Metals

Electrolux buffeted by perfect Trump tariff storm

27 Apr 2018

The Swedish fridge maker lost a tenth of its value after operating profit almost halved in the first quarter. A rejig of its freezer factories in the U.S. was one culprit. But investors are dubious that cost cuts will enable such a global business to offset higher steel prices.

U.S. sanctions rethink is only partly reassuring

24 Apr 2018

A Treasury decision to delay the effects of sanctions on Rusal and allow it to disentangle itself from Oleg Deripaska has boosted the shares of the Russian group. But it leaves U.S. policy harder to gauge. That doesn’t augur well for next month’s crunch decision on Iran.

Russia’s banks could once more be its airbag

16 Apr 2018

The Kremlin has already authorised short-term liquidity to metals group Rusal. If the U.S. sanctions net gets cast wider, Moscow could use its control of the big Russian banks to prop up stricken companies. After all, that’s what it did when things last got dicey in 2014.

Opacity makes U.S. sanctions on Russia more potent

11 Apr 2018

Rusal aluminium will be barred from London’s Metal Exchange, and the Russian group and parent En+ will be deleted from some stock indices. In theory, non-Americans should be able to deal with both. But fear of how rules will be enforced is compounding the pain of tough sanctions.

Glencore’s Rusal cloud has a silver lining

9 Apr 2018

The commodity trader is nursing a hit to its 9 percent stake in the Russian miner, whose shares have halved due to U.S. sanctions. But the loss is bearable and disruption to the aluminium market and growing protectionism may end up helping CEO Ivan Glasenberg’s trading business.

Russian stocks deliver sanctions face-palm moment

6 Apr 2018

The U.S. sanctioned Rusal and EN+, as well as related oligarchs like Oleg Deripaska. The danger that groups close to the Kremlin might get burned was pretty clear in EN+’s recent IPO prospectus. Governance and politics are as critical to such companies’ value as their operations.

Coal clearout puts Rio on path to greener deals

28 Mar 2018

The Anglo-Australian miner has raised $4.2 bln this month getting out of coal. That implies more buybacks and fewer environmental concerns, helping lift Rio Tinto’s modest valuation. It can also focus on future growth, including investments in battery ingredients like lithium.

Viewsroom: Trump slaps tariff fear on markets

8 Mar 2018

Imposing levies on steel and aluminum has lost the president his economic adviser, ex-Goldman No. 2 Gary Cohn. That has shocked investors out of complacency. Also: Italy’s elections leave fringe parties in charge. And big deals may be back on the agenda for the mining industry.

U.S. metal tariffs may not be biggest trade worry

8 Mar 2018

The president’s steel and aluminum levies have rattled markets and nudged his economic adviser to quit. A probe into Chinese intellectual-property policy could prove more devastating, though. It commands wide support and could inflict broad trade and investment disruption.

Chile can set copper behemoth on market trajectory

8 Mar 2018

Codelco needs cash - and plenty of it. Attempting to privatise the world’s biggest copper producer would be politically toxic. Still, there is plenty Chile's incoming President Sebastian Piñera can do, starting with handing the group more control over its finances.

Revamped ENRC should set its sights low

8 Mar 2018

The colourful Kazakh miner, renamed ERG after it delisted under a cloud in 2013, is testing a recovering commodities market. A fresh IPO sounds a non-starter, but selling a stake in one of its operations could fly. If so, it would help the group trim almost $6 bln of debt.

Trade tensions curb spirits in U.S. energy sector

5 Mar 2018

OPEC is breaking bread with U.S. shale producers at an industry confab in Houston. It’s a sign of American wildcatters’ influence on the global market. But infrastructure bottlenecks and Trump’s new tariffs threaten to prevent drillers from taking full advantage of their clout.

Trump’s incoherent strategy dooms tariff crusade

2 Mar 2018

The U.S. president defended his steel and aluminum duties, arguing trade wars are “easy to win.” But his tax cuts increase the budget deficit and the country’s reliance on foreign capital, almost guaranteeing a worsening trade balance. The conflicting tactics are self-defeating.

Battery-powered IPO should be handled with care

2 Mar 2018

Ganfeng Lithium is coming late to the electric vehicle party. The Chinese miner and battery maker wants to raise at least $1 bln in Hong Kong as competition to make power cells intensifies and prices are peaking. Investors will want to know it isn't just cashing out at the top.

Trump tariff chaos shoots America in its own foot

1 Mar 2018

The president is to impose sweeping import duties on steel and aluminum, citing national-security concerns – though details are scant. It’ll help domestic steelmakers. But the move ignored some U.S. agencies and could deliver a blow to vital allies like Canada and South Korea.

Glencore is a weather vane for mining M&A

21 Feb 2018

The Swiss commodity group’s once-swollen net debt is below cash flow, but it will only decide later this year whether to hike dividends further. That leaves CEO Ivan Glasenberg scope to look for deals. If Glencore can’t find any decent ones, its peers probably won’t either.

ThyssenKrupp takes second step to redemption

19 Jan 2018

Having pooled its steel assets with rival Tata, the German industrial group plans a further strategy shift. Just as well: margins even in the non-steel bits lag peers. The question is how far CEO Heinrich Hiesinger can follow the vogue for dismantling big, unwieldy conglomerates.

Mega-miners will find good things in small packages

27 Dec 2017

They still depend on moving tonnes cheaply. But with green energy changing demand, big producers must increasingly think like small ones. For companies like Rio Tinto and BHP that will require a change of mindset – and in some cases, leadership.

Chile reinforces Latin American pro-business pivot

18 Dec 2017

Billionaire Sebastian Piñera won the copper-rich nation's presidential election with a stronger showing than expected. That will lend succor to like-minded leaders in Argentina, Brazil and Peru for whom fiscal discipline is proving a long slog and graft allegations a danger.

South African gold giant throws Lonmin a lifeline

14 Dec 2017

Gold miner Sibanye-Stillwater is buying the troubled platinum specialist for shares worth 246 mln pounds. The offer is far from generous compared with available cost savings. But Lonmin’s financial woes and inability to raise equity make a share of a larger group attractive.