BUSINESS FORECASTING

How the iron ore price busted above $US100 a tonne

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Original article by Patrick Commins
The Australian Financial Review – Page: 29 : 21-May-19

The tailings dam collapse at a Vale mine in January has been a major driver of the iron ore price’s rise to a five-year high of $US100 per tonne. The disaster reduced seaborne iron ore supply by around six per cent, prompting a rally in the price of the steel input and the shares of major producers. The reduced global supply has also coincided with rising demand for iron ore in China. Meanwhile, Vivek Dhar of the Commonwealth Bank expects the iron ore price to ease to around $US85 per tonne by the end of 2019.

CORPORATES
VALE SA, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, FORTESCUE METALS GROUP LIMITED – ASX FMG

Vale’s latest legal blow boosts iron ore stocks

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Original article by Brad Thompson
The Australian Financial Review – Page: 15 : 8-May-19

Brazilian miner Vale has advised that its sales of iron ore and pellets in 2019 will be at the lower end of its previous forecast of between 307 and 332 million tonnes. The revised guidance follows a court’s move to reverse its decision to allow Vale to resume production at mines that were affected by a tailings dam collapse in January. Shares in Australian iron ore miners rallied on 7 May, and Peter O’Connor of Shaw & Partners expects further volatility in the price of the steel input in the next several years.

CORPORATES
VALE SA, FORTESCUE METALS GROUP LIMITED – ASX FMG, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, SHAW AND PARTNERS LIMITED, MOUNT GIBSON IRON LIMITED – ASX MGX

Analysts predict iron ore prices have hit peak

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Original article by Cole Latimer
The Age – Page: 25 : 24-Apr-19

UBS has forecast that the iron ore price will average $US83 per tonne in 2019, warning that the steel input’s recent high of around $US93/tonne is not sustainable. The investment bank says recent supply disruptions in Australia and Brazil are unlikely to have a long-term impact on the iron ore price, forecasting that it will fall over the next 12 months. Expectations of a lower iron ore price have also contributed to UBS’s decision to downgrade its recommendation on BHP’s shares from ‘buy’ to ‘neutral’. PhillipCapital expects iron ore to average $US78/tonne in 2019.

CORPORATES
UBS HOLDINGS PTY LTD, BHP GROUP LIMITED – ASX BHP, PHILLIP CAPITAL LIMITED, VALE SA, FORTESCUE METALS GROUP LIMITED – ASX FMG

Miners place big bets on copper to cash in on electric car boom

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Original article by Nick Evans
The Australian – Page: 17 & 28 : 16-Apr-19

Morgan Stanley has forecast that over 10 million electric vehicles will be sold each year by 2025, up from 600,000 in 2015. The rise in demand for electric cars has been tipped to lead to a corresponding increase in demand for copper, with electric vehicles needing around four times as much copper as an average-sized petrol-driven car. Rio Tinto is making copper a key focus of its future plans, having forecast a copper shortfall of eight million tonnes by 2020.

CORPORATES
MORGAN STANLEY AUSTRALIA LIMITED, RIO TINTO LIMITED – ASX RIO, BHP GROUP LIMITED – ASX BHP, OZ MINERALS LIMITED – ASX OZL, WESFARMERS LIMITED – ASX WES, AUSTRALIAN LABOR PARTY

UBS hikes iron ore forecasts a second time

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 21 : 29-Mar-19

Investment bank UBS now expects the price of iron ore to average $US83 per tonne in 2019, which is 12 per cent higher than its previous forecast. UBS had already increased its price forecast from $US65 per tonne to $U74 in response to the tailings dam disaster in Brazil in late January. UBS also forecasts that Australia’s three major iron ore producers will slightly reduce their full-year production guidance after their Pilbara operations were affected by a recent cyclone.

CORPORATES
UBS HOLDINGS PTY LTD, VALE SA, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, PEABODY ENERGY CORPORATION

Fortescue expects China’s ore demand to stay strong

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Original article by Michael Smith
The Australian Financial Review – Page: 17 & 20 : 29-Mar-19

Fortescue Metals Group CEO Elizabeth Gaines says there are no indications that Chinese steel production is contracting. She adds that the general consensus of Fortescue’s iron ore customers in China is that growth in steel output will to slow to 3-4 per cent in 2019. This follows 12 per cent growth in 2018. Gaines has also indicated that China’s move to restrict Australian coal imports has had no impact on Fortescue’s iron ore shipments. The pure-play miner has resumed shipments from Port Hedland in the wake of Cyclone Veronica.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, BOAO FORUM FOR ASIA, SHANGHAI BAOSTEEL GROUP CORPORATION, FORMOSA GROUP, VALE SA

Rinehart, Forrest and big miners sweet on Ecuador

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Original article by Brad Thompson
The Australian Financial Review – Page: 17 : 25-Mar-19

Sunstone Metals CEO Malcolm Norris expects there to be a lot of gold and copper discoveries in Ecuador in the next 10 years. Norris, secured the Cascabel tenement in Ecuador some years ago when he was in charge of SolGold, which owns 85 per cent of Cascabel. SolGold recently launched a hostile takeover bid for Cornerstone Capital, which has a 15 per cent stake in Cascabel. Cornerstone has spurned the takeover bid and criticised SolGold for what it stated were ongoing delays with releasing information about Cascabel.

CORPORATES
SUNSTONE METALS LIMITED – ASX STM, SOLGOLD PLC, BHP GROUP LIMITED – ASX BHP, NEWCREST MINING LIMITED – ASX NCM, CORNERSTONE CAPITAL RESOURCES INCORPORATED, FORTESCUE METALS GROUP LIMITED – ASX FMG, HANCOCK PROSPECTING PTY LTD

Gas supply glut deflates prices for exporters

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Original article by Perry Williams
The Australian – Page: 24 : 15-Mar-19

Bernstein analyst Neil Beveridge an increase in global LNG supply in 2019 will put downward pressure on spot prices, which will in turn impact on Australia’s LNG exporters. It is estimated that up to 58 million tonnes of additional LNG production may be approved during 2019, while a final investment decision regarding another 64 million tonnes of supply is slated for 2020.

CORPORATES
BERNSTEIN INVESTMENT RESEARCH AND MANAGEMENT, WOODSIDE PETROLEUM LIMITED – ASX WPL, OIL SEARCH LIMITED – ASX OSH, TOTAL SA, EXXONMOBIL CORPORATION

Bid on Newmont frees Kalgoorlie sale

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Original article by Jacob Greber
The Australian Financial Review – Page: 10 : 27-Feb-19

Kerry Smith of Haywood Securities says the super pit gold mine in Western Australia is among the assets that could be sold if Barrick Gold’s takeover bid for Newmont Mining Corporation succeeds. Analysts have suggested that Newcrest Mining could be among the potential buyers of the super pit, and media reports in Canada have claimed that Barrick has recently held talks with Newcrest regarding asset sales in Australia.

CORPORATES
BARRICK GOLD CORPORATION, NEWMONT MINING CORPORATION, NEWCREST MINING LIMITED – ASX NCM, HAYWOOD SECURITIES, JP MORGAN AND COMPANY INCORPORATED, RANDGOLD RESOURCES LIMITED, GOLDCORP INCORPORATED, RENAISSANCE MACRO

Glencore’s carbon cash cow: coal prices rising

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Original article by Paul Garvey, Perry Williams
The Australian – Page: 19 & 30 : 22-Feb-19

Glencore CEO Ivan Glasenberg says the Switzerland-based miner’s decision to cap annual coal production is likely to put upward pressure on coal prices, particular if global demand continues to increase. He notes that many other mining companies are also curbing coal output or seeking to divest coal assets. Dominic O’Kane of JP Morgan agrees that Glencore’s move could bolster coal prices, as well Glencore shareholders’ returns. Glencore has indicated that it has no plans to sell any of its coal mines or buy additional mines, although it has not ruled out increasing its stake in existing joint ventures.

CORPORATES
GLENCORE PLC, JP MORGAN AUSTRALIA LIMITED, DEUTSCHE BANK AG, AUSTRALIA. DEPT OF INDUSTRY, INNOVATION AND SCIENCE, CLIMATE ACTION 100+, CHURCH OF ENGLAND, MINERALS COUNCIL OF AUSTRALIA, WORLD COAL COUNCIL, AUSTRALIAN GREENS