The trading week which ended March 16, the eleventh of the year, was highlighted by record nickel prices, which have jumped 6-fold in the past five years in light of nagging supply constraints and surging stainless steel production.
Nickel supplies are now extremely tight. London Metal Exchange nickel stocks ended the week at a paltry 3,564 tonnes, or less than a day’s worth of global consumption.
Nickel stockpiles have slumped 46% in 2007 on the surging Chinese demand for stainless steel.
Stainless steel consumes about 70% of all nickel produced. Last year, China overtook Japan as the world’s largest stainless steel producer. In 2002, China surpassed Japan and the U.S. as the globe’s biggest consumer of stainless steel.
On Tuesday, CVRD (RIO-N) president and CEO Roger Agnelli told a Reuters journalist in Beijing that the company will try to develop the Goro nickel project in New Caledonia by the end of next year.
Cost estimates for the long-delayed and locally contentious project have now swelled to a whopping US$3 billion.
The rest of the base metals also had strong weeks, particularly tin and copper, which closed at US$13,850 and US$6,651 per tonne, respectively. Uranium spot notched up US$6 to US$91 per lb.
The rumour was started by America’s Business Week magazine, which published in its March 26, 2007 edition an article citing “some pros” as the source of the information. What we smell is the whiff of some pros taking advantage of a gullible journalist in order to unload some unwanted Newmont shares.
For years, and with very little success, the single-mine Freeport had been trying to position itself as a gold company in order to get a gold premium into its stock. Now, with this Phelps acquisition, Freeport has once and for all aligned itself firmly with the base metal miners.
Other notable merger of late: Selkirk Metals (SLK-V) and Doublestar Resources (DSR-V); Buffalo Gold (BUF.U-V) acquiring China explorer Dynasty Gold (DYG-V) and EURO Resources‘ (EUR-T) offer for Patricia Mining (PAT-V).
The rest of Xstrata’s substantial recycling businesses in the U.S. and Canada will be retained.
In the U.S., the Flathead is protected as a “wild and scenic river,” but has no such designation in Canada.
The ORC wants the provincial government to either ban mining at Lodgepole or demand an environmental assessment incorporating 3-5 years of study.
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