SUPPLY AND DEMAND

No relief in sight for iron ore bulls

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Original article by Stephen Cauchi
The Australian Financial Review – Page: 28 : 3-Jun-16

Morgan Stanley notes that global iron ore production will rise by 41 million tonnes in the second half of 2016, followed by an additional 78 million tonnes in 2017. The looming increase in global supply does not bode well for the price of the steel input, which has fallen by more than 30 per cent since late April 2016. BHP Billiton, Rio Tinto and Vale are among the iron ore producers that will increase their output in coming years, as new projects or mine expansions reach full production capacity.

CORPORATES
MORGAN STANLEY AUSTRALIA LIMITED, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, VALE SA, ROY HILL IRON ORE PTY LTD, SAMARCO MINERACAO SA

The lithium boom will end, like all the others

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Original article by Paul Garvey
The Australian – Page: 28 : 1-Jun-16

Expectations of strong growth in demand for lithium-ion batteries has prompted a rally in the price of lithium, and in turn bolstered the share prices of lithium producers. However, there are some similarities between the lithium boom and the iron ore boom. Macquarie Group believes that the lithium boom will have run its course within about 18 months. It has "buy" recommendations on just two lithium producers, Orocobre and Neometals.

CORPORATES
OROCOBRE LIMITED – ASX ORE, NEOMETALS LIMITED – ASX NMT, MACQUARIE GROUP LIMITED – ASX MQG, GALAXY RESOURCES LIMITED – ASX GXY, GENERAL MINING CORPORATION LIMITED – ASX GMM, PILBARA MINERALS LIMITED – ASX PLS, ALTURA MINING LIMITED – ASX AJM, LATIN RESOURCES LIMITED – ASX LRS, TALISON LITHIUM LIMITED, SQM, ALBERMARLE CORPORATION, FMC LITHIUM, CITIGROUP PTY LTD, ATLAS IRON LIMITED – ASX AGO, RIO TINTO LIMITED – ASX RIO, BHP BILLITON LIMITED – ASX BHP, VALE SA, FORTESCUE METALS GROUP LIMITED – ASX FMG

Stockpiles of iron ore drive prices lower

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Original article by Matt Chambers, Barry FitzGerald
The Australian – Page: 19 & 28 : 25-May-16

New data shows that iron ore stockpiles at Chinese ports have risen to 100.45 million tonnes, which is the highest level in 14 months. This could put further downward pressure on the benchmark price of iron ore, which has retreated from recent highs. Macquarie Group now expects the iron ore price to average about $US50 per tonne in 2017, compared with its previous forecast of $US45.

CORPORATES
MACQUARIE GROUP LIMITED – ASX MQG, METAL BULLETIN LIMITED, ATLAS IRON LIMITED – ASX AGO, BHP BILLITON LIMITED – ASX BHP, RIO TINTO LIMITED – ASX RIO, VALE SA, BLUESCOPE STEEL LIMITED – ASX BSL, ARRIUM LIMITED – ASX ARI, RESERVE BANK OF AUSTRALIA

Apartments market warning

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Original article by Lisa Allen
The Australian – Page: 1 & 2 : 17-May-16

BPM CEO Jonathan Hallinan says the stricter lending requirements for apartment buyers has resulted in a downturn in off-the-plan sales in Melbourne. Matrix Property director Andrew Antonas adds that a crackdown on shifting money out of China and lending restrictions by Australian banks has reduced demand for apartments in Sydney among Chinese buyers. Some overseas developers are also seeking to offload their development sites due to the difficulty in obtaining financing.

CORPORATES
BPM PTY LTD, MATRIX PROPERTY GROUP PTY LTD, CORELOGIC AUSTRALIA PTY LTD, RALAN PTY LTD

PM urged to tread carefully on steel

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Original article by Phillip Coorey, John Kehoe
The Australian Financial Review – Page: 4 : 13-May-16

The Minerals Council of Australia (MCA) wants Prime Minister Malcolm Turnbull to proceed cautiously when dealing with the problem of the overproduction of steel in China. Turnbull said he spoke about the issue with US President Barack Obama on 12 May 2016. The Chinese Government is under pressure globally to prevent steel makers from flooding the market with their products. MCA CEO Brendan Pearson said Turnbull should also pay attention to the interests of Australian mining companies engaged in the production of iron ore and metallurgical coal used in steel production in China.

CORPORATES
MINERALS COUNCIL OF AUSTRALIA, AUSTRALIA. DEPT OF THE PRIME MINISTER AND CABINET, UNITED STATES. EXECUTIVE OFFICE OF THE PRESIDENT, ORGANISATION FOR ECONOMIC CO-OPERATION AND DEVELOPMENT, WORLD TRADE ORGANIZATION, US STEEL CORPORATION, ALLEGHENY TECHNOLOGIES INCORPORATED, EUROPEAN UNION CHAMBER OF COMMERCE IN CHINA, CHINA. MINISTRY OF FOREIGN AFFAIRS

Rates cut, fiscal plan keep real estate ticking

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Original article by Michael Bleby
The Australian Financial Review – Page: 6 : 5-May-16

Angus Raine, the executive chairman of Raine & Horne, says the Reserve Bank’s move to reduce the cash rate to 1.75 per cent should attract first-time buyers back to the property market. Most experts do not expect the rate cut and the Australian Government’s May 2016 Budget to have much impact on activity in the residential market, but some suggest that the new rules on superannuation fund balance transfers will prompt increased demand for lower-priced commercial properties.

CORPORATES
RAINE AND HORNE PTY LTD, RESERVE BANK OF AUSTRALIA, CBRE PTY LTD, CENTURY 21 REAL ESTATE, RAY WHITE REAL ESTATE, SECRET AGENT PROPERTY SERVICES

Coca-Cola Amatil feels heat of price cut

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Original article by Sue Mitchell
The Australian Financial Review – Page: 18 : 28-Apr-16

Coca-Cola Amatil’s 2016 interim results are likely to be negatively affected by the use of discounting to drive sales of carbonated soft drinks and bottled water. Analysts expect the company to announce weaker earnings for the half-year. Consumers’ preferences are changing. Figures from Retail World show that soft drink sales declined from 57.5 per cent of non-alcoholic beverages in 2008 to 50.5 per cent in 2015. Meanwhile, consumption of bottled water has increased from 10.4 per cent to 20.4 per cent.

CORPORATES
COCA-COLA AMATIL LIMITED – ASX CCL, RETAIL WORLD PTY LTD, AUSTRALIAN BUREAU OF STATISTICS, COLES GROUP LIMITED, WOOLWORTHS LIMITED – ASX WOW, PEPSI-COLA COMPANY, ASAHI AND COMPANY, SCHWEPPES AUSTRALIA PTY LTD, DEUTSCHE BANK AG

Iron ore price reverses as Rio Tinto predicted

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Original article by Frik Els
Mining.com – Page: Online : 15-Apr-16

The Northern China benchmark import price of iron ore has fallen by 2.2 per cent to $US58.60 per dry metric tonne. However, the price of the steel input has still risen by 36.6 per cent so far in 2016, and by 58 per cent since mid-December 2015.

CORPORATES
THE STEEL INDEX LIMITED, RIO TINTO LIMITED – ASX RIO, BHP BILLITON LIMITED – ASX BHP, VALE SA, THE GOLDMAN SACHS GROUP INCORPORATED

Iron ore price at $59.90 as surge extends another day

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Original article by Frik Els
Mining.com – Page: Online : 14-Apr-16

The Northern China benchmark import price of iron ore has risen by a further 2.4 per cent to $US59.90 per dry metric tonne. The price of the steel input has risen by 39.6 per cent so far in 2016, and 62 per cent since mid-December 2015. Meanwhile, new figures show that China imported 85.8 million tonnes of iron ore in March, which is 16.5 per cent higher than February. China accounted for the bulk of the record 39.5 million tonnes that were shipped from Western Australia’s Port Hedland during the month.

CORPORATES
THE STEEL INDEX LIMITED, CITIGROUP PTY LTD, ROY HILL HOLDINGS PTY LTD, VALE SA, DALIAN COMMODITY EXCHANGE

Spot pricing threatens LNG supply glut

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Original article by Paul Garvey, Matt Chambers
The Australian – Page: 19 & 22 : 13-Apr-16

Woodside Petroleum CEO Peter Coleman has expressed concern that any move to adopt spot pricing for LNG could result in an oversupply and subsequent downward pressure on prices. He noted that this was the outcome when other commodities shifted to a spot pricing system. Royal Dutch Shell CEO Ben van Beurden expects long-term contracts to continue to be the primary mechanism for setting LNG prices, but he has suggested that these contracts could eventually be linked to the Henry Hub spot gas price rather than the crude oil price.

CORPORATES
WOODSIDE PETROLEUM LIMITED – ASX WPL, ROYAL DUTCH SHELL PLC, CHEVRON CORPORATION