Glencore to sell CSA for US$1.05B; ArcelorMittal to invest €300M in French plant

TOP NEWS IN METALS & MINING

* Glencore PLC agreed to sell its CSA copper mine in Australia to Metals Acquisition Corp. for US$1.05 billion in cash, Dow Jones Newswires reported. The deal includes a US$50 million equity stake in Metals Acquisition and a 1.5% net smelter return royalty. The parties also agreed to enter into an offtake agreement for Glencore to buy 100% of the copper concentrate produced at the CSA mine.

* ArcelorMittal SA will invest more than €300 million in France with government support to create a new production unit for electrical steels, which are used in the engines of electric vehicles, Dow Jones Newswires reported. The new production unit at ArcelorMittal's site in Mardyck will have a production capacity of 200,000 tonnes, and is scheduled to begin operations in 2024.

➤ Gold Mined Supply – Supply up in Q4'21 as prices, inflation support production

Global gold supply levels rose in the December 2021 quarter — driven mainly by Canadian production — both quarter over quarter and year over year — as production rebounded from the pandemic-induced lows of 2020. S&P Global Commodity Insights' Metals and Mining Research team believes supply growth will continue throughout 2022, as companies look to capitalize on sustained price levels.

➤ AMC pressures balance sheet with gold mining investment

AMC Entertainment Holdings Inc.'s investment in small gold-mining venture Hycroft Mining Holding Corp. is a fraction of its cash on hand and a lifeline for Hycroft; but AMC's balance sheet is still heavily weighted following the pandemic.

➤ Copper CBS March 2022 – Copper prices hit all-time high

The Russia-Ukraine conflict, along with rising inflation and supply concerns, helped lift copper prices to new highs in March, according to S&P Global Commodity Insights' Metals and Mining Research team.

EARNINGS SPOTLIGHT

* Endeavour Mining PLC swung to an attributable net loss of US$103 million in the fourth quarter of 2021, from prior-year net earnings of US$65 million. For full year 2021, Endeavour made a net profit of US$221 million, up from US$96 million in 2020, Dow Jones Newswires reported.

* U.S. Steel Corp. shares retreated 3.9% to US$33.21 in after-hours trading after the company posted softer-than-expected guidance for the first quarter, Dow Jones Newswires reported. U.S. Steel expects adjusted EBITDA of around US$1.3 billion and adjusted per-share earnings in the range of US$2.96 to US$3.

* Nucor Corp. expects first-quarter earnings to be US$7.20 to US$7.30 per share, down from fourth-quarter earnings of US$7.97 per share, Dow Jones Newswires reported. The company posted earnings of US$3.10 per share in the first quarter a year ago.

* Caledonia Mining Corp. PLC's attributable net profit in the fourth quarter of 2021 rose year over year to US$4.2 million from US$3.0 million, after revenue grew to US$32.1 million from US$28.1 million.

* Commercial Metals Co. posted net earnings of US$383.3 million in the second quarter of its fiscal 2022, surging year over year from US$66.4 million, as net sales swelled to US$2.01 billion from US$1.46 billion.

* Lithium Americas Corp.'s full-year 2021 net loss increased year over year to US$38.5 million from US$36.2 million, after expenses grew to US$46.1 million from US$30.6 million.

BASE METALS

* The London Metal Exchange's benchmark nickel contract plummeted to its daily limit for the second consecutive day, after technical glitches delayed the start of electronic trading, Reuters reported. Traders expect the fall of three-month nickel to continue until it matches the metal's price in China.

* BHP Group Ltd. faces a threat of work stoppage from Union 1 workers at its Escondida copper mine in Chile due to alleged breaches in its collective contract, Reuters reported.

* The Urinsaya community lifted a road blockade against MMG Ltd.'s Las Bambas operations, allowing the company to ship copper to its clients, Reuters reported.

* Nexa Resources SA temporarily suspended production at its Atacocha San Gerardo open pit mine in Peru as protesters blocked the road access to the mine. The company does not expect the suspension to materially affect its full-year 2022 zinc production guidance.

PRECIOUS METALS

* Osisko Gold Royalties Ltd. subsidiary Osisko Bermuda Ltd. entered an agreement with Metals Acquisition to acquire a US$90 million silver stream, to facilitate the latter's acquisition of the CSA mine from Glencore.

* Osisko Gold Royalties expects to raise about US$250.2 million in a bought deal financing agreement with Eight Capital and RBC Capital Markets. The proceeds will be used for general corporate purposes, including funding resource royalty and stream acquisitions, potential repayment from time to time of amounts drawn under the company's revolving credit facility, and other corporate development opportunities.

* Newmont Corp. received approval from Canadian federal and territorial governments for its Coffee gold project to proceed, after consultation with Yukon First Nations.

* Shares in Rambler Metals and Mining PLC rose after the company said it entered a gold purchase-and-sale agreement with Elemental Royalties Corp. worth an initial US$11 million, Dow Jones Newswires reported.

SPECIALTY

* A bill introduced in the U.S. Senate would ban uranium imports from Russia in the wake of its invasion of Ukraine.

INDUSTRY NEWS

* The jump in borrowing costs will pressure companies on the verge of default or bankruptcy, though struggling players still have plenty of options to stay afloat.

READ MORE about the market reaction and industry impact of the evolving situation in Russia and Ukraine in our new Issue in Focus.

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