Monthly Metal Review
- January 2019
- December 2018
- November 2018
- October 2018
- September 2018
- August 2018
- July 2018
- June 2018
- May 2018
- April 2018
- March 2018
- February 2018
- January 2018
The European economy was unsettled this month by the debt crisis and Greek turmoil, nevertheless there were some positive signs. Germany's business-confidence index, the Ifo Institute survey of execu-tives, was up for the fifth month. Although Germa-ny's economy shrunk 0.2 percent in the last three months of 2011, economists said they expect growth in 2012. European Central Bank president Mario Draghi declared the worst of the eurozone crisis over. In the U.S., the S&P topped the healthy 1400 mark. Equity benchmarks were at multi-months highs, although stocks have drifted. U.S. indicators, includ-ing a rising equities market, pointed up.
The proposed US$90-billion Glencore-Xstrata merger may not slip so easily past regulators. Hard looks from Xstrata shareholders, metals companies, and EU regulators could drag the process out for quite a long time. Some opposition comes from discontented Xstrata shareholders, European steel producers, and others, saying the combination would create an overwhelming power in zinc, nickel and coal.
Martin Kabwelulu, mines minister of the Demo-cratic Republic of Congo, said he intends to change the 10-year-old mining code, increasing miners' tax rates and raising the government's now-5-percent-minimum automatic stake in mining projects. He said the code would insist on more domestic processing of raw materials and more domestic manufacturing. Kabwelulu said DRC raised around US$100M in mining taxes last year.
Colombia will award 2013 mining concessions under a new bidding process and give a maximum of 20 percent of an area set aside for mineral develop-ment. Criteria will include proposed exploration spending and how much a company offers to pay in revenue sharing. Foreign direct investment in Co-lumbia more than doubled in 2011 to $14.4 billion.
Indonesia, one of South East Asia's largest econ-omies, will place a 49 percent curb on foreign own-ership of mines. The new rules will require foreign companies to increase Indonesian ownership to a minimum of 51 percent by the first decade of pro-duction. Indonesia is the top exporter of tin and thermal coal and has rich deposits of gold and cop-per. Freeport McMoRan's Grasberg is the world’s largest gold mine and second-biggest copper mine. Freeport owns some 90 percent and has an existing contract, as do other major miners. Others include U.S.'s Newmont and International Nickel Indonesia, part of Brazilian Vale. SA. France’s Eramet operates a nickel project with Japan's Mitsubishi. It is unclear when the new regulation would apply to existing investors.
Canada is to end production of the penny this fall. Finance Minister James Flaherty said it costs 1.5 pennies to make each one-cent coin. The government reports the cost of producing the penny has risen to C$11-million yearly. A 2012 Canadian penny is 94 percent steel, 1.5 percent nickel and 4.5 percent copper as plating.
Philippines President Benigno Aquino stated the government may ask for 50 percent of all mining revenues to ensure it gets a fair share from the mining industry. Mining policies are being revised and Aquino said Manila, with a US$1-trillion resource base, will probably require miners to pay what he called hefty percentages of revenues. The excise tax is now 2 percent.