Views on commodities and energy
from From Reuters.com:
Chukotka, a region revived in the last eight years by the $2.5 billion investment of Chelsea soccer club owner Roman Abramovich, produced a fifth of Russia's gold in the first half of this year. Gold is the region's passport to growth after Abramovich quit as governor last July.
Only South Africa holds more gold than Russia, but Moscow's fragmented industry has struggled to access vast reserves in its inhospitable Far East. The region was first mined in the 1930s by prisoners of the Gulags set up by Soviet leader Josef Stalin.
Global miner Rio Tinto said it had an excellent relationship with Chinalco, despite a decision to scrap a proposed $19.5 billion tie up with the Chinese firm on Friday.
The failed link up between China’s Chinalco and Rio Tinto in Australia was thought by many observers to be at least partly due to shareholders’ fears that Chinalco was trying to increase its leverage in iron ore deals with Rio.
Now that the tables have turned, and Rio announced a proposed iron ore joint venture with BHP Billiton in Western Australia the Aussies could get the upper hand in determining prices in negotiations with Chinese steel makers, analysts said.
If the deal goes through, Damien Ma, political risk analyst for Eurasia Group said BHP and Rio would supply roughly 3/4 of China’s iron ore. “That’s enormous.”
The deal comes amid very contentious iron ore negotitions with the price down sharply in the last six months.
The Australians’ proximity to China, and therefore greatly lower freight costs, and the significant operating cost reductions from the planned joint venture would certainly give Brazil’s VALE, the world’s largest iron ore producer, “some competitive issues,” as one analyst put it.
If Rio and BHP are able to meaningfully reduce their operating costs at a time when they are already competitively advantaged by the proximity to China and the rest of Asia, analysts said it could force VALE to lower their iron ore prices to remain competitive.
One of the unexpected findings from executives and analysts attending the CESCO and CRU copper conferences in Santiago, Chile: Women are better drivers than men in those house-sized trucks roaming surface mines around the world. They’re said to be more cautious and that reduces wear and tear on the 13 feet-high tires they rumble around on.
Watch this video uploaded to YouTube to see the monster-of-monster trucks in action.