IM Jan 30 2013 - customers.reuters.comLONDON, Jan 29 (Reuters) - Global steel production last year...
Transcript of IM Jan 30 2013 - customers.reuters.comLONDON, Jan 29 (Reuters) - Global steel production last year...
INSIDE METALS Wednesday, January 30, 2013
CHART OF THE DAY
TODAY’S MARKETS
MARKET NEWS
COLUMN- Global steel and the curse of the zombies
Global steel production last year set a new volume record of 1,548 mil-lion tonnes, according to figures from the World Steel Association (WSA).
Andy Home is a Reuters columnist. The opinions expressed are his own
Click here to read more..
PREVIEW-Inventories, trade seen hobbling U.S. 4th-quarter GDP
Less restocking by businesses and weaker global demand likely held back U.S. economic growth in the fourth quarter but consumer spend-ing probably picked up to help keep the recovery intact.
Click here to read more..
FEATURE
Click here for LME charts
Fed waits for job market to perk up
U.S. home prices see best yearly gain since 2006
Anglo American's $4 bln hit clears decks for new CEO
Aquarius Platinum production rises
Demand for India's silver jewellery exports picks up sharply
GENERAL NEWS
Click on the chart for full-size image
ALUMINIUM:
Tajik aluminium smelter cuts 2012 output to 272,500 T
COPPER:
HSBC raises 2013 copper price outlook on tighter market
Antofagasta's 2012 copper production beats target
NICKEL/STEEL:
Vale sees iron ore at $110-$180/Tonne - CFO
Metalloinvest cuts steel billet output as Iran sanctions bite
Italy steel output could fall in 2013 on strong euro
ZINC/LEAD:
China's refined zinc imports to stay strong on financing demand
BASE METALS: London copper rose to nearly a three-week high as traders opened new long positions on copper on hopes for improving global growth, while looking ahead to results from a Federal Reserve meeting and Chinese factory data.
"There are expectations for mildly dovish sentiment today that are weighing on the dollar and that's why we're seeing some gains across commodities," said commodities analyst Natalie Robertson of ANZ in Melbourne.
PRECIOUS METALS: Gold fought to hold steady above a key techni-cal level after snapping a four-day slide in the previous session on hopes the U.S. Federal Reserve would opt to continue with monetary stimulus.
"In the short term, gold will struggle because the U.S. data will continue to be pretty good," said Jeremy Friesen, commodity strategist at So-ciete Generale in Hong Kong.
FOREX: The dollar rose to a fresh 2-1/2 year high against the yen bol-stered by widening spreads between U.S. Treasuries and Japanese government bond yields amid expectations of more aggressive easing by the Bank of Japan in coming months.
The dollar was up 0.6 percent at 91.32 yen , with traders citing option expiries at 91.50 yen which could sway trade.
The euro was also 0.7 percent higher at 123.30 yen , with investors targetting its April 2011 high of 123.33 yen.
2
FEATURE
COLUMN-Global steel and the curse of the zombies
By Andy Home
LONDON, Jan 29 (Reuters) - Global steel production last year
set a new volume record of 1,548 million tonnes, according to
figures from the World Steel Association (WSA).
But the rate of growth braked sharply to just 1.2 percent from
6.8 percent in 2011, mirroring slowing growth in China, the en-
gine room of the global steel market.
China's leviathan steel sector is now once again cranking up
through the gears in anticipation of resurgent demand resulting
from more government infrastructure spending.
That renewed sense of optimism has already had repercussions
all the way through the steel supply chain - witness the spec-
tacular recovery in the iron ore price since last September's
implosion.
Whether that optimism is justified will be the single most impor-
tant factor in the global steel market this year.
Even if it is, though, it is unlikely to be enough to transform the
fortunes of a margin-compressed industry.
For the other key take-away from the WSA data is the steady
slide in the global capacity utilisation rate. It averaged 78.8 per-
cent in 2012, compared with 80.7 percent in 2011.
In December itself, a month characterised by a normal seasonal
slowdown in the northern hemisphere, capacity utilisation was
running at 73.2 percent, compared with 73.5 a year earlier.
STILL ALL ABOUT CHINA
The WSA's global figures mask a highly variable regional per-
formance last year, as shown in the next graphic. Graphic on
2012 steel production by region:
http://link.reuters.com/haw55t
The obvious stand-out was China, where steel production grew
by 3.1 percent. Although low by recent Chinese standards, it
was still the fastest growth rate of any major steel-producing
region.
And because of the size of the Chinese steel sector, which ac-
counted for 46 percent of world production last year, the output
rise was the main reason why global run-rates grew at all last
year.
Output in the rest of the world actually fell by 0.5 percent, the
first shrinkage since the depths of the Great Financial Contrac-
tion in 2008-2009.
But 2012 was not a simple binary dynamic between a positive
China and a negative Rest of the World.
Outside of China, output performance was also highly mixed.
Witness the contrast between a 4.7 percent decline in the core
European Union area and a 1.9 percent growth registered by
other parts of Europe, particularly Turkey, where output rose by
5.2 percent.
The negative stand-out on the graphic is the 20 percent col-
lapse in steel production in the Oceania region.
But it's worth remembering that it is the smallest steel-producing
region in the world and that last year's slump largely reflected
the trials and tribulations of Australia's Bluescope Steel.
Production in Oceania has since stabilised, as shown in the
next graphic of annualised regional production in December
compared with that in December 2011. Graphic on December
annualised steel production:
http://link.reuters.com/jaw55t
This December snapshot of annualised production shows out-
put just about everywhere else deteriorating, including in North
America where the 2012 positive growth momentum dissipated
over the closing months of the year.
That leaves China looking even more of a stand-out in terms of
production growth this year, given the country's annualised pro-
duction last month was up 7.7 percent on December 2011.
TOO MUCH TOO SOON?
This should come as no surprise.
China's finely poised economic balancing act between soft and
hard landing undermined prices of industrial raw materials
across the board last year.
The anticipated re-acceleration of growth this year has equally
fanned bullish enthusiasm across the board, tempered only by
perceptions of where each commodity is placed in terms of the
country's inventory cycle.
Copper , for example, has so far seen little price impact be-
cause of collective concerns about the large inventories accu-
mulated in Shanghai over the past year.
Iron ore, by contrast, has been on a roller-coaster ride. The spot
price plunged to a three-year low of $87 per tonne in August/
September, only to ricochet back to almost $160 earlier this
month.
It is part of a broader restocking impetus that has spread all the
way down the steel supply chain in China.
This is partly seasonal.
Northern hemisphere steel production always troughs over the
winter months and kicks back in once construction activity re-
vives with warmer weather.
This year the process in China is being given extra oomph by
expectations that government infrastructure spending will pick
up any slack from a still problematic commercial real estate
sector.
Much rests on the scale and scope of that promised infrastruc-
ture boom.
INSIDE METALS January 30, 2013
3
FEATURE (Continued)
Consider the next graphic, which tracks Chinese steel produc-
tion against the purchasing managers index (PMI) for the manu-
facturing sector.
Graphic on China's manufacturing PMI and steel output:
http://link.reuters.com/meq76s
Whereas in the past, steel production growth has lagged posi-
tive turning points in the PMI, this time around it is leading it.
That's fine as long as the Chinese government delivers what the
steel sector expects it to deliver. That would reinvigorate a re-
covery in Chinese steel prices that looks at risk of stalling.
Without higher prices for their products, mills are going to ex-
perience another round of severe margin compression similar to
that which triggered the iron ore rout of last year.
The China Iron and Steel Association (CISA), which is forecast-
ing 3.1 percent demand growth in China this year, pointedly
warns that the surging iron ore price has put steel firms under
heavy pressure, with the rise in costs "far exceeding" any in-
crease in domestic steel product prices.
CURSE OF THE ZOMBIE
The root problem is one of excess production capacity, a long-
standing target of official criticism in China.
And a long-standing problem in the global steel sector, as
shown by that low capacity utilisation rate. The problem is most
acute in Europe. Production in the core EU-27 area slid by 4.7
percent last year, but demand is widely assessed as having
fallen by far more.
ArcelorMittal , for example, said southern European demand
has contracted by 25 percent. In an ironic twist, it gave out that
number in an announcement about the restart of capacity at its
Gijon plant in Spain.
The extra steel production is aimed at the export market, which
is not surprising given the collapsed state of the Spanish con-
struction sector. Elsewhere, commodity economics are trumped
by politics - witness ArcelorMittal's battle with the French gov-
ernment over the future of its Florange plant.
The net result is the proliferation of "zombie" mills, which are
kept alive out of political rather than market necessity, to borrow
a term coined by Mike Elliott, an analyst at Ernst and Young, in
a recent interview.
Escaping the curse of the zombies will require either a synchro-
nised global economic recovery or a wholesale cull of redundant
capacity.
In the absence of either, capacity utilisation will remain low, pric-
ing power fragile and margins compressed. And what Wolfgang
Eder, chief executive officer of Austrian steelmaker Voestal-
pine , called the steel "price wars" will continue.
--Andy Home is a Reuters columnist. The opinions expressed
are his own--
PREVIEW-Inventories, trade seen hobbling U.S. 4th-quarter
GDP
WASHINGTON, Jan 28 (Reuters) - Less restocking by busi-
nesses and weaker global demand likely held back U.S. eco-
nomic growth in the fourth quarter but consumer spending
probably picked up to help keep the recovery intact.
Gross domestic product probably grew at a 1.1 percent annual
rate, a step down from the third quarter's brisk 3.1 percent pace,
according to a Reuters poll of economists. That would be the
slowest growth rate in nearly two years.
"The recovery is expected to have ground to a near halt in the
fourth quarter mostly due to the unfavorable global environment
and a slowdown in inventory accumulation," said Millan Mul-
raine, a senior economist at TD Securities in New York.
The Commerce Department will release the fourth-quarter GDP
report on Wednesday at 8:30 a.m (1330 GMT). Despite the
anticipated overall weak GDP figure, consumer and business
spending are expected to show surprising resilience, given that
the economy was on the brink of a so-called fiscal cliff, under-
scoring some fundamental strength in the economy.
The government lessened the blow the recovery would have
taken from the $600 billion "cliff" of scheduled government
spending cuts and tax hikes, but taxes still went up for many
Americans and the spending cuts were only deferred.
Peter D'Antonio, an economist at Citigroup in New York, said
signs domestic demand was well maintained "implies the econ-
omy will be able to withstand the hit from a new fiscal drag."
Tepid demand in the third quarter left businesses with unwanted
stock in their warehouses and little incentive to accumulate
more inventory in the final three months of the year.
Economists estimate that a slowdown in inventory accumulation
could slash as much as a full percentage point from fourth-
quarter GDP growth. Inventories added almost three-quarters of
a percentage point in the July-September period.
With data available so far showing a decline in exports in the
fourth quarter, trade will weigh on growth. Export growth has
been hampered by a recession in much of debt-stricken Europe
and a cooling Chinese economy. Economists expect trade will
subtract at least 0.3 percentage point from fourth-quarter GDP
growth.
DEFENSE TO WEIGH ON GROWTH
Another drag to growth is expected to come from government
spending, where defense outlays are seen reversing the prior
quarter's robust growth. Government spending is seen contract-
ing at a pace of at least 3 percent after expanding 3.9 percent.
A huge storm that struck the East Coast in late October is ex-
pected to have proved a further weight on output.
Elsewhere, details of the report should be fairly encouraging.
Consumer spending, which accounts for more than two-thirds of
INSIDE METALS January 30, 2013
4
FEATURE (Continued)
U.S. economic activity, is expected to have accelerated from the
prior quarter's 1.6 percent growth pace. A rebound in business
investment is expected after outlays fell in the third quarter for
the first time in 1-1/2 years.
"None of these developments suggest a worrisome weakening
in U.S. fundamentals," said Omair Sharif, an economist at RBS
in Stamford, Connecticut. A measure of underlying domestic
demand, which excludes inventories and trade, is expected to
have quickened a bit from the third quarter's 1.9 percent rate.
But consumer spending could come under pressure in the first
half of this year given that Congress let a temporary payroll tax
cut expire at the end of 2012. Businesses could also pull back
given uncertainty over how deeply Washington may cut spend-
ing and the likelihood of a protracted fight over raising the na-
tion's debt ceiling.
"Assuming Washington does not derail the economy, we do see
a pick-up in the pace of growth in the second half of the year led
by the private sector on strengthening consumption, housing
and released pent-up demand of capital expenditures," said
Sam Bullard, a senior economist at Wells Fargo Securities in
Charlotte, North Carolina.
The housing market was another bright spot during the fourth
quarter. Investment in residential construction is expected to
have gained momentum after notching a 13.5 percent pace in
the third quarter.
Homebuilding is expected to have added to growth last year for
the first time since 2005 and its continued recovery should help
ensure the economy remains on a modest growth path despite
headwinds.
INSIDE METALS January 30, 2013
GENERAL NEWS
Fed waits for job market to perk up
LONDON, Jan 27 (Reuters) - The Federal Reserve's ultra-loose
monetary policy is a root cause of the "currency wars" that some
see as a looming threat to the world economy, but don't expect
the U.S. central bank to signal a shift back to normal any time
soon.
The Fed, whose policy-setting Federal Open Market Committee
concludes a two-day meeting on Wednesday, said just last
month that it expects to keep short-term interest rates excep-
tionally low until the U.S. unemployment rate falls to 6.5 percent,
inflation permitting.
That goal is still distant. Figures on Friday are likely to show that
the jobless rate was unchanged in January at 7.8 percent, while
the economy created 155,000 jobs, the same as in December,
according to economists polled by Reuters.
So it would be a huge surprise if the Fed were to do anything
other than reaffirm last month's decision to anchor short-term
interest rates in a range of zero to 0.25 percent and to keep
buying $85 billion of bonds each month to hold down long-term
rates.
The only question mark is whether the FOMC vote will be unani-
mous now that Richmond Fed President Jeffrey Lacker, who
opposes the current round of bond-buying, has rotated off the
panel, said Harm Bandholz, an economist with UniCredit Bank
in New York.
Most economists polled by Reuters expect the Fed to keep its
open-ended bond-buying programme in place well into next
year, even though the economic news flow and market confi-
dence are improving markedly.
True, Wednesday's preliminary report on fourth-quarter GDP is
likely to show that growth slowed to an annualised rate of 1.2
percent from 3.1 percent in the July-September period.
And the current quarter will also be soft as the expiry of a 2 per-
cent payroll tax cut is dampening consumer spending.
But then Bandholz expects an average growth rate of 2.8 per-
cent over the rest of the year. That would be the strongest
three-quarter period of the recovery so far, he said.
"The outlook has improved a lot in the U.S. I've been on the
cautious side for the last three years, but this time I'm a bit more
bullish," he said.
THE FED BIDES ITS TIME
The recovery in housing would add at least half a percentage
point to GDP growth in 2013, while capital spending was likely
to revive now that uncertainty over budget talks in Washington
had been largely allayed, Bandholz said.
"There's a lot of pent-up demand in the system. I don't think all
these investments have been abandoned; they've just been
postponed," he said.
At some point, investors' exuberance over the super-easy
stance of the world's major central banks will give way to wor-
ries that they are about to take away the punch bowl.
Gustavo Reis, an economist with Bank of America Merrill Lynch
in New York, said concerns about the costs of money-printing
were likely to spread but would be offset by uncertainty over the
impact on growth of fiscal tightening in the United States and
Europe.
"All told, although global activity seems more robust now than at
any point in 2012, we expect policymakers to continue to worry
predominantly about downside risks," he said in a note.
The bank does not expect the Fed to consider halting asset
purchases before 2014, while the latest episode of monetary
easing announced by the Bank of Japan is likely to be 'long-
lived and significant'.
5
GENERAL NEWS (Continued)
Many economists argue that bold monetary action is long over-
due in Japan, whose nominal output has not grown in 20 years,
saddling the government with a debt-to-GDP ratio of more than
220 percent.
But Douglas McWilliams, who heads the Centre for Economics
and Business Research, a London consultancy, fears Japan's
decision will lead the global economy into unpredictable cur-
rency wars.
"It's a bit like if someone's rude to you, you're rude to them back.
You get tit-for-tat behaviour," McWilliams said.
CURRENCY FRICTION, BUT NO WAR
Olivier Blanchard, the chief economist of the International Mone-
tary Fund, last week called talk of currency wars overblown and
said countries had to pull the right policy levers to get their
economies back on track, with corresponding consequences for
exchange rates.
However, McWilliams said the problem was that it was difficult
to get countries to agree NOT to wage currency wars.
Tellingly, Chancellor Angela Merkel voiced German concerns
last week that Japan might be deliberately seeking to cheapen
the yen to give its exporters a competitive edge.
"So we may well find that there is a period of very heavy volatil-
ity before the authorities involved try and get some kind of
agreement," McWilliams said.
In a relatively quiet week for economic data in the euro zone -
money supply figures and confidence surveys from the Euro-
pean Commission are the highlights - the focus is likely to re-
main squarely on the euro, which has been rising briskly as trad-
ers price in the policy shifts that Blanchard had in mind.
While the Fed and the Bank of Japan are expanding their bal-
ance sheets, the European Central Bank is starting to soak up
some of the emergency cash it lent to banks a year ago.
The central bank said on Friday that banks would repay early
137 billion euros of cheap borrowed money.
"I'm not sure if we have too strong a euro for the moment but
certainly we would not want to see a currency war of competitive
devaluations which would have a negative effect on the euro,"
the European Union's top monetary official, Olli Rehn, told
Reuters.
U.S. home prices see best yearly gain since 2006
NEW YORK, Jan 29 (Reuters) - U.S. home prices rose in No-
vember, climbing more than five percent from a year ago in the
biggest increase since August 2006 when the housing market
was starting to collapse.
Data on consumer confidence on Tuesday was less encourag-
ing, with moods falling to their lowest level in more than a year
as Americans became more pessimistic about the economic
outlook and their financial prospects in the wake of higher taxes
for many.
In a fresh sign the housing sector is on the mend, the S&P/Case
Shiller composite index of 20 metropolitan areas gained 0.6
percent in November on a seasonally adjusted basis, in line with
economists' forecasts.
Prices in the 20 cities rose 5.5 percent year over year, making
for the strongest yearly price increase in more than six years
when prices were on their way down.
The housing market became a bright spot for the economy last
year as prices rose and inventory tightened, and the sector is
expected to contribute to economic growth in 2013.
"What we're seeing is really a gradual improvement in the over-
all economy," said Anthony Chan, chief economist for Chase
Private Client in New York.
Rising home prices and recent gains in the stock market should
blunt the impact of tax increases for consumers and spending
should improve by the second half of the year, said Chan.
Homebuyers also have been enticed by historically low interest
rates. The Federal Reserve's latest stimulus efforts are helping
to keep rates low, as the central bank buys assets including
mortgage-backed securities.
The Fed meets on Tuesday for the first session of a two-day
meeting, with a statement due on Wednesday.
It was the 10th month in a row that prices have increased, the
longest string of gains since before 2006. Last year's rise in
prices beat a nine-month consecutive run in 2009 and 2010,
when the market was boosted by a homebuyer tax credit.
Home prices on a non-adjusted basis slipped 0.1 percent. The
non-adjusted numbers showed prices fell in about half of the
cities covered by the report, with the winter months typically a
weak period for housing, the survey said.
Phoenix, which saw its housing market rebound sharply last
year, led with the biggest yearly gain at 22.8 percent. New York
was the only city to fall, down 1.2 percent from the previous
year.
Graphic - U.S. home prices: http://link.reuters.com/rem34t
Graphic - Consumer confidence: http://link.reuters.com/pum34t
A number of challenges remain for the housing market, includ-
ing tight access to mortgages and on-going foreclosures.
Highlighting the hurdles on the path to recovery, separate gov-
ernment data showed the homeownership rate slipped to 65.4
percent in the fourth quarter from 65.5 percent.
Consumer attitudes dropped more than expected to 58.6 in
January, data from The Conference Board showed. It was the
lowest level since November 2011.
At the start of the year, U.S. politicians came to an agreement
that averted the so-called fiscal cliff of spending cuts and tax
increases that had been set to come into effect.
INSIDE METALS January 30, 2013
6
GENERAL NEWS (Continued)
But the deal did raise taxes for many Americans, while a payroll
tax holiday came to an end. Lawmakers still face a number of
budget decisions.
"Consumers are probably pretty unhappy to notice that their
payroll taxes have gone up," said David Sloan, economist at
4Cast Ltd in New York.
U.S. stocks pared slight gains immediately after the report was
released, but Wall Street was mostly higher by the afternoon.
The Conference Board's consumer expectations index tumbled
to its lowest level since October 2011 at 59.5, while the present
situation measure slipped to 57.3.
Consumers' views on the labor market were also weaker, with
the "jobs hard to get" gauge rising for the first time since Sep-
tember.
Economists said the pain should be short lived and that confi-
dence was likely to perk back up as long as Washington can
come to an agreement on the budget issues yet to be resolved.
"This might bounce back pretty quickly as people get used to a
smaller paycheck. Right now, it's a sticker shock," said Craig
Dismuke, chief economic strategist at Vining Sparks in Mem-
phis, Tennessee.
Anglo American's $4 bln hit clears decks for new CEO
LONDON, Jan 29 (Reuters) - Anglo American took a $4 billion
hit to its Minas Rio project on Tuesday, clearing the decks for
new boss Mark Cutifani and indicating that the delayed Brazilian
operation will eventually get off the ground.
Minas Rio, which is now costing Anglo more than three times its
original estimates, has been seen as Anglo's most significant
failure of recent years and is partly responsible for costing out-
going chief executive Cynthia Carroll her job.
The writedown to the valuation of the huge iron ore project and
a jump in the bill for its development to $8.8 billion, alongside a
planned overhaul for the company's troubled platinum business,
are as near to a clean slate as new CEO Cutifani is going to get.
Shares in Anglo American gained 2.2 percent to 19.14 pounds
($30.06), topping Britain's blue-chip leader board in midday trad-
ing after the announcement of the impairment charge.
"The Minas Rio impairments give the incoming CEO a clean
slate, creating a degree of positive sentiment," Bernstein analyst
Paul Gait said.
"The greater detail and clarity on the progress of Minas Rio can
only increase the confidence around the executability and deliv-
ery of the project."
Designed to help to diversify a company that was still dependent
on South Africa for the bulk of its revenue, Minas Rio was
bought by Anglo for $5.5 billion in two stages in 2007 and 2008.
BRUISING
But the project, which had been valued on Anglo's balance
sheet at $9.6 billion before the writedown, has turned out to be
a bruising top-of-the-market deal, hit in part by inflationary costs
linked to Brazil's hosting of the soccer World Cup next year and
the Olympics in 2016.
The company said it still aims to ship its first iron ore by the end
of 2014 and gave further details on the project's progress, con-
firming that two grinding mills had been installed and 50 percent
of a pipeline had been laid.
"This asset has been a constant disappointment in terms of
project delivery and I think it was largely expected that we would
get this sort of writedown," Nomura International analyst Sam
Catalano said.
However, delivering on Minas Rio is not the only challenge fac-
ing Anglo's new boss.
Cutifani, a former coal miner who joins the company from Jo-
hannesburg-based AngloGold Ashanti , must also grapple with
the difficulties of executing Anglo American Platinum's
(Amplats) overhaul.
Anglo, for which South Africa still accounts for more than half its
forecast earnings, owns 80 percent of Amplats, a company in
the midst of a restructuring plan that could lead to 14,000 job
cuts. Analysts at Citi warned that more bad news could pre-
cede Cutifani's start date, with concerns also lingering around
its copper operations. They warned that the company could
choose to clean house by taking action on other legacy prob-
lems before Cutifani takes the helm.
WRITEDOWNS
Anglo's announcement is the latest in a spate of writedowns on
miners' misjudged investments, serving as a reminder of the
sector's poor record in creating value through deals. The result
for the incoming generation of mining bosses is likely to be far
fewer deals.
Rio Tinto ousted its chief executive, Tom Albanese, on Jan. 17
and took $14 billion in impairments tied to its underperforming
Mozambican coal and Canadian aluminium operations.
Other mining companies, such as BHP Billiton , are also likely to
write down underperforming assets as low prices and rising
costs eat into valuations.
Among Minas Rio's various problems has been a string of de-
lays and costs overruns, partly linked to Brazil's permitting proc-
ess.
Carroll, speaking to journalists in a call before she hands the
reins to Cutifani on April 3, was confident that the company
would not receive any more surprises on Minas Rio.
"The issues we face going forward have much lower risk than
the issues that we were facing in the past," she said, adding that
of the 300 permits and licences the project required, there are
only 17 remaining.
INSIDE METALS January 30, 2013
7
GENERAL NEWS (Continued)
The $8.8 billion capital expenditure figure for the project in-
cludes an additional $600 million risk contingency sum to cover
a potential escalation of land costs and mining inflation, Carroll
said.
Aquarius Platinum production rises
Jan 29 (Reuters) - Miner Aquarius Platinum said quarterly pro-
duction rose 10 percent, but the company added that cash gen-
eration for the precious platinum remained "constrained" at cur-
rent spot prices.
The world's fourth largest platinum producer said output rose to
78,987 ounces in the second quarter ended Dec. 31, from
71,954 ounces last year.
Production attributable to Aquarius at its main operation - Kroon-
dal located in the northwest province of South Africa - rose 18
percent.
South Africa is the source of between three-quarters and four-
fifths of the world's platinum, but its mining industry has been hit
by a wave of strikes in the last year, some of which have been
accompanied by deadly violence.
Mining companies have struggled to maintain profitability as
costs rise, while prices remain hurt by reduced demand from
carmakers, the leading consumers of the white metal used in
catalytic converters.
"It is against this backdrop that management continues to focus
on cash preservation and operational stability and improve-
ments," Aquarius said in a statement.
Aquarius said price improvements for platinum and a weak
South African rand is expected to substantially reduce cash con-
sumption.
Cash costs at Kroondal fell 7 percent in the second quarter.
Last year, Aquarius Platinum suspended production at two of its
mines in South Africa - Marikana and Everest - citing low plati-
num prices.
Shares in the company closed at 68.25 pence on Monday on
the London Stock Exchange. They have gained more than two-
thirds in value since the end of the first quarter in September.
Its Australia-listed shares closed down 0.5 percent to A$1.045
on Tuesday.
Demand for India's silver jewellery exports picks up sharply
MUMBAI, Jan 29 (Reuters) - Steep growth in India's silver ex-
ports is outpacing its other trade in precious metals as world
demand picks up, albeit for cheaper jewellery options.
Shipments are likely ro rise by up to 30 percent this year, trade
body officials said on Tuesday
"At such high prices, gold is going out of budget for many
youngsters ... a wrist bracelet of white gold is now replaced with
sterling silver as it is cheaper," said Pankaj Kumar Parekh, vice-
chairman of the Gems and Jewellery Export Promotion Council
(GJEPC). Shipments of gems and jewellery constituted 14 per-
cent of India's total exports, and employ 3.4 million workers,
with the Middle East taking most of the market.
Silver exports are likely to to go up by 25-30 percent this year
against $797 million a year ago while gems and jewellery ex-
ports are expected to rise 15 percent against $38.28 billion
worth of overseas shipments in the previous year.
The GJEPC expects robust sales from the United States, which
contributed to 11 percent of exports."From the U.S., demand
and consumer confidence are very encouraging... this market
will play a major role in gems and jewellery exports," said Vipul
Shah, chairman of the GJEPC, adding they have been focus-
sing in other growth areas like the United States, China, Russia
and Australia.
The body, which represents more than 5,000 members, also
hoped the government will reduce import duty on refined gold
bars in the budget on Feb. 28. Exporters generally take duty
free gold from lending banks, but they need to give margin
money, which includes import duty and value added tax to take
a gold loan from banks. The margin money, which is blocked for
a maximum of 90 days until payment from importers is proved,
has increased more than threefold after the duty hike was im-
plemented.
"Increase in import has an impact on export transaction cost,"
said Parekh, adding "hand to mouth exporters will have to re-
strict their business due to additional requirement of margin
money to take care of additional import duty."
The trade body wants the federal government to allow a duty
free import quota of 15 percent of the previous year's exports. In
January 2012, the government levied a 2 percent import duty on
cut and polished diamonds.
INSIDE METALS January 30, 2013
8
INSIDE METALS January 30, 2013
MARKET NEWS
Tajik aluminium smelter cuts 2012 output to 272,500 T
DUSHANBE, Jan 29 (Reuters) - Tajikistan Aluminium Company
(TALCO) cut output by 1.8 percent to 272,500 tonnes last year
after Central Asia's largest aluminium smelter was hit by a tem-
porary halt of natural gas supplies from neighbouring Uzbeki-
stan.
"We should give the plant's management their due. They man-
aged to keep aluminium output steady. They had no gas, but
they found alternative fuel. Well done," Tajik Economy Minister
Sharif Rakhimzoda told a news conference on Tuesday.
Uzbekistan, the only supplier of gas to Tajikistan, cut shipments
for 15 days last April, causing a 4.6 percent month-on-month
decline in output.
To avoid this in the future, TALCO last summer bought in China
and assembled an installation allowing to process locally pro-
duced coal into methane. Uzbekistan, which has strained rela-
tions with its much poorer Central Asian neighbour, completely
cut natural gas supplies to Tajikistan on Jan. 1, 2013.
"TALCO has no plans to lower output in the current year," said
Rakhimzoda, who declined to give figures for planned produc-
tion. Aluminium exports remain vital for Tajikistan, a Muslim
nation of 7.5 million which borders China and Afghanistan. The
metal accounts for more than 40 percent of all Tajik export reve-
nues, official data show.
HSBC raises 2013 copper price outlook on tighter market
Jan 29 (Reuters) - HSBC raised its 2013 copper price forecast
on Tuesday, saying it expects positive sentiment to drive prices
for the metal in a structurally balanced market. The bank lifted
its 2013 forecast for the average cash copper price to $8,000
per tonne from $7,500 to reflect the metal's relatively good start
to the year.
"Copper, perennially described as fundamentally tight, actually
finished 2012 posting a gain in inventories," analyst Andrew
Keen said in a note to clients. "This market remains balanced in
our view, and this is enough to keep prices high when sentiment
is good."
Benchmark three month copper futures on the London Metal
Exchange (LME) were at $8,066 a tonne at around 1000 GMT
on Tuesday. HSBC raised its aluminium price forecast by
about 5 percent to $2,250 per tonne , but maintained its view
that prices would remain around this level due to a continued
structural surplus.
"It would not take a revolution in the rate of global demand
growth to fix the structural surplus in aluminium," analyst Keen
said. Keen expects aluminium to be in a 5.9 million tonnes sur-
plus over the 2012-2016 period, with the excess absorbed by a
compound annual growth rate (CAGR) of 6.2 percent for global
demand, and the market could be brought back into balance in
one good year of demand. Three months aluminium on the
LME was at $2,056 a tonne on Tuesday.
The bank also raised its iron ore price forecasts for this year to
$123 per tonne from $105 earlier, saying that the market was
probably driven by seasonal restocking by Chinese mills and
short-term concerns over supply. The bank said, however, that it
believes the lack of marginal cost support will see weakness for
iron ore later in 2013.
Antofagasta's 2012 copper production beats target
LONDON, Jan 30 (Reuters) - Chilean miner Antofagasta posted
2012 production ahead of its target and said it expected to main-
tain output at the same level in 2013. Antofagasta, a FTSE 100
company, said on Wednesday that 2012 copper production
came in at 709,600 tonnes, beating a full-year forecast of
700,000 tonnes, and 11 percent higher than the previous year.
Fourth quarter production was helped by a more reliable per-
formance at its key growth project, the Esperanza mine, which
has been hit by nagging operational problems.
The company has said it would need to spend up to $250 million
over this year and next to improve processes at the copper-gold
mine. The cost of producing each unit of metal in the fourth
quarter was in line with forecasts, said the company. It added
that costs would rise in 2013 to around 140 cents per pound
from 103 cents per pound last year due to higher on-site costs
at Esperanza and another mine, Los Pelambres.
Antofagasta, which has been listed on the London stock ex-
change since 1888, also said it produced 299,900 ounces of
gold in 2012, 52 percent higher than in 2011, but forecast that
gold production in the coming year would come in lower at
260,000 ounces.
A review of another copper mine, Minera Antucoya, was still
underway, Antofagasta said, having halted development at the
$1.7 billion project in December to assess escalating costs of at
the project. Antofagasta is one of a number of miners, including
industry heavyweights BHP Billiton and Rio Tinto , who are
reviewing tens of billions of dollars of new projects as margins
become squeezed by stubbornly high costs and weaker prices
for key commodities. Shares in the company closed at 1,275
pence on Wednesday, valuing the company at 12.6 billion
pounds
Vale sees iron ore at $110-$180/Tonne - CFO
RIO DE JANEIRO, Jan 29 (Reuters) - Emerging-market demand
for iron ore, which accounts for 90 percent of the profit at Brazil-
ian miner Vale , will keep prices between $110 and $180 per
tonne over the long term, Chief Financial Officer Luciano Siani
said Tuesday. Vale has struggled with falling iron ore prices,
which touched three-year lows in September of 2012 and forced
9
MARKET NEWS (Continued)
it and other big miners to reassess the costs of holding on to
unprofitable operations. Earlier on Tuesday, miner Anglo Ameri-
can announced it would take a $4 billion writedown on its Minas
Rio iron ore project in Brazil.
Mining giant Rio Tinto ousted its chief executive, Tom Al-
banese, on Jan. 17 after it took $14 billion in impairments tied to
its underperforming Mozambican coal and Canadian aluminum
operations.
Analysts say Vale has had its share of problem investments
ranging from its Rio Colorado potash project in Argentina to its
massive Simandou iron ore project in Guinea. When asked
about those projects, Siani said Vale was "not afraid to write off
non-performing assets."
He said during a meeting of institutional investors in Rio de Ja-
neiro that the company plans to reduce its 50 percent stake in
the CSP steel mill project in the northeastern city of Pecem, in
which South Korea's Dungkuk holds 30 percent and Posco the
remaining 20 percent.
"We are excited about this mill because of the growing demand
for steel in the northeast of Brazil," Siani said. "But our goal is
not to be a steelmaker." Vale plans to spend more than $400
million on the project in 2013. Vale has taken stakes in steel
mills in the past in exchange for long-term, iron-ore supply con-
tracts. In order to avoid competing with its iron ore clients, Vale
does not plan to manage the mill and hopes to cut its share to a
minority stake, Siani said.
TWO-SPEED GLOBAL INDUSTRY
Roberto Castello-Branco, Vale's head of investor relations, said
earlier in the day that prices for iron ore would be supported by
growth in markets such as China. He estimated industrial pro-
duction - an indicator of demand for steel and its main compo-
nent iron ore - to grow by about 7 percent in emerging markets
in 2013 but remain flat in developed countries. He added that
iron ore stocks in China, the world's largest importer of ore, re-
mained low.
Spot China-landed iron ore prices have rebounded in recent
months to nearly $150 a tonne. Speaking at the same event as
Siani in Rio de Janeiro, Itau BBA analyst Marco Assumpcão
said he saw iron ore prices easing to between $95 and $120 a
tonne in the coming years. "Our outlook is a bit more optimistic
than Itau BBA," Siani said. "We want to recover the market
share we lost.
Vale shares closed up 1 percent on Tuesday after the company
said it would submit to its board a proposal for shareholder divi-
dends of at least $4 billion this year, or two-thirds of the mini-
mum dividends approved in 2012, after a global slowdown and a
drop in iron ore prices. In 2011, Vale paid shareholders a record
$9 billion in dividends, but weaker iron ore demand has made
the miner more cautious about the year ahead. Vale said in De-
cember it will invest $16.3 billion in 2013, down 24 percent from
its 2012 capital spending budget.
Metalloinvest cuts steel billet output as Iran sanctions bite
MIAMI, Jan 29 (Reuters) - Russian steel and raw materials pro-
ducer Metalloinvest is reducing its steel billet production as
Iran's sanctions hit sales of this product and is increasing its pig
iron output instead, a company executive said on Tuesday.
Sanctions imposed by the European Union last autumn on sales
of steel and other key materials to Iran have prompted most
traders and producers to halt sales and have hit hard Russian
steel producers, which were heavily reliant on the Iranian mar-
ket.
"Before Iran was our main market for billet but as you know Iran
is now sanctioned and we cannot do anything there so we de-
cided to hold billet production and make more pig iron," Vak-
htang Kocharov, a senior iron trader at Metalloinvest Trading,
said in an interview on the sidelines of a CRU Ryan's Notes
Metallics meeting.
Kocharov trades hot briquetted iron (HBI), pig iron, and direct
reduced iron (DRI). The CRU Ryan's meeting brings together
suppliers and consumers of pig iron, HBI and DRI.
Metalloinvest, controlled by Russia's richest man Alisher Us-
manov, currently produces about 100,000 tonnes of pig iron per
month and it forecast it will be able to double the amount it can
sell within the next couple of years, as less of this steel raw ma-
terial will be used to produce billet. Kocharov underlined that the
switch from billet production to pig iron production was not final
as things might change based on the political situation in Iran.
HBI BOOST
Metalloinvest, which is the main supplier of HBI, another steel
raw material, to the Commonwealth of Independent States (CIS)
and the European market, is also investing to expand its HBI
production from 2.4 million tonnes a year currently to 4.2 million
tonnes by 2016. The Russian producer is now looking to in-
crease its sales of both pig iron and HBI in markets such as the
United States, also taking advantage of supply difficulties affect-
ing Venezuela, historically the world's top HBI supplier.
"The U.S. market is one of the markets with biggest potential for
us; we are trying to connect with some new clients here in the
US," Kocharov said. "For the last three to four years Venezuela
has been facing huge problems with production but they are still
offering aggressively. Of course if they shrink production further
we will have more chances to get into this market."
Venezuela disposes of large amounts of shale gas and iron, the
key ingredient to produce DRI and HBI, but it has been a very
unstable producer in the last few years, especially since most of
the industry was nationalised in 2009.
Although the country disposes of an HBI capacity of about 7
million tonnes a year for example, it only produced about 2 mil-
lion tonnes in 2012 and is expected to produce a similar amount
next year.
INSIDE METALS January 30, 2013
10
MARKET NEWS (Continued)
This was mainly due to the lack of investment, which has al-
ready caused some domestic plants to shut down in recent
years, and a lack of iron ore pellets, market players said.
"A couple of old mills closed completely in the last four years
and it seems that (the government) is not interested in investing
money to restart production. If the political situation remains as it
is now I think more and more mills will face the same problems,"
Kocharov said. Asked about prices, the trader said he hoped the
average for 2013 to be around current offers of $330 to $340
per tonne FOB Black Sea for HBI and $400 to $410 FOB Black
Sea for pig iron. Transport to the United States is around $20
per tonne, he added.
Italy steel output could fall in 2013 on strong euro
MILAN, Jan 29 (Reuters) - Italian steel production in 2013 is not
expected to improve from last year and could even worsen if the
euro strengthens, the head of Italy's steel makers association
said on Tuesday. "It's very unlikely production this year will beat
last year's result and could even be something less because of
the exchange rate war we are seeing," Antonio Gozzi said at a
presentation.
In 2012 Italian steel production fell 5.2 percent to 27.2 million
tonnes, Federacciai said. Gozzi said he did not see any steel
plant closures on the horizon but acknowledged some compa-
nies would have to "rationalise" their businesses to meet com-
petition through cost cuts, mergers and other measures.
China's refined zinc imports to stay strong on financing
demand
HONG KONG, Jan 29 (Reuters) - Chinese investors, who
boosted zinc imports by almost 50 percent last year, will con-
tinue to use the metal as a financing tool in 2013, a move that
would support global premiums of the metal but curb domestic
production, traders said on Tuesday. China is the world's big-
gest consumer and producer of refined zinc, and Australia was
its biggest supplier in 2012.
Last year, investors took to buying zinc in addition to copper to
raise money, and purchases increased around the fourth quarter
of 2012 as the arbitrage between Chinese zinc prices and the
London Metal Exchange briefly opened, while the arbitrage for
copper closed, traders said. In a typical purchase of copper or
zinc for financing, an importer puts down a deposit at a bank to
obtain a letter of credit (LC) to buy the metal, and then resells
the metal to obtain cash. The importer then pays the bank loan
over a period of 3 to 9 months. China's refined zinc imports
surged 47.6 percent year-on-year to 513,624 tonnes in 2012,
according to official data, which also showed that refined copper
imports reached a record of 3.4 million tonnes.
The arbitrage for zinc is so far closed, traders said, but investors
have stayed keen on imports, especially as zinc stocks are
smaller than those of copper. Around 900,000 to 1 million ton-
nes of refined copper are estimated to be in bonded ware-
houses in Shanghai in the beginning of this year versus about
300,000 tonnes a year ago.
Zinc stocks in Shanghai warehouses, however, stood at around
500,000 to 600,000 tonnes. The stocks included metal moni-
tored by the Shanghai Futures Exchange and bonded stocks,
which have arrived in Shanghai and not yet been declared for
China's 17 percent value-added tax.
"People are watching zinc prices closely. Once the price differ-
entials are not too bad, they would open the LCs quickly and
import," said a sales manager at a Chinese trading company.
"Our firm imported zinc for financing. Some firms which im-
ported copper for financing have been using zinc because the
losses incurred from the imports were lower than copper," said
the manager, who declined to be named as he was not author-
ised to talk to the media. "Copper stocks are large, so people
believe the risk of importing copper is bigger than zinc."
COPPER IS THE FINANCING KING
Spot zinc this week traded at premiums of about $120 to $130
to China versus less than $100 in the first half of 2012. Chinese
importers and overseas suppliers have agreed term premiums
of about $120 per tonne over the cash LME prices for 2013
zinc shipments, up from about $85 to $90 for 2012 shipments,
traders said.
An increase in zinc imports by China could weigh on domestic
prices, forcing smelters to slow production, said Feng Juncong,
a senior analyst at state-backed research firm Antaike, adding
smelters may delay 300,000 tonnes of new capacity this year.
"Financing imports for zinc would continue this year, probably
an average of 30,000 to 50,000 tonnes a month. Smelters
would have to cut production. They have no other way to go,"
she said. "Prices are too low to produce."
The nearest-month zinc contract of Shanghai Futures Ex-
change , which typically reflects spot prices, traded at 15,430
yuan ($2,500) per tonne on Tuesday, down 1.7 percent from the
2012 high seen in February last year and a fall of 23.3 percent
from the 2011 high, also in February of that year.
China is expected to produce around 5 million tonnes of refined
zinc in 2013, an increase of 3.3 percent from 2012, Feng said.
Consumption is also expected to rise by 3 percent to around 5.6
million tonnes in 2013. Even though it may appear to be more
attractive now, zinc is unlikely to replace copper as the main
financing tool for domestic importers because the copper trade
is more liquid than zinc in China, allowing buyers to swiftly resell
the metal and obtain cash quickly, traders said. "If importers
cannot resell zinc fast, they would face big problems," said a
trader at an international brokerage who requested anonymity.
INSIDE METALS January 30, 2013
11
Daily LME Aluminium 3-months Daily LME Copper 3-months
ANALYTIC CHARTS (Click on the charts for full-size image)
INSIDE METALS January 30, 2013
Daily LME Nickel 3-months Daily LME Zinc 3-months
Daily LME Tin 3-months Daily LME Lead 3-months
Daily LME Nasaac 3-months Daily LME Alloy 3-months
12
MARKET REVIEW
METALS-LME copper hits near 3-wk peak on global growth
hopes
SINGAPORE, Jan 30 (Reuters) - London copper rose to nearly
a three-week high as traders opened new long positions on cop-
per on hopes for improving global growth, while looking ahead
to results from a Federal Reserve meeting and Chinese factory
data.
While the global economy is showing fresh signs of life, traders
are looking for confirmation from top consumer China's manu-
facturing sector this week before Lunar New Year holidays start
next month. Copper has been trapped in a band of $7,920 to
$8,250 a tonne since a new year rally fizzled out.
"There are expectations for mildly dovish sentiment today that
are weighing on the dollar and that's why we're seeing some
gains across commodities," said commodities analyst Natalie
Robertson of ANZ in Melbourne.
"Copper is also trading a little more cautiously ahead of the Chi-
nese new year. As a result we won't be expecting such a huge
price rally on the back of China's factory figures, but it will cer-
tainly be supportive if they improve as expected."
Three-month copper on the London Metal Exchange had
climbed 0.51 percent to $8,144 a tonne by 0701 GMT, after
earlier hitting $8,159 -- its highest since Jan. 11. LME copper
closed up 0.66 percent on Tuesday.
Traders said speculators had been adding to long positions
since Monday with volume trade of more than 5,000 lots over
the session .
The most-traded May copper contract on the Shanghai Futures
Exchange climbed about 1 percent to end at 59,260 yuan
($9,500) a tonne. It earlier marked its highest point since Sept.
28 at 59,400 yuan a tonne.
U.S. home prices rose in November, climbing more than 5 per-
cent from a year ago in the biggest increase since August 2006
when the housing market was starting to collapse, bolstering the
outlook for the global economy.
Market focus is now on the Fed's monetary policy committee,
with the central bank expected to confirm it will keep up $85
billion in monthly bond buying until unemployment rates drop
significantly, although officials have shown concern over side
effects from such measures.
In Europe, shares were set to open flat.
"Rising housing prices in the U.S. and a late December spike in
lumber prices certainly indicate the U.S. recovery is underway,
but we still need confirmation from China that things are improv-
ing," said RBC Capital in a note.
China's factory activity in January, scheduled for release on
Friday, probably expanded at its fastest pace in nine months,
adding to signs that recovery momentum is building as domestic
demand strengthens.
"We may well have to wait until after the Chinese Lunar New
Year holidays to see the big move we have been expecting in
metal prices," it added.
MARKETS NEWS
A stronger euro was aiding the uplift in metals. Euro bulls were
battling to break 14-month peaks versus the dollar and trip op-
tion barriers at $1.3500. A break beyond this level could spark a
fresh rally in metals, traders said.
"Based on momentum, the euro looks certain to keep rising.
Today is the FOMC so anything goes ... but the upside (on met-
als) looks very real," a Singapore-based trader said.
A weaker dollar makes metals cheaper for holders of other cur-
rencies.
"The USD could well correct further if today's US Q4 GDP re-
lease confirms the ongoing economic recovery while the Fed
retains its dovish tone ... We are overall positive on EUR/USD
and expect 1.38 in 3 months," said Credit Suisse in a note.
PRECIOUS-Gold fights to hold ground above key level, Fed
in focus
SINGAPORE, Jan 30 (Reuters) - Gold fought to hold steady
above a key technical level after snapping a four-day slide in
the previous session on hopes the U.S. Federal Reserve would
opt to continue with monetary stimulus.
The central bank is expected to confirm in a statement at 1915
GMT that it will keep up $85 billion in monthly bond buying until
unemployment rates drop significantly, although officials have
shown concern over side effects from such measures.
Investors are also waiting for nonfarm payrolls data on Friday
for a close look at the U.S. labour market. Economists sur-
veyed by Reuters expect steady hiring from employers in Janu-
ary, helping unemployment to stand unchanged from a month
earlier at 7.8 percent.
Recent data showing signs of a steady economic recovery has
depressed sentiment towards gold, a safe haven popular in
times of economic and political distress.
"In the short term, gold will struggle because the U.S. data will
continue to be pretty good," said Jeremy Friesen, commodity
strategist at Societe Generale in Hong Kong.
But he added that the global inflation outlook is firming due to
ultra-loose monetary policies adopted by central banks in key
economies, which will benefit gold as an inflation hedge.
"Growth looks better so the market is shifting out of risky low-
yield asset or zero-yield assets to equities, but inflation con-
cerns are opposing that and may be sustaining some interest in
gold."
INSIDE METALS January 30, 2013
13
MARKET REVIEW (Continued)
Rising oil prices may also stoke worries about inflation. Bench-
mark Brent crude matched a more than three-month high hit
the session before.
Spot gold had edged up 0.2 percent to $1,666.44 an ounce by
0619 GMT. It rose above the key 200-day moving average in
the previous session, which stood just below $1,663.
U.S. gold was up 0.3 percent at $1,666.
Reuters market analyst Wang Tao said that technical analysis
suggested spot gold may hover around $1,662 an ounce for one
session or retrace moderately before climbing again towards
$1,669.
Graphic: Spot gold 24-hour technical outlook
http://graphics.thomsonreuters.com/WT1/20133001094740.jpg
Purchases in Asia's physical market were slow, as buyers that
beefed up their inventories earlier in the month moved to the
sidelines, waiting for clear direction in prices.
"We see some buying from Shanghai, but overall the volume is
small," said Peter Fung, head of dealing at Wing Fung Precious
Metals in Hong Kong. "There is no direction and gold will remain
in a range between $1,620 and $1,700."
A recent rise in U.S. Treasury yields helped weigh on gold sen-
timent as investors unwind their safe-haven buying, Fung
added.
In other metals, spot platinum rose 0.4 percent to $1,682.24,
headed for a second straight session of gains, shrugging off
news that Anglo American Platinum , the world's top platinum
producer, has delayed job cuts to allow time for talks with the
South African government and unions.
Spot silver was flat at $31.38.
India's silver jewellery exports are expected to jump up to 30
percent this year as world demand picks up, said India's Gems
and Jewellery Export Promotion Council.
FOREX-Yen under pressure, falls to 2-1/2 yr low versus
dollar
LONDON, Jan 30 (Reuters) - The dollar rose to a fresh 2-1/2
year high against the yen bolstered by widening spreads be-
tween U.S. Treasuries and Japanese government bond yields
amid expectations of more aggressive easing by the Bank of
Japan in coming months.
The dollar was up 0.6 percent at 91.32 yen , with traders citing
option expiries at 91.50 yen which could sway trade.
The euro was also 0.7 percent higher at 123.30 yen , with inves-
tors targetting its April 2011 high of 123.33 yen.
(Inside Metals is compiled by Shruthi G in Bangalore) For questions and comments on Inside Metals click here Your subscription: To find out more and register for our free commodities newsletters, click here Privacy statement: To find out more about how we may collect, use and share your personal information please read our privacy statement here To unsubscribe to this newsletter click here
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INSIDE METALS January 30, 2013