Commodity Corner

Views on commodities and energy

from Global Investing:

Competition for rare earth metals

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China’s dominant position in the arena of rare earth metals used in new technology such as batteries for hybrid cars and magnetic motors could be eroded by an Australian listed company – Greenland Mineral and Energy. The company is planning to list in London next year, pending the resolution of a couple of issues.

Greenland Minerals and Energy thinks it probably has access to the world's largest depositis of rare earth metals and uranium -- used to make nuclear energy.

Global consumption of rare earths last year is estimated at 135,000 tonnes or $1.5-$2.0 billion in 2008. Demand is forecast to grow by 65 percent by 2012 from 2008 levels.

from Summit Notebook:

U.S. Commerce Secretary doesn’t like ring of Shanghai Silicon Valley

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U.S. Commerce Secretary Gary Locke says one thing he doesn't want to see is a Shanghai Silicon Valley develop from China's investment in clean energy.

He warned that if the United States doesn't move forward on clean energy, it risks falling behind China where the government is spending almost $100 billion a year to support renewable energy and clean energy efficiency.

Will Russia cut aluminum production after winter thaw?

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On Alcoa’s quarterly conference call this week, CEO Klaus Kleinfeld pointed out that there is currently a 1.4 million tonne aluminum surplus in the world outside of China, and therefore to expect more production to come off line in coming months above the already-announced 1.6 million tonnes of production that has yet to be implemented.

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Source: Alcoa

Both Alcoa, as the world’s largest aluminum producer, and China, producing more than 13 million tonnes in 2008, have idled substantial percentages of their output.

Start of the Games, end of the commodities boom?

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Were the opening ceremonies for the Beijing games the beginning of the end of the commodities rally? This graphic shows that China’s economic growth took off after the International Olympic Committee gave it the nod in 2001. The commodities boom, based on the Reuters/Jefferies CRB Index, can be traced back to around that time as well.

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China went on an unprecedented seven-year construction spree to modernize its cities and infrastructure before throngs of athletes, tourists and media members arrived from around the world, stockpiling raw materials to accomplish its makeover.