Why J.P. Morgan Upgraded Price Forecasts for These Iron Ore Stocks
J.P. Morgan (JPM) upgraded its price forecasts for iron ore and coal based on its analysis of the next generation of iron and coal projects.
BHP’s Balance Sheet: The 2017 Outlook
BHP’s net debt was $20.1 billion at the end of December 2016, as compared to $26.1 billion on June 30, 2016.
BHP Billiton’s and Rio Tinto’s Take on Iron Ore Prices
BHP Billiton’s and Rio Tinto’s take Rio Tinto (RIO) announced that operations at its Hope Downs 4 mine in Western Australia will be shut down for two weeks over Christmas. The company hopes to achieve the fiscal production it’s guided for before that and the break should allow it to reduce operating expenses and maximize cash. […]
Why Vale SA Believes the Iron Ore Market Will Balance Out
Vale SA (VALE) is positive on the iron ore outlook. On the demand side, it believes that credit easing and public fixed asset investment should help kick-start the property market.
What Could Drive BHP Billiton’s Free Cash Flows for Fiscal 2017?
BHP Billiton’s (BHP) (BBL) unit costs declined by 16% in fiscal 2016, supported by increased capital efficiency. This helped BHP generate strong free cash flow.
A Look at BHP Billiton’s Balance Sheet after Fiscal 2016
BHP has a strong balance sheet in this depressed commodity environment. Standard & Poor’s cut its rating by one notch from A+ to A in February 2016.
With Volatile Times Not Seen Dwindling, How Is RIO Positioned?
Rio Tinto (RIO) has a high-quality suite of tier-1 assets with low-cost, high-quality products. This positions it well for the challenging times ahead.
Is Rio Tinto Finding a Silver Lining in This Project?
On August 2, 2016, Rio Tinto (RIO) announced the approval of the development of its Silvergrass mine to maintain its Pilbara blend.
Iron Ore Production Weakness Not Seen Dampening Supply
BHP Billiton’s iron ore production for its fiscal 2016 was 227 million tons. This was slightly lower than BHP’s guidance of 230 million tons.
Rio Tinto’s Recent Developments: What Do They Mean?
On June 7, 2016, Rio Tinto (RIO) announced a new cash tender offer to repurchase debt notes worth up to $3 billion. It’s the company’s second debt buyback offer in about two months.
Why Is BHP Predicting Another 10 Years of Glut for Iron Ore?
BHP Billiton’s (BHP) CEO Andrew Mackenzie said that there will be at least ten years of iron ore oversupply before demand-supply balances itself.
Vale’s Stretched Balance Sheet: Why Are Investors Still Worried?
Vale management maintains that “in spite of the increasing prices, we remain fully-committed to the strengthening of our balance sheet through the reduction of our net debt.”
Why Rio Tinto Doesn’t Believe in the Iron Ore Price Rally
Wall Street analysts expect iron ore to fall again as supply-demand fundamentals catch up with its price. Rio Tinto (RIO) shares this view.
Why Did Moody’s Downgrade Rio Tinto Despite Cost-Cutting Efforts?
Rio Tinto (RIO) released its 2015 results on February 11, 2016. It announced several cost-cutting measures to weather the prolonged downturn in commodities.
Moody’s Cut Rio Tinto’s Credit Rating: Cited Commodity Downturn
Moody’s Investors Service lowered Rio Tinto’s (RIO) credit rating on February 24, 2016. It downgraded Rio’s senior unsecured ratings by one notch to “Baa1” from “A3.”
A Look at BHP Billiton’s Capital Allocation Priorities
BHP Billiton (BHP) (BBL) has reframed its capital allocation priorities, including sustaining capex, maintaining balance sheet strength, and cutting dividends.
Why Is BHP Billiton Cutting Its Dividends?
BHP Billiton has changed its dividend policy from one based on progressive dividends to a payout ratio based on earnings.
Why Was 2015 Disappointing for the Franklin Mutual European Fund?
The Franklin Mutual European Fund was barely able to keep its head above water in 2015 with the smallest gains among the funds in this review.
Can BHP Maintain Its Dividends in 2016?
BHP Billiton is facing pressure in all the commodity businesses it’s involved in. At spot prices, free cash flow doesn’t cover the company’s dividends.
Why the Chinese Steel Demand Outlook for 2016 Remained Subdued
The construction sector is the biggest steel consumer in China, accounting for more than half of steel consumption in the country.
Rio’s Balance Sheet Could See It through the Cyclical Downturn
All eyes are now on Rio Tinto’s 2015 results due on February 11, 2016, when Rio’s management will report the unit cost reductions for various commodities.
Copper Production Cost Details Released by Chile
During the week ended December 24, 2015, the government of Chile released data on the production costs of its mining industry. This is the first report of its kind released by Chile’s government regarding its mining industry.
Detractors across Sectors Held TEMIX Back in Year-to-Date 2015
In the one-year period, TEMIX has returned 4.0%, while from November’s end until December 22, the fund has fallen a sharp 9.8%.
Are Curtailments Enough to Offset New Capacity in Iron Ore?
The Nullagine joint venture, where BC Iron owns 75% and Fortescue Metals (FSUGY) owns 25%, will cease production in 2016 due to weak iron ore prices.
BHP’s Free Cash Flow Could Fall Short of Covering Its Dividends
BHP has a capital expenditure (or capex) guidance of $8.3 billion for fiscal 2016 and $7 billion for fiscal 2017.
Is the ‘Tipping Point’ for Miners Near?
Rio Tinto’s CEO Sam Walsh said, “I expect we need a bit more pain. A minor interest adjustment could actually be a tipping point for some people.”
Anglo American Works to Restore Its Balance Sheet to Health
Anglo American’s balance sheet is in bad shape. The company is realigning its focus on cash flow generation, high-quality assets, and reduction of costs.
What Is Anglo American’s Strategy on Operational Discipline?
Anglo American embarked on operational discipline improvements starting in 2013. It will focus on achieving $2.1 billion in improvements in 2016 and 2017.
What Led Anglo American to Lower Production Guidance?
Anglo American has reduced its production guidance for 2016 from 24–26 million tons to 18–21 million tons.
Anglo American Shifts Its Focus to “Priority 1” Assets
Anglo American has announced a transformation in its assets. Its focus will now be on “Priority 1” assets, which can deliver cash flow through the cycle.
Investors Are Concerned after Anglo American’s Investor Day
Anglo American’s investor day highlighted the challenges faced by the broader mining industry. To return to health, it has announced drastic measures.
Copper Supply Faces Water Problems in Chile
The world’s five largest copper mines are located in Chile, and the water scarcity situation could impact copper supply significantly in the near future.
Copper Slumps to Multiyear Low following Paris Attacks
On November 16, 2015, all base metals tumbled to fresh lows following the terrorist attacks in Paris, which raised concerns about the global economy.
Chinese Economic Data and Production Cuts Boost Copper
On Wednesday, November 4, 2015, copper prices were supported by better economic data from China and production cuts from miners.
Monitoring the Blowback of Falling Base Metal Prices after November 5
On November 5, the fall in the price of base metals resulted in a weak performance from major base metal mining companies, driven by the strong US dollar.
Interpreting Base Metals’ Reactions to the Strong US Dollar on November 5
On November 5, most base metals closed negative due to the rise of the US dollar. The LME 3M copper price fell by 2.4%, closing the day at $5,011 per MT.
Can Production Cuts Stop the Falling Copper Prices?
As a result of falling copper prices, major copper miners like Freeport-McMoRan, Glencore, and Anglo American have declared mine shutdowns and production cuts in the past two months.
How Have Production Cuts Impacted the Copper Forecast?
After increasing by 7% in 2014, the total refined copper mine production is forecast to increase by only 0.8% in 2015.
Supply Disruptions in 2015 Support Copper Prices
Copper prices have traded largely sideways in April. Copper prices fell sharply in January but have recovered smartly since then. Year-to-date, copper prices are down ~4%.
What Would South32 Look Like after the Demerger?
After the demerger, South32 would be the world’s largest producer of manganese ore and a top global producer of manganese alloy.
Demerger Vote for BHP Billiton and South32 Is on May 6
BHP Billiton’s (BHP) board recommended voting in favor of the South32 demerger. The shareholder approval vote on the demerger will be held on May 6, 2015.
What does X2’s potential bid for Vale’s nickel assets mean?
Bloomberg reported a potential bid for Vale’s (VALE) nickel assets. We’ll briefly analyze the potential consequences if the bid goes through.
China’s thermal coal imports—who benefits?
Apart from shipping companies, coal producers (KOL) around the world benefit from China’s coal imports. However, competition in the Pacific market remains steep.