Weekly News 27 31 May 2013 - · PDF fileWeekly News 27 – 31 May 2013 Padaeng Industry...

Weekly News 27 – 31 May 2013

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METALS-Copper steady as investors ponder U.S., Chinese data

US zinc market: Orders slow ahead of Memorial Day weekend

Investment Focus - Hindustan Zinc: A good option in metals space

Manufacturers turn up heat on LME over metals warehousing

ASIA METALS MORNING - Shanghai copper drops as China growth

concerns weigh

Are New Mines Threatening Zinc’s Positive Price Outlook?

Iron Ore Price Outlook: How Much Further Will it Fall?

METALS-Copper gains after upbeat U.S. data; firmer dollar weighs

Zinc to Play Key Role in Reducing Preventable Childhood Deaths in India

METALS-Copper falls on mine restart, global growth worries

METALS-Copper up on China demand prospects, tighter supply

Blackthorn Resources expects to ship first Perkoa zinc concentrate Q3

2013

China urges better use of associated metal minerals, tailings in 2011-15




METALS-Copper steady as investors ponder U.S., Chinese data LONDON, May 24 (Reuters) - Copper was little changed on Friday as investors weighed the potential impact on metals demand of upbeat figures on U.S. jobs and factory output versus data showing slower industrial activity in top metals consumer China. Benchmark copper on the London Metal Exchange traded at $7,280 a tonne at 1300 GMT, down only slightly from its close of $7,300 on Thursday. Data out on Thursday showed China's factory activity shrank for the first time in seven months in May, raising fears that its economic recovery has stalled. Partially balancing concerns about China, which accounts for about 40 percent of global copper consumption, data from the United States showed orders for long-lasting manufactured goods rose more than expected in April. U.S. data on Thursday also showed a bigger-than-expected drop in claims for unemployment benefits. "It seems positive data from the U.S. has helped, but the data on China yesterday was bearish," Sucden Financial analyst Kashaan Kamal said. "We've seen a gradual price decline since late January as concerns of slower growth have put pressure on prices, but this recent data highlighted the bearish outlook for both domestic and export demand." China's economy grew by a less-than-forecast 7.7 percent in the first three months of the year. Its imports of refined copper declined by more than a third in January-April, dragging down LME copper prices by 12 percent from this year's peak. TIGHTER SUPPLY Despite the weakness in its manufacturing sector, China is unlikely to launch any stimulus, with the economy still on track to grow by 7.5 to 8 percent this year, in line with government targets, Commonwealth Bank of Australia said in a note. "Incremental easing - for instance a more accommodative stance toward the property sector - is about all we expect might change," the bank said. Fundamentals, in the meantime, were providing some support to copper prices. Signaling demand for the metal may be improving, copper inventories in warehouses monitored by the Shanghai Futures Exchange fell 7.2 percent from last Friday to their lowest in more than seven months, data showed on Friday. Stocks in LME-registered warehouses also fell, daily data showed on Friday, posting a 2,700 tonnes decline to 621,175 tonnes, their lowest in two weeks.




A production outage since a May 15 tunnel collapse killed 28 workers at Grasberg in Indonesia, the world's second-largest copper mine, should also support prices. A trade union official said on Thursday all investigations into the incident at the Freeport McMoRan mine must be completed before workers return. Jinchuan Group Ltd, China's third-largest copper producer, has shut a 200,000 tonne-a-year facility due to a raw scrap shortage, which could reduce its refined output by more than 16 percent this year, an executive said on Friday. Aluminium was at $1,849 a tonne from a $1,850 close on Thursday, and lead was at $2,050.75 a tonne from $2,045. Zinc traded at $1,852 a tonne from $1,856, tin at $21,135 from $20,950 and nickel at $14,807 from $14,940. Metal Prices at 1301 GMT Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T Metal Last Change Pct Move End 2012 Ytd Pct move COMEX Cu 330.25 0.35 +0.11 365.25 -9.58

LME Alum 1848.00 -2.00 -0.11 2073.00 -10.85

LME Cu 7272.50 -27.50 -0.38 7931.00 -8.30 LME Lead 2050.25 5.25 +0.26 2330.00 -12.01

LME Nickel 14803.00 -137.00 -0.92 17060.00 -13.23 LME Tin 21075.00 125.00 +0.60 23400.00 -9.94

LME Zinc 1851.00 -5.00 -0.27 2080.00 -11.01

SHFE Alu 14650.00 25.00 +0.17 15435.00 -5.09 SHFE Cu* 53000.00 160.00 +0.30 57690.00 -8.13

SHFE Zin 14530.00 90.00 +0.62 15625.00 -7.01

** Benchmark month for COMEX copper

* 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07

US zinc market: Orders slow ahead of Memorial Day weekend Washington (Platts)--24May2013/557 pm EDT/2157 GMT Zinc players in the US market reported slow business this week ahead of the Memorial Day weekend, with zinc premiums from the East Coast to the West seemingly at one uniform level -- high. An alloyer in the Western US said he hadn't made any spot purchases this week, but said he was quoted from sellers of special high-grade zinc "anywhere between 9 and 9.5 cents" plus LME cash. A zinc trader put current SHG premiums at 8.5-9 cents and said current demand levels are mixed, with some customers reporting weak orders, while others say they anticipate the warmer temperatures will bring a surge in sales-enhancing construction activity. Another trader said his selling range is 9-11 cents, but said most of his transactions this week were closer to 11 cents. The trader said that, if customers can wait for material beyond a week or so, they might secure a premium nearer to 9 cents.




The trader also reported slow business, and compared the current zinc market to the aluminum market, referring to the large percentage of material tied up in warehouse financing deals, with the resulting elevated premiums. However, in the broader global zinc market, analysts at Bank of America Merrill Lynch in a report this week called zinc "the new copper." "Investment in zinc mines has not been sufficient to prevent continued declines of surpluses in recent years," the report said. "This is unlikely to change until projects like Ivanplat's Kipushi site come online later in the decade. Hence, we believe zinc could become the new copper." Meanwhile, in the Alloy No. 3 market, there was ample evidence that most market players -- even in the historically lower-priced West -- are paying more and charging more. "We are still around 18 cents for Alloy No. 3," an alloyed in the West told Platts. Late last year, many alloyers in the Western states were offering the alloy at 16 cents or below. Alloyers further East this week also put premiums in a generaly range of 18-20 cents. One alloyer who quoted that range said he sold about 15-20 truckloads of the material this week at standard net 30-day payment terms. He said the higher-end deals were generally for sales with a shipping point of 500-700 miles. The alloyer said that, as a general rule, destinations within about 200 miles represent about a penny in freight costs, and 400 miles costs roughly 2 cents in freight. Distances of about 700 miles will add about 3 cents in freight costs to the premium. Another alloyer said he is also quoting at 18-20 cents, but said he didn't close any spot deals this week. Platts assessment for special high-grade zinc was steady at 9 cents/lb plus LME cash, while the assessment for Alloy No. 3 was stuck in place at 19 cents/lb plus LME cash.

Investment Focus - Hindustan Zinc: A good option in metals space http://www.thehindubusinessline.com/ May 25, 2013: Investors can buy the Hindustan Zinc stock in view of the company’s financial strength, improving mineral demand and share buy-out prospects. The company is among the largest domestic producers of zinc, lead and silver. It is debt-free and was cash surplus by Rs 21,479 crore as on March 31, 2013. Global zinc and lead demand has been stabilising and there is a potential for the Government to sell its stake in the company. The company’s current valuation of 7.3 times the FY13 earnings is also attractive, compared to the multiple of 10 times, over the past five years. In the quarter ended March 2013, Hindustan Zinc’s income from operations grew 24.7 per cent from last year to Rs 3,908 crore. Quarterly net profit grew 53 per cent to Rs 2,166 crore, helped by rising zinc and lead prices, higher silver output, along with rupee depreciation. Zinc price realisation was Rs 44,900 a tonne for the quarter, eight per cent




higher than in the year-ago period. For FY13, sales grew 11 per cent to Rs 12,526 crore and profits jumped 25 per cent to Rs 6,899 crore, aided by rupee depreciation and higher silver output — a very high margin product. Operating margins remained stable at 68 per cent for the year, but improved to 72 per cent in the last quarter. The company has been operating cash flow positive and its cash holdings and current investments are substantial at Rs 51 a share. The company’s guidance for mined metal production in FY14 is 15 per cent higher than FY13 and for saleable silver production up 25 per cent. According to the company, its mine life, based on estimated production, is over 25 years. With high margins due to low conversion costs for zinc and lead, the large cash cushion and the expected higher metal output, Hindustan Zinc is a good option in the metals space. The International Lead and Zinc Study Group estimates that demand for lead and zinc will grow by around 5 per cent this year. About 50 per cent of the zinc demand is for rust-proofing (galvanising) steel and will be driven by infrastructure development in China and the US and global automobile growth. Price is likely to remain stable or rise due to mine closures by Canada’s Xstrata. Global silver offteke is expected to be driven by growth in industrial demand from the electronics and solar industries, even as the safe haven allure fades. Majority stake-holder Vedanta group (64.9 per cent) had made an offer to buy out the government’s 29.5 per cent share in January 2012. Vedanta had obtained shareholder approval (with August 9 expiry) to increase the original offer price by 25 per cent. The Government is considering the offer-for-sale route and a decision is awaited. The free float of the stock is close to five per cent and a stake-sale will be positive for the stock’s liquidity.

Manufacturers turn up heat on LME over metals warehousing * Complaints about queues, high surcharges gather pace * EC competition watchdog has received enquiry findings * US group says could withdraw support for LME contract LONDON, May 24 (Reuters) - Big industrial metals users are leaning heavily on the London Metal Exchange (LME) to fix its controversial metal storage system, although they have limited alternatives to relying on the exchange's global benchmark contracts. Firms running warehouses registered by the LME, the world's biggest industrial metals marketplace, have been making money by building up big stocks and charging for storage while they deliver metal at a limited rate to holders of LME contracts. Manufacturers are struggling to get supplies as they compete with banks and trading houses, which hold huge stockpiles as collateral for finance deals. Their problems came to a head this year as queues, sometimes lasting months, developed across the LME warehouse network. The queues and the false shortage created by financial buyers have kept physical metal away from industrial buyers, pushing up surcharges or "premiums" across the market.




"It creates an artificial industry and an artificial business model," Novelis Chief Executive Phil Martens said on the sidelines of the Platts Global Metals Awards on Thursday, where he was named CEO of the year. Novelis, the world's top maker of aluminium beverage cans whose customers include Coca Cola, has complained to the European Commission after long criticising the warehouse system. "It's been a constraint on supply, artificially inflates regional premiums, and it hurts the end-user, the consumer," Martens said. Litigation is not a viable option but increasing the company's independence is, Martens said, referring to reliance on a market set by the LME system. By the end of the decade, Novelis aims to have 80 percent of the products it makes to come from recycled material. "This would divorce us to a certain degree," he said. A spokeswoman for the LME said the exchange was "aware of market comment". "The warehouse system is under constant review and we will communicate our responses when it is appropriate to do so," she said. The LME has said the solution must come from a change in market conditions, mainly a rise in interest rates that would discourage finance deals. WATCHDOG The European Commission's enterprise and industry department has passed on to the EU's competition watchdog the results of an enquiry into complaints by manufacturers about the impact the storage play was having on their businesses, a commission source said. The competition authority will now decide whether an investigation is warranted, the source said. The commission has strong powers and can investigate anti-competitive behaviour and potential collusive agreements between companies, Diego Valiante, research fellow at the Centre for European Policy Studies, said. "This is a serious matter and involves potentially fines of billions of euros. They can apply sanctions to firms of up to 10 percent of their global turnover; it's a huge amount," he said. Collusion is difficult to prove. The trading companies and banks that own the warehouses say they are acting legally within their rights, and that long queues are largely the result of the difficulty and expense of moving metal out of depots. Novelis, which since 2011 has been almost alone in speaking out publicly about the controversy, has been joined by Southwire Co. and Encore Wire Corp, the two biggest U.S. manufacturers of copper electrical building wire and cable. They wrote to the LME last month and asked it to take action to reduce the queues and improved access to metal.




"We have put the LME on notice that there is a severe market dysfunction that is having an adverse economic impact," said Robert Bernstein, a partner at new York-based Eaton & Van Winkle LLP, which is representing the companies. "We're not trying to declare war. We're asking them to work with us, to make them aware of a situation that is not in the best interests of the LME or the best interests of the future of the copper contract and is threatening the viability of the price discovery function of the LME." The North American Die Casting Association (NADCA) warned last month it would encourage its members to withdraw support for the LME's North American Secondary Aluminium Alloy Contract (NASAAC) unless the LME made immediate changes. The association, which makes specialist products for automotive companies such as Ford and GM, was fed up with nine-month long queues for metal and inflated premiums. NADCA this week held a video conference call with LME executives, who said they would work with the aluminium committee to find solutions, NADCA President Daniel Twarog said. "Changes need to be made as soon as possible because the difference in NASAAC and what quality material can be purchased is a serious and costly issue for die casters," Twarog said in notes after the conference call. NADCA will have another call with the LME after the aluminium committee meets next month, he said.

ASIA METALS MORNING - Shanghai copper drops as China growth concerns weigh BaseMetals.com Singapore 27/05/2013 - Copper prices fell in Shanghai during Monday morning trading in Asia as signals from Chinese leaders indicated that they would tolerate sluggish growth while making efforts to rebalance the economy and reduce environmental degradation, dampening hopes for additional stimulus measures from the world's top metals consumer. The most-actively traded copper contract for September delivery on the SHFE fell to 52,510 yuan per tonne from Friday's close at 52,900. The LME was closed today for the Spring Bank Holiday, and the absence of US market participants for the Memorial Day holiday was also expected to lighten trading activity. Chinese president Xi Jinping said on Friday that the government would not pursue faster short-term growth at the expense of the environment, an indication that Beijing would make efforts to reduce widespread pollution that has become one of the chief sources of public disapproval with the government's management of the economy. The comments weighed on hopes for additional stimulus measures from Beijing after the HSBC Flash Manufacturing PMI for May showed contraction in Chinese factory output last month. Better-than-expected US data on Friday helped to counterbalance the impact, but




market participants remained concerned that the supply of base metals would continue to outstrip demand. "Positively surprising US durable goods orders provided some support," broker Credit Suisse said. "However, weak technical momentum and sluggish economic data from China suggests that trading could remain choppy." Prices were supported by the drop of copper stockpiles in SHFE warehouses of 7.2 percent, or 13,706 tonnes, to 176,624 tonnes last week. There were no major data releases scheduled for Monday.

Are New Mines Threatening Zinc’s Positive Price Outlook? Monday May 27, 2013, 4:15am PDT http://resourceinvestingnews.com Zinc’s medium-term price outlook is positive, Stephen Briggs, a senior metals strategist in commodity markets strategy at BNP Paribas, recently told Metal Bulletin; however, if too many new zinc projects come online, that forecast may worsen. “There is a good medium-term story, but that’s tending to disappear, and is being pushed further out,” he said. That’s because “[t]he bullish case is built on the key mine closures that we’re starting to see.” Such closures include the shutdown of Xstrata’s Brunswick 12 mine about a month ago and the impending shuttering of MMG’s Century mine and Vedanta’s Lisheen mine. The problem, Briggs believes, is that too many zinc companies see their mines as the solution to the decline in production that these closures will bring about. “None of them is huge. It’s a bit like copper in the sense that nobody is talking about very, very large mines, but there are quite a lot of medium-sized new mines and expansions. They’re mostly of the 100,000-tpy order of magnitude,” he explained. Replacing production wouldn’t be a problem if there was demand for it. However, Briggs noted that the market is “awash with excess inventory,” stating that zinc inventories in London Metal Exchange-listed warehouses remain high. FastMarkets’ Zinc Analysis and Forecast Q1 2013 report elaborates on that point, noting that “[d]espite last year’s 3.5-percent fall in refined zinc production to 12,618,000 tonnes, there is no actual shortage of capacity or of metal.” The reason is that a 5-percent increase in mine output in 2011 has created a build up of concentrate inventory. It’s this excess that has Briggs worrying about whether more zinc mine output is as necessary as miners seem to think it is. Who’s building zinc mines? Who are the miners that could benefit from recent and upcoming zinc mine closures? Here’s a brief look at three of them: Trevali Mining, a zinc-focused base metals development company operating in both Canada and Peru, is one company that believes the zinc mine shutdowns will be to its advantage. So

http://www.metalbulletin.com/Article/3201972/Channel/195220/MB-APEX-Q1-2013-BASE-METALS-Zinc-outlook-depends-on-closuresBriggs.html?eventlogin=Login&login=1&actionname=login&eid=E017

http://copperinvestingnews.com/

http://www.fastmarkets.com/base-metals-news/zinc-news/zinc-analysis-forecast-q1-2013

http://www.fastmarkets.com/base-metals-news/zinc-news/zinc-analysis-forecast-q1-2013

http://zincinvestingnews.com/2091-trevali-mining-corp-north-and-south-american-silver-lead-zinc-deposits.html




much so that, according to its website, it intends for production from its New Brunswick-based Caribou mine and concentrate plant, where operations are set to begin in early 2014, to coincide with their closure. Trevali received an operations permit for the complex at the beginning of the month, and looks to be on track to meet that goal. Vancouver-based Canadian Zinc, a development-stage company, also seems to be looking to benefit from the closures. It hopes to bring its Prairie Creek mine, located in the Northwest Territories, into production “as soon as possible.” Already in the final stages of permitting, it is likely that the mine will come online sooner rather than later. Currently in production is the Bracemac-McLeod mine, which started up just last week. The mine is a joint venture under which Donner Metals holds a 35-percent stake and Glencore Xstrata holds the remaining 65 percent. Like Caribou and Prairie Creek, Bracemac-McLeod is intended to benefit from zinc mine closures. In fact, it was brought into production specifically to replace production from Xstrata’s Perseverance mine “without a gap in feed to the Matagami mill,” according to Donner’s website. What’s ahead for zinc? Though Briggs notes that ”[w]e would need two or three years of deficit to erode the inventory that has built up in the past five years,” he also expects zinc to rise above $2,000 per tonne by the end of 2013 as “the medium story is still quite positive.” Similarly, FastMarkets states, “[f]or now, the stock overhang seems to be well managed by a combination of cash-and-carry deals and restricted load-out rates – these are expected to keep supply regulated.” The takeaway, then, seems to be that at least for now, the zinc market remains in a good place. Moving forward, however, investors may want to keep an eye on how many new zinc mines come online and how their production affects the market.

Iron Ore Price Outlook: How Much Further Will it Fall? by Stuart Burns on May 23, 2013 http://agmetalminer.com/ Iron ore is in a bear market, according to Bloomberg, as prices have fallen to their lowest in five months amid a wave of negativity that has led Chinese traders and steel mills to sell down their stocks of the key steel ingredient. The price of benchmark Australian iron ore with 62% iron content has fallen 12.5 percent in the past month. On Monday, it dropped to $123 a metric ton, the lowest since December, according to sources quoted in the paper. Perversely, daily steel production in early May rose to 2.19 million tons, on track for a monthly record, data from the China Iron Ore & Steel Association and the National Bureau of Statistics quoted in Bloomberg show; while at the same time, prices for finished steel continue to tumble. Not surprisingly, the Baltic Dry Index is down as well, as shipping rates chase lower iron ore volumes. The index has fallen 27 percent from a year ago with Capesize vessels down to $5,000/day.

http://zincinvestingnews.com/4455-project-update-trevali-receives-operations-permit-for-caribou-mine-concentrate-plant.html

http://agmetalminer.com/author/stuart/

http://www.bloomberg.com/news/2013-05-22/mine-energy-projects-worth-147-billion-delayed-australia-says.html

http://www.ft.com/cms/s/0/52cf34f2-c16b-11e2-9767-00144feab7de.html#axzz2U0ogyQ1f

http://www.bloomberg.com/news/2013-05-21/iron-ore-ships-extend-decline-as-china-seen-cutting-steel-output.html




What does this all mean? The Chinese steel industry appears to be have several dynamics operating at the same time. On the one hand steel, mills are de-stocking iron ore inventory, no doubt conscious of the fact that prices are falling and looking to move higher-cost stocks before prices fall further. In time, this will promote a restocking cycle when inventory levels reach sufficiently low levels and mills feel confident the market has bottomed. However, most analysts remain surprised that finished steel production has remained so high when growth is slowing and construction remains depressed. Reports of steel mill cut-backs and closures may have more to do with power shortages (in provinces like Hebei) and routine maintenance than a response to poor sales or loss-making economics. Yet the weakness in finished steel prices and record production numbers are trends that should run in opposite directions, and either production should slow or prices stabilize in the short to medium term as demand is not expected to pick up significantly this year. Lower iron ore costs are helping steelmakers’ squeezed margins, and the arrival of more capacity on the supply side later this year will not help iron ore producers reverse that trend even if steel mills enter a restocking cycle in H2. Whether Bloomberg has it right in calling iron ore a bear market remains to be seen, but on

balance, we can’t see a lot of evidence to prove them wrong this summer

METALS-Copper gains after upbeat U.S. data; firmer dollar weighs * U.S. single-family home prices rise by most in 7 years * Restart of Indonesian, Indian mine could drag on prices * China willing to tolerate slower growth LONDON, May 28 (Reuters) - Copper climbed on Tuesday after strong U.S. housing and consumer confidence data lifted prospects for rising metals demand in the world's biggest economy although gains were capped by a stronger dollar and concerns over Chinese growth. Metals prices got a shot in the arm after U.S. single-family home prices rose in March by the most in seven years and consumer confidence climbed in May to the highest level in more than five years. "We were struggling a bit most of the morning and the weaker euro didn't help, but it got a boost when those U.S. figures came through. It looks like investment buying; the trade are very quiet at the moment," a London trader said. Benchmark copper on the London Metal Exchange climbed 0.8 percent to $7,360 a tonne by 1406 GMT after touching a session peak of $7,379. LME copper was mostly steady last week, but looks set to end the month with gains of more than 4 percent, its first monthly advance since January.




"We expect copper to continue moving around current levels as dips will attract consumer buying so the downside should be pretty limited. But the upside is also limited as caution over growth out of China will prompt some selling at higher prices," Societe Generale analyst Robin Bhar said. "Comments from Chinese officials have also been accentuating expectations of slower growth." Fuelling investor concern, China's factory activity shrank for the first time in seven months in May, data showed last week, reigniting worries over stuttering growth there. An official report is due on June 1. Comments from officials on Monday also signaled that the country, which accounts for around 40 percent of refined copper demand, is willing to tolerate slower growth. A stronger dollar against a basket of currencies was weighing on dollar-priced commodities such as metals, making them more expensive for buyers in other countries. Helping to firm sentiment, however, European Central Bank Executive Board member Joerg Asmussen said on Monday the bank will stick to its expansive monetary policy for as long as necessary. In supply news, Freeport McMoRan Copper & Gold Inc is allowed to re-start most of its production at its Papua copper mine, a mining ministry official said on Tuesday, two weeks after a tunnel collapse killed 28 people. A resumption of mining operations at the giant Grasberg mine in Indonesia, could erode support for copper prices, analysts said. Putting further pressure on copper prices, Hindalco Industries Ltd, India's No. 2 copper producer, will also reopen its Birla smelter in early June after a month-long shutdown. LEAD TIGHTNESS Battery material lead was the best performer on the LME, gaining 2.0 percent to $2,110.50 a tonne. "Tightness in the metal's nearby forward structure continues to be a feature of the market and may well be deterring any would-be shorts from stepping in too aggressively to try and cap the rally," said analyst Leon Westgate at Standard Bank in London. The premium of three-month lead over cash metal has shrunk to $1.50 a tonne from $19.50 at the start of the month, indicating increasing scarcity for nearby metal. Tin inventories on the LME fell by another 1,825 tonnes to 230,725 tonnes on Tuesday, bringing the decline in stocks this year to 27 percent. Metal Prices at 1409 GMT Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T Metal Last Change Pct Move End 2012 Ytd Pct move




COMEX Cu 3.33 0.04 +1.19 365.25 -99.09 LME Alum 1851.00 11.00 +0.60 2073.00 -10.71

LME Cu 7358.00 59.00 +0.81 7931.00 -7.22 LME Lead 2106.75 37.75 +1.82 2330.00 -9.58

LME Nickel 14876.00 51.00 +0.34 17060.00 -12.80

LME Tin 21152.00 102.00 +0.48 23400.00 -9.61 LME Zinc 1868.25 12.75 +0.69 2080.00 -10.18

SHFE Alu 14620.00 0.00 +0.00 15435.00 -5.28 SHFE Cu* 52900.00 300.00 +0.57 57690.00 -8.30

SHFE Zin 14510.00 15.00 +0.10 15625.00 -7.14

** Benchmark month for COMEX copper

* 3rd contract month for SHFE AL, CU and ZN SHFE ZN began trading on 26/3/07

Zinc to Play Key Role in Reducing Preventable Childhood Deaths in India http://asia.wsj.com/home-page May 28, 2013, 12:08 p.m. ET Zinc to Play Key Role in Reducing Preventable Childhood Deaths in India IZA Partners With the Clinton Health Access Initiative (CHAI) and the Bill & Melinda Gates Foundation on the India Essential Medicines Initiative BRUSSELS, BELGIUM, May 28, 2013 (GLOBE NEWSWIRE) -- The International Zinc Association (IZA) has pledged its support to a program with the Clinton Health Access Initiative (CHAI) and the Bill & Melinda Gates Foundation to scale up intake of zinc and oral rehydration salts (ORS) by children in the state of Uttar Pradesh in India. The partnership aims to save lives of tens of thousands of children by accelerating progress towards reducing preventable childhood deaths from diarrhea. More than one of every four diarrhea-related deaths among children under five worldwide occurs in India; with Uttar Pradesh accounting for roughly 25 per cent of these (approximately 60,000 deaths annually). Over 90 per cent of these deaths can be prevented with a simple, highly effective treatment of zinc and ORS. Although it costs less than US $0.50 to treat a child, less than 1 per cent of all children receive the full-recommended treatment. This is due in part to a lack of awareness among caregivers and providers that zinc and ORS are the nationally recommended treatment for diarrhea. Without demand, there is limited incentive for suppliers to invest in production and distribution of these products. To overcome this, an ambitious, large-scale program was designed to significantly increase the use of zinc and ORS by simultaneously pursuing three key objectives: 1. Generate provider demand: Mobilize networks of rural medical practitioners (RMPs), local kiosks and retail outlets to stock and promote zinc and ORS. 2. Generate caregiver demand: Support the design and execution of widespread communication and marketing campaigns and conduct health diplomacy through community leaders.




3. Ensure and expand a solid supply base: Increase production of affordable, high-quality zinc and ORS products and support the commercial introduction of innovative products and packaging. The goal of the partnership is to significantly increase the coverage of zinc and ORS in Uttar Pradesh to 35 percent by 2015 and help save the lives of over 40,000 children by 2015, and tens of thousands more thereafter. IZA's direct contribution will extend the impact of these activities in an additional high-priority district of Uttar Pradesh, allowing the programs to reach even more children suffering from diarrhea. IZA is a proponent of public private partnerships. Since 2010, IZA has partnered with UNICEF to support zinc supplementation and health care programs through the Zinc Saves Kids initiative. "We are pleased to support work with CHAI and the Bill & Melinda Gates Foundation in their efforts to reduce the number of child deaths caused by diarrhea," said Stephen Wilkinson, Executive Director of IZA. He added, "By combining our efforts with similar initiatives the reach is broadened and more lives can be saved. This program also compliments IZA's other zinc and health initiative with UNICEF." [1] RMPs represent a large proportion of private providers in rural India.

About IZA IZA is a nonprofit organization representing the global zinc industry by supporting and advancing zinc products and markets through research, development, technology transfer and communicating the unique attributes that make zinc sustainable and essential for life. IZA is supporting UNICEF's zinc and health programs through the Zinc Saves Kids initiative. IZA is also promoting crop health through its Zinc Nutrient Initiative. Please visit www.zinc.org to learn more. CONTACT: Dr. Andrew Green Director, Zinc Nutrient Initiative Director, Environment, Health, and Sustainability International Zinc Association, US Tel. +1 919 287 1875 [email protected]

METALS-Copper falls on mine restart, global growth worries * OECD trims global growth forecast, IMF trims China forecast * Imminent resumption of Grasberg mine ops weigh * Order to remove copper from LME warehouses at record high LONDON, May 29 (Reuters) - Copper fell on Wednesday under pressure from the imminent resumption of production at the world's second largest copper mine, Grasberg in Indonesia, and The OECD reduced its global growth estimate for this year to 3.1 percent from a previous 3.4 percent, while the International Monetary Fund trimmed its growth forecast for China this year to 7.75 percent from 8 percent. Also, Freeport McMoRan Copper & Gold Inc said it would resume some operations at its Grasberg mine in Indonesia, with production possible in the next two to three days.




Operations at the mine have been suspended since a tunnel collapse killed 28 people more than two weeks ago. Three-month copper on the London Metal Exchange fell 0.51 percent to $7,281 a tonne at 1435 GMT, erasing the previous session's gains and heading towards a second weekly loss. Other base metals traded largely higher. "The market is struggling to move higher. We have supply outages, spot shortages, high premiums and then we have one bad macro number and it flushes out two to three days of gains," said INTL FCStone analyst Ed Meir. Copper prices have recovered from a year low of below $6,800 a tonne - hit last month - but have been trapped in a range of $7,100 to $7,500 since early May, hit by disappointing growth in top copper consumer China. Also a drag on copper was Tuesday's upbeat U.S. housing and consumer confidence data, which fanned fears the Federal Reserve may soon begin tapering back its massive stimulus programme. Financial markets have seen a rise in volatility since Fed chairman Ben Bernanke last week suggested the central bank could begin to roll back its $85 billion-a-month funds injection. But signs from the physical markets remained positive. LME data out earlier showed cancelled copper warrants - or orders to take delivery of metal from warehouses - rose to a new record high of almost 239,000 tonnes, blanketing some 38 percent of the exchange's total copper stocks. "Even though production at Grasberg Mine in Indonesia may be partially resumed as tomorrow, the situation on the global copper market remains tight at present," said analysts at Commerzbank. Also a plus for copper, physical demand in China is picking up. Stocks in Shanghai Futures Exchange warehouses have fallen for eight weeks on the trot to a seven-month low. At the same time, however, recent Chinese macro numbers on first quarter growth and on factory activity have been disappointing. China consumes about 40 percent of the world's copper. Metal Prices at 1340 GMT Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T Metal Last Change Pct Move End 2012 Ytd Pct

move

LME Alum 1862.25 9.75 +0.53 2073.00 -10.17 LME Cu 7268.00 -54.00 -0.74 7931.00 -8.36

LME Lead 2125.00 6.00 +0.28 2330.00 -8.80 LME Nickel 14878.00 3.00 +0.02 17060.00 -12.79

LME Tin 20951.00 -174.00 -0.82 23400.00 -10.47 LME Zinc 1887.00 16.00 +0.86 2080.00 -9.28

SHFE Alu 14640.00 40.00 +0.27 15435.00 -5.15

SHFE Cu* 52450.00 -40.00 -0.08 57690.00 -9.08 SHFE Zin 14490.00 -15.00 -0.10 15625.00 -7.26




** Benchmark month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN

SHFE ZN began trading on 26/3/07

METALS-Copper up on China demand prospects, tighter supply * Premiums for bonded copper in Shanghai as high as $150 * Worries linger that Fed may taper bond-buying programme * Chilean copper production down 1.2 pct y-o-y in April LONDON, May 30 (Reuters) - Copper rose almost 1 percent on Thursday as investors bet on improved imports by the biggest consumer China and as data from top producer Chile showed April output fell from a year earlier due to strikes and production problems. Three-month copper on the London Metal Exchange closed at $7,320, almost 1 percent up, reversing Wednesday losses. Lending copper some support, premiums for bonded copper in Shanghai were heard as high as $150 a tonne, according to China price provider SMM, a sign demand for delivery of the metals has improved. Some of China's largest copper smelters have recently been forced to shut some units due to shortages of scrap, cutting copper output in the region. "People are underestimating the pace of growth of demand in China; on the copper side of things we think demand is holding pretty well and the tightness in the scrap market in China is also quite notable," said analyst Dan Smith of Standard Chartered in London. "On the other hand the data out of Chile also helped a bit today." April copper production in Chile dropped by 1.2 percent from the same month a year before, due to strikes, production line problems and lower ore grades in some deposits, the Chilean government said. Some Shanghai traders were said to be betting copper imports by China, which accounts for around 40 percent of world copper consumption, will pick up in May. "The arbitrage between the LME and Shanghai (copper) did open up this week. I suspect we will see a bit more Chinese buying," said Citi analyst David Wilson. But he added: "I think it's a tad artificial. Prices are not going anywhere because macro data in China is not showing any acceleration in activity." Copper prices have fallen 9 percent so far this year on worries over less-than-stellar growth in China. They have been pegged for the past month between $7,100 and $7,500 a tonne. INDONESIAN MINE




The U.S. job market and the economy as a whole may be strong enough in a few months' time to allow the Federal Reserve to pare its bond-buying a little, one of the central bank's most dovish policymakers said on Wednesday. Uncertainty over the timing of any shift in policy left the dollar broadly weaker versus a currency basket, and versus the euro. A weak dollar makes dollar-priced metals cheaper for European and other non-U.S. investors. Also propping up copper, workers at Freeport McMoRan Copper and Gold Inc Indonesia mine will not return to open pit mining until all investigations are completed into this month's deadly tunnel collapse, union official Virgo Solossa said on Thursday. The global copper market has been keeping an eye on the closure at the world's second largest copper mine, which has helped underpin metal prices, but only a prolonged shutdown will hit world supplies, which are still seen in a small surplus this year. In other metals, aluminium closed at $1,908 a tonne from $1,862 on Wednesday, while zinc ended at $1,912 from $1,884 and lead at $2,170 from $2,126. Tin closed at $21,100 from $21,050 and nickel finished at $14,800 from $14,820. Metal Prices at 1412 GMT Comex copper in cents/lb, LME prices in $/T and SHFE prices in yuan/T Metal Last Change Pct Move End 2012 Ytd Pct move LME Alum 1896.00 34.00 +1.83 2073.00 -8.54

LME Cu 7318.00 53.00 +0.73 7931.00 -7.73

LME Lead 2157.00 31.00 +1.46 2330.00 -7.42 LME Nickel 14827.00 7.00 +0.05 17060.00 -13.09

LME Tin 20950.00 -100.00 -0.48 23400.00 -10.47 LME Zinc 1914.00 30.00 +1.59 2080.00 -7.98

SHFE Alu 14690.00 55.00 +0.38 15435.00 -4.83 SHFE Cu* 52610.00 -200.00 -0.38 57690.00 -8.81

SHFE Zin 14640.00 110.00 +0.76 15625.00 -6.30

** Benchmark month for COMEX copper * 3rd contract month for SHFE AL, CU and ZN

SHFE ZN began trading on 26/3/07

Blackthorn Resources expects to ship first Perkoa zinc concentrate Q3 2013 Thursday, May 30, 2013 http://www.proactiveinvestors.com.au/ Blackthorn Resources (ASX: BTR) is in the final stages of commissioning the Perkoa Mine process plant and expects to make the first zinc concentrate shipment from the Burkina Faso project in the third quarter of 2013. Notably, ore throughput and concentrate quality are approaching design specifications for a single ball mill operation. The company added ongoing training of operators and fine-tuning of the plant are continuing to further improve plant performance.

http://www.proactiveinvestors.com.au/companies/overview/2728/Blackthorn+Resources

http://www.proactiveinvestors.com.au/companies/sponsors_landing/2728/blackthorn-resources-2728.html




Improvements to the lead circuit, including the commissioning of the Flash Flotation Cell has also significantly improved concentrate quality close to budget expectations. The plant milled 42,168 tonnes of ore at an average grade of 4.8% zinc and 0.39% lead in April 2013 with plant availability approaching 90%. About 12,000 tonnes of concentrate with a grade of about 53% zinc is now stockpiled at the mine. This is available for transport to the port of Abidjan in Ivory Coast for shipping to market. Transport of concentrate has been timed to coincide with completion of civil works at the port. Blackthorn added the second ball mill to take throughput up to 1 million tonnes is expected to be delivered in June, with the second stage ramp-up in production to start during the fourth quarter. “We are pleased with the progress being made at Perkoa and seeing the project move into the production phase,” managing director Scott Lowe said. Open Pit

Perkoa Open Pit Mining in the open pit is continuing, with the second push-back now well under way. Drilling performance in April 2013 was below target due to poor drill rig availability, constraining volumes moved from the pit. However, drilling performance has improved in May 2013 with the mobilisation of an extra drill rig to site to meet the planned drilling schedule. The focus for the open pit remained on waste removal for development. Underground Underground ore production from development was well ahead of target at the end of April




2013, with high-grade development ore of approximately 20% zinc being stockpiled both on surface and underground. This ore will be used to improve the head grade in the coming months. Stoping from the 130 level is expected to commence in June 2013, resulting in increased production tonnage and grade from the underground mine. The Main Ramp, which had reached the 220 level, was stopped during the month to facilitate the drilling of the 220 to 190 level ventilation raise. Ramp production has now recommenced and is advancing towards the 250 level. Perkoa The Perkoa Project is a joint venture between Glencore International (project manager), Blackthorn and the Burkina Faso Government (10% free carried) which is currently developing the first large-scale underground base metals mine in the country. Glencore had in March this year agreed to provide additional equity funding for the Perkoa Project of up to US$80 million during 2013 to complete construction and commissioning as well as fund estimated costs until the project becomes self-funding. This additional funding requirement represents approximately US$40m to cover increased construction and commissioning costs and approximately US$40m to cover working capital and additional capital requirements up to 31 December 2013. As part of this agreement, Blackthorn elected not to fund its share of the capital requirement and instead chose to reduce its stake to 27.3% from 39.9%. Perkoa has a JORC Probable Ore Reserve of 6.3 million tonnes at 13.9% zinc. Mine life is estimated at 9.5 years. Analysis The imminent start-up of the Perkoa project will be a key milestone for Blackthorn Resources with the project currently expected to be cash flow positive later in 2013. Despite this, the full value of the project does not appear to be reflected in the company's share price. Blackthorn is currently trading at close to 50% cash backing with cash of $28.6 million, or $0.174 per share, as of 31 March 2013 and a market capitalisation of $61.61 million and share price of $0.375. This values its 27.3% stake in Perkoa and its flagship Mumbwa Project in Zambia at just $33 million. As production time line moves closer, we expect the share price to be re-rated.






China urges better use of associated metal minerals, tailings in 2011-15 Hong Kong (Platts)--30May2013/621 am EDT/1021 GMT China's State Council has urged the country's nonferrous metals sector to develop innovative smelting projects in the 12th Five-Year plan period (2011-2015), requesting more efficient use of associated metal minerals and tailings, the Ministry of Industry and Information Technology said in a circular on its website Thursday. "To keep in line with the country's medium-term and long-term science and technology development plans in 2006-2020, the State Council is encouraging innovation in the country's infrastructure sector," the circular said. "During the 12th Five-Year plan period, the nonferrous metals sector should adopt low energy-consuming, low polluting, modern smelters, with highly efficient utilization of associated metal minerals, tailings [the mining waste after ore processing], and shorter, low-energy consuming technology," it said. "China is still lagging behind the world's most advanced industrialized nations in the areas of innovation, with low efficiency and a lack of resource sharing," the circular said.

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