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Indonesia to keep ban on nickel ore exports -govt officials – by Gayatri Suroyo and Bernadette Christina (Reuters U.K./Yahoo – September 1, 2015)

https://uk.finance.yahoo.com/

JAKARTA, Sept 1 (Reuters) – Indonesia will keep its export ban on nickel ore, contrary to recent media reports suggesting the country may relax curbs to prop up its slowing economy, senior government officials said.

Indonesia banned exports of unprocessed metal ores in early 2014 to force firms to develop smelters that would add value to the country’s resources and create jobs. But the curbs cost the country billions of dollars in lost revenue last year.

While there are signs the government is trying to bring more money back into resources, the Chief Economics Minister Darmin Nasution warned against speculation that the country would relax its nickel ore export ban.

Indonesia will seek consistency in its mining policies, he said on Tuesday, a view echoed by Mining Minister Sudirman Said.

“What we’re doing is looking for incentive to boost economic activities in nickel and bauxite business.

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India Invites Australia Firms to Partner in Developing Mining Sector (The New Indian Express – September 1, 2015)

http://www.newindianexpress.com/

NEW DELHI: Steel and Mines Minister Narendra Singh Tomar today invited Australian companies to partner with their Indian counterparts to develop the domestic mining and exploration sector.

Tomar in his inaugural address at the Asia Pacific International Mining Exhibition (AIMEX) 2015 in Sydney today said that India and Australia can forge mutually beneficial relationships, an official statement said.

The Minister is leading a delegation, comprising heads of mining organisations and ministry officials to AIMEX 2015 — the world’s largest mining exhibition, it added.

“The total trade between India and Australia in 2013-14 was to the tune of 15 billion Australian dollars. We are hopeful that by forging mutually beneficial alliances, India will go on to feature in the top ten trade partners of Australia,” the statement quoted the Minister as saying.

India Day event was organised at the four-day exhibition with the objective of inviting proactive partnership of miners and explorers from across the world in the Indian mining industry, the statement said.

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Lynas CEO Digs In as Rare-Earth Prices Slump – by Rhiannon Hoyle (Wall Street Journal – September 1, 2015)

http://www.wsj.com/

CEO Amanda Lacaze says it is time for Lynas to invest more in sales and marketing to grow the business

SYDNEY—As rare-earths miner Molycorp Inc. looks to wind down production at its U.S. mine, Lynas Corp. Ltd., the only other producer outside of China, hopes to do the opposite and raise its output of elements used in batteries, magnets and other high-tech products.

To accomplish that goal, the Australian-listed miner plans to do one crucial thing: “Go out there and sell,” said Chief Executive Amanda Lacaze, in an interview.

Lynas, a former market darling, has found it tough to become a major competitor in the global rare-earths market.

The company was founded with an eye to breaking China’s stranglehold on the industry: The world’s second-largest economy has accounted for more than 90% of world-wide supply in recent times. But it took nearly a decade of development before Lynas began operations at its refinery in Malaysia’s Pahang state in late 2012.

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Copper slump continues amid waning Chinese demand – by Rachelle Younglai (Globe and Mail – August 31, 2015)

The Globe and Mail is Canada’s national newspaper with the second largest broadsheet circulation in the country. It has enormous influence on Canada’s political and business elite.

Copper used to be considered one of the relatively bright spots in the recent downturn of commodity prices. But now it is becoming yet another victim of China’s slowing economy, and the future looks bleak.

“There was always this belief that the deceleration in the Chinese manufacturing sector was going to not just stabilize, but there was this hope that we would see a modest reacceleration,” said John Mothersole, a research director with consultancy IHS, who specializes in metal price analysis and forecasting. “Markets are coming to realize that those expectations were falsely held,” he said.

Copper, like other commodities, has been on a decline since 2011. This year, the red metal is down 20 per cent.

The metal, used in power generation, cars and construction, has dropped as low as $2.20 (U.S.) a pound – the break-even price for some producers.

The main problem is the surplus of copper in the market along with excess capacity in the Chinese copper industry.

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[Philippines Nickel Laterite Mining] King Of Ore: Despite Nickel Asia’s Raids, Zamora Did Not Retreat (Forbes Magazine – August 26, 2015)

http://www.forbes.com/

Jose Anievas still remembers Oct. 3, 2011 quite vividly. Early in the morning that fateful Monday, the chief operating officer of [prisoners of war] was seized by New People’s Army (NPA) rebels who raided the company’s sprawling open-pit mining site in Claver, Surigao del Norte in Mindanao.

“We were being lectured on how POWs [prisoners of war] should behave when we noticed thick smoke rising in the sky,” recalls Anievas, then the resident manager at Nickel Asia’s Taganito mine, the Philippines’ biggest nickel producer last year: About 200 NPA men and women descended on the mine and burned construction cranes, hauling trucks, barges and four buildings.

The rebels did a lot of damage–about $11 million worth of assets went up in smoke. But they failed to destroy the foundation and steel framework of the nickel refinery being built by Sumitomo and Mitsui & Co. in partnership with Nickel Asia.

The NPA members took hostages, including Anievas, an experienced mining engineer who was forced to march with the rebels deep into the forest. The hostages were used as human shields to keep away pursuing government troops. Their agony lasted almost ten hours. It was nightfall when they were released in a densely forested mountain ridge.

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COLUMN-Worried about China? Ask a metals trader – by Andy Home (Reuters U.S. – August 26, 2015)

http://www.reuters.com/

Aug 26 (Reuters) – Everyone’s worried about China. Collective concern about what exactly is happening in the world’s second-largest economy is roiling all parts of the financial universe.

Industrial metal markets have not been immune and the price of copper, viewed by many investors as a proxy for industrial activity, hit a fresh six-year low of $4,855 per tonne on Monday.

But while the rest of the world seems shocked that all is not as it should be in the industrial powerhouse that is China, metal traders have been grappling all year with the implications of a Chinese slowdown.

The omens were there as early as January, when London copper prices fell almost 12 percent in two days after a bear attack led by Chinese funds. They were expressing what with hindsight looks a good call on the impact on Chinese demand of weakness in key metallic parts of the economy such as construction, automotive and manufacturing.

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For Emerging Markets, 2015 Isn’t 1997 – by Greg Ip (Wall Street Journal – August 26, 2015)

http://www.wsj.com/

Echoes of 1997 exist, but financial crisis is less of a risk today than economic stagnation

The Federal Reserve was planning to raise interest rates, oil prices were sinking, and an emerging Asian country devalued its currency.

For emerging markets, there are unsettling similarities between 1997, when Thailand’s devaluation touched off a crisis that engulfed Asia and eventually Russia and Latin America, and the present, when China’s devaluation has triggered selloffs in currencies, stocks and bonds.

The good news is that a lot has changed since then. Today, falling currencies aren’t a sign of a brewing crisis, but a welcome shock absorber. The bad news is that China’s slowdown and the accompanying slump in commodity prices are exposing structural weaknesses that emerging economies have neglected for too long.

For emerging markets, the Fed’s apparent determination to tighten monetary policy stirs unpleasant memories. In 1981-82, 1994, and 1997-98, the fact or fear of higher U.S. interest rates squeezed countries and companies that borrowed in dollars, precipitating crises.

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[History] How Silver Wrecked China – by Stephen Mihm (Bloomberg View – August 25, 2015)

http://www.bloombergview.com/

China’s devaluation of the yuan last week surprised many market observers. The yuan, which is pegged to the dollar, had been rising in tandem with the U.S. currency — in part because of expectations the Federal Reserve will increase interest rates soon. With China’s economy slowing, currency markets were pressing for the yuan to depreciate, and the Chinese government, seeking to boost competitiveness in export markets, gave in to the pressure and moved the peg.

This isn’t the first time the two countries’ monetary policies have been closely intertwined. In the Great Depression, China found itself vulnerable to the price of silver, thanks to the misguided moves of U.S. policy makers.

The Great Depression was a global crisis — almost. Every significant economy was devastated, with one notable exception: China. The reason was simple. In 1929, the U.S. and every other major nation pegged their currencies to gold. As the economic historian Barry Eichengreen has described, adherence to this standard punished countries by imposing “golden fetters” that led to crippling deflation. The fixed exchange rates of the gold standard helped transmit the monetary shocks around the world.

China, alone among the world’s major economies, operated under a silver standard in which the currency was pegged to a specific weight of that metal.

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China, US Seek ‘Clean Coal’ Agreement as Industry Struggles (Associated Press/New York Times – August 25, 2015)

http://www.nytimes.com/

BILLINGS, Mont. — U.S. and China officials took a major step Tuesday toward an agreement to advance “clean coal” technologies that purport to reduce the fuel’s contribution to climate change — and could offer a potential lifeline for an industry that’s seen its fortunes fade.

The agreement between the U.S. Department of Energy and China’s National Energy Administration would allow the two nations to share their results as they refine technologies to capture the greenhouse gases produced from burning coal, said Christopher Smith, the Energy Department’s assistant secretary for fossil energy.

Terms of the deal were finalized late Tuesday. Officials said it would be signed at a later date.

Smith spoke after he and other senior officials from President Barack Obama’s administration met with representatives of China’s National Energy Administration during an industry forum in Billings. The discussions took place near one of the largest coal reserves in the world — the Powder River Basin of Montana and Wyoming, where massive strip mines produce roughly 40 percent of the coal burned in the U.S.

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Iron and Steel: BHP’s big admission – by Kip Keen (Mineweb.com – August 26, 2015)

http://www.mineweb.com/

Steel demand in China is expected to be what BHP once thought.

HALIFAX – Just a couple of weeks ago I argued BHP and Rio should defend – in detail – their bullish steel demand forecasts in China given the growing number of forecasters that say the peak has already past.

Recall that Rio Tinto and BHP have long stuck to forecasts putting peak steel demand in China at, or over, a billion tonnes a decade or so from now. Others see it behind us already.

Well, I haven’t seen that defense, yet. We got a major revision of steel demand announced to the market instead.

In outlining its year-end financials August 25, BHP slashed its forecast of Chinese demand a decade or so from now by some 100 million tonnes steel.

A half year ago BHP argued peak demand would come in the mid-2020s somewhere around 1 billion to 1.1 billion tonnes.

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Corruption, Death and Tin Mining – by Yoga Rusmana (Bloomberg News – August 25, 2015)

http://www.bloomberg.com/

At the end of a muddy track through plantations of oil-palm and cocoa on the Indonesian island of Bangka, three dozen men on wooden rafts off the beach are dredging black sand from the shallow bay.

The workers, near the village of Sungai Liat, are among hundreds of illegal tin miners on the island, the first link in a chain of trucks, smelters and fishing boats that smuggles the metal out of the country. Backed by a complex web of corruption and international payments, the dark sediment is transformed into the solder that ultimately ends up binding the electronics in everything from smartphones to cars.

The trail begins on two islands off the coast of Sumatra in a sea channel that connects Indonesia’s capital, Jakarta, to Singapore and Malaysia. These islands, called Bangka and Belitung, produce more than 90 percent of the tin in Indonesia, which is the world’s biggest exporter of the metal.

Most of that production comes from mining companies such as PT Timah, the world’s third-largest producer. Pits those operators abandoned and more marginal deposits are worked illegally by men and children using diesel-powered equipment on floating platforms off remote stretches of coast, or with high-pressure hoses on land.

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Family of former Centerra Gold CEO fears he will be ‘kidnapped’ to Kyrgyzstan – by Drew Hasselback (National Post – August 26, 2015)

The National Post is Canada’s second largest national paper.

The family of former Centerra Gold chief executive Len Homeniuk says he has been re-arrested in Bulgaria and fears he may be spirited away to Kyrgyzstan.

Homeniuk, who last week spoke with the Financial Post, spent 11 days in prison after he was arrested on July 27 in the Bulgarian town of Vidin, near the border of Romania. He was later transferred to house detention in a small apartment in the capital, Sofia.

Family members now say Homeniuk was re-arrested at that apartment at 9:30 local time Monday night, then whisked back to Vidin on Tuesday.

It’s the latest twist in a saga in which the former mining executive, who holds dual U.S.-Canadian citizenship, seems to be a pawn in on-going talks over the fate of a gold mine in Kyrgyzstan, a rugged Central Asian republic located along the Silk Road.

Marina Stephens, Homeniuk’s wife, was with him when the police came Monday night, and was able to visit him at the police station a short while later.

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COLUMN-BHP downgrades China steel forecast but keeps iron ore strategy – by Clyde Russell (Reuters U.S. – August 25, 2015)

http://www.reuters.com/

LAUNCESTON, Australia, Aug 26 (Reuters) – One of the first steps in recovering from a debilitating condition like alcoholism is admitting you have a problem. It seems BHP Billiton has finally started down this path with iron ore.

In announcing a 52-percent plunge in annual profit on Tuesday, Chief Executive Andrew Mackenzie also lowered BHP’s forecast for the peak in Chinese steel output to between 935 and 985 million tonnes by the mid-2020s.

This was down from the previously long held target of 1 to 1.1 billion tonnes that had underpinned BHP’s massive expansion of its iron ore mines, which has more than doubled output in the past five years to a total of 254 million tonnes in the 2014-15 financial year.

The scaling back of BHP’s China steel forecast leaves Sam Walsh, the chief executive of rival Rio Tinto, as one of the last holdouts for a peak above 1 billion tonnes.

Walsh said after releasing Rio’s results, which saw a 43-percent drop in underlying earnings, that his company was “holding the line” on the 1 billion tonne by 2030 forecast, saying this represented growth of just 1 percent per year over the period.

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Can You Read China? Top Mining CEOs Disagree on Biggest Customer – by Thomas Biesheuvel (Bloomberg News – August 25, 2015)

http://www.bloomberg.com/

What on earth is going on in China?

Two of the biggest mining companies feeding the country’s appetite for raw materials can’t even agree on whether there’s an answer to the question.

Andrew Mackenzie, head of BHP Billiton Ltd., is bullish on his ability to comprehend a country that consumes more commodities than any other — and whose economic woes have shaken markets around the globe this week.

“We don’t find China impossible to read,” Mackenzie, chief executive officer of the world’s biggest mining company, said Tuesday.“We’ve been at this game for decades.”

His certainty conflicts with billionaire mining rival Ivan Glasenberg’s admission last week that he couldn’t read the world’s second-largest economy right now and neither could anyone else.

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Commodity rout unlike 2008 recession, no China to the rescue – by Clyde Russell (Reuters U.S. – August 24, 2015)

http://www.reuters.com/

LAUNCESTON, AUSTRALIA – With the prices of many major commodities currently plumbing depths last seen six years ago, what are the chances of a repeat of the China-led boom that lifted resources out of the 2008 recession funk?

To answer the question it’s worth looking at what is the same and what is different about the weakness in commodity prices between 2008-09 and now, and the answer is not much is the same.

The main similarity is simply that prices are weak and have fallen precipitously in a relatively short period of time. Brent crude fell by about 75 percent between the all-time high in July 2008 and the low in December that year.

So far it has dropped about 52 percent from the last year’s peak in June to the close of $45.46 a barrel on Aug. 21.

Benchmark London copper futures dropped about 67 percent between July and December in 2008, and they have slumped 22 percent since July this year to the close of $5,055 a tonne on Aug. 21.

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