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Thursday, January 14, 2010
Today's News Headlines
* Cochilco revises up copper price forecast to US$3.10/lb in 2010 - Chile
* Australian authorities approve CSN's purchase of Riversdale stake - Brazil
* GFMS sees fresh gold highs in H1 on investment demand - Regional
* Precious and base metal prices slip Wed - Regional
* Tamsa expecting 60% increase in tube production - Mexico
* CAP stakeholder hopes for new partner to enter iron ore branch - Chile
* IN BRIEF Gerdau mum on devaluation effect at Sizuca - Brazil, Venezuela
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* Cochilco revises up copper price forecast to US$3.10/lb in 2010 - Chile
Chile's state copper commission Cochilco has raised its forecast for the average copper price this year to US$3.10/lb from its previous estimate of US$2.70/lb, the organization's director of research and public policy Ana María Zúñiga told reporters at a Santiago press conference Wednesday.
Zúñiga said the upward revision is because 2009 came to a close with a greater level of tightness between supply and demand than Cochilco had previously expected and because China showed stronger consumption than anticipated.
For 2011 Cochilco forecast an average copper price of US$3.20/lb on grounds that it expects demand to rise 6% compared to the year before, creating a global supply deficit of about 150,000t.
As for molybdenum, Cochilco said it expects global demand to slip 0.6% this year compared to 2009 but will rise about 6% in 2011, compared to 2010.
By Pablo Gaete
Business News Americas
* Australian authorities approve CSN's purchase of Riversdale stake - Brazil
Australian authorities have approved the second and final stage of Brazilian steelmaker CSN's (NYSE: SID) purchase of a stake in Australian coal producer Riversdale Mining (ASX: RIV), the former company reported in a release.
As a result, the deal is complete and CSN has a 16.3% indirect stake in Riversdale.
According to the release, CSN paid A$6.10 per share and the sale is reportedly worth a total of around US$176mn.
Riversdale produces 700,000t/y of anthracite coal in South Africa and has projects in Mozambique. Coal production of 2Mt/y in Mozambique is due to start in 2011 or 2012.
By Business News Americas staff reporters
* GFMS sees fresh gold highs in H1 on investment demand - Regional
UK-based metals consultancy GFMS predicts that the price of gold will rise above US$1,200/oz by the second quarter of 2010 and hit new records as growing levels of investment cash enter the gold market early in the year.
Investor demand for the yellow metal will be driven by fears of a "double dip" recession, continuing huge government deficits, very loose monetary policy and worries that major inflation will make a comeback, GFMS said in a summary of an update to its Gold Survey 2009 report.
"Our base case is that the economic recovery will prove sluggish. This suggests that there may be little or no tightening of fiscal and monetary policies this year in a number of the major economies," said GFMS chairman Philip Klapwijk.
Gold averaged US$972/oz in 2009 and peaked at a record US$1,218/oz in December, but has since dropped, the consultancy noted.
The survey update found that world investment demand grew 105% last year to 1,820t from 885t, surpassing jewelry demand for the first time in 30 years.
Gold mine production rose 6% last year, while jewelry demand fell 23% and scrap supply rose 27%.
The yellow metal closed at US$1,127/oz in London on Wednesday.
By Business News Americas staff reporters
* Precious and base metal prices slip Wed - Regional
The price of gold trading on the London Bullion Market (LBM) fell for the second consecutive day after having registered six straight increases since the start of 2010, closing at US$1,127/oz on Wednesday, down from US$1,151/oz the day before.
The decline in the gold price was despite a weaker US dollar, which fell Wednesday compared to the euro and other currencies.
Silver on the LBM also slipped, closing at US$18.35/oz, down from US$18.41/oz the prior trading day.
The performance of base metals was not much different, with all metals except lead trading on the London Metal Exchange (LME) down Wednesday, versus the day before.
Copper fell to US$3.353/lb cash from US$3.368/lb the previous day while LME stocks rose by 4,600t to 521,775t.
By Business News Americas staff reporters
* Tamsa expecting 60% increase in tube production - Mexico
Mexican seamless tube producer TenarisTamsa, which supplies the oil sector, expects to increase its production by 60% this year thanks to a third plant it is opening up in Veracruz, local press reported.
With the new plant Tamsa will increase production from 1Mt to 1.6Mt, the company's union leader Pascual Lagunes was cited as saying.
"Tamsa is very healthy economically and financially, and our products continue to be sold, mainly in the states that make up the United Arab Emirates," Lagunes said.
The new plant should create at least 1,600 new jobs as well, he added.
Tamsa currently employs roughly 3,000 workers.
Luxembourg-based Tenaris (NYSE: TS) controls Tamsa and also operates seamless pipe plants in Argentina (Siderca) along with welded pipe plants in Brazil (Confab) and Argentina (Siat).
By Business News Americas staff reporters
* CAP stakeholder hopes for new partner to enter iron ore branch - Chile
AFP Habitat, a Chilean private pension provider that has a stake in local iron and steel group CAP, hopes the steelmaker will hold a public bidding process to choose a partner to participate in its iron ore mining business CMP in light of an ongoing deal whereby Mitsubishi will acquire 25% of CMP through a restructuring transaction, according to a report by Santiago daily Diario Financiero.
Last month Mitsubishi finished due diligence on the restructuring of its participation in CMP. Presently the Japanese company owns 50% directly in CMP's Minera Huasco mine but wishes to swap that for a direct 25% in CAP's mining division.
Chile's largest iron and steel producer, CAP sold 3.21Mt of iron ore and 276,747t steel during last year's third quarter. The company took a US$52.5mn net loss in the first nine months of 2009 due to lower year-on-year steel prices and demand.
By Business News Americas staff reporters
* IN BRIEF Gerdau mum on devaluation effect at Sizuca - Brazil, Venezuela
Operations in Venezuela represent 1% of Brazilian steelmaker Gerdau's (NYSE: GGD) installed capacity, Brazil's Agência Estado reported.
Porto Alegre-based Gerdau, the largest long products steelmaker in the Americas,
controls Siderúrgica Zuliana (Sizuca) in Venezuela.
Gerdau, which has installed capacity of over 20Mt, acquired Sizuca in 2007. According to the report, Gerdau has not commented on Venezuelan President Hugo Chávez's announcement of a currency devaluation late last week nor on its effects on the company's operations in the country.
By Business News Americas staff reporters
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In-deph interview
* "It's sad to say this but scrap collectors, who gather inputs for the steel industry, are being pushed aside"
José Arévalo Jr
President
Cofarja
Brazil
http://www.bnamericas.com/interviews/metals/Jose_Arevalo_Jr_,Cofarja,/169883979
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Main companies covered in today's news
* Comisión Chilena del Cobre
http://www.bnamericas.com/company-profile/en/Comision_Chilena_del_Cobre-Cochilco/169883979
* Administradora de Fondos de Pensiones Habitat S.A.
http://www.bnamericas.com/company-profile/en/Administradora_de_Fondos_de_Pensiones_Habitat_S,A,-AFP_Habitat/169883979
* ALFA S.A.B. de C.V.
http://www.bnamericas.com/company-profile/en/ALFA_S,A,B,_de_C,V,-ALFA/169883979
* C.V.G. Aluminio del Caroni S.A.
http://www.bnamericas.com/company-profile/en/C,V,G,_Aluminio_del_Caroni_S,A,-Alcasa/169883979
* Doe Run Perú
http://www.bnamericas.com/company-profile/en/Doe_Run_Peru-Doe_Run_Peru/169883979
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