on the back of Chinese demand.
"Apart from China, Japan is also on the path of recovery, though Europe is not showing distinct signs of recovery," Som said. NMDC had asked the federal railways for some additional wagons to help transport iron-ore supplies to steel plants following damages to a 274 km-long pipeline in Chattisgarh state in central India in June.
Source: Reuters
Zinc Prices Up 80 Per Cent This Year
Kazakhstan Today reportsthat prices rose in the world zinc market in October while in November prices have fluctuated in different directions. From the beginning of the year, the prices for of zinc has gone up by 80%.
There are fundamental reasons for the increase: a sharp reduction of supply of this metal last year and increase of demand.
According to the International Lead and Zinc Study Group, for 8 months of 2009, world zinc production decreased by 7%.
Source: Steel Guru
There are fundamental reasons for the increase: a sharp reduction of supply of this metal last year and increase of demand.
According to the International Lead and Zinc Study Group, for 8 months of 2009, world zinc production decreased by 7%.
Source: Steel Guru
Sunday, November 15, 2009
Slight Rise In Iran Iron Ore Production
Iran’s iron ore production reached 12,754,331 tons during the first half of this year which a 1 pct increase over 2008.
According to the Public Relations of the Iranian Mines and Mining Industries Development and Renovation Organization (IMIDRO), the iron ore production breakdown was as follows:
4,000,771 tons were produced by iron ore unit of Chadormalo,
3,644,000 tons were produced by Golgohar,
2,723,000 tons were produced by Markazi Iron Ore and
1,616,000 tons were produced by other units.
Iron ore exports stood at 1,982,515 tons, showing an increase of 9 percent YoY, with a value of $116,256,000 during the first six months of this year.
Iron ore exploitation totalled 15,438,000 tons during the same period.
According to thereport, in the 6th month of this year, iron ore production and exploitation reached 2,303,639 tons and 2,255,095 tons respectively.
Source: ME Steel
According to the Public Relations of the Iranian Mines and Mining Industries Development and Renovation Organization (IMIDRO), the iron ore production breakdown was as follows:
4,000,771 tons were produced by iron ore unit of Chadormalo,
3,644,000 tons were produced by Golgohar,
2,723,000 tons were produced by Markazi Iron Ore and
1,616,000 tons were produced by other units.
Iron ore exports stood at 1,982,515 tons, showing an increase of 9 percent YoY, with a value of $116,256,000 during the first six months of this year.
Iron ore exploitation totalled 15,438,000 tons during the same period.
According to thereport, in the 6th month of this year, iron ore production and exploitation reached 2,303,639 tons and 2,255,095 tons respectively.
Source: ME Steel
TVI Concentrating On Philippines Gold Mine
TVI Resource Development (Philippines) Inc., a unit of TVI Pacific Inc. of Canada, is looking at the Balabag gold prospect in Zamboanga del Sur as its next priority mining project.
TVI Resource said the Balabag mining property had the potential to become the company’s second production center based on initial exploration results.
TVI Resource has begun to evaluate options to bring the Balabag project into production, with advance development work scheduled to commence later this year.
A company official who declined to be named said initial work on the mine could follow with a minimum initial capital.
The company has begun construction of an additional flotation circuit to process zinc ore at its Canatuan mine in Siocon, Zamboanga del Norte province.
“As we mine through the copper rich portion of the ore body and start getting into the copper-zinc zone as expected, the ability to separate and monetize the zinc will result in additional revenue,” said chief executive Cliff James earlier.
“This will allow us to further accelerate two key target areas of our growth strategy, which include exploration and development activities at Canatuan and Balabag, and exploration projects at Tamarok,” he added.
Construction of the zinc circuit began on Oct. 28, or three months ahead of schedule. It is expected to be fully operational by late April next year.
Source: Manila Standard
TVI Resource said the Balabag mining property had the potential to become the company’s second production center based on initial exploration results.
TVI Resource has begun to evaluate options to bring the Balabag project into production, with advance development work scheduled to commence later this year.
A company official who declined to be named said initial work on the mine could follow with a minimum initial capital.
The company has begun construction of an additional flotation circuit to process zinc ore at its Canatuan mine in Siocon, Zamboanga del Norte province.
“As we mine through the copper rich portion of the ore body and start getting into the copper-zinc zone as expected, the ability to separate and monetize the zinc will result in additional revenue,” said chief executive Cliff James earlier.
“This will allow us to further accelerate two key target areas of our growth strategy, which include exploration and development activities at Canatuan and Balabag, and exploration projects at Tamarok,” he added.
Construction of the zinc circuit began on Oct. 28, or three months ahead of schedule. It is expected to be fully operational by late April next year.
Source: Manila Standard
Outokumpu Sees No Rise In Nickel Prices
Finnish stainless steel maker Outokumpu has said that nickel prices are unlikely to rise strongly in the next two years because of weak fundamentals.
Mr Karri Kaitue, deputy CEO of Outokumpu, said that current London inventory levels, at their highest in about 15 years, highlight the difficulties still facing the industry.
He added that "We don't see any reason why the nickel price would dramatically increase. If we are solely basing everything on supply and demand analysis, during the next couple of years there shouldn't be a tremendous pressure for the nickel prices to be on an increasing trend."
Mr Kaitue said that the firm's ferrochrome Tornio plant went back into production at the end of September after being idled for 6 months. He added that "The actual amount of job losses is about 50 people, some of which will be offered to relocate. We are moving some of the production lines to another facility in Finland."
Mr Karri Kaitue, deputy CEO of Outokumpu, said that current London inventory levels, at their highest in about 15 years, highlight the difficulties still facing the industry.
He added that "We don't see any reason why the nickel price would dramatically increase. If we are solely basing everything on supply and demand analysis, during the next couple of years there shouldn't be a tremendous pressure for the nickel prices to be on an increasing trend."
Mr Kaitue said that the firm's ferrochrome Tornio plant went back into production at the end of September after being idled for 6 months. He added that "The actual amount of job losses is about 50 people, some of which will be offered to relocate. We are moving some of the production lines to another facility in Finland."
Saturday, November 14, 2009
Steep Fall In Ukrainian Ferroally Production
According to the Association of Ukrainian Ferroalloy Producers, in January to October this year Ukraine registered a decreased of 41.5% YoY in ferroalloys production to 810,700 tonnes.
During the first ten months of 2009, Ukraine silicomanganese output decreased by 33.8%YoY to 582,000 tonnes, ferromanganese production went down by 72.6% YoY to 98,500 tonnes, ferrosilicon output dropped by 15.9% YoY to 117,800 tonnes while metallic manganese production increased by 44.2% YoY to 12,400 tonnes.
According to the preliminary data, in January to October this year the largest Ukrainian ferroalloy producer Nikopol Ferroalloy Plant reduced its ferroalloy output by 36%YoY to 520,700 tonnes including 463,400 tonnes of silicomanganese down by 16.6% YoY and 57,300 tonnes of ferromanganese down by 77.7% YoY. Since the beginning of the year, the plant has not produced any other ferroalloys.
Source: Steel Guru
During the first ten months of 2009, Ukraine silicomanganese output decreased by 33.8%YoY to 582,000 tonnes, ferromanganese production went down by 72.6% YoY to 98,500 tonnes, ferrosilicon output dropped by 15.9% YoY to 117,800 tonnes while metallic manganese production increased by 44.2% YoY to 12,400 tonnes.
According to the preliminary data, in January to October this year the largest Ukrainian ferroalloy producer Nikopol Ferroalloy Plant reduced its ferroalloy output by 36%YoY to 520,700 tonnes including 463,400 tonnes of silicomanganese down by 16.6% YoY and 57,300 tonnes of ferromanganese down by 77.7% YoY. Since the beginning of the year, the plant has not produced any other ferroalloys.
Source: Steel Guru
Chinese Eye Anglo Zinc Assets
Several Chinese metal firms including China Minmetals Corp are in the fray to acquire Anglo American's divested zinc assets, according to sources familiar with the matter.
Minmetals, Shenzhen-based Zhongjin Lingnan Nonfemet Co Ltd and Canadian mining company Teck Resources, in which Chinese sovereign wealth fund China Investment Corp owns a 17-percent stake, are in talks for the zinc assets to help secure supplies of resources, the source said.
"After Minmetals' takeover of Oz Minerals, its zinc business has started to grow. Seeking other zinc projects to meet its growing demand is in line with the company's business strategy," the source said. Zinc is widely used in die-casting and battery manufacturing.
Minmetals paid $1.4 billion for the acquisition of Oz Minerals including the Rosebery zinc mines in Australia.
A source from China Minmetals who declined to be named admitted that the company was keen on acquiring Anglo American's zinc assets, but refused to divulge any further details on grounds of confidentiality.
Anglo American said last month it was trimming part of its management and also selling non-core assets to cut costs. The assets included Scaw Metals, Copebras, Catalao and the group's portfolio of zinc assets. Together with the Tarmac unit, which has previously been identified as non-core, these assets accounted for nearly 11 percent of the group revenue in 2008.
Its zinc assets include the 100-percent-owned Skorpion mine in Namibia and Lisheen mine in Ireland, the 74-percent-owned Black Mountain mine and Gamsberg Project in South Africa. Anglo American's zinc businesses produced 340,500 tons of zinc and generated revenue of $209 million last year.
The 21st Century Business Herald said Anglo American held talks with Chinalco, the country's largest producer of aluminum, and Baosteel, the country's largest steel mill, over the Scaw Metals unit.
Source: China Daily
Minmetals, Shenzhen-based Zhongjin Lingnan Nonfemet Co Ltd and Canadian mining company Teck Resources, in which Chinese sovereign wealth fund China Investment Corp owns a 17-percent stake, are in talks for the zinc assets to help secure supplies of resources, the source said.
"After Minmetals' takeover of Oz Minerals, its zinc business has started to grow. Seeking other zinc projects to meet its growing demand is in line with the company's business strategy," the source said. Zinc is widely used in die-casting and battery manufacturing.
Minmetals paid $1.4 billion for the acquisition of Oz Minerals including the Rosebery zinc mines in Australia.
A source from China Minmetals who declined to be named admitted that the company was keen on acquiring Anglo American's zinc assets, but refused to divulge any further details on grounds of confidentiality.
Anglo American said last month it was trimming part of its management and also selling non-core assets to cut costs. The assets included Scaw Metals, Copebras, Catalao and the group's portfolio of zinc assets. Together with the Tarmac unit, which has previously been identified as non-core, these assets accounted for nearly 11 percent of the group revenue in 2008.
Its zinc assets include the 100-percent-owned Skorpion mine in Namibia and Lisheen mine in Ireland, the 74-percent-owned Black Mountain mine and Gamsberg Project in South Africa. Anglo American's zinc businesses produced 340,500 tons of zinc and generated revenue of $209 million last year.
The 21st Century Business Herald said Anglo American held talks with Chinalco, the country's largest producer of aluminum, and Baosteel, the country's largest steel mill, over the Scaw Metals unit.
Source: China Daily
Friday, November 13, 2009
Centrex In China Iron Ore Deal
An Australian iron ore producer announced on Friday that it had sold the expected first five years of production from a new mine to Chinese customers.
Centrex Metals Ltd announced it had signed a five-year sales agreement for its Wilgerup project in South Australia with Shenyang Orient Iron & Steel (Group) Co Ltd plus a one-year extension option for one million tons of hematite per annum (Mtpa).
The deal follows Centrex's sales deal with its second largest shareholder, Baotou Iron & Steel (Group) Co Ltd, for the remainder of ore produced at the 1.6Mtpa mine.
The mine is expected to start production around October next year.
Baotou, China's 10th largest steel company by output in 2008, has an 8.13 percent stake in Centrex while Shenyang, a privately owned, medium-sized steel producer, holds a 5.57 percent interest.
The pricing for both deals will be based on Rio Tinto Ltd's benchmark for iron ore it produces at its Hamersley operations in Western Australia's Pilbara region.
However, Centrex said there would be pricing flexibility "should that pricing mechanism be replaced".
Centrex managing director Gerard Anderson has joined a growing number of iron ore sector players, including executives of BHP Billiton Ltd, who believe the benchmark pricing system's days are numbered.
Price negotiations dragged on longer than ever before this year as major iron ore producers resisted calls by Chinese steel mills for deep price cuts.
Anderson said he expected benchmark pricing would be abandoned at some stage during Centrex's five-year agreements with Baotou and Shenyang in favor of a quarterly, index-based system.
Source: Xinhua
Centrex Metals Ltd announced it had signed a five-year sales agreement for its Wilgerup project in South Australia with Shenyang Orient Iron & Steel (Group) Co Ltd plus a one-year extension option for one million tons of hematite per annum (Mtpa).
The deal follows Centrex's sales deal with its second largest shareholder, Baotou Iron & Steel (Group) Co Ltd, for the remainder of ore produced at the 1.6Mtpa mine.
The mine is expected to start production around October next year.
Baotou, China's 10th largest steel company by output in 2008, has an 8.13 percent stake in Centrex while Shenyang, a privately owned, medium-sized steel producer, holds a 5.57 percent interest.
The pricing for both deals will be based on Rio Tinto Ltd's benchmark for iron ore it produces at its Hamersley operations in Western Australia's Pilbara region.
However, Centrex said there would be pricing flexibility "should that pricing mechanism be replaced".
Centrex managing director Gerard Anderson has joined a growing number of iron ore sector players, including executives of BHP Billiton Ltd, who believe the benchmark pricing system's days are numbered.
Price negotiations dragged on longer than ever before this year as major iron ore producers resisted calls by Chinese steel mills for deep price cuts.
Anderson said he expected benchmark pricing would be abandoned at some stage during Centrex's five-year agreements with Baotou and Shenyang in favor of a quarterly, index-based system.
Source: Xinhua
Thursday, November 12, 2009
ENRC Says Output Back To Pre-Crisis Levels
Eurasian Natural Resources Corp. PLC said on Thursday that production of its main commodities had nearly returned to pre-financial crisis levels, though the Kazakh miner cautioned that risks of volatility in prices and output remain.
"An economic recovery is now looking more convincing, but we see some uncertainties for the industry into 2010," Chief Executive Felix Vulis said in a statement.
The company expects 2010's full-year output at its core operations to match 2008 levels.
The London-listed Kazakh miner said total ferroalloys production for the three months to Sept. 30 decreased 7% to 413,000 metric tons compared with 444,000 tons during the same period a year earlier.
ENRC's ferroalloys division accounted for almost half of the company's earnings before interest, taxes, depreciation and amortization, or Ebitda, during the first half of the year.
ENRC's production of saleable iron ore concentrate climbed 2.4% to 2.54 million tons in the third quarter, and saleable iron ore pellet production was down 0.1% to 1.86 million tons.
ENRC's iron ore division contributed just more than a third of the company's Ebitda during the first half of the year.
Ferrochrome, the main commodity in ENRC's ferroalloys division, and iron ore are used to make stainless steel and steel, respectively.
Aluminum production was 31,000 tons during the quarter, compared with 32,000 tons a year earlier. The aluminum division accounted for less than 3% of Ebitda in the first half of the year.
Source: EasyBourse, Dow Jones
"An economic recovery is now looking more convincing, but we see some uncertainties for the industry into 2010," Chief Executive Felix Vulis said in a statement.
The company expects 2010's full-year output at its core operations to match 2008 levels.
The London-listed Kazakh miner said total ferroalloys production for the three months to Sept. 30 decreased 7% to 413,000 metric tons compared with 444,000 tons during the same period a year earlier.
ENRC's ferroalloys division accounted for almost half of the company's earnings before interest, taxes, depreciation and amortization, or Ebitda, during the first half of the year.
ENRC's production of saleable iron ore concentrate climbed 2.4% to 2.54 million tons in the third quarter, and saleable iron ore pellet production was down 0.1% to 1.86 million tons.
ENRC's iron ore division contributed just more than a third of the company's Ebitda during the first half of the year.
Ferrochrome, the main commodity in ENRC's ferroalloys division, and iron ore are used to make stainless steel and steel, respectively.
Aluminum production was 31,000 tons during the quarter, compared with 32,000 tons a year earlier. The aluminum division accounted for less than 3% of Ebitda in the first half of the year.
Source: EasyBourse, Dow Jones
Wednesday, November 11, 2009
NMDC Forms SPV For Andhra Pradesh Iron Ore Project
NMDC Ltd, the public sector mining company, is all set to test the iron ore potential in Andhra Pradesh. The miner is in the process of forming a special purpose vehicle with the Andhra Pradesh Mineral Development Corporation (APMDC) to explore the iron ore potential in the state.
"We are likely to finalise the terms for an SPV by November 30. Once that is done and we finalise a plan to start exploration; it would take at least 12 months to come to a conclusion on the available reserves in the state," NMDC chairman and managing director Rana Som told DNA Money.
Iron-ore mining in Andhra Pradesh has become a politically sensitive issue. Currently, the Congress-led government is in a fix over a lease granted to Obulapuram Mining Company (OMC) of Karnataka's BJP leader Gali Janardhan Reddy.
With the opposition political parties alleging that the former chief minister Y S Rajasekhara Reddy's son Y S Jaganmohan Reddy has an interest in OMC forcing the government to relax certain mining norms, the issue of iron ore mining has gained political significance.
"We spoke directly to the chief minister (K Rosaiah). As far as we are concerned, there is no politics involved in the issue of joining hands with APMDC," Som said.
"There are several locations in AP, which are unexplored. Except one or two where OMC is currently working, there are other locations that have never been touched. We are going to focus on them to begin with," he said.
OMC's mines are currently located on AP-Karnataka border in Anantapur. Studies have shown there was significant iron ore potential in other districts such as Kadapa, Kurnool and Chittoor.
Source: Daily News And Analysis, India
"We are likely to finalise the terms for an SPV by November 30. Once that is done and we finalise a plan to start exploration; it would take at least 12 months to come to a conclusion on the available reserves in the state," NMDC chairman and managing director Rana Som told DNA Money.
Iron-ore mining in Andhra Pradesh has become a politically sensitive issue. Currently, the Congress-led government is in a fix over a lease granted to Obulapuram Mining Company (OMC) of Karnataka's BJP leader Gali Janardhan Reddy.
With the opposition political parties alleging that the former chief minister Y S Rajasekhara Reddy's son Y S Jaganmohan Reddy has an interest in OMC forcing the government to relax certain mining norms, the issue of iron ore mining has gained political significance.
"We spoke directly to the chief minister (K Rosaiah). As far as we are concerned, there is no politics involved in the issue of joining hands with APMDC," Som said.
"There are several locations in AP, which are unexplored. Except one or two where OMC is currently working, there are other locations that have never been touched. We are going to focus on them to begin with," he said.
OMC's mines are currently located on AP-Karnataka border in Anantapur. Studies have shown there was significant iron ore potential in other districts such as Kadapa, Kurnool and Chittoor.
Source: Daily News And Analysis, India
Mongolia Energy Signs Coal Mining Agreement
Mongolia Energy Corp., the Hong Kong-traded mineral and energy explorer, signed a $206 million agreement with a contract miner to extract coal from its pit in the west of the country.
The six-year agreement with a unit of Leighton Holdings Ltd., Australia’s largest construction company, is initially to mine 3 million metric tons of coal a year from the Khushuut pit. Production will likely start in the second quarter next year, Mongolia Energy’s Chief Executive Officer James Schaeffer said at a media briefing in Hong Kong today.
Mongolia Energy is developing the mine and owns 330,000 hectares of mineral and energy concessions in the resource-rich north Asian country. The agreement allows for production to rise to 8 million tons of coal a year.
“There’s an enormous market for coal in China and Mongolia is sitting right on its doorstep,” said Hamish Tyrwhitt, managing director of Leighton Asia Ltd. “It’s in fantastic position. Mongolia has incredible commodity resources.”
Total investment in the Khushuut mine will likely reach $2.85 billion over its estimated lifetime of 19 years, said Mongolia Energy’s general counsel, Mohan Datwani.
The coking coal will likely be sold in the northwestern Chinese province of Xinjiang and $111 million has been spent this year building a road between the pit and China.
Mongolia Energy hopes to extend the contract beyond the initial six years, Schaeffer said.
Shares in Mongolia Energy rose the most in a month in Hong Kong on Nov. 9 after an analyst report that billionaire Cheng Yu-teng had increased his stake in the company.
Cheng owns 3.7 percent of the company’s shares, according to data compiled by Bloomberg. Cheng controls property developer New World Development Co.
The shares have gained 55 percent in Hong Kong trading this year, compared with the 57 percent increase in the benchmark Hang Seng index.
Mongolia Energy’s coal reserves at Khushuut are estimated at 460 million tons and could generate $240 million in revenue next year if prices remain stable, according to a research note by Timothy Kwai, an analyst at Quam Securities in Hong Kong.
Source: Bloomberg
The six-year agreement with a unit of Leighton Holdings Ltd., Australia’s largest construction company, is initially to mine 3 million metric tons of coal a year from the Khushuut pit. Production will likely start in the second quarter next year, Mongolia Energy’s Chief Executive Officer James Schaeffer said at a media briefing in Hong Kong today.
Mongolia Energy is developing the mine and owns 330,000 hectares of mineral and energy concessions in the resource-rich north Asian country. The agreement allows for production to rise to 8 million tons of coal a year.
“There’s an enormous market for coal in China and Mongolia is sitting right on its doorstep,” said Hamish Tyrwhitt, managing director of Leighton Asia Ltd. “It’s in fantastic position. Mongolia has incredible commodity resources.”
Total investment in the Khushuut mine will likely reach $2.85 billion over its estimated lifetime of 19 years, said Mongolia Energy’s general counsel, Mohan Datwani.
The coking coal will likely be sold in the northwestern Chinese province of Xinjiang and $111 million has been spent this year building a road between the pit and China.
Mongolia Energy hopes to extend the contract beyond the initial six years, Schaeffer said.
Shares in Mongolia Energy rose the most in a month in Hong Kong on Nov. 9 after an analyst report that billionaire Cheng Yu-teng had increased his stake in the company.
Cheng owns 3.7 percent of the company’s shares, according to data compiled by Bloomberg. Cheng controls property developer New World Development Co.
The shares have gained 55 percent in Hong Kong trading this year, compared with the 57 percent increase in the benchmark Hang Seng index.
Mongolia Energy’s coal reserves at Khushuut are estimated at 460 million tons and could generate $240 million in revenue next year if prices remain stable, according to a research note by Timothy Kwai, an analyst at Quam Securities in Hong Kong.
Source: Bloomberg
Steep Fall In China Iron Ore Imports
China's imports of iron ore in October fell almost 30 percent to 45.47 million tonnes, down from a record the previous month but still high enough to raise further concerns about oversupply in the country's steel sector.
Steel product exports stood at 2.71 million tonnes over October, up nearly 10 percent compared with September and another positive sign of a recovery taking root in China's crucial foreign markets, but overcapacity concerns remain.
China imported 64.55 million tonnes of iron ore in September, a surprising record after steel mills cranked up output to 1.69 million tonnes per day. Imports over the first 10 months reached 514.81 million tonnes, up 37 percent compared to the same period of last year, with China's steel mills maintaining record output levels despite a collapse in export markets.
Sustained demand from China has already pushed spot Indian benchmark prices up to more than $100 per tonne for the first time since mid-August.
Despite widespread concerns that China's mills are producing too much steel, analysts said that demand has held out so far, driven by record automobile sales and stimulus-driven investment in infrastructure.
Daily crude steel output stood at 1.67 million tonnes in October, according to figures released on Wednesday by the National Bureau of Statistics, only slightly lower than the record set in August and September.
At a press briefing last week, the China Iron and Steel Association repeated its concerns about domestic overcapacity, but also conceded that growing demand meant benchmark iron ore prices were likely to rise in 2010.
It said the domestic Chinese market would have to absorb an additional 47 million tonnes of crude steel supply as a result of falling global demand.
Source: Alibaba News Channel
Steel product exports stood at 2.71 million tonnes over October, up nearly 10 percent compared with September and another positive sign of a recovery taking root in China's crucial foreign markets, but overcapacity concerns remain.
China imported 64.55 million tonnes of iron ore in September, a surprising record after steel mills cranked up output to 1.69 million tonnes per day. Imports over the first 10 months reached 514.81 million tonnes, up 37 percent compared to the same period of last year, with China's steel mills maintaining record output levels despite a collapse in export markets.
Sustained demand from China has already pushed spot Indian benchmark prices up to more than $100 per tonne for the first time since mid-August.
Despite widespread concerns that China's mills are producing too much steel, analysts said that demand has held out so far, driven by record automobile sales and stimulus-driven investment in infrastructure.
Daily crude steel output stood at 1.67 million tonnes in October, according to figures released on Wednesday by the National Bureau of Statistics, only slightly lower than the record set in August and September.
At a press briefing last week, the China Iron and Steel Association repeated its concerns about domestic overcapacity, but also conceded that growing demand meant benchmark iron ore prices were likely to rise in 2010.
It said the domestic Chinese market would have to absorb an additional 47 million tonnes of crude steel supply as a result of falling global demand.
Source: Alibaba News Channel
Ferrochrome Demand "Non-Existant"
Ferrochrome producers must cut production by as much as 50% of capacity to allow supply and demand to again dictate price direction, says Danko Konchar, chairman of Kermas Group. That's because demand from steelmakers probably won't rebound quickly.
Konchar, whose firm runs South Africa's privately owned Samancor Chrome, tells an international ferroalloys conference in Monte Carlo: "Cut production-- there is no demand yet." According to a Reuters report of the meeting, Konchar also says that "demand will come but you need to be patient."
"Today there is no demand but the price in chrome ore is not going down too much," he added. "Price is connected to supply and demand ... at the moment, this movement of price in the third and fourth quarter is not due to demand."
Ferrochrome, used in making stainless steel to prevent corrosion, currently is traded at about 88¢/lb, Reuters reports, which is well below levels above $2.50 a lb in April last year.
Taking his own medicine, Konchar says Samancor, the world's second-largest ferrochrome producer, shut down all its mining and smelting operations between December last year and the end of February 2009 after demand slumped. He tells Reuters that his organization since then has kept production between 55%-60% of capacity.
"If (producers) don't cut, they will ruin their future position," he says. "The price will not be related to production ... the suggestion is to cut now and not have up, down, up, down (of price volatility)."
Source: Purchasing.com
Konchar, whose firm runs South Africa's privately owned Samancor Chrome, tells an international ferroalloys conference in Monte Carlo: "Cut production-- there is no demand yet." According to a Reuters report of the meeting, Konchar also says that "demand will come but you need to be patient."
"Today there is no demand but the price in chrome ore is not going down too much," he added. "Price is connected to supply and demand ... at the moment, this movement of price in the third and fourth quarter is not due to demand."
Ferrochrome, used in making stainless steel to prevent corrosion, currently is traded at about 88¢/lb, Reuters reports, which is well below levels above $2.50 a lb in April last year.
Taking his own medicine, Konchar says Samancor, the world's second-largest ferrochrome producer, shut down all its mining and smelting operations between December last year and the end of February 2009 after demand slumped. He tells Reuters that his organization since then has kept production between 55%-60% of capacity.
"If (producers) don't cut, they will ruin their future position," he says. "The price will not be related to production ... the suggestion is to cut now and not have up, down, up, down (of price volatility)."
Source: Purchasing.com
BC Iron Secures Off-Take Agreement
BC Iron yesterday announced a $53.8 million off-take agreement with a Hong Kong-based industrial and trading company for its Nullagine Joint Venture (NJV) iron ore project with Fortescue Metals.
Under the terms of the agreement, the project will deliver 20 million tonnes of iron ore to the off-take partner over the eight-and-a-half years.
The $53.8 million worth of pre-payments will go towards having the project operational by late-2010.
The first $16 million tranche will be drawn down in December this year.
According to BC Iron managing director Mike Young, the agreements would not only underpin project finance, but also establish long-term relationships with customers.
“We are extremely pleased to have secured not only our first off-take agreements but also a significant project finance facility on very attractive terms,” he said.
“This will allow us to push ahead with development of the project, without the complexity that comes with conventional finance agreements.”
As per the terms of the agreement, iron ore pricing will be related to the annual benchmark reference price.
If there is no benchmark in place, the ore will be priced according to a pre-agreed index system.
BC Iron will issue the Hong Kong company with a total of eight million options with a two year term.
Six million of the options will be priced at $1.35, while the remaining two million will be $1.50.
Source: Australian Mining
Under the terms of the agreement, the project will deliver 20 million tonnes of iron ore to the off-take partner over the eight-and-a-half years.
The $53.8 million worth of pre-payments will go towards having the project operational by late-2010.
The first $16 million tranche will be drawn down in December this year.
According to BC Iron managing director Mike Young, the agreements would not only underpin project finance, but also establish long-term relationships with customers.
“We are extremely pleased to have secured not only our first off-take agreements but also a significant project finance facility on very attractive terms,” he said.
“This will allow us to push ahead with development of the project, without the complexity that comes with conventional finance agreements.”
As per the terms of the agreement, iron ore pricing will be related to the annual benchmark reference price.
If there is no benchmark in place, the ore will be priced according to a pre-agreed index system.
BC Iron will issue the Hong Kong company with a total of eight million options with a two year term.
Six million of the options will be priced at $1.35, while the remaining two million will be $1.50.
Source: Australian Mining
Tuesday, November 10, 2009
Altius Announces Plans For New Iron Ore Company
Altius Minerals Corporation is pleased to announce that it has entered into an agreement with a private company with respect to its Kamistiatusset iron ore project in western Labrador, Canada. A primary condition of the agreement is that the private company is obligated to form a new public company ("Newco") that will focus on the western Labrador iron ore mining district of Canada. Newco is wholly responsible for the recruitment of a Management and Board acceptable to Altius. Organization of the board, management and capital structuring of Newco is presently underway and will be reported upon once completed.
As part of the commercial agreement a substantial drilling program, with a budget of approximately $5 million dollars, is anticipated to commence early in 2010 to provide sufficient data to generate an NI 43-101 resource estimate of the iron ore zones discovered by Altius in its 2008-2009 drilling program. Previous drilling by Altius on the project has outlined an area of magnetite rich iron mineralization that displays comparable grade, thickness and geometry to other producing deposits in the district. For further details regarding the 2008-2009 exploration program at the Kamistiatusset property please see the following link - http://www.altiusminerals.com/kamistaitussett.php.
Altius will retain a 100% interest in the Kamistiatusset project until such time as Newco incurs the $5 million in exploration expenditures on the property. At that time Altius will transfer its 100% interest in the project to Newco in exchange for a 3% gross sales royalty and for an initial 50% equity interest in Newco.
Source: Benzinga
As part of the commercial agreement a substantial drilling program, with a budget of approximately $5 million dollars, is anticipated to commence early in 2010 to provide sufficient data to generate an NI 43-101 resource estimate of the iron ore zones discovered by Altius in its 2008-2009 drilling program. Previous drilling by Altius on the project has outlined an area of magnetite rich iron mineralization that displays comparable grade, thickness and geometry to other producing deposits in the district. For further details regarding the 2008-2009 exploration program at the Kamistiatusset property please see the following link - http://www.altiusminerals.com/kamistaitussett.php.
Altius will retain a 100% interest in the Kamistiatusset project until such time as Newco incurs the $5 million in exploration expenditures on the property. At that time Altius will transfer its 100% interest in the project to Newco in exchange for a 3% gross sales royalty and for an initial 50% equity interest in Newco.
Source: Benzinga
Zambia Copper Production Rises Says Central Bank
Zambia's copper production for the nine months to September 2009 increased to 514,320 tonnes compared with 429,792 tonnes in the same period last year, the central bank said on Tuesday.
The central bank said copper exports in the period under review rose to 496,111 tonnes from 411,533 tonnes in 2008.
Cobalt output dropped to 2,816 tonnes from 3,526 tonnes in the corresponding period last year and exports fell to 3,225 tonnes from 3,488 tonnes, the Bank of Zambia (BoZ) said.
Source: Reuters
The central bank said copper exports in the period under review rose to 496,111 tonnes from 411,533 tonnes in 2008.
Cobalt output dropped to 2,816 tonnes from 3,526 tonnes in the corresponding period last year and exports fell to 3,225 tonnes from 3,488 tonnes, the Bank of Zambia (BoZ) said.
Source: Reuters
Mounting Copper Stockpiles Force China Re-Think
Copper stockpiles held in duty-free warehouses in China, the top user, may be re-exported after surging to as much as 350,000 tons from almost none at the start of the year, according to Xi’an Maike Metal International Group.
“We can hardly find buyers for refined copper,” said Luo Shengzhang, general manager of the copper department at Xi’an Maike. The company ranks among the country’s three biggest importers, according to the executive. “China’s got to export some copper from now and next year,” Luo said in an interview.
Copper, used to make pipes and wires, has more than doubled this year as China’s 4 trillion yuan ($586 billion) stimulus spending, increased state stockpiling and a lack of scrap material boosted China’s imports to a record. That’s helped to drive Chinese prices below London’s since at least July.
Xi’an Maike has had to re-route some bonded copper to London Metal Exchange warehouses in South Korea because the company was unable to find buyers in China, with local supply outpacing demand, said Luo. The effect of the stimulus package was wearing off and local scrap supply was improving, he said.
‘Bearish for London’
“We do see the trend of more copper being re-routed, though our estimate for bonded copper isn’t as big,” Grace Qu, an analyst at CRU International Ltd., said from Beijing today. A shift of the metal from bonded stockpiles “to LME reported inventory would be bearish for London prices,” she said.
Luo’s estimate of the bonded-zone stockpiles compares with 60,000 tons by Macquarie Group Ltd. in July. It’s also more than triple the inventory in Shanghai Futures Exchange warehouses, which stood at 104,275 tons as of the week of Nov. 2. A bonded zone holds imported goods before duty has been paid.
Three-month copper in London traded today at $6,548 a ton compared with $3,070 at the end of last year. Futures in Shanghai have also more than doubled this year to a high of 51,580 yuan ($7,554) a ton today.
Still, buying the metal from overseas to sell in the Chinese market has not been profitable since at least July, according to Bloomberg calculations. Prices in Shanghai were more than 1,300 yuan a ton lower than London yesterday, after accounting for China’s 17 percent value added tax.
In addition to the bonded-zone stockpiles, China may also hold 150,000 tons in the Shanghai area, including in exchange- monitored warehouses; 235,000 tons at the State Reserve Bureau, which maintains government holdings; and 200,000 tons with fabricators and private investors, Luo, 36, said yesterday.
Refined-copper exports by China were 10,705 tons in September, 70 percent more than a month ago and the highest this year, according to data by the Beijing-based customs office. Refined-copper imports in the first nine months were 2.58 million tons, 165 percent more than a year ago.
Xi’an Maike’s inbound shipments of refined copper may total about 400,000 tons this year, ranking among the top three importers by volume, according to Luo. The country’s imports of refined copper may halve to 1.6 million tons in 2010 from an estimated 3 million tons this year, he said.
Source: Bloomberg
“We can hardly find buyers for refined copper,” said Luo Shengzhang, general manager of the copper department at Xi’an Maike. The company ranks among the country’s three biggest importers, according to the executive. “China’s got to export some copper from now and next year,” Luo said in an interview.
Copper, used to make pipes and wires, has more than doubled this year as China’s 4 trillion yuan ($586 billion) stimulus spending, increased state stockpiling and a lack of scrap material boosted China’s imports to a record. That’s helped to drive Chinese prices below London’s since at least July.
Xi’an Maike has had to re-route some bonded copper to London Metal Exchange warehouses in South Korea because the company was unable to find buyers in China, with local supply outpacing demand, said Luo. The effect of the stimulus package was wearing off and local scrap supply was improving, he said.
‘Bearish for London’
“We do see the trend of more copper being re-routed, though our estimate for bonded copper isn’t as big,” Grace Qu, an analyst at CRU International Ltd., said from Beijing today. A shift of the metal from bonded stockpiles “to LME reported inventory would be bearish for London prices,” she said.
Luo’s estimate of the bonded-zone stockpiles compares with 60,000 tons by Macquarie Group Ltd. in July. It’s also more than triple the inventory in Shanghai Futures Exchange warehouses, which stood at 104,275 tons as of the week of Nov. 2. A bonded zone holds imported goods before duty has been paid.
Three-month copper in London traded today at $6,548 a ton compared with $3,070 at the end of last year. Futures in Shanghai have also more than doubled this year to a high of 51,580 yuan ($7,554) a ton today.
Still, buying the metal from overseas to sell in the Chinese market has not been profitable since at least July, according to Bloomberg calculations. Prices in Shanghai were more than 1,300 yuan a ton lower than London yesterday, after accounting for China’s 17 percent value added tax.
In addition to the bonded-zone stockpiles, China may also hold 150,000 tons in the Shanghai area, including in exchange- monitored warehouses; 235,000 tons at the State Reserve Bureau, which maintains government holdings; and 200,000 tons with fabricators and private investors, Luo, 36, said yesterday.
Refined-copper exports by China were 10,705 tons in September, 70 percent more than a month ago and the highest this year, according to data by the Beijing-based customs office. Refined-copper imports in the first nine months were 2.58 million tons, 165 percent more than a year ago.
Xi’an Maike’s inbound shipments of refined copper may total about 400,000 tons this year, ranking among the top three importers by volume, according to Luo. The country’s imports of refined copper may halve to 1.6 million tons in 2010 from an estimated 3 million tons this year, he said.
Source: Bloomberg
Monday, November 9, 2009
Rocklands Rebuffs Jindal Revised Offer
Jindal Steel and Power (JSPL) has raised its bid for Australian coal miner Rocklands Richfield to match a counteroffer by a Chinese firm, only to be rebuffed by the Aussie firm.
Rocklands said the AUS $0.52 a share offer by China’s Meijin Energy was still “superior” than the revised bid made by Naveen Jindal’s JSPL.
The Australian firm has asked the Indian company to place a better bid. Jindal Steel had earlier offered AUS $0.42 a share and signed a term sheet with the Rocklands management on September 22.
After Meijin threw its hat in the bid ring, JSPL revised the offer to AUS $0.50, valuing the company at AUS $194.98 million, or around Rs 841 crore.
The latest Jindal offer is the same as the Ruias-owned Essar Group’s offer in October. Essar entered the fray in October 7 but dropped out of the race on October 20. Meijin Energy joined the bid battle on November 2 at a time when Jindal Steel was carrying out due diligence on Rocklands.
In the revised offer, JSPL wanted Rocklands to reject the Meijin offer, proposed infusion of new equity and sought board representation, all of which had been rejected by the Australian company.
Rocklands said the Chinese were giving a better deal, mainly because of the higher price.
JSPL, which has a steel mill and a power plant in Chhattisgarh and is expanding in Orissa, already owns 14.16 per cent in Rocklands.
The company is looking for coking coal abroad since there is an acute shortfall of the crucial raw material, used in steel making, in India.
Australia, South Africa and Indonesia are the three most sought-after destinations for steel companies seeking to own coking coal. China, which has large deposits of coking coal, rations export, thereby dictating the price.
The Rocklands acquisition will give JSPL entry into the Chinese coking coal market, which foreign companies find difficult to access.
The Aussie company has two metallurgical coke plants in China following its acquisition of China Coke and Chemicals in October 2007. These units make met coke from local coal.
Source: Calcutta Telegraph
Rocklands said the AUS $0.52 a share offer by China’s Meijin Energy was still “superior” than the revised bid made by Naveen Jindal’s JSPL.
The Australian firm has asked the Indian company to place a better bid. Jindal Steel had earlier offered AUS $0.42 a share and signed a term sheet with the Rocklands management on September 22.
After Meijin threw its hat in the bid ring, JSPL revised the offer to AUS $0.50, valuing the company at AUS $194.98 million, or around Rs 841 crore.
The latest Jindal offer is the same as the Ruias-owned Essar Group’s offer in October. Essar entered the fray in October 7 but dropped out of the race on October 20. Meijin Energy joined the bid battle on November 2 at a time when Jindal Steel was carrying out due diligence on Rocklands.
In the revised offer, JSPL wanted Rocklands to reject the Meijin offer, proposed infusion of new equity and sought board representation, all of which had been rejected by the Australian company.
Rocklands said the Chinese were giving a better deal, mainly because of the higher price.
JSPL, which has a steel mill and a power plant in Chhattisgarh and is expanding in Orissa, already owns 14.16 per cent in Rocklands.
The company is looking for coking coal abroad since there is an acute shortfall of the crucial raw material, used in steel making, in India.
Australia, South Africa and Indonesia are the three most sought-after destinations for steel companies seeking to own coking coal. China, which has large deposits of coking coal, rations export, thereby dictating the price.
The Rocklands acquisition will give JSPL entry into the Chinese coking coal market, which foreign companies find difficult to access.
The Aussie company has two metallurgical coke plants in China following its acquisition of China Coke and Chemicals in October 2007. These units make met coke from local coal.
Source: Calcutta Telegraph
Chambishi Metals Resumes Operations
Zambia's largest cobalt smelter, Chambishi Metals PLC, has started to receive concentrate supplies from Congo's Katanga province, allowing it to resume operations after nearly 12 months of inactivity, an official with Zambia Consolidated Copper Mines Investments Holdings told Dow Jones Newswires Monday.
"The smelter resumed operations on Friday and they have already started producing cobalt," the ZCCM-IH official said by telephone from Lusaka, the Zambian capital. Chambishi Metals is operated by U.K.-based Enya Holdings, while ZCCM-IH holds a minority stake in the smelter.
The plant, which was closed in December last year due to plunging global metals prices, had initially been expected to resume output in May, but delayed supplies of concentrates hampered the start-up.
In addition from getting supplies from Congo, Chambishi also expected to process copper concentrates from Baluba Copper Mines, now owned by NFCA Mining, a unit of China Nonferrous Metal Mining Group Co. (8306.HK). Chambishi Metals has the capacity to produce 4,000 tons of cobalt and 40,000 tons of copper a year.
Baluba is expected to start supplying the plant early next year. However, management of the plant has rejected supplies from other Zambian mines, saying they would be expensive to process because of their low grades.
Analysts say the delayed resumption of output has led to a global cobalt shortage, aiding cobalt prices on the international market.
According to Sikufela Mundia, the president of Zambia's National Union of Miners and Allied Workers Union, management has also started recruiting workers but is yet to sign a recognition deal with the unions.
Chambsihi laid off around 700 workers when it closed in December, while in total some 10,000 Zambian miners were laid off after global copper prices slumped last year. Around 2,000 miners have since been rehired as a result of a resurgent market.
Zambia is Africa's largest copper producer and the second-leading cobalt producer after Congo
Source: Trading Markets/Dow Jones
"The smelter resumed operations on Friday and they have already started producing cobalt," the ZCCM-IH official said by telephone from Lusaka, the Zambian capital. Chambishi Metals is operated by U.K.-based Enya Holdings, while ZCCM-IH holds a minority stake in the smelter.
The plant, which was closed in December last year due to plunging global metals prices, had initially been expected to resume output in May, but delayed supplies of concentrates hampered the start-up.
In addition from getting supplies from Congo, Chambishi also expected to process copper concentrates from Baluba Copper Mines, now owned by NFCA Mining, a unit of China Nonferrous Metal Mining Group Co. (8306.HK). Chambishi Metals has the capacity to produce 4,000 tons of cobalt and 40,000 tons of copper a year.
Baluba is expected to start supplying the plant early next year. However, management of the plant has rejected supplies from other Zambian mines, saying they would be expensive to process because of their low grades.
Analysts say the delayed resumption of output has led to a global cobalt shortage, aiding cobalt prices on the international market.
According to Sikufela Mundia, the president of Zambia's National Union of Miners and Allied Workers Union, management has also started recruiting workers but is yet to sign a recognition deal with the unions.
Chambsihi laid off around 700 workers when it closed in December, while in total some 10,000 Zambian miners were laid off after global copper prices slumped last year. Around 2,000 miners have since been rehired as a result of a resurgent market.
Zambia is Africa's largest copper producer and the second-leading cobalt producer after Congo
Source: Trading Markets/Dow Jones
Orissa Suspends 30 Iron Ore Mines
Orissa has ordered the suspension of work in at least 30 iron ore mines after the operators failed to produce documents to show their mining activities were legal, a senior mines department official said Monday.
The state mines department served notices in October to the mine operators in mineral-rich Keonjhar district, asking them to produce necessary documents so they could continue operations.
'The suspension notices were served Saturday after they failed to do so,' deputy director of mines Purna Chandra Patra told IANS.
The state government had last month set up a task force headed by the chief secretary to check illegal mining.
The mines department served the notices to operators after it was asked by the task force to verify documents of about 600 mine operators in the state following reports that many were operating without valid mining and environmental clearances.
Source: Sify
The state mines department served notices in October to the mine operators in mineral-rich Keonjhar district, asking them to produce necessary documents so they could continue operations.
'The suspension notices were served Saturday after they failed to do so,' deputy director of mines Purna Chandra Patra told IANS.
The state government had last month set up a task force headed by the chief secretary to check illegal mining.
The mines department served the notices to operators after it was asked by the task force to verify documents of about 600 mine operators in the state following reports that many were operating without valid mining and environmental clearances.
Source: Sify
Benga Coal Mining Prject Gets Go-Ahead
The consortium developing a US$ 270 million coal mining project at Benga in Mozambique’s Moatize province has approved the first phase of the undertaking, the Noticias newspaper reported.
The consortium comprises Riversdale Mining of Australia, with a 65 percent stake, and India’s Tata Steel, with a 35 percent shareholding. The companies expect to produce 5.3 million tons of coal in the first stage of the joint venture, providing 1.7 million tons of high-quality coking coal and 300,000 tons of export thermal coal.
Riversdale CEO Michael O´Keefe told Noticias approval of the project’s initial phase allows his company to proceed with mining operations in Mozambique. There is great expectation for the venture due to investment involved and its impact on employment, he added.
Work to build the mine will begin before the end of this year after final environmental approval is given.
“We’re committed to bringing the Benga project into first production during the 2010 and we will be supplying world coking coal markets in 2011, initially via our relationship with project partner Tata Steel of India, “ said O’Keefe.
The Indian-Australian joint venture plans to build a thermal power station in Moatize that will come on line in 2013 with a 500 MW generating capacity.
The Benga mining concession is for 25 years.
Source: macauhub
The consortium comprises Riversdale Mining of Australia, with a 65 percent stake, and India’s Tata Steel, with a 35 percent shareholding. The companies expect to produce 5.3 million tons of coal in the first stage of the joint venture, providing 1.7 million tons of high-quality coking coal and 300,000 tons of export thermal coal.
Riversdale CEO Michael O´Keefe told Noticias approval of the project’s initial phase allows his company to proceed with mining operations in Mozambique. There is great expectation for the venture due to investment involved and its impact on employment, he added.
Work to build the mine will begin before the end of this year after final environmental approval is given.
“We’re committed to bringing the Benga project into first production during the 2010 and we will be supplying world coking coal markets in 2011, initially via our relationship with project partner Tata Steel of India, “ said O’Keefe.
The Indian-Australian joint venture plans to build a thermal power station in Moatize that will come on line in 2013 with a 500 MW generating capacity.
The Benga mining concession is for 25 years.
Source: macauhub
Sunday, November 8, 2009
Japan Iron Ore Imports At Record High
According to the latest data from Japan’s Ministry of Finance, Japan’s iron ore imports in September surged above 10 million tonne for the first time over the past 9 months up by 12% YoY to 10.82 million tonne. However, imports in the first 9 months were still down by 31% from the same period of 2008 to 72.4 million tonne.
Meanwhile, Japan’s coal imports fell for the 2nd consecutive month to a 4 month low of 13.9 million tonne in September. However, coking coal imports to Japan rose to 6 million tonne, the highest level since January.
Source: Steel Guru
Meanwhile, Japan’s coal imports fell for the 2nd consecutive month to a 4 month low of 13.9 million tonne in September. However, coking coal imports to Japan rose to 6 million tonne, the highest level since January.
Source: Steel Guru
China "To Remain Coal Importer"
Chinese coal imports are set to continue to grow strongly for metallurgical as well as thermal coal as demand for electricity and high-quality coal increases, said Peabody Energy Corp. Chief Executive Greg Boyce said Friday at a media conference in Sydney.
"China turning net importer is a structural change. We expect Chinese rapid coal demand growth to continue for some time," said Boyce, who expects "healthy" increases in coal contract prices for the 2010-2011 Japanese financial year starting April 1.
This contract year coking prices settled at US$125 a metric ton and thermal coal prices at US$72/ton.
"There is no question that coal demand is continuing to increase. Spot prices for metallurgical coal are higher than benchmark prices and we are seeing economies starting to recover," Boyce told reporters.
During January-September, China imported nearly 26 million tons of coking coal, up nearly fivefold on the year and coming at a crucial time for miners when coking coal demand in other major countries plummeted. Australia supplied 17.4 million tons of those imports.
Total coal imports to China until September are at nearly 86 million tons, up more than double on the year.
During the first nine months of the year, Peabody has committed nearly 3.3 million tons of coal for China deliveries, including more than 1.7 million tons from its Australian operations.
"It looks to us like (China's) strategy is to satisfy an increasing amount of electricity demand in southern and eastern China from imported coal and to actually keep the coal mined in northern and western China there and convert it in the region," said Boyce.
During the September quarter, the U.S.-based company established a trading hub in Singapore for its expanding trading activities, as well as a representative office in Jakarta.
Peabody has extensive operations in Australia and expects those operations to contribute 30%-40% of earnings over the next two years. It plans to double output to up to 36 million tons over the next five years from existing mines in New South Wales and Queensland.
The bulk of Peabody's output volume comes from its U.S. operations that currently produce about 225 million tons a year.
Third-quarter profit released last month was US$106.8 million, down 71% on sharply lower margins in the Pacific market, but still beating analyst expectations. For 2009, Peabody said it expects earnings before interest, taxes, depreciation and amortization of US$1.2 billion to US$1.3 billion.
Aside from rail and port infrastructure bottlenecks at the Newcastle and Dalrymple ports, Boyce said he was concerned about the Australian government's proposed emissions trading scheme, or ETS, which he said unduly impacts underground "gassy" mines.
"Australia's is the only proposed ETS to include fugitive emissions from coal mines," he said, adding that the company's expansion plans in Australia may be scaled back depending on the eventual shape of the scheme. Other areas in Peabody's focus included Mozambique's nascent coal mining sector, he said.
Australia's parliament is due to vote on the emissions trading scheme in mid-November.
Infrastructure constraints were "always an issue" in Australia but Boyce said he was confident to execute Peabody's expansion plans with current rail and port projects in the works.
In New South Wales, Peabody forms part of the Newcastle Coal Infrastructure Group that includes BHP Billiton Ltd. among others, and in September agreed to a coal export plan that could see capacity of Australia's biggest coal export port double to 180 million tons by 2016.
"We're confident that the current commitments match our expansion plans," Boyce said.
Aside from expanding organically in Australia, Peabody said it's "very interested" in Mongolia's Tavan Tolgoi coking coal project.
Last month Mongolia's government signed a significant investment agreement for another giant project, the US$4 billion Oyu Tolgoi copper-gold mine, expected to act as a blueprint for billions of investment in the country.
"Without an investment agreement on Oyu Tolgoi, nothing on Tavan Tolgoi was going to happen. We're very interested in Tavan Tolgoi. It's early (in the process) and we'd look to do it with a partner," said Boyce. Other bidders for Tavan Tolgoi include BHP Billiton, Brazil's Vale and Chinese companies.
Peabody already has a joint venture in Mongolia, recently spending US$23 million on a 50% interest in a Mongolian joint venture with London-based Polo Resources Ltd.
Source: Marketwatch
"China turning net importer is a structural change. We expect Chinese rapid coal demand growth to continue for some time," said Boyce, who expects "healthy" increases in coal contract prices for the 2010-2011 Japanese financial year starting April 1.
This contract year coking prices settled at US$125 a metric ton and thermal coal prices at US$72/ton.
"There is no question that coal demand is continuing to increase. Spot prices for metallurgical coal are higher than benchmark prices and we are seeing economies starting to recover," Boyce told reporters.
During January-September, China imported nearly 26 million tons of coking coal, up nearly fivefold on the year and coming at a crucial time for miners when coking coal demand in other major countries plummeted. Australia supplied 17.4 million tons of those imports.
Total coal imports to China until September are at nearly 86 million tons, up more than double on the year.
During the first nine months of the year, Peabody has committed nearly 3.3 million tons of coal for China deliveries, including more than 1.7 million tons from its Australian operations.
"It looks to us like (China's) strategy is to satisfy an increasing amount of electricity demand in southern and eastern China from imported coal and to actually keep the coal mined in northern and western China there and convert it in the region," said Boyce.
During the September quarter, the U.S.-based company established a trading hub in Singapore for its expanding trading activities, as well as a representative office in Jakarta.
Peabody has extensive operations in Australia and expects those operations to contribute 30%-40% of earnings over the next two years. It plans to double output to up to 36 million tons over the next five years from existing mines in New South Wales and Queensland.
The bulk of Peabody's output volume comes from its U.S. operations that currently produce about 225 million tons a year.
Third-quarter profit released last month was US$106.8 million, down 71% on sharply lower margins in the Pacific market, but still beating analyst expectations. For 2009, Peabody said it expects earnings before interest, taxes, depreciation and amortization of US$1.2 billion to US$1.3 billion.
Aside from rail and port infrastructure bottlenecks at the Newcastle and Dalrymple ports, Boyce said he was concerned about the Australian government's proposed emissions trading scheme, or ETS, which he said unduly impacts underground "gassy" mines.
"Australia's is the only proposed ETS to include fugitive emissions from coal mines," he said, adding that the company's expansion plans in Australia may be scaled back depending on the eventual shape of the scheme. Other areas in Peabody's focus included Mozambique's nascent coal mining sector, he said.
Australia's parliament is due to vote on the emissions trading scheme in mid-November.
Infrastructure constraints were "always an issue" in Australia but Boyce said he was confident to execute Peabody's expansion plans with current rail and port projects in the works.
In New South Wales, Peabody forms part of the Newcastle Coal Infrastructure Group that includes BHP Billiton Ltd. among others, and in September agreed to a coal export plan that could see capacity of Australia's biggest coal export port double to 180 million tons by 2016.
"We're confident that the current commitments match our expansion plans," Boyce said.
Aside from expanding organically in Australia, Peabody said it's "very interested" in Mongolia's Tavan Tolgoi coking coal project.
Last month Mongolia's government signed a significant investment agreement for another giant project, the US$4 billion Oyu Tolgoi copper-gold mine, expected to act as a blueprint for billions of investment in the country.
"Without an investment agreement on Oyu Tolgoi, nothing on Tavan Tolgoi was going to happen. We're very interested in Tavan Tolgoi. It's early (in the process) and we'd look to do it with a partner," said Boyce. Other bidders for Tavan Tolgoi include BHP Billiton, Brazil's Vale and Chinese companies.
Peabody already has a joint venture in Mongolia, recently spending US$23 million on a 50% interest in a Mongolian joint venture with London-based Polo Resources Ltd.
Source: Marketwatch
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