BUSINESS FORECASTING

Thermal coal prices set to rebound this year

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Original article by Paul Garvey
The Australian – Page: 20 : 19-Feb-19

New figures from the Australian Bureau of Statistics show that the value of the nation’s coal exports rose to a record $66.2bn in 2018. Meanwhile, Viktor Tanevski of Wood Mackenzie forecasts that demand for bituminous thermal coal in the Asia-Pacific region will rise by three million tonnes in 2019. He also expects the price of high-energy Australian thermal coal to recover to $US98 per tonne after testing the $US88 level earlier in 2019.

CORPORATES
AUSTRALIAN BUREAU OF STATISTICS, WOOD MACKENZIE, MACH ENERGY, GLENCORE PLC, RIO TINTO LIMITED – ASX RIO, BHP GROUP LIMITED – ASX BHP, SOUTH32 LIMITED – ASX S32

Iron ore could surge upon China’s return

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Original article by Timothy Moore
The Australian Financial Review – Page: 21 : 11-Feb-19

March iron ore futures closed 3.1 per cent higher at $US92 a tonne in Singapore on 8 February. Capital Economics says the spot price of iron ore could rally on 11 February, when Chinese traders return to the market following the Lunar New Year break. The tailings dam disaster in Brazil in late January may also impact on the iron ore price. Shares in BHP, Rio Tinto and Fortescue Metals Group have rallied in the wake of the disaster, although Vale’s share price has slumped.

CORPORATES
CAPITAL ECONOMICS LIMITED, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, VALE SA, TD SECURITIES, OXFORD ECONOMICS LIMITED, MACQUARIE WEALTH MANAGEMENT, ARCELOR MITTAL SA, CITIGROUP INCORPORATED, FASTMARKETS MB

Brazilian closures test iron restraint

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Original article by Paul Garvey
The Australian – Page: 27 : 7-Feb-19

UBS analysts are among those to have forecast an iron ore surplus in 2019. However, this is in doubt after a Brazilian court ordered Vale to put production at its Brucutu iron ore mine on hold in the wake of the tailings dam disaster at its Feijao mine. Vale has responded by declaring force majeure over its iron ore shipments. Vivek Dhar of the Commonwealth Bank says the iron ore price could potentially rise above $US100 per tonne following the production halt at Brucutu, whose annual output is 30 million tonnes.

CORPORATES
VALE SA, UBS HOLDINGS PTY LTD, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO

Iron ore surge predicted to be temporary

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Original article by Timothy Moore
The Australian Financial Review – Page: 23 : 4-Feb-19

The spot price of iron ore rose above $US85 per tonne in the wake of the latest tailings dam disaster in Brazil. Goldman Sachs and Fitch Ratings are among the firms that have upgraded their iron ore price forecasts, and Capital Economics has suggested that it could peak at around $US100 per tonne. Meanwhile, Liberum Research still expects the iron ore price to retreat to $US50/tonne in 2019 and around $US40/tonne in 2020.

CORPORATES
THE GOLDMAN SACHS GROUP INCORPORATED, FITCH RATINGS LIMITED, CAPITAL ECONOMICS LIMITED, LIBERUM RESEARCH, VALE SA, FASTMARKETS MB

China demand to drive earnings: Fortescue

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Original article by Perry Williams
The Australian – Page: 24 : 1-Feb-19

Fortescue Metals Group has advised that its iron ore shipments for the December 2018 quarter totalled 42.5 million tonnes, an increase of five per cent year-on-year. The result included its first shipments of the higher-grade West Pilbara Fines. Meanwhile, Fortescue expects its earnings to be boosted by renewed demand for lower-grade iron ore among Chinese steel mills. The pure-play miner also says it is too soon to determine the likely impact of the latest tailings dam collapse in Brazil on the iron ore price.

CORPORATES
FORTESCUE METALS GROUP LIMITED – ASX FMG, VALE SA

Dam disaster fuels surge in iron ore price

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Original article by Perry Williams
The Australian – Page: 17 & 20 : 31-Jan-19

Goldman Sachs has upgraded its 2019 forecast for iron ore after the price of the steel input rose 4.4 per cent to $US78.50 ($109) a tonne in response to another tailings dam disaster in Brazil. Goldman Sachs now has a price forecast of $US65 per tonne, compared with $US60 previously. The federal government’s mid-year budget update had forecast that the iron ore price would average $US55 per tonne in 2019. Vale has indicated that its annual iron ore production could be cut by up to 40 million tonnes due to the dam collapse. This would equate to about 10 per cent of its annual output.

CORPORATES
VALE SA, THE GOLDMAN SACHS GROUP INCORPORATED, BHP GROUP LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, FORTESCUE METALS GROUP LIMITED – ASX FMG, COMMONWEALTH BANK OF AUSTRALIA – ASX CBA, SHAW AND PARTNERS LIMITED, AUSTRALIA. DEPT OF INDUSTRY, INNOVATION AND SCIENCE, MACQUARIE GROUP LIMITED – ASX MQG, TUV SUD

Expense reports to be thing of past

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Original article by Yolanda Redrup
The Australian Financial Review – Page: 3 : 11-Jan-19

SAP Concur has processed $160.4 billion worth of employee expenses in the past 12 months, with the company boasting 44,000 customers in 150 countries. SAP Concur president Mike Ebarhard notes that employee expense reports could soon become a thing of the past as digital invoicing becomes more common. He says Australia is lagging behind other parts of the world when it comes to the adoption of digital invoicing.

CORPORATES
SAP CONCUR, WECHAT, SAP AG

Boom time for gas as Australia becomes the major player

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Original article by Perry Williams
The Australian – Page: 18 : 10-Jan-19

Australia surpassed Qatar as the world’s biggest LNG exporter in late 2018. However, Australia faces growing competition from rival nations in the LNG market, with global production capacity set to increase by nearly 35 million tonnes in 2019. An additional 60 million tonnes worth of annual capacity is also set to be approved over the next 12 months. The global economic outlook may also affect both demand for LNG and the price of LNG.

CORPORATES
CHEVRON CORPORATION, INPEX CORPORATION, ROYAL DUTCH SHELL PLC, WOOD MACKENZIE, SAUDI ARABIAN OIL COMPANY

Trump makes a year of heavy metal

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Original article by Paul Garvey
The Australian – Page: 15 : 2-Jan-19

Commodity prices fell for the seventh year out of the last 11 during 2018. The prices of metals such as zinc, copper and aluminium in particular fell sharply, although supply constraints resulted in strong gains for both coking and thermal coal. The US-China trade war weighed on commodity markets, and the outlook for 2019 may depend to a large extent on the actions of US President Donald Trump. Daniel Hynes of the ANZ Bank and Glyn Lawcock of UBS are upbeat about the outlook for base metals prices in 2019.

CORPORATES
AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED – ASX ANZ, UBS HOLDINGS PTY LTD, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT, AUSTRALIA. DEPT OF INDUSTRY, INNOVATION AND SCIENCE

Coal demand resilient in face of risks

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Original article by Angela Macdonald-Smith
The Australian Financial Review – Page: 17 : 19-Dec-18

A new report from the International Energy Agency shows that coal-fired power generation increased by three per cent in 2017 and is expected to grow again in 2018. The IEA’s annual coal outlook also notes that coal’s share of the global energy mix was steady at 38 per cent in 2017. IEA executive director Fatih Birol says coal will remain a major source of power generation for some time. Meanwhile, the IEA forecasts that Australia’s thermal coal exports will rise over the next five years.

CORPORATES
INTERNATIONAL ENERGY AGENCY, ADANI MINING PTY LTD