Asia Mining – Page 138 – Republic of Mining

BHP to open new coal mine in Borneo amid concern for orangutans – by Peter Ker (Sydney Morning Herald – July 22, 2015)

July 22, 2015

http://www.smh.com.au/

If you thought Shenhua and Adani had raised hackles with their plans to develop new coal mines in controversial parts of Australia, you ain’t seen nothing yet.

In a move likely to enrage environmental campaigners, BHP Billiton quietly flagged on Wednesday that it would soon start production of coal at the Haju mine in Indonesian Borneo. Haju will initially produce about 1 million tonnes of coal a year, which is pretty small compared to the coal mines BHP already operates in Queensland.

But Haju could be the start of a much larger coal project for BHP in Indonesian Borneo known as IndoMet, which is believed to have potential to produce around 5 million tonnes of coal per year, if it is ever fully developed.

That remains a big “if” given the depressed prices for coal, but Wednesday’s confirmation that first production will begin within 12 months will be a blow to environmental campaigners who have lobbied BHP and its joint venture partner Adaro Energy for the best part of a decade to abandon the project.

India Looks to Central Asia for Uranium Mining – by John C. K. Daly (Silk Road Reporters – July 21, 2015)

July 21, 2015

http://www.silkroadreporters.com/

While attending back-to-back BRICS and Shanghai Cooperation Organization (SCO) summits in Ufa, Russia on July 8-10, Indian Prime Minister Narendra Modi also took the time to visit Kazakhstan, Turkmenistan, Uzbekistan, Tajikistan and Kyrgyzstan. The significance of the visit is that ever since the former Soviet Central Asia states became independent in 1991, no Indian Prime Minister has visited all five Central Asian countries simultaneously.

Not surprisingly, the visits focused on increasing bilateral trade, with energy being a significant component of the talks. But while significant hydrocarbon exports remain in the future due to costs and infrastructure development, Modi scored significant successes in both Kazakhstan and Uzbekistan over a portable “cash and carry” energy source – uranium.

In Astana Modi signed five agreements covering defense, railways and uranium supplies. After talks with Kazakh president Nursultan Nazarbayev Modi said, “We are pleased to have a much larger second contract for purchase of uranium with Kazakhstan and expanding our civil nuclear cooperation. Kazakhstan is our biggest economic partner in the region. We will work together to take economic ties to a new level.” The agreement provides for Kazakhstan’s state-owned NAC Kazatomprom nuclear company to deliver 5,000 tons of uranium between 2015 and 2019.

After China dumps gold, don’t count on India to come to the rescue – by MANOLO SERAPIO JR AND RAJENDRA JADHAV (Reuters India – July 21, 2015)

July 21, 2015

http://in.reuters.com/

MANILA/MUMBAI – Blame poor rains or a lack of weddings, but Indians, for whom gold is the investment of choice, aren’t rushing to buy bullion after this week’s sharp sell-off.

India and China are the world’s top gold buyers and, after massive selling on the Shanghai Gold Exchange on Monday helped drive down gold prices by 4 percent to a 5-year low, traders hoped demand would perk up in India, or elsewhere in Asia.

The last big slide in gold prices – a 13 percent drop in just two consecutive trading days in April 2013 – prompted weeks of long queues of Indians outside gold showrooms.

Not this time. India’s gold appetite – it accounts for more than a fifth of global demand – remains sluggish, with only modest local premiums to the global spot benchmark.

“That’s really a bearish sign, when the main consuming region remains on the sidelines after such a price drop to a multi-year low,” Commerzbank senior oil analyst Carsten Fritsch told the Reuters Global Gold Forum on Tuesday.

Chinese Nickel Imports Jump to 6-Year High as Shortage Looms (Bloomberg News – July 21, 2015)

July 21, 2015

http://www.bloomberg.com/

China imported the most refined nickel in six years in a further sign that the world’s biggest consumer is drawing on global supply. Futures rose 2.4 percent in London.

Inbound shipments of the metal used to produce stainless steel surged 67 percent to 38,545 tons in June from the previous month, the highest since July 2009, and were more than three times the level a year earlier, Chinese customs data show.

Goldman Sachs Group Inc. and Citigroup Inc. are bullish on prices amid prospects for rising Chinese demand. Macquarie Group Ltd. sees a global shortage which may cut inventories further from a record. Stockpiles in London Metal Exchange sheds have already fallen to the lowest in almost two months. Some imports may have been for delivery against the first nickel contract to expire on the Shanghai bourse, said Celia Wang from Tianjin Zhongwei Group’s investment department.

“Huge imports arrived in China from LME warehouses as traders seek profits by delivering against the first settlement of a Shanghai nickel futures contract,” said Wang, the general manager. “Refined nickel imports are expected to remain at a high level into July.”

Iron Ore Supply to Overwhelm Weak China Demand, Goldman Predicts – by Jake Lloyd-Smith (Bloomberg News – July 20, 2015)

July 21, 2015

http://www.bloomberg.com/

Rising seaborne iron ore supplies over the next two quarters will probably overwhelm weak demand from mills in China, according to Goldman Sachs Group Inc., which said that a global glut was entering its second year.

While housing starts in China have recovered and infrastructure has overtaken property to become the largest market for steel, an improvement this half may not be strong enough to support iron ore, the bank said in a report. Prices are seen dropping over the next four quarters, from $49 a metric ton through September to $44 by the April-to-June period of 2016, according to analysts Christian Lelong and Amber Cai.

Iron ore sank to the lowest since 2009 this month amid concern that the biggest mining companies including Rio Tinto Group, BHP Billiton Ltd. and Vale SA are intent on boosting low-cost supply even as demand falters.

Imports by China fell in the first six months of the year, while local mills sold a record amount of output overseas. BHP, which is set to report quarterly production data tomorrow, said on Tuesday it’s spending $240 million to upgrade tug-boat operations at Port Hedland.

Mitsubishi Materials apologizes for using U.S. POWs as slave labor – by Mariko Lochridge (Reuters U.S. – July 20, 2015)

July 14, 2016July 20, 2015

http://www.reuters.com/

LOS ANGELES – Construction company Mitsubishi Materials Corp (5711.T) became the first major Japanese company to apologize for using captured American soldiers as slave laborers during World War Two, offering remorse on Sunday for “the tragic events in our past.”

A company representative offered the apology on behalf of its predecessor, Mitsubishi Mining Co, at a special ceremony at a Los Angeles museum.

“Today we apologize remorsefully for the tragic events in our past,” Mitsubishi Materials Senior Executive Officer Hikaru Kimura told an audience at the Simon Wiesenthal Center’s Museum of Tolerance in Los Angeles.

In all, about 12,000 American prisoners of war were put into forced labor by the Japanese government and private companies seeking to fill a wartime labor shortage, of whom more than 1,100 died, said Rabbi Abraham Cooper, an associate dean at the Simon Wiesenthal Center.

Six prisoner-of-war camps in Japan were linked to the Mitsubishi conglomerate during the war, and they held 2,041 prisoners, more than 1,000 of whom were American, according to nonprofit research center Asia Policy Point.

Coal India aiming to double output to one-billion tons a year by 2020 – by Ajoy K Das (MiningWeekly.com – July 17, 2015)

July 20, 2015

http://www.miningweekly.com/page/americas-home

KOLKATA (miningweekly.com) – Coal India Limited (CIL) dreams of producing one-billion tons of coal a year by 2020, and, as the sixth-largest miner in the world, having big dreams is not unusual. However, if past performance is seen as an indicator of future performance, then it has a lot of sceptics to prove wrong.

“CIL’s major challenge is to meet the rising demand from the power sector . . . and this is how the dream of achieving the one-billion-tons-a-year coal production [target] began,” the miner states in its Roadmap for Enhancement of Coal Production.

“The idea of ramping up production germinated at grassroots level and traversed up, growing bigger as the possible potential was realised,” the vision document adds.

With a current production of 494-million tons a year, the target centres on achieving a 15% compound average annual growth rate (CAGR). However, the road ahead may not be that easy as, over the past five years, CIL’s yearly growth rate has averaged between 0% and 7%, with the latter achieved only in the previous fiscal year.

POSCO may scrap planned $12 billion India steel project – by KRISHNA N. DAS AND JATINDRA DASH (Reuters India – July 16, 2015)

July 17, 2015

http://in.reuters.com/

NEW DELHI/BHUBANESWAR, INDIA – South Korean steelmaker POSCO could scrap plans for a $12 billion project it agreed to set up in India a decade ago, after a new law made it costlier to source iron ore for the plant, a company spokesman told Reuters.

The U.S.-listed shares of POSCO fell as much as 3.3 percent to their lowest in more than six and a half years after the report.

The 2005 project to set up a steel plant in Odisha state was billed as India’s biggest foreign direct investment at the time, but it has encountered a series of delays.

The company waited almost a decade to acquire land for the proposed 12 million-tonnes-a-year steel plant due to opposition from local tribal groups.

A mining law enacted in March by India means the company would now also have to buy a mining license in an auction. Originally, the Odisha government had promised to help the company obtain the licence for free.

Vale’s designs on China add to Rio, BHP drive for more iron ore – by James Regan (Reuters U.S. – July 15, 2015)

July 16, 2015

http://www.reuters.com/

SYDNEY – As Rio Tinto and BHP Billiton ship more iron ore than ever to China, the Australia mining giants face a fightback from Brazil’s Vale for market share that threatens to drive already weak prices even lower.

Rio Tinto and BHP, which will release quarterly production data this week and next, have been racing to keep up exports to boost profits while lower prices eat into margins.

They now face stiffer competition from Vale, which is also working its mines harder, after the world’s biggest producer won approval for its giant Valemax ships to unload in China, cutting down on freight costs.

With a capacity of 400,000 tonnes each, the 34 Valemaxes are the world’s biggest bulk carriers and twice the size of vessels used by Rio and BHP, but a ban on entering Chinese ports had severely curbed the cost efficiencies of the larger ships.

“BHP and Rio have been looking to raise volumes in this environment to maximize every tonne,” said Morgans Financial analyst James Wilson.

Nickel’s fightback begins but obstacles loom – by Pratima Desai (Reuters U.S. – July 15, 2015)

July 15, 2015

http://www.reuters.com/

LONDON, July 15 (Reuters) – Prospects for tighter nickel supplies may have put a floor under prices but any real recovery will need Chinese stainless steel mills to step up their orders and global stockpiles to fall.

Benchmark nickel on the London Metal Exchange fell to six-year lows of $10,430 a tonne last week on worries about demand, particularly after a tumble in Chinese equities.

Prices have climbed back to around $11,500 yet remain at just half the $21,625 hit in May 2014 after Indonesia banned nickel ore exports.

The sell-off that followed that peak was triggered by suppliers in the Philippines who moved to supply ore to Chinese smelters, which produce nickel pig iron, a cheaper alternative to refined nickel that costs around $15,000 a tonne to make.

Chinese nickel pig-iron producers are losing money and have cut output. Analysts estimate China’s nickel pig-iron production fell about 25 percent year on year between January and May to below 170,000 tonnes.

Indian iron-ore miners rush to steelmaking sector – by Ajoy K Das (MiningWeekly.com July 14, 2015)

July 15, 2015

http://www.miningweekly.com/page/americas-home

KOLKATA (miningweekly.com) – India’s standalone miners have been galvanized to take a slice of the domestic steelmaking pie.

All large government-owned and managed miners with large iron-ore portfolios have been in touch with their respective controlling authorities seeking to spread their strategic investments into steel production, an official in the Ministry of Steel said.

Every iron-ore, manganese and chrome ore miner was scouting for opportunities to invest in large steel mills, based on the perception that the current downturn in global commodity prices could be prolonged, making it an opportune time for capital investments in downstream production and to hedge against margin erosion from just raw material production, he added.

NMDC Limited, the largest domestic iron-ore miner and under administrative control of the Steel Ministry, has sought government approval to participate in the planned special purpose vehicles (SPVs) for construction of mega steel plants across India’s mineral-rich provinces.

The Steel Ministry has already announced the creation of SPVs in Jharkhand, Chhattisgarh, Odisha and Karnataka to put up steel mills that each have a capacity of about 10-million tonnes a year with an investment of $7-billion to $8-billion riding on each.

The Latest Sign That Coal Is Getting Killed – by Tom Randall (Bloomberg News – July 13, 2015)

July 14, 2015

http://www.bloomberg.com/

Coal is a sick dragon, and the bond market wields a heavy sword

Coal is having a hard time lately. U.S. power plants are switching to natural gas, environmental restrictions are kicking in, and the industry is being derided as the world’s No. 1 climate criminal. Prices have crashed, sure, but for a real sense of coal’s diminishing prospects, check out what’s happening in the bond market.

Bonds are where coal companies turn to raise money for such things as new mines and environmental cleanups. But investors are increasingly reluctant to lend to them. Coal bond prices tumbled 17 percent in the second quarter, according to an analysis by Bloomberg Intelligence. It’s the fourth consecutive quarter of price declines and the worst performance of any industry group by a long shot.

Bonds fluctuate less than stocks, because the payoff is fixed and pretty much guaranteed as long as the borrower remains solvent. A 17 percent decline is huge, and it happened at a time when other energy bonds—oil and gas—were rising. Three of America’s biggest coal producers had the worst-performing bonds for the quarter:

China imports of coal go into steep decline but there’s a silver lining for Australia – by Angus Grigg (Australian Financial Review – July 13, 2015)

July 13, 2015

http://www.afr.com/

China is demanding less coal and more wheat.

That’s the key message from first-half trade data released on Monday by the Customs Bureau, which showed China’s overall imports remained weak while exports were only marginally better.

In US dollar terms the value of trade in the world’s second biggest economy fell 6.9 per cent over the first half of the year as wheat imports surged and coal declined.

For Australia, these wildly divergent statistics are hard to ignore. Over the first six months of the year, the volume of China’s coal imports fell 37.5 per cent compared to the same period in 2014.

The volume of wheat imports was up 66.5 per cent over the same period. For coal, the decline is a combination of protectionism and falling domestic demand.

Shock and ore: What iron ore’s 10% rebound means – by Nyshka Chandran (CNBC.com – July 9, 2015)

July 13, 2015

http://www.cnbc.com/

Iron ore’s near 10 percent rebound on Thursday following a horror streak this week left strategists debating whether more pain is in store for the beleaguered commodity.

Benchmark ore for delivery to the Chinese port of Tianjin ended a ten-day rout overnight, rising to $48.30 a ton, a 9.5 percent increase from an all-time record low of $44.10 hit in the previous session.

Major banks like Citigroup remain bearish, predicting prices to fall below $40 a ton this year due to the commodity’s fundamental oversupply. HSBC meanwhile expects prices to trade around $45 during the third quarter. “We expect the market to go into oversupply and shake out mode again,” it said in a report this week.

But some analysts are optimistic.

“A near 10 percent bounce suggests people will think iron ore is now relatively cheap. A market that breaks to new lows and stays low is very weak, but to see such a bounce suggests there’s more comfort.

Time to Tackle Rare Earth’s Toxic Underbelly – by Matthew J. Kiernan (Huffington Post – July 9, 2015)

July 10, 2015

http://www.huffingtonpost.com/business/

Matthew J. Kiernan is the Founder and Chief Executive of Inflection Point Capital Management

On April 2, 2015, the BBC ran an investigative report that illustrated rare earth mining’s trail of destruction. Whilst it was not the first time that the toxicity of rare earth mining had been the subject of scrutiny, the graphic portrayal of a man-made toxic lake on the outskirts of Baotou in Mongolia, should be a wake-up call for consumers of digital TVs, computers and smart phones, which are the major users of rare earth elements.

BBC’s piece was written by Tim Maughan, who had received support from Unknown Fields Division, an NGO that has a track record of going to the farthest flung regions of the world to uncover hidden secrets. It is estimated that Baotou is the centre of production of half of China’s rare earth elements, with one tonne of rare earth elements producing 2,000 tonnes of toxic waste.

Baotou’s toxic lake raises the important question; how is that such important commodities continue to be mined with such low environmental standards? Rare earth mining has long been dominated by China, which up until recently produced over 90 percent of global production.