Asia Mining – Page 113 – Republic of Mining

Goodbye Shanghai, hello Qianhai: HKEx’s quest for a metals connector – by Andy Home (Reuters U.S. – October 27, 2016)

October 27, 2016

http://www.reuters.com/

LONDON – When Hong Kong Exchanges and Clearing (HKEx) bought the venerable London Metal Exchange (LME) in 2012, the narrative was all about China. HKEx was, it claimed, uniquely positioned to bridge the gap between the world’s oldest marketplace for trading base metals and the world’s largest market for those metals.

The exchange was already far advanced in constructing a stocks bridge between Chinese and international markets, subsequently realized in the form of the Shanghai-Hong Kong Connect pipeline. That, it was hoped, would be a template for something similar in the metals and wider commodities trading space. Yet four years on and there is no similar metallic product.

That is largely because the obvious Chinese partner, the Shanghai Futures Exchange (ShFE), which dominates industrial metals trading on the mainland, has shown a conspicuous lack of interest.

Why We Missed the Coal Spike – by David Fickling (Bloomberg News – October 27, 2016)

October 27, 2016

https://www.bloomberg.com/

We got it wrong on coal.Falling inventories at Chinese ports might not be sufficient to set the market on fire, Gadfly argued in February. After prices instead rose about 42 percent, China’s economic planners last month ordered a ramp-up of production at local pits to squash the boom. The prospect of a buyer’s cartel should be able to push prices back down to between $50 and $60 a metric ton, Gadfly argued.

It’s fairly easy to see what’s happened: The promised domestic supply flood isn’t happening, causing demand and prices for imported product to surge.

While the country’s largest coal miner, China Shenhua Energy Co., managed to increase output 14.4 percent in September from a year earlier, reversing a decline over the previous eight months, the rest of the domestic industry hasn’t been so nimble.

Suspended Philippine nickel miner mounts first legal challenge to govt crackdown – by Manolo Serapio Jr (Reuters India – October 26, 2016)

October 26, 2016

http://in.reuters.com/

MANILA – A suspended Philippine nickel miner said on Wednesday it has sued government environment agencies for a nearly four-month stoppage of its operations, in the first legal challenge to the state’s environmental crackdown on the mining sector.

The Philippines is the world’s top nickel ore supplier and an environmental audit that has halted a quarter of its 41 mines plus the risk that 20 more may be shuttered has fuelled a rally in global nickel prices.

Benguetcorp Nickel Mines Inc’s (BNMI) mine in Zambales province, north of the capital Manila, is among 10 suspended for environmental infractions in a government clampdown on damage from mining in July and August.

China’s aluminum output booms as Shanghai disconnect looms – by Andy Home (Reuters U.S. – October 25, 2016)

October 26, 2016

http://www.reuters.com/

LONDON – The Chinese aluminum machine is once again cranking up. The country produced 2.75 million tonnes of the stuff in September, the second-highest monthly tally ever, exceeded only in June 2015. Annualized run rates have accelerated by 2.16 million tonnes to 33.48 million over the last two months and China accounted for 55.7 percent of global output in September.

These figures, supplied to the International Aluminum Institute by China’s Nonferrous Metals Industry Association, come with a health warning, prone as they are to bouts of alarming monthly volatility. But the trend is firmly upwards and appears to bear out a broad analyst consensus that a period of rare self-discipline by Chinese smelters was doomed to end sooner or later.

The reason that smelters are now turning the taps back on is largely one of price. Shanghai aluminum prices have been on a tear since troughing below 9,000 yuan per tonne in November 2015.

Exclusive: Chinese miners in talks for stake in Barrick’s Veladero mine – sources – by John Tilak and Nicole Mordant (Reuters U.S. – October 25, 2016)

October 26, 2016

http://www.reuters.com/

TORONTO/VANCOUVER – China’s Zijin Mining Group Co Ltd and Shandong Gold Mining Co Ltd have held separate talks with Barrick Gold Corp to buy a 50 percent stake in its Veladero gold mine in Argentina, according to four sources with knowledge of the process.

Veladero is one of Barrick’s five core mines, which are all in the Americas. It is expected to produce between 580,000 and 640,000 ounces of gold this year.

The high quality of the mine, production capacity and the prospect for geographical diversification have appealed to the state-owned Chinese suitors, said three of the sources, who requested anonymity because the matter is private. All of the persons spoke over the past week.

Gold demand plummets in India as government cracks down on ‘black money’ – by Swansy Afonso, Eddie Van Der Walt and Ranjeetha Pakim (Globe and Mail/Bloomberg News – October 25, 2016)

October 26, 2016

http://www.theglobeandmail.com/

MUMBAI/LONDON/SINGAPORE — In the world’s largest gold-consuming country after China, demand has just fallen off a cliff. Saurabh Gadgil, a sixth-generation jeweller, says it’s the worst year in India since he took charge of the family business in 1999. The 39-year old chairman of PN Gadgil Jewellers, which has stores in the country, Dubai and the United States, has offered discounts and freebies to lure customers.

“There’s not much you can do as the whole industry is suffering,” he said by phone from the city of Pune. A slump in prices has given jewellers a glimmer of hope before the Hindu festival of Diwali this weekend and Dhanteras on Oct. 28, the most auspicious day in the year to buy gold.

But consumption is still set to shrink to 650 tonnes in 2016, the smallest in seven years, according to a Bloomberg survey of five jewellers and traders. Indians bought 864 tonnes last year, a quarter of global demand, and a record 1,006 tonnes in 2010, World Gold Council data show.

As Yuan Sinks, Goldman Flags Scope for Gold Demand in China – by Ranjeetha Pakiam (Mining.com – October 25, 2016)

October 25, 2016

http://www.bloomberg.com/

Further weakness in China’s currency and investors’ concerns over the outlook for the nation’s property market may spur gold demand in Asia’s top economy, according to Goldman Sachs Group Inc., which made the forecast as the offshore yuan sank to a record.

“The potential drivers of increased Chinese physical buying include purchasing gold as a way to hedge for potential currency depreciation in the face of capital controls,” analysts including Jeffrey Currie and Max Layton, wrote in a report dated Oct. 24. Bullion consumption in China may also rise “as a way of diversifying away from the property market,” they said.

The potential for stronger demand may help prop up prices that are headed for a monthly loss as the Federal Reserve prepares the ground for higher U.S. interest rates.

Green activists must not usurp [Australian] national sovereignty – Editorial (The Australian – October 24, 2016)

October 24, 2016

http://www.theaustralian.com.au/

To paraphrase John Howard, we should decide what mining projects are opened up in this country and the circumstances in which they open. Such authority rests with Australia’s democratically elected representatives and established government processes.

It does not belong with overseas governments (including prospective US presidents or their staff), self-appointed meddling international activists or local vigilante “lawfare’’ litigants funded by activists.

Thinking Australians, whatever their views about coal, should be appalled by the revelation, reported exclusively by Dennis Shanahan, that the Sunrise Foundation, part of a highly organised group of Australian activists working to stop the $16 billion Adani coalmine in Queensland, is being funded by the Sandler Foundation in the US. The connection surfaced in material released by WikiLeaks, including Clinton campaign chairman John Podesta’s emails.

Foreign-funded anti-coal activists risk driving India away – by Dennis Shanahan and Michael McKenna (The Australian – October 24, 2016)

October 24, 2016

http://www.theaustralian.com.au/

A highly orchestrated, secretly foreign-funded group of Australian environmental activists opposing the $16 billion Adani coalmine in Queensland has “dampened” Indian investment interest in Australia and received heated criticism from the federal Coalition and Queensland Labor governments.

Indian Power Minister Piyush Goyal told The Australian yesterday the years of legal challenges to the vast Carmichael coal project, now revealed to have been funded by multi-million-dollar foundations in the US, “will certainly dampen future investments” from India.

Federal ministers and the Queensland Premier, Annastacia Palaszczuk, have warned of the danger posed by activists to jobs and investment, and questioned the links between the Australian groups, through their US funders, to the chairman of Hillary Clinton’s Democratic election campaign, John Podesta.

Gold miner Zijin stands out as overseas acquisition pioneer – by Eric Ng (South China Morning Post – October 21, 2016)

October 21, 2016

http://www.scmp.com/

Chinese gold mining firms have said for years they have been on the overseas acquisition trail, especially as the recent crash in commodity prices has sent asset prices tumbling. Few have managed to land any gilt-edged deals on foreign turf – but Zijin Mining Group is now standing head and shoulders above the crowd as being able to buy at just the right time.

One of three state-backed gold miners listed on the Hong Kong stock exchange, Xiamen-based Zijin has also been by far the most aggressive.

The company has spent about 7.9 billion yuan since 2010 on 13 transactions, mainly buying stakes in gold and copper projects in the Democratic Republic of Congo, Australia, Tajikistan, Papua New Guinea, Peru and Canada, more than double the 3.3 billion yuan it has invested in domestic mines.

Goldman Sees China’s ‘Stealth’ Coal Bailout Lasting to 2020 (Bloomberg News – October 21, 2016)

October 21, 2016

http://www.bloomberg.com/

China’s coal production restrictions are a “stealth” bailout for miners and their creditors that may last until the end of the decade as the policies help boost prices, according to Goldman Sachs Group Inc.

Without government intervention, China’s coal industry wouldn’t be able to service the nearly 3 trillion yuan ($444 billion) in debt from investing in new mines before demand started to drop, the banks analysts including Christian Lelong wrote in an Oct. 20 note.
The twin goals of the mining restrictions have been to develop a “safe, solvent and efficient” industry and protect the country’s financial system from the risk of large-scale defaults, they wrote.

BHP Sees Imminent Turning Point in Nickel With Deficit Looming – by Rebecca Keenan (Bloomberg News – October 20, 2016)

October 21, 2016

http://www.bloomberg.com/

BHP Billiton Ltd., the world’s largest mining company, sees the nickel market swinging into deficit because of supply threats in the Philippines and growing demand from electric vehicles and stainless steel.

“There are signs that this year could be finally the turning point for nickel with many expecting the market to be in deficit and so starting the much needed re-balancing process,” Eduard Haegel, asset president of BHP’s Nickel West unit, said at a conference in Perth Thursday. “The welcome return to balance over the next few years should see further recovery in nickel prices.”

Nickel has rebounded more than a third from the intraday low in February this year, which was the cheapest in more than a decade. Prices have been buoyed as the market awaits the final results from a nationwide audit in the Philippines, the world’s largest producer, which was ordered by President Rodrigo Duterte to ensure suppliers aren’t flouting environmental rules.

PHL nickel supply to depend on government mining policies – by Cai Ordinario (Business Mirror – October 21, 2016)

October 21, 2016

THE Philippines’s nickel supply in the next few years will depend on mining policies implemented in the country, the World Bank said.

In its latest Commodity Markets Outlook, the World Bank said the suspension of operations of several mining firms by the Department of Environment and Natural Resources (DENR) has already resulted in economic losses for the country. Nickel prices, the World Bank added, surged 16 percent due to strong stainless-steel demand, which the Philippines missed out on due to the suspensions.

“The nickel market had already moved into deficit with falling production output in the Philippines due to depletion, and declining NPI [nickel pig iron] production in China,” the World Bank said. The suspension of mining permits has effectively suspended 55 percent of the country’s nickel production, equivalent to over 10 percent of global supply, the bank added.

Exclusive: Production slowing fast at Myanmar mine that rattled tin market – by Yimou Lee and Antoni Slodkowski (Reuters U.S. – October 18, 2016)

October 18, 2016

http://www.reuters.com/

MAN MAW, MYANMAR – Output from a mysterious Myanmar tin mine that has disrupted the global market in the metal is falling sharply and deposits could be depleted in “two to three years”, senior mine officials told Reuters.

A surprise discovery of large quantities of tin has propelled the formerly isolated Southeast Asian country into the position of third largest producer of the industrial metal, and contributed to a sharp fall in prices in the last three years.

Much of it comes from the Man Maw mine deep inside the self-proclaimed “Wa State”, a secretive, China-dominated statelet the size of Belgium controlled by Myanmar’s most powerful ethnic armed group, the 30,000-strong United Wa State Army (UWSA).

India poised to become centre for rough diamond trading? – by Melvyn Reggie Thomas (Times of India – October 18, 2016)

October 18, 2016

http://timesofindia.indiatimes.com/

SURAT: Will the Special Notified Zone (SNZ) become the centre for rough diamond trading? It seems so, after the Russian President Vladimir Putin and Prime Minister Narendra Modi discussed about strengthening bilateral diamond trade at the recently concluded BRICS summit in Goa.

Both India and Russia welcomed initiatives to promote direct trade in diamonds between the two countries and gave positive evaluation of the work of the SNZ at the Bharat Diamond Bourse (BDB) in Mumbai during the summit after noting active support of this project from Russian diamond company, ALROSA.

India is the world’s largest diamond cutting and polishing centre and one of ALROSA’s key trade partners. In 2015, companies with Indian capital purchased ALROSA’s rough diamonds for the total of US$ 1.5 billion, including US$ 575 million direct supplies to India.