Commodities

3

Vale slashes capex

Brazil’s Vale has announced further cuts to its planned iron ore expansions. From the Globe and Mail: Brazil’s Vale SA , the world’s second-largest mining company, cut estimated 2013 capital spending by 24 per cent after a global slowdown and a drop in iron ore prices led the company to rethink its outlook for expansion.

0

Daily iron ore price update

Here is the the iron ore price complex chart for December 3, 2012: Spot still resilient, really, with some hope as well that swaps have bottomed. Not so long as Chinese steel prices keep falling, however. In some good news for the bulks and beleaguered thermal coal miners, it looks like a breakout from the recent

5

Iron anvil falls on Sundance

Things are not looking good for the iron ore juniors. From BS: Shares in Sundance Resources remain in a trading halt, as a potential takeover deal with suitor Hanlong Mining appears to be falling apart. Sundance released a statement on Monday saying Hanlong wanted to delay the deal because it could not secure credit approval

0

Coking coal restock done

From ANZ: Last week Newcastle physical thermal coal prices were up 2.5%, but iron ore and coking coal prices fell 2.8%. Australian thermal coal prices gained on improved activity on-screen ahead of January annual term talks between producers and Japanese utilities. Traders were reportedly covering short positions ahead of year-end. Premium hard coking coal prices ended the week lower, in line

9

Rio cuts (but what?)

But what exactly? The AFR and BS are reporting it’s all about productivity: Rio said it had boosted the size of the expansion plans to 360 million tonnes from 353 million tonnes previously through de-bottlenecking and productivity improvements with minimal spend. It has a current production capacity of 237 million tonnes and expects to reach 360 million

6

BREE describes mining boom peak

BREE (Bureau of Resources and Energy Projects) has released its much anticipated major projects update and although the numbers are epic, the peak is very much in sight. Just to confuse, BREE has introduced a methodology, making like for like comparisons with past reports difficult: This release of the Resources and Energy Major Projects report

4

Daily iron ore price update (Nev powers back)

Here is today’s iron ore complex chart, where the correction continues: And the chart: Still no spread compression, which tends to happen during decent corrections,  so plenty more downside potential for spot. Today’s news is the fightback offered by Fortescue’s CEO, Nev Power, yesterday. From The Australian: FORTESCUE Metals Group chief executive Nev Power has

54

The US gas triple threat

By Leith van Onselen The Sunday Age/SMH ran two articles picking-up on the looming threat to Australian coal and gas exports caused by the shale oil and gas boom currently gathering pace in the US. First, here’s David Pott’s take on the situation (my emphasis): …our sovereign debt is low by global standards, but it’s

0

Commodities daily

Courtesy of ANZ: Reports suggest Chinese buyers had defaulted on three Australian thermal coal imports and some from South Africa, but are unlikely to spark a wave of cancellations (that we saw in May/June). We remain cautious – China’s domestic stockpiles at power plants are high and many traders in China could face tight liquidity

4

CBA makes hay with the mining bust

Late yesterday, CBA produced a note with the combined resources of its economics, commodities, currency and equities teams that argued that: With commodity prices off recent highs a question is being asked is, “Is the resource boom over?”  We put that question to CBA’s Economics, Currency,Commodity and Equities research teams. They conclude that the resource boom is a

0

Traders push thermal coal rally

Courtesy of ANZ. Newc FOB physical thermal coal and Australia FOB coking coal prices firmed last week, with Asia demand showing signs of improvement for early next year loadings. Reports suggest traders were covering their short positions before closing their books or the year and ahead of Xstrata’s annual negotiations with Japanese utilities for thermal coal contracts starting in January. Reports

2

Daily iron ore price update (the MRRT joke that keeps on giving)

Here is Friday’s iron ore price table: And the ore price chart: As well as Chinese coastal bulk shipping rates: It’s good news for thermal coal basically, which continues its nice rally on better Chinese electricity generation. For iron ore, the topping pressure is still there in our spreads. First, the 12m swap/spot spread looks