US Commerce Department proposes global tariffs on steel, aluminum
U.S. Department of Commerce Secretary Wilbur Ross recommended that President Donald Trump take "immediate action" to impose tariffs on imports of steel, a move that could be a boon to U.S. metallurgical coal producers. Ross' report recommends that Trump takes one of three actions: a global tariff of 24% on all steel imports, a tariff of at least 53% on steel imports from a targeted list of 12 countries or a quota on all countries' steel imports capped at 64% of their 2017 sales into the U.S. The remedies aim to increase domestic steel production from the current 73% of capacity to an approximately 80% operating rate.
Amplats reinstates H2'17 dividend on 3.89B rand FY'17 headline earnings
Anglo American Plc unit Anglo American Platinum Ltd. reinstated a cash dividend of 900 million South African rand, or 3.49 rand per share, for the second half of 2017, following full-year 2017 headline earnings of 3.89 billion rand, from 1.87 billion rand in the previous year. Amplats' net profit attributable to owners of the company for full-year 2017 also improved to 1.94 billion rand, from 632 million rand for full-year 2016.
Vale posts record iron ore production in 2017
Vale SA's iron ore production rose 1.1% year over year to 93.4 million tonnes in the fourth quarter of 2017 and 5.1% to 366.5 million tonnes in the full year, driven by record production at its Northern System operations in Brazil, due to the S11D mine and plant ramp-up. The company's pellet output came in at 50.3 million tonnes, which was a record and an 8.8% improvement over 2016 thanks to higher productivity and less scheduled maintenance stoppages. Quarterly pellet production increased 2.2% to a record of 12.9 million tonnes.
* Morgans Financial Ltd expressed alarm at South32 Ltd.'s "deteriorating" key assets and the miner's apparent rethinking of its entire regional operating model strategy, cutting its rating on the BHP Billiton Group spinoff. South32's first-half results confirmed Morgans' economic concerns for the diversified miner, with unit costs for most of its operations now at levels near or even above where they were when BHP owned them before South32 debuted on its own on the ASX in May 2015. The miner's announcement that it planned to make its South African energy coal assets a standalone business with the intention of broadening ownership also had Morgans worried.
* Institutional investors Plato Investment Management and Baring Asset Management are seeking a detailed explanation from BHP on its reluctance to unify the company's dual-listed structure, The Australian Financial Review reported. This follows activist shareholder Elliott Management's renewed push for the simplification of the mining giant's structure.
* Rio Tinto CEO Jean-Sebastien Jacques said the company's productivity drive will also set a foundation for the miner to pursue mergers and acquisition opportunities, The Australian reported. However, the executive added that the company will set a very high threshold on value for any acquisitions.
* Meanwhile, Jacques said the company is engaging with The Australasian Centre for Corporate Responsibility, the activist group demanding a review of Rio Tinto's Minerals Council of Australia membership, The Australian reported. The executive said that while industry bodies have roles to play, it does not mean Rio Tinto always agrees with their position and that the company has its own voice.
* The prospects of an old dispute among Russian oligarchs over controlling PJSC Norilsk Nickel Co. being rekindled has seen the company's shares drop, along with United Co. Rusal Plc, Bloomberg News reported. Rusal President Oleg Deripaska sought an injunction in a London court to stop Roman Abramovich's Crispian Investment Ltd. from selling a portion of its stake in Norilsk, which is the world's largest palladium producer and produces metals including nickel and copper.
* Codelco's Radomiro Tomic Sulfuros expansion project underwent a restructuring that reduced the original investment by US$3.2 billion to US$2.2 billion, due to the decision to outsource the construction of a desalination plant, El Mercurio reported. The restructured project is expected to begin operations in 2024.
* Indonesia's mining ministry issued Freeport-McMoRan Inc.'s PT Freeport Indonesia an export quota of about 1.25 million wet tonnes of copper concentrate up to Feb. 15, 2019, Reuters reported, citing a ministry official.
* Australian Mines Ltd. signed an off-take agreement term sheet with electric vehicle battery manufacturer SK Innovation to sell 100% of the expected cobalt sulfate and nickel sulfate output from its SCONI cobalt-nickel-scandium project in Queensland, Australia, for an initial seven-year term. Additionally, SK Innovation secured an option to acquire up to a 19.99% stake in Australian Mines by purchasing 669 million shares at 12 Australian cents apiece.
* Aeris Resources Ltd. will proceed toward drilling at the Torrens copper joint venture in South Australia in the third quarter after receiving final approval from the South Australian minister for aboriginal affairs and reconciliation.
* Acacia Mining plc confirmed media reports that Chinese buyers are interested in its assets in Tanzania, amid talks with the government to resolve outstanding issues that have forced it to idle production, crippling its cash flow. The company, which is majority-owned by Barrick Gold Corp., said it had received expressions of interest in some or all of its Tanzanian operations.
* Despite a weaker performance in the first half of its fiscal year, Newcrest Mining Ltd. remains on track to achieve its production, cost and CapEx guidance for the full year. "We remain on track to achieve our annual guidance, with production expected to be stronger in the second half of the year, and [all-in sustaining costs] spend potentially being below the guidance range if copper prices remain around current levels," Managing Director and CEO Sandeep Biswas said on a conference call.
* Polymetal International Plc increased its stake in the Prognoz silver project to 50% by acquiring a further 45% stake in Polar Acquisition Ltd. for US$72 million in shares. The other 50% of Prognoz is owned by Garden Ring Capital, a Russian private equity group.
* Brio Gold Inc. shares jumped nearly 10% in early afternoon trading in Toronto on Feb. 16 after the miner's board agreed to back a sweetened offer and struck a definitive deal to be acquired by LeaGold Mining Corp. in an all-share deal valuing the company at C$314 million. In late January, LeaGold made an all-share takeover bid of US$264 million for Brio Gold.
* Equus Mining Ltd. acquired the precious-and base-metals prospective Cerro Diablo project, about 40 kilometers north-northwest of the company's flagship Los Domos gold-silver project in Chile.
* Millennium Minerals Ltd. awarded an initial three-year mining contract to GBF Underground Mining Co. for the development of the Bartons underground mine, part of its Nullagine gold project in Western Australia. GBF will mobilize to Nullagine later in the month, with underground mining set to commence at Bartons in March.
* St Barbara Ltd. entered gold hedging contracts for production of 35,000 ounces from its Simberi project in Papua New Guinea, to be delivered in monthly installments from July 2018 to December 2019 at a forward price of A$1,750 per ounce.
* Nippon Steel & Sumitomo Metal Corp. is concerned that the recent steel import cuts proposed by the U.S. Department of Commerce may result in oversupply in the Asian markets, Reuters reported, while China said that it reserves the right to retaliate if the "groundless" tariffs are implemented by the U.S. government, Bloomberg News reported. Australian Prime Minister Malcolm Turnbull is expected to request President Trump to leave his country out of the new steel and aluminum quotas, The Australian Financial Review reported, and Rio Tinto chief executive Jean-Sébastien Jacques will travel with Turnbull to the White House to plead the case.
* Century Aluminum Co. and AK Steel Holding Corp. supported the recommendation by the U.S. Department of Commerce to impose tariffs on steel imports. Century Aluminum CEO Michael Bless said the report shows the administration recognizes that swift action is necessary to stop the surge of aluminum imports from affecting the industry. AK Steel CEO Roger Newport, meanwhile, urged prompt action on the recommendations.
* South Korea opposed the U.S. Department of Commerce's recommendation to impose tariffs on steel imports, following an emergency council meeting held by the Ministry of Trade, Industry and Energy with the country's key steelmakers, The Korea Herald reported.
* Tata Steel Ltd.'s acquisition of Bhushan Steel Ltd is seen as a strategic fit for the company, despite it allegedly overpaying for the distressed steelmaker, The Economic Times of India reported.
* Strike Resources Ltd. entered into a nonbinding memorandum of understanding with China-based Dalian Huarui Heavy Industry Group Co. Ltd. in connection with the former's Apurimac iron ore project and associated rail and port infrastructure in Peru.
* Petra Diamonds Ltd. swung to a net loss of US$117.7 million, or 17.55 cents per share, in the first half of fiscal 2018, from a profit of US$35.2 million, or 5.20 cents per share, in the corresponding period of fiscal 2017, due to a strike at its South African operations in the first quarter, the inability to sell output from the Williamson diamond mine in Tanzania, and a strengthened South African rand against the U.S. dollar. Revenue for the period, however, remained in line with year-ago figures at US$225.2 million.
* Latin Resources Ltd. signed a binding term sheet with Kontrarian Resources Fund No. 1 to acquire five lithium concessions covering 44,177 hectares in Argentina's San Luis province that are near the company's existing concession applications.
* PJSC Alrosa launched a 1.5 million Russian ruble contest for the best solution to restart underground mining at the Mir deposit, part of its Mirny Division in Russia, Mining Weekly reported. The company selected 33 applications for next stage of the contest.
* To give a boost to U.S. metal production, the Department of the Interior published a draft list of critical minerals in the Federal Register as called for in a recent executive order by President Donald Trump. The draft list identifies 35 minerals, metals and groups of metals that are critical to the U.S. economy and military but may be vulnerable to dependence on foreign supplies.
* A South African industry group representing mining companies agreed to postpone a High Court challenge against new mining regulations to allow parties to engage in talks with new President Cyril Ramaphosa, Reuters reported.
* Tropical Cyclone Kelvin hit the north coast of Western Australia, causing floods and forcing the closure of the Great Northern Highway that links Port Hedland with Kimberley region and Perth, Reuters reported. The cyclone is forecast to move south through East Pilbara, which produces an estimated US$15 billion of mining exports per year.
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