April Newsletters – 25.04.16
ANNOUNCEMENTS
Behre Dolbear is sponsoring the SME’s 4th Current Trends in Mining Finance Conference on April 24-27th in New York City.
Behre Dolbear will be an exhibitor at the 35th International Geological Congress, 27th August – 4th September 2016, Cape Town, South Africa
TOP NEWS
Miners spending again: $50 billion capex in five months
Greenfield project spending up three-fold in first quarter
Frik Els April 21, 2016
SNL Metals & Mining tallied the value of planned capital spending announced by mining companies in November.
The industry research firm based in Charlottesville, Virginia did the same thing again April 7.
Outlays on new mines, sustaining capital, expansions and projects like mine life extensions had surged by nearly $50 billion to $108 billion over the duration of just five months.
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Easy on the soap: mining firms pinch pennies as downturn bites
James Regan Reuters, April 21, 2016
- Mining firms hunting for savings at all levels of business
- Have been hit hard by plunging commodity prices
- Worker perks seen in boom years are disappearing
- Miners face ‘cost-grind environment’ -analyst
SYDNEY, April 21 From trimming menus in staff canteens to cutting back on soap and washing detergent at worker camps, the global mining industry that once lavished perks on employees is scrimping like never before as a brutal downturn engulfs minerals markets.
After frantically cutting costs by slashing jobs, freezing salaries and squeezing more from suppliers, mining companies are now scrambling to unearth savings in even the most mundane parts of their businesses.
“It’s not to the point yet where employees are being asked to grow their own vegetables or stay in farmhouses, but if you’re not seen attacking costs at any level, no matter how small, it’s not a good look,” said Kevin Kartun, a geologist and principal of Karmar Mining Services in Sydney.
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COMMODITIES
Iron Ore soars past $70 to a 16-month high
Cecilia Jamasmie
Iron ore prices skyrocketed Thursday to above $70 a tonne, hitting their highest level since January 2015.
The spot price for benchmark 62% fines gained 8.78%, or $5.69, to $70.46 a tonne, extending this year’s gain to 61.7%, according to data from the Metal Bulletin.
In percentage terms, the surge was the third largest since spot pricing first began in May 2009.
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Lithium shares leap as tesla sees more battery-car orders: chart
Jonathan Triune, Bloomberg, April 22, 2016
Shares of Lithium companies have surged after Tesla Motors Inc. boosted its outlook for electric vehicles powered by batteries that use the element, sending the Solactive Global Lithium Index up by about a third since the middle of February. Production of the light metal may triple over the next 15 years, driven not only by car sales but also utility-scale batteries being installed on power grids, according to Bloomberg New Energy Finance.
This Month’s Iron Ore-Fueled Mining Rally Skips Glencore: Chart
Jesse Riseborough, Bloomberg, April 22, 2016
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China’s Gold Miners Come of Age to Scour Globe for Acquisitions
Bloomberg News April 22, 2016
- Biggest producers look overseas as western miners struggle
- China “aggressively looking at opportunities:” Hanking CEO
China’s gold miners plan to extend the biggest buying spree in four years as the nation seeks greater clout in the global bullion industry. The prospect may be helping drive up the price of assets from Australia to the U.S.
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Silver’s new bull market
Adam Hamilton, Zeal Intelligence April 22, 2016
Silver officially entered a new bull market this week, decisively crossing the necessary +20% threshold. Speculators and investors alike are returning as awareness spreads of how radically undervalued silver is compared to prevailing gold prices. When silver awakens to a new bull market after a long bearish slumber, massive gains are usually unleashed. Silver’s tiny advance so far is just the tip of the iceberg.
This Tuesday, silver surged 4.4% higher on strong Asian bidding in parallel with gold. The catalyst was fascinating, China finally launching its long-awaited yuan-denominated gold benchmark. China is the world’s largest gold producer, importer, and consumer, a commanding position that should grant it much bigger say in the gold industry. The new yuan gold price will ultimately challenge London’s century-old hegemony.
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LEGAL AND REGULATORY
Broken tax pledge irks N.S. mining industry
The Chronicle Herald April 21, 2016
The province now has two strikes against it in the eyes of Nova Scotia’s mining companies.
This week’s budget marked the second straight year the McNeil government has broken a promise to the $420-million mining and quarrying industry, says the Mining Association of Nova Scotia.
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FINANCIAL
Mining is roaring, and here are some of the S&P/TSX Venture Composite Index companies leading the way
James West, MidasLetter Financial Post April 22, 2016
The S&P/TSX Venture Composite Index (INDEXTSI:JX) is on fire presently. Not merely trending bullishly — literally gapping upward, with year-to-date performance currently above 26 per cent, making by far and away the best performing index among the 27 global exchanges with market caps in excess of US$1 billion.
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TSX Venture Exchange overrun by more than 900 ‘zombie’ companies, critic says
Peter Koven, Financial Post, April 21, 2016
TORONTO — The TSX Venture Exchange is overrun with more than 900 “zombie” companies with negative working capital, according to a new study.
The research comes from Tony Simon, co-founder of the Venture Capital Markets Association and a frequent thorn in the side of TMX Group Inc.’s management team. By Simon’s calculations, there are 910 companies on the Venture that are not meeting capital requirements for listings. He said the combined working capital of these companies, which are nicknamed “zombies,” is negative $4.2 billion.
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PROJECTS
Randgold strikes new JV with Israeli billionaire mining firm, State miner
Henry Lazenby, Mining Weekly, 19th April 2016
Africa-focused miner Randgold Resources on Tuesday advised that it had recently entered into a new joint venture (JV) agreement – its third in the Democratic Republic of Congo (DRC) – with a State-owned mining company and Moku Goldmines for the Moku-Beverendi gold exploration project, located along the same greenstone belt that hosted its significant Kibali mine.
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INNOVATION AND TECHNOLOGY
Commerce Resources Corp. Completes Preliminary Evaluation for Renewable Power at the Ashram Rare Earth Project
By Filing Services Canada. Thursday Apr 21, 2016
Vancouver, British Columbia (FSCwire) – Commerce Resources Corp. (TSXv: CCE, FSE: D7H, OTCQX: CMRZF) (the Company or Commerce) announces that it has completed a preliminary evaluation of local and regional wind data to the west of Lac LeMoyne, indicating favourable wind speeds for renewable power development as part of the Ashram Rare Earth Projects energy requirements.
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