Blackrock World Mining Share Discussion Threads

[essentialinvestor] 11/1/2016 19:40

This next 6-9 months will be utterly brutal for many of the lower tier
miners, Sam Walsh at RIO referred to some of the smaller IO producers
as hanging on by their fingertips last December, brutal but without demand
needs to happen.
Some of the major miners will not survive in their current form either imv
which is now becoming very clear.

[essentialinvestor] 11/1/2016 18:07

Ah thank you.

[llef] 11/1/2016 15:53

EI - was it Grange Resources?

hxxp://www.macrobusiness.com.au/2016/01/another-junior-iron-ore-miner-stumbles/

hxxp://www.abc.net.au/news/2016-01-06/grange-resources-warns-of-job-losses-due-to-low-iron-ore-prices/7070682

cheers

[aleman] 11/1/2016 12:42

Glencore's Sherwin Alumina plant files for CHapter 11. Don't know if that does anything.

Edit - another Glencore subsidiary has made a bid for it !?

[essentialinvestor] 11/1/2016 12:06

An OZ IO miner is on the verge of going under with the loss of 1,000 jobs,
the name escapes me atm but it is Chinese backed from memory.

[aleman] 11/1/2016 12:01

Strange day. Base metals all down again in line with China. Copper has actually hit a new 6-year plus low yet mining stocks are up. Did somebody announce some more output cuts or maybe rumours of rationalisation/mergers starting?

[rcturner2] 11/1/2016 05:59

EI, that post is a great read. I agree with a lot of what the manager says, although I think he is possibly over stating the case in terms of how quickly technology will disrupt the older order. For example referring to electric cars as the basis for disrupting oil, there are two problems with that view, 1) they are currently minuscule in the market and will remain so for 10-20 years and 2) electricity still has to be produced to power the things and that for many years will still come from fossil fuels. Also I cannot see electric transport disrupting air, sea and freight transport for a very long time.

[essentialinvestor] 10/1/2016 10:19

I will add tomorrow at the open, if lower than my last buy of 13.779.

If someone said 18 months ago that RDSB may be available at this
price I would suggested professional help, it just shows.

[rcturner2] 10/1/2016 09:12

Cheers EI.

I accepted when I bought Shell that it would not be a fun ride for the foreseeable future.

However I think low oil prices will be temporary, so I am looking forward 12-24 months with it.

[essentialinvestor] 08/1/2016 21:11

RCT, you may be interested in Simon's post 49597 on the SHA board re RDSB,
it is not bullish.

[chillwill] 08/1/2016 17:23

For those of you mentioning uranium, are you investing in Geiger counter (GCL). It's a fun trading at about 12p now (NAV 16p). Had it on my watch list for years, but never held it (or looked into it too much, as uranium didn't seem to be worth buying).

[essentialinvestor] 08/1/2016 15:21

The Shell divi will largely rest on poo, that is it in a nutshell.

Speaking of poo RDSB is off about 5% atm, added a small amount at 1388.

I could not even hope to begin to make an assessment of the BG acquisition,
you are putting faith in the BOD.

[my retirement fund] 08/1/2016 12:55

I agrre Uranium low investment in last 3 years due to depressed prices coupled with rising carbon free world wide nuclear electric power stations will mean prices can only rise and do so for a long time to come.Shell looks like it will double bottom at £12 or worse this will be driven by overpaying for BG and destroying shareholder value. Longer term the yield will also need to fall imo.

[essentialinvestor] 08/1/2016 11:43

Joined you in Shell RCT, will add lower if the opportunity is there.
14.158

[tonsil] 07/1/2016 19:19

Uranium mines have been closing for the last few years. New discoveries remain unexploited. Dont know if BRWM cover the U space. U is starting to rise after years of stagnation.

I also added BRWM at 175p

[chillwill] 07/1/2016 19:14

Precious metals looking resilient (and improving), which has helped here, like you say Fabius.

Perhaps why this only fell 2.5% compared to almost 5% for the mining index as a whole.

Copper isn't looking very healthy; looks like it's set to fall further imo...

[fabius1] 07/1/2016 18:42

Well chaps, I added today. Let's see how we go. Technicals look better but if it misbehaves then it goes to the back of the queue.

Mining, as we all know, is and has always been cyclical. Australia is probably the most vulnerable of all with a relatively weak secondary economy and high rise property values et al. BRWM suits (or should that be skirts) have already stated their strategy of concentrating on precious rather than bulk commodities. Makes sense to me. BRWM's real advantage is they can cherry pick their miners according to taste. We just have to hope their vision and selection is on the ball from an investment angle.

RDSB's main advantage is good cashflow and downstream operations. Not especially profitable but keeps everyone busy. Not long ago, this was considered to be their Achilles Heal with dwindling reserves and exploration costs soaring. Lower commodity prices will in turn lead to economic growth but there is still plenty of dead wood to clear away and plenty of valuations on the FTSE remain questionable. In short, the reset button is past it's sell by date.

[aleman] 07/1/2016 15:56

Base metals had a bit of a fall today but have reversed half of it in the last hour. Gold is up again. Despite all the turmoil on stockmarkets in recent weeks, base metals and gold are up a touch in a currency that has risen a touch. It does not mean they have bottomed but if recent bad news can't knock them back, just what kind of news will it take?

[rcturner2] 07/1/2016 15:01

A new commodity cycle isnt going to start, that is the problem.

[celeritas] 07/1/2016 14:45

Totally agree Aleman.
Zinc is a long way along that cycle, it never got going after the last one with a complete lack of investment for a long time now. Inventories will carry on falling with the odd delivery to the lme or maybe a Glencore style dumping but over the medium term no new large mines are coming online. 675,000 tonnes was taken from two large mines last years, (Lisheen and Century closed) other have cut the odd 50,000 tonnes here and there. Glen are taking another 500k tonnes from the mkt.
It will catch up in the end when a new commodity cycle with gather pace. Will that happen this year, maybe but I'd hate to stick a date to it.

[aleman] 07/1/2016 14:31

I don't agree that metals are just a demand issue. There has been an investment boom in mining and supply has increased year on year. Like ships, a whole load of new capacity has come on line just as there has been a slowdown. If you can find me an article to the contrary that shows output has not increased in recent years, I'd like to see it. Miners are now cutting supply to match demand such that some metals are expected to be in deficit next year. I don't think anyone is forecasting that for oil so oil is later in the cycle. Oil still has a supply surplus so its price is falling. I think metals are mostly stabilising as cuts have taken the excess out. THey might advance next year if forecasters are correct about supply and demand. Of course, oil could easily switch overnight if all the oil producers do a deal but that is a gamble and not an investment decision based on current supply and demand estimates.

I agree that demand for oil will hold up. AS prices fall, it brings a while new slug of demand in for chemicals, plastics and solvents and the fallign price of petrol then makes the opportunity cost of "green" transport more expensive. Some country somewhere will utilise cheap transport fuels and undermine the other countries economically - but we are already seeing that.

[rcturner2] 07/1/2016 13:11

Consider transport as another example, how long do you think it will take to convert the worlds cars, lorries, ships and planes to non fossil fuel? If you are a climate change worrier it is best not to think about it, the demand for oil is HUGE and growing, look at the number of new car sales per year even now still increasing and over 95% are petrol/diesel.

[rcturner2] 07/1/2016 13:03

mf, I hear this a lot, but oil will be around for a long long time yet (plastics and chemicals too don't forget).

Energy production in the world is over 95% fossil fuel.

Take little old Denmark, what date is their target for being fossil fuel free? 2050 is the answer. So a small bit player like that which is already half the way there predicts at least 30 years to go.

Oil (and gas) will still be big players for many years yet.

[mad foetus] 07/1/2016 12:23

RCT,
I disagree with your prediction. The oil producers are pumping because they know, long term, there is no future for oil. The Saudis fear they will be left, in a few decades time, with billions of barrels of oil that nobody wants. Better get $30 a barrel now than nothing. With Iran and shale and renewables and global warming, I don't see that changing.

Whereas demand will come back for commodities. China may have had a boom to dwarf all others (apparently they used more concrete in 3 years than America has in its entire history) but China isn't the whole world. At some point, the Middle East will be rebuilt, Africa's shanties will be modernised, new roads and airports will be built across India.

Extrapolating into the future is a mug's game, but there will be demand for commodities again. Perhaps never on the scale of the Chinese demand, but enough to sustain an industry.