Minerals and Metals

China Iron Ore Imports Show Steep Fall

2009-11-16T15:58:00.001Z

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

NMDC Sees Iron Ore Prices At $75 - 80 A Tonne

2009-11-16T12:39:00.000Z

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

Zinc Prices Up 80 Per Cent This Year

2009-11-16T12:37:00.001Z

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

Slight Rise In Iran Iron Ore Production

2009-11-15T13:39:00.002Z

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

TVI Concentrating On Philippines Gold Mine

2009-11-15T10:45:00.001Z

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

Outokumpu Sees No Rise In Nickel Prices

2009-11-15T10:42:00.001Z

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."

Steep Fall In Ukrainian Ferroally Production

2009-11-14T16:16:00.001Z

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

Chinese Eye Anglo Zinc Assets

2009-11-14T16:14:00.000Z

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

Centrex In China Iron Ore Deal

2009-11-13T14:23:00.001Z

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

ENRC Says Output Back To Pre-Crisis Levels

2009-11-12T08:50:00.001Z

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

NMDC Forms SPV For Andhra Pradesh Iron Ore Project

2009-11-11T23:43:00.001Z

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

Mongolia Energy Signs Coal Mining Agreement

2009-11-11T23:41:00.001Z

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

Steep Fall In China Iron Ore Imports

2009-11-11T14:03:00.002Z

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

Ferrochrome Demand "Non-Existant"

2009-11-11T14:01:00.001Z

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

BC Iron Secures Off-Take Agreement

2009-11-11T13:58:00.000Z

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

Altius Announces Plans For New Iron Ore Company

2009-11-10T15:10:00.001Z

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

Zambia Copper Production Rises Says Central Bank

2009-11-10T15:08:00.000Z

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

Mounting Copper Stockpiles Force China Re-Think

2009-11-10T15:05:00.000Z

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

Rocklands Rebuffs Jindal Revised Offer

2009-11-09T23:31:00.001Z

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

Chambishi Metals Resumes Operations

2009-11-09T23:27:00.000Z

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

Orissa Suspends 30 Iron Ore Mines

2009-11-09T23:25:00.001Z

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

Benga Coal Mining Prject Gets Go-Ahead

2009-11-09T23:21:00.000Z

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

Japan Iron Ore Imports At Record High

2009-11-08T12:40:00.000Z

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

China "To Remain Coal Importer"

2009-11-08T12:36:00.000Z

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

Evraz Buys 90% Stake In Vanadium-Tula

2009-11-07T11:19:00.001Z

Interfax reportsthat the Russian Federal Antimonopoly Service has allowed the Evraz Group's Nizhny Tagil Iron & Steel Works to acquire 90.84% in OJSC Vanadium-Tula setting a number of requirements.

The Ukraine Antimonopoly Committee in June this year allowed the Cyprus based Evraz Group member Mastercroft Limited to acquire over 50% in Vanadium-Tula.

Mr Alexei Agureyev vice president for PR of Evraz said "The deal has not yet been done. LLC Sibmetinvest and NTMK filed the request with the FAS to acquire 90.84% of Vanadium-Tula in September 2009. The FAS granted the request on November 2nd. The law allocates one year from the date permission has been received to complete the transaction."

He said the regulator's approval was needed because Vanadium-Tula was one of the biggest ferrovanadium and Nitrovan vanadium producers.

Vanadium-Tula is one of world's leading producers of vanadium compounds. Siberian Mining and Metallurgical Company bought the plant from OJSC Koks a member of the Industrial metallurgical Holding, at the end of 2007. The plant used slag supplied by Evraz steel mills as feedstock.

Sources: Steel Guru, Interfax