Steel

Buoyant copper is riding for a fall

9 Feb 2011

The red metal has busted through $10,000 a tonne, partly because of its links to Chinese growth. Demand outstrips supply, so the market is tight. But financial participants have clouded the picture. When they lose interest, or if China proves fickle, copper prices could tumble.

Court ruling gives Deripaska a chance at Norilsk

8 Feb 2011

A West Indies court says that the Russian nickel group can't vote or sell treasury shares held by its offshore subsidiaries. This gives aluminium oligarch Oleg Deripaska a chance to convince minority investors to back him and fire Norilsk's board. But he faces an uphill struggle.

Japan shows the way on steel consolidation

3 Feb 2011

The country doesn't normally lead the way in M&A. But the possible tieup of two of Japan's biggest steelmakers is a welcome move for an overpopulated industry. Still, with the two targeting an April 2012 deal, they may be allowing for plenty of Japanese complications ahead.

As interest rates climb, gold could tank

1 Feb 2011

The yellow metal's price has tripled in the last five years as investors, wary of money printing, craved something solid. Now cash is coming out of one of the world's biggest gold funds. As global growth and inflation picks up and interest rates rise, gold could fall hard.

Nord Gold shoots high with valuation hopes

27 Jan 2011

Russia's Severstal hopes its gold mining business will be worth as much as $5.1 billion in a London IPO. Nord Gold's diversification and production growth look good relative to UKlisted rivals. But the value of a large subsidiary suggests the price tag is punchy.

Norilsk’s dividend slash shows Deripaska the exit

20 Jan 2011

The Russian nickel miner may not pay a dividend this year, even as it spends $4.5 billion on share buybacks. This puts further pressure on RUSAL, the aluminium giant, to sell Norilsk its 25 percent stake in the group. RUSAL's owner Oleg Deripaska may soon have no other choice.

China may stub its toe on rare earths quotas

30 Dec 2010

Export restrictions on metallic elements are designed to help protect domestic industry. But Chinese companies will lose if the policy leads to broader protectionism. If Beijing is serious about addressing environmental damage, it should limit rare earths production, not exports.

Vallar is set for an impressive return

9 Dec 2010

There is a good chance that investors in Vallar, the mining newcomer fronted by Nat Rothschild, will enjoy a tidy payday when trading in shares in the company restarts. Judging by the current market value of what it's buying, a 12 percent jump is in order.

ArcelorMittal’s spin-off logic is hard to fault

8 Dec 2010

The steelmaker is offloading its stainless steel unit, the smallest of its businesses. With its parent focused on mining expansion, the niche division risked becoming a distraction. The spin off also clears the way for industry consolidation ArcelorMittal is reluctant to lead.

Rio Tinto’s China deal a big win – for China

3 Dec 2010

The UK miner is teaming up with top customer and shareholder Chinalco to explore Chinese mineral reserves. It's a pioneering deal. Being first has option value for Rio. But by putting people and assets in the Middle Kingdom, Rio's giving the Chinese miner a new kind of leverage.

Gold/platinum ratio indicates investors’ gloom

18 Nov 2010

The yellow metal is seen as a haven against financial turmoil. Platinum demand rests on industrial production. Both have risen strongly in price in the last two years, for different reasons. But the ratio between the two suggests goldhoarding bears currently have the upper hand.

Norilsk Nickel EGM unlikely to end oligarchs row

21 Oct 2010

Oleg Deripaska and Vladimir Potanin, the Russian metals billionaires, are taking their fight to an EGM of Norilsk Nickel. The owner of RUSAL faces an uphill struggle in trying to regain some influence on the company's board. A standoff would test the patience of minority owners.

Ukraine has a lot to lose from Arcelor dispute

6 Oct 2010

The steel giant's $5 billion investment in the country's largest steel plant is under threat. ArcelorMittal is accused of reneging on social commitments made during privatisation. The outcome of the case will show whether Ukraine can shake off its terrible business reputation.

Kazakhmys stake shuffle could hurt minorities

5 Oct 2010

The Kazakh state has seminationalised the Londonlisted miner by purchasing an 11 pct stake from chairman Vladimir Kim. It's good the $1.3 bln stake wasn't just dumped on the market. But with the government holding a 26 pct stake, politics could prevail over shareholder value.

Reserves and growth make Severstal Gold attractive

29 Sep 2010

Russian miner Severstal looks set to spin off its gold division in a London listing likely to value it at around $4 billion. The rumoured price isn't cheap. But international diversification, large reserves and growth prospects should make the issue a hit.

RUSAL’s criticisms of Norilsk are half right

21 Sep 2010

The metals group controlled by Oleg Deripaska has lambasted Norilsk's governance and performance, saying they saddle the miner with a $20 bln discount. Deripaska makes an unlikely shareholder champion, but his governance criticisms are valid. Sadly the rest is less convincing.

Rio and BHP steel themselves to abandon JV

15 Sep 2010

Pooling the riches of Australia's western desert, currently split between Rio and BHP, would give the duo world dominance in iron ore. But they've asked the Aussie authorities to postpone a decision yet again. The deal is on the rocks. Still, there should be relief all round.

Deripaska will struggle to keep a hand in Norilsk

1 Sep 2010

The oligarch has suffered a setback in his row with the Russian nickel miner, after Vladimir Putin rejected his criticisms of Norilsk's dividend policy. Without political support, Deripaska may be better selling the 25 pct stake held through debtridden aluminium giant Rusal.

IMF sale should worry the gold bugs

18 Feb 2010

Gold continues to develop an illustrious hedge fund fan base with George Soros recently doubling his holdings. But enthusiasts for the yellow metal should be perturbed by the waning interest from central banks. Their unwillingness to scoop up IMF gold is an ominous sign.

ArcelorMittal signals lumpy recovery

10 Feb 2010

The world's largest steelmaker survived an awful 2009, but reckons the crisis isn't over. Global steel demand will return to 2008 levels, but only because growth in emerging markets will offset weakness in developed ones. That combination will be tough on prices and margins.