Asia Mining – Page 165 – Republic of Mining

Investors return to Indonesia, but World Bank warns of challenges – by Peter Alford (The Australian – March 24, 2014)

March 24, 2014

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

WHILE a resumption of strong portfolio flows so far this year suggests the Indonesia story is getting renewed and favourable consideration from foreign investors, the World Bank has warned the country faces a highly challenging 2014.

The bank’s new Indonesian Economic Quarterly, pointedly titled Investment in Flux, appears as investment confidence, domestic and foreign, has got another lift from the confirmation of Jakarta governor Joko Widodo will contest, and most likely win, the 2014 presidential race.

The decision by Indonesian Democratic Party of Struggle doyenne Megawati Sukarnoputri that “Jokowi” — not she — would carry the party’s banner in July lifted the Jakarta stockmarket 4 per cent in the final two hours of trade on Friday, while the currency strengthened nearly 2 per cent against the US dollar.

The 52-year-old former small businessman from Jogjakarta is perceived by investors, domestic and foreign, as by far the most market rationalist of the main candidates. A Jokowi administration is expected to promote public-private investment in critically underfunded sectors like transport infrastructure and healthcare.

The Jokowi effect reinforces strengthening sentiment about Indonesia apparent since late January, which in turn reflects significant improvements in current account deficit, government fiscal deficit and inflation outlook since the third quarter of last year.

INSIGHT-Russia’s leading role in the Indonesian mining revolution – by Randy Fabi and Fergus Jensen (Reuters U.S. – March 23, 2014)

March 24, 2014

http://www.reuters.com/

JAKARTA, March 24 (Reuters) – Russia’s two metal giants have emerged as big winners from Indonesia’s new mining law, after leading a drive to get Jakarta to stick to its controversial mineral ore export ban in the face of opposition from miners and Asian buyers.

In its six-month lobbying campaign last year, United Company Rusal and Norilsk Nickel delivered a blunt message to Indonesian officials: We will only invest billions of dollars in smelters if you ban bauxite and nickel ore exports.

The effort seemed to have paid off, despite a denial by Indonesia that it was influenced. When the law came into effect this year, Indonesia enforced a water-tight export ban for only two major minerals – nickel ore and bauxite.

The halting of $3 billion of annual nickel ore and bauxite exports has already lifted the price of nickel and helped support aluminium, boosting the fortunes of Rusal and Norilsk, the world’s top aluminium and nickel producers, respectively.

At the same time, it has strengthened the case for the pair to invest billions of dollars in Indonesia to build smelters to replace costly capacity in Russia, a key part of a recovery plan for struggling Rusal and in line with Indonesia’s own aims to earn more from its minerals resources.

Rio Tinto Puts Indian Women in the Driver’s Seat – by Joe Kirschke (Engineering and Mining Journal – March 19, 2014)

March 21, 2014

http://www.e-mj.com/

India is no easy place to be a woman. Despite comprising a workforce majority in the teeming nation of 1.2 billion with equal rights under a 1949 constitution, India’s women are almost universally exploited while often denied access to health, education and other basic needs. Worse, the world’s second most populous nation looms among the most dangerous places for gender-based violence.

Madhya Pradesh, one of India’s poorest regions and home to Rio Tinto’s Bunder Diamond Project, is emblematic: In 2011, the National Crime Bureau recorded 3,406 assaults against women—surely a conservative figure, and the highest rate nationwide. But while meeting local women pending development of India’s No. 1 diamond resource the year before, Rio officials noticed another grouping: dozens of raised hands at a community meeting—all hoping for driving skills.

The diversified Anglo-Australian giant is now beating the curve in empowering women in a deeply tribal, hardscrabble land booming India has long since forgotten. Through community development, moreover, Rio Tinto is bringing a Corporate Social Responsibility (CSR) win-win for women in a trajectory where half marry before 18, and 60% of whom give birth within a year amid one of the highest infant mortality rates worldwide.

The story surrounding Rio’s CSR footprint in the 15 villages of 15,000 inhabitants each surrounding its Bunder site dates to 2006, two years after the discovery of porous volcanic outcroppings revealed the deposit.

Battle over Essar-led project reflects India’s new mining pains – by Nita Bhalla (Reuters India – March 20, 2014)

March 20, 2014

http://in.reuters.com/

MAHAN FOREST, India (Thomson Reuters Foundation) – With an axe on one shoulder and lugging a large log over the other, Bhajandhari Kushwaha emerges from the dense Mahan forest in central India with his dog by his side after a day of foraging and wood cutting.

For Kushwaha, the timber, leaves and seeds of this centuries-old forest not only sustain his family of five, they represent a vital part of his community’s cultural identity that has suddenly come under threat from two of India’s largest mining companies.

“This forest is our life. We get everything from it,” says the 45-year-old, vowing to fight plans by Mahan Coal Ltd (MCL) – jointly owned by London-listed Essar Energy Plc (ESSR.L) and the Aditya Birla-owned Hindalco Industries Ltd (HALC.NS) – to mine part of the 1,000-square-km (385-square-mile) woods for coal. “Whatever compensation the company is offering us, we do not want it. We will fight until we die, if that’s what it takes.”

It is a sentiment shared by many villagers in this dusty corner of Madhya Pradesh, a sign of growing popular resistance spurred by a new forest law that gives people a greater say over how natural resources are exploited.

PRESS RELEASE: Jinchuan International (02363.HK) Announces Annual Results for the Year Ended 31 December 2013

March 20, 2014

Revenue Increased by 21.2% to Approximately US$742.2 million

Profit Attributable to the Owners Increased approximately 354.7% to Approximately US$203.9 Million

Hong Kong, Mar 20, 2014 – (ACN Newswire) – Jinchuan Group International Resources Co. Ltd (the “Company”, together with its subsidiaries, collectively referred to “the Group” or “Jinchuan International”, Stock Code: 2362) today announced its annual results for the year ended 31 December 2013 (the period under review)*. For the year ended 31 December 2013, the Group’s revenue amounted to approximately US$742.2 million (2012: US$612.2 million), representing a significant increase of approximately 21.2%. This increase in revenue was due to the Group’s increased sales of copper from its operating mines and also the increase in trade volume from its international trade. Profit attributable to the owners of the company increased for approximately 354.7% to approximately US$203.9 million. Basic earnings per share was US cents 4.69 (2012: US cents 1.05 ). The Directors do not recommend final dividend for the year ended 31 December 2013.

Mr. Yang Zhiqiang, the Chairman of Jinchuan Group and the Chairman of the Board of the Directors and Chief Executive Officer of Jinchuan International said, “2013 was a landmark year for the Group’s transformation into a global metal mining company. To in line with the Company’s strategy to transform its business to the mineral and metal resources sector, the Group had completed acquisition from Jinchuan Group of a high grade copper and cobalt mining asset in Africa and had achieved turning its core business into a pure mining play, with its growing international metal related trading to support a steady revenue stream for the Group. The Group will continue to maintain high profitability through competitive differentiation strategies of copper business, to further optimize market segment and to broaden the scope of application of special copper metal.”

China doomsayers misguided and will be proven wrong – Vale CEO – by Juan Pablo Spinetto & David Biller (Mineweb.com/Bloomberg – March 20, 2014)

March 20, 2014

http://www.mineweb.com/

Vale CEO, Murilo Ferreira, says investors betting against China and its demand for iron ore from the company will be proven wrong.

Investors betting against China and the nation’s demand for iron-ore from top producer Vale SA will be proven wrong, Chief Executive Officer Murilo Ferreira said.

“The biggest enemy to our share price is a certain belief that China will be over,” Ferreira said during a presentation in Sao Paulo today. “They are once more betting against China as they did in 2004, 2005, 2006 and beyond and I think that people are going to fail again with their projections.”

Shares of Vale, which ships about half its iron ore and pellets to China, dropped to a five-year low earlier this month on concern a possible economic slowdown in the biggest buyer of the mineral will hurt sales. Iron-ore entered a bear market on March 7, losing 23 percent from a five-month high in August through today, as Australian miners including Rio Tinto Group boost supply and China tightens monetary conditions.

The world’s third-largest mining company has underperformed its main peers in the stock market for the past year as weakening demand growth in China and a multibillion-dollar tax dispute with Brazil weighed on investors’ confidence.

Jeb Handwerger: China Isn’t Slowing Down, It’s Buying Up (Resources, that Is) – Interview by Tom Armistead (The Energy Report – March 18, 2014)

March 19, 2014

http://www.theaureport.com/

Headlines about a Chinese economic slowdown may get good web traffic, but the real story is that China is buying up uranium and other resources around the world, says Gold Stock Trades writer Jeb Handwerger. Meanwhile, tensions in Russia highlight the massive country’s resource dominance in natural gas, oil, uranium, platinum group metals, rare earths and nickel. Handwerger tells The Mining Report that North America is already acting to develop resources that can meet both domestic and international demand—and this global geopolitical uncertainty is an investment opportunity.

The Mining Report: Jeb, how will the companies you follow be affected by the crisis in the Ukraine and the growing tensions in East Asia over China’s claims on islands held by Japan and the Philippines?

Jeb Handwerger: This is really all about natural resources and the ability to control the trade. There’s a whole list of 10 to 15 strategic minerals that come from China almost exclusively. Russia, on the other hand, has a major control on palladium, platinum group metals and nickel, as well some of the agricultural fertilizers, such as potash. Russia also has a critical supply of uranium; it produces about 3,000 tons of uranium, close to double United States production of uranium. Not only that, but Russia has strategic ties with Kazakhstan, which produces close to 20,000 tons of uranium—over 36% of global supply.

I’ve written for years that these metals and these materials are at risk of critical supply shortfall.

Australian Nickel Processor Eyes Indonesian Ore Piles – by James Regan (Jakarta Globe – March 18, 2014)

March 18, 2014

http://www.thejakartaglobe.com/

Perth. At a small plant on the outskirts of Perth, metallurgists have been turning raw ore shipped from top Indonesian nickel miner Aneka Tambang (Antam) into a concentrate to meet the country’s new export guidelines.

After a year of tests, Australia’s Direct Nickel says it has now entered into a joint venture with Antam for a feasibility study on building a full-scale plant on Indonesia’s Halmahera island using its new nitric acid-based technology.

The agreement comes as Antam struggles to meet Indonesia’s tough new export rules, which prevent the company from shipping raw mineral ore to Chinese nickel pig iron producers and instead demand it processes the ore before export.

“We could not have asked for a better time to start planning our first commercial plant in Indonesia,” said Direct Nickel Chief Executive Russell Debney. Antam has warned its nickel ore production could fall by as much as 87 percent this year as sales to China dry up due to the ban.

“What they want now is cheaper alternatives to enable them to apply to the government for concessions to keep exporting,” Debney said.

World Bank scornful of Indonesia’s mineral ore ban – by Jonathan Thatcher (Reuters India – March 18, 2014)

March 18, 2014

http://in.reuters.com/

JAKARTA – (Reuters) – The World Bank delivered a blunt assessment of Indonesia ban on mineral ore exports on Tuesday, warning that it would hit trade and government revenue and risked undermining already weak investor sentiment towards Southeast Asia’s biggest economy.

Implemented in January, five years after the law was initially passed, the ban has been met with confusion in the mining sector.

It was introduced to encourage mineral processing in Indonesia in order to increase the value of exports. But, one group of mining companies has mounted a legal challenge, warning that the ban on exports will force them out of business.

“The long term gains are at best uncertain,” Jakarta-based World Bank economist Jim Brumby said, adding there were no success stories elsewhere in the world where countries had tried to impose similar bans.

Brumby was speaking at the launch of the Bank’s quarterly economic report. The World Bank estimated that for the period 2014-2017, the negative impact on net trade could be $12.5 billion because of the loss of export revenue while capital goods imports, to build smelting capacity, will have to rise.

Juniors jump at chance in Mongolia – by Sarah-Jane Tasker (The Australian – March 18, 2014)

March 18, 2014

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

MONGOLIA — a landlocked country in central Asia — boomed as the resources cycle peaked but just as quickly as the investment flooded in, it flowed out as the government radically changed the rules.

Now, after years of largely being ignored by foreign investors, the country is trying to win favour with the global resources sector with another change of its rules — but this time in a move to say it is open for business.

David Paull, who heads junior Aspire Mining, has witnessed the rise and fall of Mongolia’s appeal in the competitive global resources space. Having penned an exploration deal in the country in October 2009, just weeks before a government agreement for the massive Oyu Tolgoi project was signed, Paull has been front row for the roller-coaster ride.

“It was a very hot environment, then it got extremely cold from mid-2012 onwards and that coincided with the fading of the global commodities boom,” he says.

Canada in Afghanistan: From digging trenches to digging mines? – by Murray Brewster (Canadian Press/CTV News – March 14, 2014)

March 14, 2014

http://kitchener.ctvnews.ca/

KABUL, Afghanistan – Canadians could go from digging trenches to helping dig gold and copper mines in Afghanistan if the Harper government has its way.

The country’s ambassador to Kabul signalled this week that the moribund Afghan economy will be a principal focus for Canada, which has formally ended its military mission.

The hope is to turn the page on a decade of military involvement and aid handouts in the desperately poor, war-torn nation. Standards which Canada has long promoted, education, good governance and women’s rights, will still be there, with an additional emphasis on business.

“Our diplomatic focus will also be on economic development,” said Deborah Lyons, who took over as Canada’s first woman ambassador to Afghanistan six months ago. The approach has the enthusiastic endorsement of Shamial Bantija, Afghanistan’s ambassador-designate to Canada and an economic adviser to President Hamid Karzai.

Roping in Canada for food security – by A. Didar Singh, (Deccan Herald – March 1, 2014)

March 13, 2014

http://www.deccanherald.com/ [India]

(The writer is secretary general, FICCI)

Indo-Canadian agriculture and food relationship has to move beyond a mere buyer-seller framework. Recent spurts in food prices suggest that a purely domestic strategy will not suffice for India’s food security, where food security refers to assured supply at stable prices.

There is, thus, clearly a need to find international partners in the agri-food segment, given the sheer volumes required going forward, and the diversity of this sector. Now, while an India-Canada energy relationship seems a natural tie and is much talked about, it is less apparent that the North American country can play an equally significant role in aiding India generate enough food for its populace. In fact, in some ways Canada does already play a real role in helping India increase the availability of food for its population, through its supply of pulses and fertilizer.

Despite Canada being mainly a services economy, the agri-food segment has emerged as a major driver of economic growth in Canada in recent years. Food processing and beverage industries are actually Canada’s largest manufacturing estate and also its greatest industrial employers. Given Canada’s relatively small population compared to the size of its agri-food sector one can imagine that the country has a rather lot of surplus produce that is available for export.

Secretive Chinese funds: a potent force in copper rout – by Polly Yam, Fayen Wong and Melanie Burton (Reuters India – March 13, 2014)

March 13, 2014

http://in.reuters.com/

HONG KONG/SHANGHAI/SYDNEY, March 13 (Reuters) – Chinese funds taking massive short positions played a powerful role in copper’s slide to around four-year lows this week, signalling the growing force of the sector in global commodities markets.

The funds had been building up bets against copper since December, according to sources at funds, futures dealers and analysts, in a market already edgy over slowing Chinese demand and fears that credit upheaval in the world’s second-biggest economy could unwind financing deals using the metal as collateral.

On Friday, funds and other speculators pounced and sold London Metal Exchange and Shanghai copper contracts heavily as they took advantage of worries over the Chinese credit market after a bond default by a solar equipment producer.

The scale of the sell off shows that Chinese funds are gaining greater sway over global commodity markets — influence that is likely to grow given China’s intention to liberalise the yuan and pilot projects for free trade zones.

Indonesia’s next leader unlikely to ease tough mineral export rules – by Rieka Rahadiana and Randy Fabi (Reuters India – March 12, 2014)

March 12, 2014

http://in.reuters.com/

(Reuters) – Indonesia’s next president is unlikely to make major changes to the country’s controversial mining rules, after major political parties backed an export ban that has led miners to halt $6 billion in annual mineral exports.

The broad political support will disappoint miners, like Freeport-McMoRan Copper & Gold, Newmont Mining Corp , that may have been hoping the tough new rules were only temporary measures imposed by a lame duck administration.

Political parties representing presidential front runners for the July election told Reuters they support the current government’s moves to ban mineral exports and tax concentrate shipments, aimed at forcing miners to build smelters in Indonesia.

Freeport has cut copper output by 60 percent due to a prolonged dispute over the export tax imposed by President Susilo Bambang Yudhoyono, who is barred from running for a third term.

Opinion polls show Jakarta Governor Joko Widodo of the Indonesian Democratic Party-Struggle (PDI-P) as the most popular presidential pick.

COLUMN-Sentiment diverges from fundamentals on China commodity imports – by Clyde Russell (Reuters U.S. – March 11, 2014)

March 11, 2014

http://www.reuters.com/

LAUNCESTON, Australia, March 11 (Reuters) – The reaction of commodities to the Chinese trade data show that sentiment and fundamentals are diverging, with the fear trade winning so far.

No matter which way you try and slice and dice it, China’s imports of commodities in the first two months of the year have been surprisingly strong.

But the market has chosen rather to focus on the February slide in merchandise exports from the world’s second-biggest economy, concluding that all isn’t well and therefore commodity imports will tumble in the coming months.

Add to this the view that much of the strength in imports of copper and iron ore was related to accessing financing rather than underlying demand, and suddenly you can turn large gains in imports into something negative for future demand.

The issue is whether the market is reading it correctly and the outlook for Chinese commodity demand is weak, or whether a more modest pullback in import growth is likely in the months ahead.