TOP NEWS
Wuhan Iron, Yunnan Tin land multibillion-yuan funding deals with Chinese bank
Wuhan Iron & Steel Co. Ltd. and China Construction Bank Corp., the country's second-largest lender, are planning to raise 24 billion Chinese yuan for a fund that will help ease Wuhan's debt burden by investing in shares of the steelmaker's units and taking over some of the group's maturing debt, Bloomberg News reported, citing the Chinese lender. The companies reached an agreement over the fund in August and have already raised 12 billion yuan. Meanwhile, the bank and Yunnan Tin Group also agreed on a debt-to-equity swap that could be worth almost 10 billion yuan. Xinhua News Agency reported that Yunnan Tin will receive a first tranche of 2.35 billion yuan next week.
Fresnillo improves Q3 production across all commodities
Fresnillo Plc's third-quarter production increased across all commodities year over year. Total silver output went up 6.7% to 11.78 million ounces while gold output increased 20.9% to 219,840 ounces. Lead and zinc production, meanwhile, jumped 19.0% and 32.1%, respectively, to 12,473 tonnes and 14,476 tonnes.
Alcoa misses Q3 earnings forecasts
Alcoa Inc. just missed the analyst forecasts for third-quarter revenue and earnings and revised down revenue expectations for its Arconic business segment. The company reported US$5.2 billion in revenue during the quarter, down 6% from the corresponding quarter of 2015, while the net income was US$166 million, up fourfold from US$44 million in the third quarter of 2015.
DIVERSIFIED
* Rio Tinto priced the cash tender offer to buy back about US$1.5 billion of its 2019, 2020, 2021 and 2022 notes. The settlement will occur Oct. 12.
BASE METALS
* Western Mining Co. Ltd. expects an 828% jump year over year in its net profit for the first nine months of the year from the 13.0 million yuan posted a year ago. The company attributed the profit surge to higher output of concentrates as well as lower operation costs and investment losses.
* Maanshan Iron & Steel Co. Ltd. expects to swing to a net profit attributable to equity shareholders of 757 million yuan for the first nine months, from the net loss of 2.58 billion yuan in the corresponding year-ago period. The expected turn to profit is being attributed to efforts in promoting sales and optimizing product mix as well as to effective cost-cutting measures.
* An employee was killed at Capstone Mining Corp.'s Cozamin copper mine in Mexico after getting struck by a piece of mobile equipment in transit in the Mala Noche Footwall Zone area. Operations at the site were temporarily suspended after the incident.
* Prospect Resources Ltd. secured an option to acquire a 90% stake in the Fimpimpa West copper-cobalt project in northern Zambia. The company has 90 days to purchase the project stake for US$15,000.
* Botswana's BCL Ltd. is backing out of a deal it made in 2014 to acquire PJSC MMC Norilsk Nickel's 50% stake in the Nkomati nickel joint venture in South Africa due to its inability to afford the US$279 million price tag, Bloomberg News reported, citing Khaulani Fichani, chairman of the state-owned company.
* Global Copper Group Inc. staked an additional five mineral claims adjacent to and surrounding its recently acquired claims in Ontario for C$14,000 and 150,000 common shares. The company now holds 712 hectares in Ontario's Cobalt region.
PRECIOUS METALS
* Fitch Ratings revised its outlook on Polyus Gold International Ltd.'s long-term issuer default rating to positive from negative while affirming it at BB-, reflecting the expectation that the company will maintain a conservative financial profile with no additional share buyback or one-off dividend payments over the next two to three years. Separately, Polyus Gold International is planning a US$500 million senior unsecured notes offering, to which Moody's assigned a provisional (P)Ba1 (LGD3) rating.
* West Wits Mining Ltd. will grant PT Tobacom Del Mandiri, or TDM, a 30% interest in its Derewo River alluvial gold project in Indonesia as part of a business alliance agreement.
* The milling of ore has started at Blackham Resources Ltd.'s 5.1 million-ounce Matilda gold project in Western Australia, with first gold pour expected within a few days.
* Shandong Gold Mining Co. Ltd. is interested in fully acquiring Barrick Gold Corp.'s Veladero gold mine in Argentina, sources told El Inversor Online. When asked about the potential acquisition, Barrick Gold declined to comment.
* Enterprise Metals Ltd. entered into an exploration agreement over its Doolgunna project in Western Australia, which allows Sandfire Resources NL to earn up to a 75% interest in the gold property.
* Unionized workers in Mali will go on a five-day strike starting Oct. 24 at mines belonging to gold producers, including Resolute Mining Ltd. and Robex Resources Inc., alleging victimization by employers over their affiliation with a union called Secnami, Bloomberg News reported, citing Mahamadou Konte, a spokesman for the National Section of Mines and Industries. The union is also in dispute with Randgold Resources Ltd. over unpaid productivity bonuses.
* Several banks involved in a gold price fixing lawsuit — including Bank of Nova Scotia, Barclays PLC, HSBC Holdings PLC, Societe Generale and Deutsche Bank — will be required to turn over internal emails and other correspondence spanning several years as the case moves ahead, said Daniel Brockett, a New York-based lawyer who is spearheading the U.S. lawsuit, the Financial Post reported.
* Chalice Gold Mines Ltd. entered into a binding option and farm-in terms sheet to acquire Globex Mining Enterprises Inc.'s full interest in the Nordeau gold project in Quebec's Abitibi region.
* Seabridge Gold Inc. said the government of British Columbia granted the necessary permit to develop an exploration adit into the large Deep Kerr deposit at the KSM gold-copper project.
BULK COMMODITIES
* Nippon Steel & Sumitomo Metal Corp. has agreed to buy coking coal from Peabody Energy Corp. at US$200 per tonne in the fourth quarter, the highest contract price since 2012, as China's effort to curb its coal output helped spot prices surge this year, Bloomberg News wrote, citing people with knowledge of the matter.
* PAO Severstal's hot metal output in the third quarter increased 8% quarter over quarter to 2.39 million tonnes, as the second quarter was impacted by short-term maintenance of blast furnace No. 5 at the Cherepovets steel mill. Crude steel production also went up 6% to 2.98 million tonnes. However, consolidated steel product sales decreased 5% quarter over quarter to 2.65 million tonnes, due to reduced activity of local traders and softened domestic steel demand.
* The CFMEU confirmed the first case of black lung disease in an Australian open-cut coal mine, at BHP Billiton Group's 50%-owned Goonyella Riverside coal mine in Central Queensland's Bowen Basin.
* A civil court in Brazil's Minas Gerais state sentenced Samarco Mineração SA and its parent companies, Vale SA and BHP Billiton, to compensate 28 families affected by the Fundão tailings dams collapse in November 2015, O Tempo reported. Compensations will range between 10,000 Brazilian reais and 20,000 reais per family.
* S&P Global Ratings affirmed its junk-grade CCC/C rating on miner Ferrexpo Plc, with a negative outlook. The recent high iron ore prices had benefited the company, but a sustained fall in the price of the commodity below US$45 per tonne put the group at high risk of default or debt restructure.
* Anglo American Plc was granted an operating license from Brazil's Minas Gerais state environmental council for the next phase of its Minas Rio iron ore operation in the country, Metal Bulletin reported.
* Russian steelmaker OJSC Novolipetsk Steel is targeting a 20% increase in construction steel sales in 2016 through boosting exports, Metal Bulletin reported, citing CFO Grigoriy Fedorishin.
* The Australian anti-dumping commission initiated an exemption inquiry into anti-dumping measures against imports of stainless steel sinks from China, Metal Bulletin wrote.
SPECIALTY
* Mineral Commodities Ltd.'s Mineral Sands Resources (Pty.) Ltd. unit in South Africa is taking legal action against the country's Department of Environmental Affairs, alleging that the department used an "illegally obtained search warrant" when it raided the company's Tormin ilmenite mine last week, Business Day wrote.
* DiamondCorp Plc said full commercial production at its Lace diamond mine in South Africa has been delayed until around February 2017. The company cited the tonnage constraints encountered in September, which will likely continue at least until the end of the year, as the reason for the postponement.
* The Chilean government should define the "rules of the game" soon for foreign and local investors interested in developing lithium in the South American country, the president and CEO of Wealth Minerals Ltd., Henk van Alphen, told Diario Financiero. In recent months, the company has executed several letters of intent to secure options to acquire lithium exploration concessions in northern Chile.
* The construction of Tianqi Lithium Corp.'s US$400 million Kwinana lithium project in Western Australia has started. More than 115 employees will be needed once the project becomes operational toward the end of 2018.
* Lucapa Diamond Co. Ltd. produced a record 8,853 carats from its Lulo diamond operations in Angola during the September quarter, reflecting a 154% year-over-year increase.
* PJSC ALROSA is on track to sell 37 million carats of diamonds in 2016, up from 30 million last year, while net earnings are expected to jump "two to three times" from last year's total of 32.19 billion Russian rubles, President Andrey Zharkov said.
* A rare 8.01-carat "fancy vivid blue" diamond will be displayed this week in London ahead of a November auction at Sotheby's, where it is expected to fetch up to US$25 million, Reuters reported.
INDUSTRY NEWS
* Chinese miners invested a total of 10.73 billion yuan in acquiring domestic exploration licenses in the first nine months of 2016, up 887.8% from a year ago, according to data from the Ministry of Land and Resources.
* China's environment ministry said 55 firms "severely exceeded" their pollution limits in the second quarter, with most offenders in Inner Mongolia, Liaoning and Hebei, the country's top steel-producing province. According to Reuters, the offenders will face punitive measures such as fines and production restrictions.
* Harvard Law School's International Human Rights Clinic has accused the South African government of failing to uphold its citizens' human rights, as it "inadequately mitigated" the impact of toxic wastes from abandoned and active mines, Bloomberg News reported.
* Fortescue Metals Group Ltd. Chairman Andrew Forrest said the end of a five-year slump is near, with commodity prices to start edging higher and Australia to enjoy a "substantial market share," The Australian Financial Review reported.
* The Australian Securities and Investments Commission made some minor drafting changes to its regulations around forward-looking statements, clarifying that production targets and forecast financial information can be published even if secured funding is not in place. However, Australian miners and ASIC have reached an "impasse" over what is considered acceptable with respect to secured funding.
* Local nongovernmental organizations opposed the Indonesian government's plan to give extra time for mining companies to export concentrates until 2021, instead of the currently set 2017, Jakarta Globe reported.
S&P Global Ratings and S&P Global Market Intelligence are owned by S&P Global Inc.
The Daily Dose is updated as of 7 a.m. ET, and scans news sources published in Chinese, English, Indonesian, Malay, Portuguese, Russian, Spanish, Thai and Ukrainian. Some external links may require a subscription.