JLN Metals

May 24, 2012: Copper ETF plan would 'wreak havoc'

2012-05-24T14:31:00.000-05:00

Yesterday's top stories were: "CME's bid for London Metal Exchange falls short" by Lynne Marek in Crain's Chicago Business; "LME Transaction Update" press release from the London Metal Exchange, and "Singapore vies to become commodities hub" by Jeremy Grant and Javier Blas in the Financial Times.

"I would say the mining community should be doing nothing but applauding China. All of these junior mines are being built today because of what China's regulations did to the price of REEs [rare earth elements] in recent years."

-- Michael Silver, chairman and CEO of rare earth supplier American Elements, in "Rare Earth Juniors Should Applaud China" by Sally Lowder in Resource Investor.

Observations - Statistics - Commentary

First, Do Good When Mining for Gold: Benoit La Salle
International Business Times
Benoit La Salle is the founder, president and CEO of SEMAFO, a mining company that rates its work in sustainability and community building as high as it does its gold production. In an exclusive interview with The Gold Report, La Salle tells investors why they should be looking at both gold and West Africa right now; which company report is most important (hint: it's no longer the annual report); and what a company's most critical asset is, no matter its project.
http://jlne.ws/Kt0RSf

Rare Earth Juniors Should Applaud China: Michael Silver
Resource Investor
In a sector where the playing field is not always level, the chairman and CEO of rare earth supplier American Elements, makes a case for more cooperation. Silver insists that junior miners finally have an opportunity to develop the US resource and manufacturing sectors.
http://jlne.ws/Kt0RBT

Gold production, exploration and ‘peak gold' - an analysis
The Gold Report
Global gold production is at an all-time high, according to a new report from the USGS. Micheal George*, the USGS gold specialist comments on ‘peak gold', output and exploration trends.
http://jlne.ws/Kt0Pde

Gold Boom Spreading Mercury as 15 Million Miners Exposed
Bloomberg
As he clambered out of bed and onto his feet one morning late last year, Miguel Angel Cardona, 62, felt his body betray him. His head grew so heavy it pulled him tumbling back down. [...] He worked with drums filled with mercury, water and crushed stone to process gold. Cardona suspected his job was poisoning him, Bloomberg Businessweek reports in its May 28 issue.
http://jlne.ws/Kt0UO0

CHART OF THE DAY: Stocks Priced In Gold Since 1886
Matthew Boesler, Business Insider
Citigroup's chief U.S. equity strategist Tobias Levkovich on the (cautious) case for buying stocks at current valuations
http://jlne.ws/LjMGwf

JLN Metals Scorecard	5/23/2012

NYSE LIFFE US Total Volume	87,132

100 oz. Gold Futures Volumes
NYSE LIFFE US	48
CME/NYMEX (Globex + PNT)	300,623
CME/NYMEX Open Auction	2,610
NYSE LIFFE market share	0.02%
NYSE LIFFE US Electronic market share	0.02%

100 oz. Gold Futures Open Interest
CME/NYMEX	441,681
NYSE LIFFE US	1379
NYSE LIFFE US market share	0.31%

Mini Gold Volume
NYSE LIFFE US	6,338
CME E-micro Gold (10 Troy oz)	1,617
CME/NYMEX miNY	492
NYSE Liffe market share (Contracts)	75.03%
NYSE Liffe market share (Notional)	83.77%

5,000 oz. Silver Futures Volume
NYSE LIFFE US	7
CME/NYMEX	64,399
NYSE LIFFE US market share	0.01%

NYSE LIFFE US	2,997
CME/NYMEX miNY	630
NYSE LIFFE US market share	82.63%

Additional Metal Futures Volume statistics
EUREX Gold Futures (100 troy ounces)	3
TOCOM Gold Futures (1 kg / 32.15 ounces)	54,882
TOCOM Mini Gold Futures* (100 grams / 3.215 ounces)	14,062
TOCOM Silver Futures (10 kg / 321.51 ounces)	274
Dubai Gold & Commodities Exchange (32 troy ounces / 1 kg)	3,282

METAL ETFS	METAL ETFS
ProShares Ultra Silver	485,972
Powershares DB Base Metals Fund	17,023
Market Vectors Gold Miners GG	6,696,596
MARKET VECTORS JUNIOR	1,540,149
ProShares UltraShort Gold	364,072
ETFS Precious Metals Baskets Trust	1,300
iShares COMEX Gold Trust	1,056,935
iShares Silver Trust (ETF) historical prices	3,724,660
ETFS PHSYICAL PALLADIUM SHARES	24,092
ETFS PHYSICAL PLATINUM SHARES	23,823
ETFS GOLD TRUST	50,201
ETFS SILVER TRUST	78,578
Market Vectors Steel	61,119
ProShares Ultra Gold	47,466
ProShares UltraShort Silver	347,639
SPDR Gold Trust	4,786,772

Lead Stories

Copper ETF plan would ‘wreak havoc’
By Jack Farchy in London - Financial Times
US manufacturers have attacked plans by JPMorgan Chase to launch an exchange-traded fund backed by physical copper, arguing that the product would “grossly and artificially inflate prices” and “wreak havoc on the US and global economy”.
http://jlne.ws/Kt0S8U

Tanzania Gold exports rebound
BullionStreet
After a sharp decline last year, Africa's third largest gold producer, Tanzania's gold exports witnessed a ten percent increase in the year ending February 2012.
http://jlne.ws/Kt0UO8

Indonesia to offer incentives to firms to help build smelters
Reuters
Indonesia will offer financial incentives to help firms build smelters in compliance with new mining regulations, a senior finance ministry official said on Thursday.
http://jlne.ws/Kt0V4p

Newmont to cut over $1bn from planned Peru project spend
Reuters
Newmont Mining Corp said it would cut planned spending on a controversial gold mine project in Peru by two-thirds for the 2012-13 period because of delays caused by government and environmental reviews.
http://jlne.ws/Kt0V4w

Hanlong Mining delays $1.3bn Australia iron ore bid
By Sonali Paul and Narayanan Somasundaram - Reuters
The long delay on its takeover of Sundance Resources points to China's reluctance to make big bets on risky resources projects offshore amid uncertainty over economic growth at home.
http://jlne.ws/Kt0VkU

Looks Like The Pain, And The Opportunity, Might Be Ending For Gold Stocks
Seeking Alpha
For those deeply invested in gold shares, the past few weeks have resulted in one of two scenarios:
1. Tears, heart attack, hair loss and other such events and emotions that dispel the notion that investing is easy
2. The buying opportunity of a lifetime
Which scenario applies depends on how one has been positioned, and whether they kept capital aside ready for a big sell-off.
http://jlne.ws/Ldxa8s

Futures & ETF News

Laying a golden egg
New York Post
Investors with legendary hedge-fund manager John Paulson aren't taking a shine to his gold metal performance - in fact, some are heading for the exits. Investors are upset over Paulson's huge gold positions - specifically, his outsize holding of AngloGold Ashanti, down 20 percent this year, The Post has learned.
http://jlne.ws/LsSsOU

JPMorgan Copper ETF Plan Seen Creating Havoc by Merchant Groups
Bloomberg
JPMorgan Chase & Co. (JPM) 's plan to introduce an exchange-traded fund linked to copper will "severely disrupt" the market, a group of industrial copper users told the Securities and Exchange Commission.
http://jlne.ws/Kt0Vl9

Gold ETF Selling Could Speed Metal's Decline
ETF Trends via Yahoo! Finance
Gold ETFs helped fuel the precious metal’s historic rally as the exchange-listed funds allowed investors to buy gold in one trade without the hassles of transporting or storing bullion. However, the largest bullion ETF SPDR Gold Shares (GLD - News) reportedly saw outflows of nearly $900 million on Tuesday.
http://jlne.ws/Kt0SFU

Some Of John Paulson's Investors Are So Angry At His Gold Bets They Want Out
Julia La Roche, Business Insider
John PaulsonClosely followed hedge fund manager John Paulson, who famously bet against the subprime housing market in 2007, had a disastrous year during a volatile 2011 with some of his funds falling 30 to 50%. This year his Advantage funds, which invest heavily in gold, are in the red again.
http://jlne.ws/Kj2VeP

Commodities & Macroeconomics

Toxic Euro Corroding Gold
GoldSeek.com
The Euro has become a very odd, very toxic asset... WHAT'S UP with the gold price? Not a lot. Gold is down, in fact. So is everything else outside the US Dollar and "safe" sovereign debt.
http://jlne.ws/Kt0SWg

Copper Slumps as Euro-Area Crisis May Threaten Chinese Growth
Bloomberg
Copper fell in London on concern the euro-region debt crisis may threaten economic expansion in China, the world's biggest consumer of the metal.
http://jlne.ws/Kt0VBF

Philippines ups gold reserves: IMF
Reuters
Philippines raised its gold holdings in March by the largest amount in 3-1/2 years, while Mexico and Ukraine made additions in April, in line with the trend among emerging-market central banks to diversify away from the dollar and the euro.
http://jlne.ws/Kt0VS0

Swiss platinum imports hit 4-yr low in April
Reuters
Imports of platinum to Switzerland, a major clearing hub, fell to their lowest in over four years, driven by a drop in South African shipments, while imports of palladium hit three-month highs, according to Swiss customs data on Thursday.
http://jlne.ws/Kt0TcW

Market Nuggets: UBS: More Central-Bank Purchases Should Help Sentiment For Gold
Allen Sykora - Kitco
http://jlne.ws/Kt0W8A

Company & Production News

Olma to make 'concrete proposal' to First Uranium by weekend
Matthew Hill - Mining Weekly
First Uranium shareholder Olma Investments plans to submit a “concrete proposal” to the board of directors by Friday laying out an alternative to the asset sales the gold and uranium producer has announced, head of equities at the wealth management firm, Nick Betsky, said.
http://jlne.ws/Kt0Ttm

Hana Shares Commence Trading on the Botswana Stock Exchange
Marketwire via Yahoo! Finance
Hana Mining Ltd. is pleased to announce that it has received official approval for a secondary listing of its common shares on the Foreign Venture Capital Board of the Botswana Stock Exchange.
http://jlne.ws/Kt0Wp0

PolyMet Reports Progress on Environmental Review
Marketwire
PolyMet Mining Corp. today reported continued progress on the environmental review of its NorthMet project. PolyMet controls 100% of the development-stage NorthMet copper-nickel-precious metals ore-body and the nearby Erie Plant, located near Hoyt Lakes in the established mining district of the Mesabi Iron Range in northeastern Minnesota.
http://jlne.ws/Kt0Tts

Norilsk Nickel Announces Intention to Make All-Cash Offer for Asian Mineral Resources Limited
Marketwire
OJSC "MMC NORILSK NICKEL" today announced that it intends, acting through a subsidiary to make an all-cash take-over bid to acquire all of the outstanding common shares of Asian Mineral Resources Limited at a price of C$0.11 per Share
http://jlne.ws/Kt0WFz

Coeur Recognized with Five Safety Awards
Business Wire via Yahoo! Finance
Coeur d'Alene Mines Corporation today announced that it has been recognized by the International Society of Mine Safety Professionals (ISMSP) with five national and international safety awards for its operations in North and South America.
http://jlne.ws/Kt0TJQ

Harmony Gold Plans Solar Power, Biofuels Plants in South Africa
Bloomberg
Harmony Gold Mining Co. (HAR) , Africa 's third-largest producer of the metal, plans a solar-power plant with partners in the north of South Africa , where a lack of generating capacity has forced companies to cut electricity use.
http://jlne.ws/Kt0WFM

Blue Gold Appoints VP, Exploration
Marketwire via Yahoo! Finance
Blue Gold Mining Inc. (BGX.V) is pleased to announce the appointment of Mr. Scott Heffernan to its management team as Vice President, Exploration.
http://jlne.ws/Kt0TK4

Duluth Metals Announces Normal Course Issuer Bid and Securities Repurchase Plan for its Class A Shares
CNW Group via Yahoo! Finance
Duluth has TSX approval to purchase for cancellation up to a maximum of 5% of Duluth's issued and outstanding Shares.
http://jlne.ws/Kt0U0m

Tiffany Cuts Revenue Outlook
By KAREN TALLEY, WSJ.com
Sales outlooks from Tiffany TIF -7.80% & Co. and Signet Jewelers Ltd. SIG -11.75% suggest global economic worries are weighing on luxury spending in jewelry, echoing sentiment from other, broader retailing segments. Tiffany's first-quarter earnings edged up just 0.6% and the high-end jeweler reduced its full-year expectations, citing slowing economic growth in many countries and softness in U.S. operations. World-wide sales are now seen increasing 7% to 8% this year, compared with prior guidance for 10% growth.
http://jlne.ws/KtZD9z

Constellium, Airbus sign $2 billion aluminium products supply deal
Platts
Constellium has signed a $2 billion multi-year agreement to provide aluminium products and solutions to aircraft manufacturer Airbus and its parent company, the European Aeronautic Defence and Space Co., the company said Thursday.
http://jlne.ws/LuRceb

Regulatory News

Let Data, Not Politics, Guide Regulation
Tobias J. Moskowitz - Bloomberg
Several years after the global financial crisis, the fierce debate over regulation continues to be driven by strong beliefs -- largely uninformed ones -- rather than hard facts. Some believe more regulation is necessary, others that it would cause the downfall of our markets. No one, however, seems to be talking about the evidence for or against regulation. This is partly because very little evidence exists on the effects of regulation or its efficacy.
http://jlne.ws/LsSjLx

May 23, 2012: LME Transaction Update

2012-05-23T14:24:00.002-05:00

Yesterday's top stories were: "CME Group Eliminated From LME Sale Process" by Dow Jones Newswires, "Whales in the Gold Market" by Will Bancroft at Resource Investor, and "Dennis Gartman Buying Gold and Stocks", by Lee Brodie for CNBC.

"Certainly there's a risk that anybody who acquires the LME can become the dominant player in the metals arena. They're a major player, and how does that play out on somebody else's platform?"

-- Jim Ginsburg, managing partner of Chicago-based Vernon & Park Capital L.P., which owns CME stock, in "CME's bid for London Metal Exchange falls short" by Lynne Marek in Crain's Chicago Business

Observations - Statistics - Commentary

Singapore vies to become commodities hub
By Jeremy Grant in Singapore and Javier Blas in London - Financial Times
When Sir Stamford Raffles founded Singapore in 1819, a flourishing trade hub quickly followed in commodities such as rubber, tin, gold and opium from India. The southeast Asian city-state later fell under the shadow of fast-growing Hong Kong as a financial centre. But the rapid growth of Asia's economies, coupled with the generous tax breaks it offers, means Singapore is challenging its regional rival for supremacy.
http://jlne.ws/JR30tA

Grexit and gold: The first 46 hours
Frik Els - Mining.com
With more than 50% of investors surveyed by Bloomberg News predicting an exit of a euro member this year the wire service on Tuesday reported on how a Greek exit from the Eurozone may play out based on synthesized scenarios from 21 economists, analysts and academics.
http://jlne.ws/LfBrou

Mongolians Scramble For A Share Of Mining Wealth
KERA North Texas
Mongolia, the land of Genghis Khan and nomadic herders, is in the midst of a remarkable transition. Rich in coal, gold and copper, this country of fewer than 3 million people in Central Asia is riding a mineral boom that is expected to more than double its GDP within a decade. The rapid changes simultaneously excite and unnerve many Mongolians, who hope mining can help pull many out of poverty, but worry it will ravage the environment and further erode the nation's distinctive, nomadic identity.
http://jlne.ws/LfBrov

Yukon juniors with cash to burn, and where they are spending it
Kip Keen - Mineweb
Despite a rocky junior market, exploration continues apace in the Yukon, which is set to have near record exploration expenditures this year. Natural Resources Canada recently estimated nearly C$300 million would go into mineral exploration in the Yukon during 2012, just a little bit less than last year's C$307 million.
http://jlne.ws/LD4wQv

People power, gold and silver - huge rebound ahead
Mineweb
Leonard Melman, veteran precious metals analyst, discusses the implications of the recent European elections on the prospects for the gold and silver markets and their likely huge rebound. Gold Report interview.
http://jlne.ws/LfBpgx

JLN Metals Scorecard	5/22/2012

NYSE LIFFE US Total Volume	75,249

100 oz. Gold Futures Volumes
NYSE LIFFE US	122
CME/NYMEX (Globex + PNT)	198,643
CME/NYMEX Open Auction	6,060
NYSE LIFFE market share	0.06%
NYSE LIFFE US Electronic market share	0.06%

100 oz. Gold Futures Open Interest
CME/NYMEX	435,706
NYSE LIFFE US	1365
NYSE LIFFE US market share	0.31%

Mini Gold Volume
NYSE LIFFE US	4,811
CME E-micro Gold (10 Troy oz)	1,142
CME/NYMEX miNY	304
NYSE Liffe market share (Contracts)	76.89%
NYSE Liffe market share (Notional)	85.71%

5,000 oz. Silver Futures Volume
NYSE LIFFE US	0
CME/NYMEX	46,353
NYSE LIFFE US market share	0.00%

Mini Silver Volume
NYSE LIFFE US	2,114
CME/NYMEX miNY	420
CME/NYMEX E-mini	#REF!
NYSE LIFFE US market share	#REF!

Additional Metal Futures Volume statistics
EUREX Gold Futures (100 troy ounces)	26
TOCOM Gold Futures (1 kg / 32.15 ounces)	59,303
TOCOM Mini Gold Futures* (100 grams / 3.215 ounces)	18,674
TOCOM Silver Futures (10 kg / 321.51 ounces)	246
Dubai Gold & Commodities Exchange (32 troy ounces / 1 kg)	2,564

METAL ETFS	METAL ETFS
ProShares Ultra Silver	301,680
Powershares DB Base Metals Fund	9,167
Market Vectors Gold Miners GG	3,936,668
MARKET VECTORS JUNIOR	1,356,866
ProShares UltraShort Gold	216,246
ETFS Precious Metals Baskets Trust	3,000
iShares COMEX Gold Trust	835,347
iShares Silver Trust (ETF) historical prices	1,853,288
ETFS PHSYICAL PALLADIUM SHARES	19,231
ETFS PHYSICAL PLATINUM SHARES	6,558
ETFS GOLD TRUST	48,824
ETFS SILVER TRUST	35,864
Market Vectors Steel	46,109
ProShares Ultra Gold	62,437
ProShares UltraShort Silver	158,334
SPDR Gold Trust	2,316,648

Lead Stories

LME transaction update
The Chairman of the London Metal Exchange (LME) has today issued an update to shareholders regarding the potential acquisition of the Exchange. The Board of the LME has decided to continue discussions with two parties regarding their proposals for the potential acquisition of the LME.
http://jlne.ws/JR33FT

CME's bid for London Metal Exchange falls short
Crain's Chicago Business
(Crain's) - The Chicago firm's $1.9 billion offer for the London Metal Exchange was bested by rivals. But there may be a silver lining to losing the auction.
http://jlne.ws/LfBrF3

Mining Industry Financings, Drilling Falls In April – MEG
By Kitco News
The mining industry’s aggregate market capitalization fell in April to $1.82 trillion, the lowest level since December, said a mining research and consultancy group on Tuesday.
http://jlne.ws/LfBrFb

Singapore’s low taxes lure Trafigura
By Javier Blas in London and Jeremy Grant in Singapore - Financial Times
Singapore has enticed Trafigura, one of the world’s biggest commodities trading houses, to move its legal headquarters from Switzerland to the Asian city state, highlighting the attractions of its low-tax regime and proximity to China.
http://jlne.ws/JR39xa

Gold Investors Seek Silver Lining
Prospect of More Fed Action Has Some Piling Into Options That Would Pay Off if the Metal Spikes
By MATT DAY, TATYANA SHUMSKY and KAITLYN KIERNAN, WSJ.com
Some investors are fighting the tide of lower gold prices.
Gold is down 17% from its record high in August. Yet a few bullish investors including hedge funds are wagering on a reversal. Some are piling into less-risky options bets that would deliver huge profits if gold spikes over the next couple of months. Others are holding tight to exchange-traded funds that are a close substitute to holding the physical metal. These longer-term investors tend to be more willing to ride out volatility.
http://jlne.ws/MoCCoe

Futures & ETF News

Ex-Société Générale commodity traders plan discretionary hedge fund for end of 2012
Vita Millers - Hedge Funds Review
Former Société Générale commodity traders plan to launch a hedge fund in Q4 to take advantage of an expected increase in investor appetite for commodities. The fund will combine three strategies.
http://jlne.ws/JR39x6

Gold ETFs or Mining Stocks: Which Is the Better Bet?
By Helen Burnett-Nichols - Minyanville
It is no secret that the second quarter of 2012 is proving to be a tough one for gold. After climbing 4% in the first quarter, the SPDR Gold Shares ETF (GLD) is now up only 0.5% (to May 17) after briefly moving into negative territory, as bullion has continued its decline since late February.
http://jlne.ws/LfBrVA

Swiss Bank Copies MF Global Fraud, Averts Disaster
ETF Daily News
Dominique de Kevelioc de Bailleul: When James Turk, Marc Faber, Eric Sprott and Gerald Celente say get your gold out of the hands of bankers, each one of these men isn’t hyping the gold trade.
http://jlne.ws/Jy2ukj

Commodities & Macroeconomics

Copper Slumps for First Time in Four Days on Greece Exit Risk
Bloomberg
Copper declined for the first time in four days as concern that Greece may quit the euro region outweighed a report showing an improvement in U.S. home sales.
http://jlne.ws/LfBpNA

China's slowing economy hitting its appetite for commodities?
Reuters
Traders are saying more Chinese buyers are deferring on coal and iron ore shipments following a drop in prices, providing more evidence that the country's economy is slowing.
http://jlne.ws/LfBsc1

Hedge funds re-evaluate gold's potential
GoldSeek.com
Gold's biggest problem since February has been one of relative weakness. This weakness in turn has kept the market-moving hedge fund players away from gold. But as we'll see in the latest commentary, that may be about to change.
http://jlne.ws/LfBsc9

Hold the gold
Clyde Russell - Fin 24
Gold has jumped some 4.4% since hitting a four-month low last week, but it's way too early to say this is the start of a renewed bull run for the precious metal. The reasons to be sceptical about gold resuming its decade-long upswing are to be found in the World Gold Council's first quarter report, which highlighted several areas of concern for demand.
http://jlne.ws/LfBq43

Scrap export restrictions elsewhere affect US prices: Nucor CEO
Platts
Various restrictions on ferrous scrap exports imposed by more than 20 countries have had a greater impact on pricing than availability, according to steelmaker Nucor's CEO Dan DiMicco. The US is the leading exporter of scrap in the world, exporting a record-high 24.3 million mt in 2011.
"The issue on scrap is not so much availability because of exporting, but it does have an impact on price," DiMicco said Tuesday during a press briefing at the American Iron and Steel Institute's joint annual meeting with the Metals Service Center Institute in Cambridge, Maryland.
http://jlne.ws/KgiJiE

ArcelorMittal monitoring development of iron ore e-trading platforms
London (Platts)
ArcelorMittal is still monitoring electronic trading platforms and hedging solutions for raw materials, Frank Schulz, vice president of purchasing and procurement at ArcelorMittal Flat Carbon Europe, told the Platts Steel Markets Europe conference in Brussels. He said there was currently not enough liquidity in platforms, such as the China Beijing International Mining Exchange (CBMX), to be considered an effective tool for the market. CBMX is an e-trading platform for iron ore.
http://jlne.ws/LoVAeP

Company & Production News

Argus Metals Corp.: Drilling Commences on Kaituma Uranium/Gold Project
Marketwire via Yahoo! Finance
Argus Metals Corp. announces that, further to the Company's news release dated May 10, 2012, the 2,500m drill program on its 100% owned Kaituma uranium and gold project in north-west Guyana has commenced.
http://jlne.ws/LfBqko

Global Advanced Metals Joins The AVX "Solutions for Hope" Project
Business Wire via Yahoo! Finance
AVX Corporation, a leading manufacturer of advanced passive components and interconnect solutions, announced today that US-based Global Advanced Metals’ tantalum processing division, (GAM Technology), the first tantalum smelter to achieve EICC/GeSI Conflict-Free Smelter validation in December 2010, has joined the AVX “Solutions for Hope Project.”
http://jlne.ws/LfBqkw

Anglo American, Codelco resume talks to end Chile asset dispute
Clara Ferreira-Marques and Erik Lopez - Reuters
Anglo American and Chilean copper giant Codelco have agreed to go back to the negotiating table in a push to end a damaging and increasingly acrimonious dispute over the global miner's operations in the country's central-south region.
http://jlne.ws/LfBssK

Anglo Asian Mining full year profits jump 60pct as gold prices rise
by Sergei Balashov - Proactive Investors
Anglo Asian Mining said it made “excellent” progress in 2011, reporting a 60 percent jump in full year profits. The precious metals focused mining group, which owns the Gedabek gold-copper mine in Azerbaijan, said profits increased to US$31.6 million from US$19.8 million in 2010 and revenues reached US$83.8 million, up from US$72 million in 2010.
http://jlne.ws/LfBqAW

Celeste Copper Announces Alan Shoesmith has been Appointed President and CEO
Celeste Copper Corporation is pleased to announce that Mr. Alan Shoesmith, FFA, has been appointed Chief Executive Officer and President of the Company.
http://jlne.ws/LfBsJ3

Endeavour Silver finally hits bonanza silver grades at San Sebastian
Kip Keen - Mineweb
For junior miner Endeavour Silver (TSX: EXK), it was almost time to consider dropping the option after last year's drilling results at the San Sabastian property in Jalisco state, Mexico. As Hugh Clarke, Endeavour's vice-president of corporate communications put it, 2011 drilling results from San Sebastian last year "didn't bring a lot of joy."
http://jlne.ws/LfBqB1

Production at Chinese copper fabricators slowing: Beijing Antaike
Washington (Platts)--Production at Chinese copper fabricators has slowed this year due to higher costs and financing issues, according to a report released Tuesday by Beijing Antaike, the state-owned metals research firm. Citing recently released data from the China Nonferrous Metals Industry Association, Antaike analysts noted that production of semi-fabricated copper products peaked last year at 10.28 million mt. Semi-fabricated copper production in January-February 2012 totaled 1.58 million mt, up nearly 18.75% from January-February 2011, but the pace is slowing, Antaike said.
http://jlne.ws/JdgGJl

Tata Steel increases offtake agreement with Northern Iron
London (Platts)--Tata Steel is increasing its iron ore offtake volume for the current contract year with Northern Iron, the Scandinavia-focused miner said Wednesday. Northern's subsidiary Sydvaranger Gruve AS will sell 1.775 million wet mt of concentrate to Tata during the contract year, up 275,000 wmt on the amount previously agreed.
http://jlne.ws/KODRLc

Regulatory News

NY Times backs increasing EPA's authority to revoke mining wetlands permits
Dorothy Kosich - Mineweb
The New York Times editorial board this week endorsed the U.S. Environmental Protection Agency's decision to appeal a federal judge's ruling that the EPA exceeded its authority on January 12, 2011, when it revoked a Clean Water Act Section 404 permit for Arch Coal's Spruce No. 1 mine, which originally had been issued by the U.S. Army Corps of Engineers on Jan. 22, 2007.
http://jlne.ws/LfBqB6

Missouri lawmakers debate U.S. gold, silver coins use as legal tender
Mineweb
Missouri may be the second state, after Utah, to authorize the use of gold and silver coins or special "sound-money depositories" to pay debts to state government.
http://jlne.ws/LfBqB9

Gold needs to regain its sparkle
Thuy Lien - Vietname Investment Review
Decree 24/2012/ND-CP on gold business management will come into force from May 25 and National Financial and Monetary Policy Council member Cao Si Kiem said current bottlenecks needed to be tackled if the market was to prosper.
http://jlne.ws/LfBtwB

Rare earths juniors should applaud China's export controls
Critical Metals Report / Mineweb
With China's quotas creating a marked price differential for critical metals, Michael Silver* insists that junior miners finally have an opportunity to develop the U.S. resource and manufacturing sectors.
http://jlne.ws/LfBsZC

Miscellaneous News

High-Temp Ethernet Cameras monitor combustion in real-time.
ThomasNet
Furnace Camera HD and Hot Area Camera Systems include IP-networkable models for viewing and recording real-time color video images via Web browser or integration with other video management systems. Camera systems can generate configurable IP, HD resolution, MPEG-4 video stream at up to 25 and 30 ips for PAL and NTSC, respectively.
http://jlne.ws/LfBtwF

May 22, 2012: CME Group Eliminated From LME Sale Process

2012-05-22T16:11:00.000-05:00

Yesterday's top stories were "Icap unveils top brass across FX and Traiana" by Luke Jeffs of Reuters, and "World 'Hopefully' Through Worst of Currency Wars: Pro" by Antonia Oprita for CNBC.

Observations - Statistics - Commentary

Quote of the day

"The market is acting, despite what it might protest, like this deal is indeed likely to proceed as originally planned." -- Mark Kelly, of Olivetree Securities, on the pending $90 billion merger of Glencore and miner Xstrata, in "Ownership changes clear way for Glenstrata" By Anousha Sakoui in The Financial Times

Whales in the Gold Market
Resource Investor
Traditionally pension funds have ignored gold due to their focus on yields. Japan is the world's second largest pension market, and a move by Okayama Metal & Machinery is worth paying close attention to.
http://jlne.ws/Lcv2dT

Real estate won’t be supporting Chinese steel demand much longer
Kate Mackenzie - FT Alphaville
Something is up with China’s steel production. It reached record levels in March, driving up expectations of rising coking coal and iron ore prices. As the FT and Reuters have reported, there are accounts of both thermal coal and iron ore shipments being deferred or even defaulted on, and prices of both commodities have fallen 12 per cent since the beginning of April. To an extent, China’s steel production growth has also slowed: April’s production only increased 1.9 per cent compared to a year earlier, versus March’s rate of 2.5 per cent compared to a year previous. So why is China still producing steel at relatively high rates?
http://jlne.ws/Lcv2ud

A Precious-Metals Fund That Straddles the Gold Debate
ASA Gold and Precious Metals Limited ASA has been beaten down with its market, but don't count it out.
By Mike Taggart, CFA, Morningstar
The debate about gold's place in a portfolio heated up earlier this month, after Warren Buffett derided the asset at Berkshire Hathaway's annual meeting. On one side of the debate stand those, like Buffett, who believe that gold by itself has little economic value because it doesn't generate cash flow. On the other side stand those who point out that in inflationary periods gold and other precious metals will hold their value while fiat (aka “paper”) money’s value deteriorates. Given the recent elections in France and Greece, the winds in Europe seem to have changed from austerity to pro-growth talk. Indeed, the largely banal communique arising from the weekend's G8 summit also points to growth. And, for those unaware, pro-growth measures entail tactics that are more than likely to fuel inflation in coming years.
http://jlne.ws/JDmIIu

JLN Metals Scorecard	5/21/2012

NYSE LIFFE US Total Volume	42,880

100 oz. Gold Futures Volumes
NYSE LIFFE US	193
CME/NYMEX (Globex + PNT)	163,908
CME/NYMEX Open Auction	1,968
NYSE LIFFE market share	0.12%
NYSE LIFFE US Electronic market share	0.12%

100 oz. Gold Futures Open Interest
CME/NYMEX	435,213
NYSE LIFFE US	1360
NYSE LIFFE US market share	0.31%

Mini Gold Volume
NYSE LIFFE US	2,423
CME E-micro Gold (10 Troy oz)	840
CME/NYMEX miNY	172
NYSE Liffe market share (Contracts)	70.54%
NYSE Liffe market share (Notional)	82.55%

5,000 oz. Silver Futures Volume
NYSE LIFFE US	13
CME/NYMEX	37,268
NYSE LIFFE US market share	0.03%

Mini Silver Volume
NYSE LIFFE US	1,763
CME/NYMEX miNY	82
CME/NYMEX E-mini	0
NYSE LIFFE US market share	95.56%

Additional Metal Futures Volume statistics
EUREX Gold Futures (100 troy ounces)	23
TOCOM Gold Futures (1 kg / 32.15 ounces)	29,204
TOCOM Mini Gold Futures* (100 grams / 3.215 ounces)	7,873
TOCOM Silver Futures (10 kg / 321.51 ounces)	208
Dubai Gold & Commodities Exchange (32 troy ounces / 1 kg)	2,091

METAL ETFS	METAL ETFS
ProShares Ultra Silver	268,006
Powershares DB Base Metals Fund	6,322
Market Vectors Gold Miners GG	3,352,794
MARKET VECTORS JUNIOR	955,260
ProShares UltraShort Gold	98,274
ETFS Precious Metals Baskets Trust	2,890
iShares COMEX Gold Trust	1,099,244
iShares Silver Trust (ETF) historical prices	2,392,884
ETFS PHSYICAL PALLADIUM SHARES	6,316
ETFS PHYSICAL PLATINUM SHARES	5,229
ETFS GOLD TRUST	7,524
ETFS SILVER TRUST	21,849
Market Vectors Steel	64,536
ProShares Ultra Gold	28,099
ProShares UltraShort Silver	85,981
SPDR Gold Trust	1,780,637

Lead Stories

CME Group Eliminated From LME Sale Process - Sources
Dow Jones Newswires
CME Group Inc. (CME) has been eliminated from the sale process to buy the London Metal Exchange after being given more time to come up with a higher priced offer, leaving just two bidders in the frame to acquire the 135-year-old exchange, people familiar with the matter told Dow Jones Newswires Tuesday.
http://jlne.ws/LcuZPh

Ownership changes clear way for Glenstrata
By Anousha Sakoui in London - Financial Times
The adage of the equity market says “sell in May, go away, come back on St Ledger day”. But in the commodities world, this May is important: if you went away this month you would miss out on the biggest game the London market has seen for a long time.
http://jlne.ws/Lcv2uh

FOCUS: Speculators' Bullish Positions In CFTC Report Continue To Fall
By Debbie Carlson Of Kitco News
Speculators continued to drop their bullish positions across the board in precious and base futures and options traded on the Comex division of the New York Mercantile Exchange and the Nymex, with some positions falling to multi-year lows, according to U.S. government data.
http://jlne.ws/Lcv05z

BHP Billiton Provides Updates on TEMCO Operation
Mineweb
On 23 February 2012, BHP Billiton announced a 90-day suspension of operations at its TEMCO1 manganese alloy facility in Tasmania, Australia, to review the economic viability of continuing operations. With that review now complete, BHP Billiton is pleased to announce that TEMCO operations will be restarted, with planning for a safe and full restart of the operation to commence immediately.
http://jlne.ws/K7xV2R

Market Nuggets: HSBC: India's Gold Demand Subdued By Weakening Rupee
Allen Sykora of Kitco News
Gold demand in the key consuming nation of India remains subdued as the Indian rupee continues to hit record lows against the U.S. dollar, says HSBC.
http://jlne.ws/Lcv2ur

Futures & ETF News

Dennis Gartman Buying Gold and Stocks
CNBC
Can gold and stocks rally at the same time? Not only does Dennis Gartman think they can, he's betting they will.
http://jlne.ws/KHQeIT

Physical Gold ETFs Crushing Gold Stock ETFs
Seeking Alpha
Gold ETF products that track the price of gold through holding bars of gold are positive for the year while gold stock ETFs are well into negative double digit territory. The disconnect between gold prices and gold stocks is significant this year and many investors are finding out that using gold ETF products focused on gold stocks can be a painful indirect way to play gold prices." http://jlne.ws/JOhYk5

Italian steelmaker Beltrame lists billets on LME contract
Platts
Italian merchant bar and longs maker Beltrame has got approval from the London Metal Exchange for three brands of its billet to be available for delivery on the bourse's physically delivered futures contract effective Monday.
http://jlne.ws/Kx7xNp

Company & Production News

Codelco dispute puts focus on copper
By Jack Farchy at the Andina mine, Chile - Financial Times
Every morning, 4,200m above sea level in the Chilean Andes, an engineer from Codelco drives into “no-man’s-land” to meet his counterpart from Anglo American’s mine next door.
http://jlne.ws/Lcv2KJ

Q&A: Anglo-Codelco dispute
By Helen Thomas - Financial Times
http://jlne.ws/Lcv2KR

Glencore takes control of Mutanda with $480 million deal
Reuters
Commodities trader Glencore has taken majority control of its fast-growing Mutanda copper operation in Congo with deals worth $480 million, marking the first step in a planned merger of the mine with its nearby Kansuki concession.
http://jlne.ws/Lcv05I

Iran discovers 90 tons of gold reserves last year
BullionStreet
A month after announcing the discovery of 16 tons of gold reserves, Iran on Tuesday said 90 tons of new gold reservoirs have been discovered in the country over last year.
http://jlne.ws/Lcv05K

Tanzania Gold Exports Increased 44% in Year Through February
By David Malingha Doya - Bloomberg
Tanzania, which vies with Mali to be Africa’s third-biggest gold producer, posted a 44 percent increase in earnings from exports of the metal in the year through February, the central bank said.
http://jlne.ws/Lcv2KV

Jubilee Platinum says revenues improved significantly, shares surge
by Sergei Balashov - Proactive Investors
Jubilee Platinum rallied in early trade after reporting a significant improvement in revenues in the second half. The mining group said that its revenues for the first four months of the second half of its financial year already exceed that for the first half.
http://jlne.ws/Lcv0m5

Renewable Energy in the Mining Industry
PR Newswire via Yahoo! Finance
Reportlinker.com announces that a new market research report is available in its catalogue: Renewable Energy in the Mining Industry
Utilization of Solar, Wind, Geothermal, Hydro and Hydrokinetic, Biomass and Biofuels, Energy Storage, Fuel Cells, and Microgrids in the Global Mining Industry: Market Analysis and Forecasts
http://jlne.ws/Lcv31a

GTSO Opens Joint Venture Talks with Alaskan Mining Company
Business Wire via Yahoo! Finance
As its due diligence period draws to a close, Green Technology Solutions, Inc. is moving forward with discussions on a potential partnership or joint venture with mining company Diamond V Associates, Inc., to acquire and develop new tungsten prospects in the U.S.
http://jlne.ws/Lcv31e

Regulatory News

NCPA Study: U.S. Mining Policy Restricts Rare Earths
Today's Energy Solutions
The U.S. could add jobs and strengthen national security by developing rare earth mining domestically and in other countries to break China’s 97% monopoly on the global supply of these critical minerals, according to a new report from the National Center for Policy Analysis (NCPA).
http://jlne.ws/Lcv31i

State Cracking Down on Unlicensed Gold Buyers
WKRC-TV in Cincinnati
The price of gold has skyrocketed and to cash in on the modern-day gold rush, businesses are advertising “We Buy Gold”. But some businesses that are buying gold and other precious metals have nothing to do with jewelry.
Local 12's Angenette Levy says state officials have spotted everything from barber shops and hair salons to drive-thru buying gold. And, whether the business owners know it or not, they’re breaking the law. "We've even found a Goodyear tire store that all of the sudden hangs a sign in the front window 'We buy gold.' We stop in, it's like, ‘why do you have that sign out there?’ It's like ‘well, we thought we'd try to make some easy money," said Brian Landis, chief examiner for Ohio Department of Commerce’s Division of Financial Institutions.
http://jlne.ws/L2oVvX

Miscellaneous News

Trapped Zimbabwe miners accounted for, no injuries
Reuters
All of around 60 miners trapped underground after an accident and fire at Zimbabwe's Mimosa platinum mine are accounted for and are being bring brought to the surface, the company said on Tuesday.
http://jlne.ws/Lcv0mg

May 21, 2012 - Dollar-Wary China Soon To Be World's Top Gold Buyer; Hedge funds dump $2 billion in gold over a week: CFTC; Japan Aluminum Buyers Said to Face Highest Premiums Since 1996

2012-05-21T15:30:00.002-05:00

Last Thursday's top stories were "HKEx May Win LME With China Card" by By Nisha Gopalan in the Wall Street Journal, "Go for the Gold: From sequined boots to a clutch fit for a queen...by Karla Martinez in W Magazine, "Gold investors forgetting the lessons of 2008" by Adrian Ash at Mineweb, and "LME Chairman: Members Need Compelling Reason to Sell" by Andrea Hotter in the Wall Street Journal.

Editor’s Note:

As mentioned earlier in today’s John Lothian Newsletter, Nicole Rohr has been hired away from John J. Lothian & Co. We will all miss her and we wish her well in her new job.
I will be taking over as editor of JLN Metals starting today. It will be hard to fill Nicole’s shoes, but I am plunging in and looking forward to exploring the metals space and hearing from those of you who have contributed and/or worked with Nicole in the past and from the Metals readership. If you have any suggestions for original content or additional coverage of the metals markets, please do not hesitate to contact me at sarahrudolph@johnlothian.com.

Thank you,

Sarah Rudolph
(new) Editor
JLN Metals Newsletter

“China and India have seen continuing economic growth and while China’s economy is expected to slow, it will nonetheless surpass the rates of growth in the West.”

-- Marcus Grubb, managing director for investment at the World Gold Council, in Dollar-Wary China Soon To Be World's Top Gold Buyer in Forbes

Observations - Statistics - Commentary

Gold lull may just be a pause for bulls
By Jack Farchy in London and Kanupriya Kapoor in Mumbai - Financial Times
At gold dealerships such as Manfra, Tordella & Brookes in downtown Manhattan, the phones have been ringing off the hook for the past four years. When Lehman Brothers declared bankruptcy in September 2008, investors rushed to buy gold. When the eurozone crisis erupted in 2010, they bought more. When the US lost its triple A debt rating last summer, they bought even more. But this year, the buying has fizzled out.
http://jlne.ws/Jiplz8

Whales in the gold market
GoldSeek.com
Last April gold investment analysts where excited to see a new institutional player enter the gold market. The University of Texas Investment Management Co. took delivery of nearly $1bn of gold bullion into a New York vault.
http://jlne.ws/JiplPq

Guest Post: Backwardation In Gold And Silver
Zero Hedge
On Monday, May 14, something happened that hasn’t happened since Dec of 2008. Two successive near-month precious metals futures contracts were in backwardation at the same time. To oversimplify, backwardation is when the price of a futures contract is lower than the price in the spot market. It should not be possible for it to happen in gold and silver.
http://jlne.ws/JiplPw

Gold bushwhacks bears
Commentary: Is a central bank buying?
By Peter Brimelow, MarketWatch
Gold bushwhacked the bears last week. It’s even got gold bugs talking about gold stocks ... again. After breaking gold bugs’ hearts by plunging to a new low for the year on Thursday, gold violently reversed.
http://jlne.ws/Jipnae

JLN Metals Scorecard	5/18/2012

NYSE LIFFE US Total Volume	55,162

100 oz. Gold Futures Volumes
NYSE LIFFE US	94
CME/NYMEX (Globex + PNT)	192,663
CME/NYMEX Open Auction	1,410
NYSE LIFFE market share	0.05%
NYSE LIFFE US Electronic market share	0.05%

100 oz. Gold Futures Open Interest
CME/NYMEX	429,575
NYSE LIFFE US	1363
NYSE LIFFE US market share	0.32%

Mini Gold Volume
NYSE LIFFE US	3,598
CME E-micro Gold (10 Troy oz)	840
CME/NYMEX miNY	193
NYSE Liffe market share (Contracts)	77.69%
NYSE Liffe market share (Notional)	86.87%

5,000 oz. Silver Futures Volume
NYSE LIFFE US	11
CME/NYMEX	48,048
NYSE LIFFE US market share	0.02%

Mini Silver Volume
NYSE LIFFE US	2,175
CME/NYMEX miNY	449
CME/NYMEX E-mini	0
NYSE LIFFE US market share	82.89%

Additional Metal Futures Volume statistics
EUREX Gold Futures (100 troy ounces)	19
TOCOM Gold Futures (1 kg / 32.15 ounces)	63,320
TOCOM Mini Gold Futures* (100 grams / 3.215 ounces)	13,824
TOCOM Silver Futures (10 kg / 321.51 ounces)	294
Dubai Gold & Commodities Exchange (32 troy ounces / 1 kg)	2,383

METAL ETFS	METAL ETFS
ProShares Ultra Silver	370,594
Powershares DB Base Metals Fund	7,500
Market Vectors Gold Miners GG	4,758,153
MARKET VECTORS JUNIOR	1,523,072
ProShares UltraShort Gold	206,216
ETFS Precious Metals Baskets Trust	2,483
iShares COMEX Gold Trust	1,591,098
iShares Silver Trust (ETF) historical prices	3,138,093
ETFS PHSYICAL PALLADIUM SHARES	15,662
ETFS PHYSICAL PLATINUM SHARES	8,039
ETFS GOLD TRUST	63,285
ETFS SILVER TRUST	27,513
Market Vectors Steel	17,227
ProShares Ultra Gold	51,245
ProShares UltraShort Silver	458,217
SPDR Gold Trust	2,889,616

Lead Stories

Dollar-Wary China Soon To Be World's Top Gold Buyer
Forbes
China drives up gold demand, followed by ETFs like State Street's SPDR Gold.
http://jlne.ws/Jipnqs

Hedge funds dump $2 billion in gold over a week: CFTC
Reuters via Yahoo! News
Hedge funds and other money managers liquidated more than $2 billion in gold futures over a week, trade data on Friday showed, before a forceful rebound in the precious metal potentially tripped up some of them.
http://jlne.ws/KFigJ5

China buyers defer raw material cargos
By Javier Blas in Singapore and Jack Farchy in London - Financial Times
Chinese consumers of thermal coal and iron ore are asking traders to defer cargos and – in some cases – defaulting on their contracts, in the clearest sign yet of the impact of the country’s economic slowdown on the global raw materials markets.
http://jlne.ws/JipnqD

Japan Aluminum Buyers Said to Face Highest Premiums Since 1996
Bloomberg
Aluminum buyers in Japan, Asia's biggest importer, were asked to accept a 57 percent increase in fees starting in July, as supply decreased after smelters cut output and China boosted purchases.
http://jlne.ws/Jipm65

Futures & ETF News

Hedge Funds Shift Gold ETF Holdings
Tom Lydon | ETF Trends
Hedge funds and prominent money managers have held onto their gold exchange traded fund positions, with some even raising their bullion exposure, over the first quarter, but market observers believe they are beginning to lighten their holdings.
http://jlne.ws/KFikbP

Rupee, gold drive new DGCX record
Khaleej Times
Driven by an increase in the Indian rupee and gold futures trading, the Dubai Gold and Commodities Exchange, or DGCX, registered a new daily volume high of 51,943 contracts last Wednesday, May 16.
http://jlne.ws/JipnqE

Commodities & Macroeconomics

RBI directions may hit India Gold loan businesses
Bullion Street
Gold based businesses in India will be hit by central bank's directions on banks to reduce exposure to NBFCs, which give loan against the precious metal, analysts said.
http://jlne.ws/JipnqF

This Is the Bottom for Gold- John Hathaway
GoldSeek.com
In an interview with Louis James, John Hathaway discusses the US's economic outlook and why he's delighted by the current bearish sentiment toward gold.
http://jlne.ws/JipnH1

Politics weighs heavily on platinum
CLARA FERREIRA-MARQUES and ED STODDARD - Business Day
MINER Anglo American has made a priority of its struggling platinum business, admitting earlier this year that the world’s largest primary producer is underperforming in the face of soaring costs, safety stoppages and weak demand.
http://jlne.ws/JipnH2

Platinum's Price Hangs in the Balance
By FRANCESCA FREEMAN - WSJ
Platinum's sliding price stands at the mercy of competing "swing factors" that make forecasting prices and the market's balance between physical supply and demand particularly challenging.
http://jlne.ws/JipnH6

Company & Production News

Rhodium fails to regain lustre
By Jack Farchy - Financial Times
If you don’t work in the precious metals industry you may not even have heard of it. But over the last couple of years rhodium has been just about the worst-performing commodity.
http://jlne.ws/JipmmG

CME Group loses fund sales chief
Tom Osborn - Financial News
CME Group, the world’s largest futures exchange, has suffered the departure of a senior sales executive at its Chicago clearing house, at a crucial juncture in the battle for buyside business between global clearers.
http://jlne.ws/KFib8f

Snyder proposes mining severance tax
Times Herald
TRAVERSE CITY - Gov. Rick Snyder's administration is proposing a new severance tax for nonferrous mining operations that would replace four other taxes they'd have to pay under existing law.
http://jlne.ws/JipnHf

McEwen Mining Cautions Shareholders at Annual General Meeting
Marketwire via Yahoo! Finance
McEwen Mining Inc. announces that at its Annual General Meeting in Toronto on May 17, 2012, Mr. Robert McEwen, Chairman, President and Chief Executive Officer, provided an overview of the company's current development plans and outlook for the price of gold.
http://jlne.ws/JipnXv

Molycorp Prices $650 million of Senior Secured Notes
Business Wire
Molycorp, Inc. today announced the pricing of $650 million aggregate principal amount of 10.000% senior secured notes due 2020 in an offering exempt from the registration requirements of the Securities Act of 1933.
http://jlne.ws/JipmD4

Carrick Gold gets approval for gold project acquisition in Kalgoorlie
by Christine Feary - ProactiveInvestors
Carrick Gold can complete the acquisition of the Mt Jewell Gold Project, which lies adjacent to the company’s flagship LKK Project near Kalgoorlie, following shareholder approval.
http://jlne.ws/JipnXz

Fjordland Begins Exploration Program on Tak Copper-Gold-Molybdenum Project
Zecco
Fjordland Exploration, Inc. reported that it has commenced a Phase 4, exploration program, budgeted at approximately $375,000, on the Tak Project, part of the Tak-Milligan Property Option, located approximately 50 kilometres (km) east of Williams Lake, and immediately south of the developing Woodjam copper-gold-molybdenum porphyry camp.
http://jlne.ws/JipmD9

Regulatory News

ISDA/CFTC "Fireside Chat" Video At this year's AGM, the final day's opening session featured a standing-room-only "fireside chat" between ISDA Chairman Stephen O'Connor and CFTC Chairman Gary Gensler. The conversation covered a wide range of topics of importance to the OTC derivatives industry and regulators. Below, find short video clips from the talk labeled by topic in sequential order; the full recording of the conversation is available at the bottom of the page.
http://jlne.ws/KFiaRY

May 17, 2012 - HKEx May Win LME With China Card; BHP Billiton U-Turns Amid the Turmoil; China May Surpass India as Biggest Gold Market, WGC Says

2012-05-17T15:00:00.000-05:00

Yesterday's top stories were "Wanted -- iron ore traders" by Silvia Antonioli and Jacqueline Cowhig for Reuters via Yahoo! Finance and "Germans Getting Paranoid About Gold Reserves" by Matthew Yglesias for Slate. Other popular reads were "Gold Tumbles Into Bear Market on Greece Euro-Exit Concern" by Debarati Roy and Phoebe Sedgman for Bloomberg News and "Gold miners need $3,000 price in five years - gold council" by Reuters.

Editor's Note:

We will not be publishing tomorrow in honor of our MarketsWiki Spring Cleaning Party (see balloons below). Our staff will be focusing on MarketsWiki all day, and for good reason! The site is fast approaching 24 million page views after ending 2012 with 17.5 million page views since the start of the wiki. That is almost 6.5 million page views in less than five months.

Also, on a sad note, tomorrow will be my last day with John J. Lothian & Co. It is hard to leave my family here, and I have enjoyed every second of publishing JLN Metals. JLN is moving up and up, and I'm so amazingly proud of what the company has achieved.

Nicole V. Rohr

Quote of the Day:
“In the event that HKEx competes with others in commodities and other asset classes either via the potential acquisition of the LME or organic growth, it is only right that as a condition the authorities should remove its favored nation status."

-Hong Kong Mercantile Exchange chief operating officer William Barkshire in "H.K. Should End Bourse Monopoly If LME Won, Rival Says" by Eleni Himaras for Bloomberg News

++++

Observations - Statistics - Commentary

BHP Billiton chief sparks workplace row (Video)
Australian Broadcasting Corporation
Federal Treasurer Wayne Swan has rejected suggestions that major international companies will abandon their investments in Australia because of the country's workplace laws. BHP Billiton chairman Jac Nasser yesterday slammed Australia's industrial relations framework and called for an overhaul of the system to recognise the right of management to run businesses.
http://jlne.ws/JLqiOD

Gold investors forgetting the lessons of 2008
BullionVault via Mineweb
Gold just gave back the last of its big surge from summer 2011's big crisis... So the price of gold keeps falling, and it keeps falling despite the imminent failure of Greece's Euro membership, the looming collapse of Europe's banking system, and the fast-looming debt-ceiling repeat and fiscal cliff in the US.
http://jlne.ws/JLyZsh

New Group Seeks To Promote Clean Technology Use In Mining Industry
Kitco News
A new group launched this week seeks to promote and encourage new forms of technology for use the mining industry in an effort to make mining cleaner, safer and ultimately less expensive. The Clean Mining Alliance is a non-profit industry association formed to draw attention to new technologies that make a “radical departure” from how mining and production methods have been done, said Dallas Kachan, executive director of the Clean Mining Alliance.
http://jlne.ws/JSDjFB

LME Clear to move into new premises
Press Release
The London Metal Exchange (LME) plans to move LME Clear staff into dedicated offices close to the main premises in Q3 2012. The LME Clear team continues to expand as the selection processes for both the technology supplier and treasury partner reach the final stages.
http://jlne.ws/L2XU8j

Latest Issue: Gold Demands Trends Q1 2012
World Gold Council
The World Gold Council's Gold Demand Trends (GDT) is the leading industry resource for data and opinion on world-wide gold demand. Our quarterly publication examines demand trends by sector and geography. (Available for PDF download.)
http://jlne.ws/JLBtXD

++++

MarketsWiki Spring Cleaning Party - May 18, 2012

Join the MarketsWiki staff on Friday, May 18 as we clean up our most popular pages and take suggestions from MarketsWiki users all day.

Help us by participating in one of three ways:

(1) Help us edit - Spend some time on May 18 to help update a page. We’ll give you (and your organization) a shout out in the newsletter and on the front page of MarketsWiki during the party. Don’t have a MarketsWiki account? You can start a FREE MarketsWiki account for this event. Send Jeff Bergstrom an email to get signed up. We’ll also have help available all day for those new to wiking (or are a bit rusty).

(2) Suggest a page to clean up - Tweet your suggestion to @MarketsWiki with the #MWParty hashtag on (or before) May 18. You can also suggest a page at http://jlne.ws/MWSuggest.

(3) Spread the word - Contact colleagues that might have suggestions or want to become MarketsWiki editors. For a quick explanation of MarketsWiki, send them our short animated video: http://jlne.ws/WhatIsMW. Use the the #MWParty hashtag on Twitter to help us spread the word about our newly updated pages on May 18.

We hope you’ll join us on May 18, and remember to watch our progress by following the #MWParty hashtag on Twitter or visiting MarketsWiki.com.

++++

JLN Metals Scorecard	5/16/2012

NYSE LIFFE US Total Volume	114,516

100 oz. Gold Futures Volumes
NYSE LIFFE US	418
CME/NYMEX (Globex + PNT)	292,666
CME/NYMEX Open Auction	4,449
NYSE LIFFE market share	0.14%
NYSE LIFFE US Electronic market share	0.14%

100 oz. Gold Futures Open Interest
CME/NYMEX	416,956
NYSE LIFFE US	1507
NYSE LIFFE US market share	0.36%

Mini Gold Volume
NYSE LIFFE US	6,462
CME E-micro Gold (10 Troy oz)	1,314
CME/NYMEX miNY	361
NYSE Liffe market share (Contracts)	79.42%
NYSE Liffe market share (Notional)	87.31%

5,000 oz. Silver Futures Volume
NYSE LIFFE US	12
CME/NYMEX	63,701
NYSE LIFFE US market share	0.02%

Mini Silver Volume
NYSE LIFFE US	3,489
CME/NYMEX miNY	134
CME/NYMEX E-mini	0
NYSE LIFFE US market share	96.30%

Additional Metal Futures Volume statistics
EUREX Gold Futures (100 troy ounces)	19
TOCOM Gold Futures (1 kg / 32.15 ounces)	61,888
TOCOM Mini Gold Futures* (100 grams / 3.215 ounces)	13,060
TOCOM Silver Futures (10 kg / 321.51 ounces)	572
MCX India (1 kg / 32.15 ounces)	N/A
Dubai Gold & Commodities Exchange (32 troy ounces / 1 kg)	3,715

METAL ETFS	METAL ETFS
ProShares Ultra Silver	482,866
Powershares DB Base Metals Fund	29,825
Market Vectors Gold Miners GG	6,606,295
MARKET VECTORS JUNIOR	2,431,838
ProShares UltraShort Gold	308,889
ETFS Precious Metals Baskets Trust	3,146
iShares COMEX Gold Trust	1,036,113
iShares Silver Trust (ETF) historical prices	4,426,185
ETFS PHSYICAL PALLADIUM SHARES	32,993
ETFS PHYSICAL PLATINUM SHARES	13,270
ETFS GOLD TRUST	95,251
ETFS SILVER TRUST	66,775
Market Vectors Steel	10,090
ProShares Ultra Gold	51,852
ProShares UltraShort Silver	297,887
SPDR Gold Trust	3,557,116

Lead Stories
HKEx May Win LME With China Card
WSJ.com
For the LME, picking Hong Kong Exchanges & Clearing Ltd. would give the 135-year-old member-owned exchange better access to China and its hunger for resources. With close ties to mainland exchanges and government officials as well as its experience in trading yuan-denominated securities, the Hong Kong exchange operator appears a worthy contender.
http://jlne.ws/KhB0KA

H.K. Should End Bourse Monopoly If LME Won, Rival Says
Bloomberg
Hong Kong Exchanges & Clearing Ltd., one of three remaining bidders for the London Metal Exchange, should lose government protections against competition if it begins commodities trading, Hong Kong Mercantile Exchange Chief Operating Officer William Barkshire said.
http://jlne.ws/LfKJ9N

LME Chairman: Members Need Compelling Reason to Sell
WSJ.com
Shareholders in the London Metal Exchange, who are also its members, need to be convinced to sell the 135-year-old business to any of the remaining bidders, according to a document seen by Dow Jones Newswires. The exchange is evaluating proposals from three bidders who have made it to the final round.
http://jlne.ws/JOItlJ

Costs and investments cut LME profits
FT.com
The London Metal Exchange suffered a 19 per cent drop in profits last year as higher costs and investments outweighed a sharp rise in trading volumes. The results highlight the challenges facing the 135-year-old exchange should it remain independent in an increasingly competitive and more stringently regulated industry. They also underline the dilemma for the LME’s shareholders, the banks and brokers that use it, as they decide whether or not to sell the exchange.
http://jlne.ws/JwcwSB

LME Hasn't Served Notice On LCH.CLearnet Yet - Document
Fox Business
The London Metal Exchange hasn't served notice on London clearing house LCH.Clearnet, its current clearing provider, and won't do so until and unless the LME board gives final approval for the exchange to develop its own in-house clearing project, the LME chairman said in a document seen by Dow Jones Newswires Thursday.
http://jlne.ws/KppbCz

BHP Billiton U-Turns Amid the Turmoil
WSJ.com
BHP Billiton is leading the mining sector's retreat. Like its peers, the world's largest miner by market capitalization experienced strong growth over the last decade thanks to high commodity prices. Last year, Chief Executive Marius Kloppers said BHP would invest $80 billion by the end of 2015 to expand further. But the euro-zone crisis and slower Chinese growth are hitting even the biggest companies, and amid falling metals prices, BHP now says it will cut those spending plans. For a company that prides itself on a long-term outlook, that is a hurried change of tune.
http://jlne.ws/KwcN7u

BHP may delay at least two mega projects to rein in spending
Reuters via MiningWeekly.com
BHP Billiton, the world's biggest miner, is likely to delay signing off on at least two mega projects after its chairman put the brakes on an $80-billion plan to grow the company's iron-ore, copper and energy operations, analysts say. Slumping commodity prices and escalating costs have squeezed cash flows, pushing BHP to join rival Rio Tinto in reconsidering the pace of their long-term expansion in countries such as Australia and Canada.
http://jlne.ws/Mor46O

China May Surpass India as Biggest Gold Market, WGC Says
Bloomberg
Gold demand in China may surge as much as 30 percent this year as rising incomes boost consumption, helping the country topple India as the world’s largest bullion market on an annual basis, according to the World Gold Council.
http://jlne.ws/JVGiOE

Asian gold investors buy as Europe holds back
Mineweb
Demand for gold in China during the first quarter of 2012 rose to a record 255.2 tonnes, according to data released by the World Gold Council on Thursday. In its Gold Demand Trends Report for Q1 2012, the council writes, "Although the pace of growth in demand is slowing, gold continues to benefit from rising income levels, increasing urbanisation, economic growth and the high inflation environment."
http://jlne.ws/KDUM5Y

Glencore tightens grip on global zinc industry
Reuters via Mineweb
Commodity trader Glencore is tightening its grip on the global zinc market by moving material to inaccessible locations, forcing industrial users to pay high physical premiums for a metal that is in surplus. The matter is under scrutiny because Glencore, which controls 60 percent of the world's zinc trade, is using warehouses monitored by the London Metal Exchange (LME) to stow away the metal and support premiums, sources told Reuters.
http://jlne.ws/JmtLjb

Rhodium fails to regain lustre
FT.com
If you don’t work in the precious metals industry you may not even have heard of it. But over the last couple of years rhodium has been just about the worst-performing commodity. Last year the price of the precious metal tumbled 42 per cent. Since a peak of more than $10,100 an ounce in 2008, it has fallen 87 per cent, this week trading at $1,360.
http://jlne.ws/KbVWmG

Futures & ETF News

Gold Soars On Technical Factors, Slightly Higher Hopes For More Fed Accommodation
Kitco News
The sharp surge in gold futures Thursday is mostly a technical-chart bounce, with some help from Federal Open Market Committee minutes late Wednesday which were construed to leave the door slightly ajar for possible further accommodative monetary policy, analysts said Thursday.
http://jlne.ws/LaLBGq

Gold Rebounds, Silver Surges, After Selloff
WSJ.com
Gold futures had slumped for four consecutive sessions through Wednesday, crumbling to the lowest settlement price since July 2011 as worries about Europe's financial system boosted demand for the U.S. dollar at the expense of precious metals. But futures clung above a key price point, gold's late-December intraday lows, spurring some buyers who had bet on lower prices during the market's selloff to close out those bets, traders said. Those gains accelerated as the dollar, a headwind to gold in recent weeks as it rallied to four-month highs, paused on Thursday.
http://jlne.ws/J3jRoh

Copper steady but near 4-mth lows, Greece crisis weighs
Reuters
Copper steadied on Thursday after hitting four-month lows the previous session, but sentiment was cautious given worries Spain might be hard hit if Greece leaves the euro and defaults on its debt. The metal used in power and construction snapped four straight sessions of falls but worries surrounding the euro zone debt crisis, demand slowdown in top consumer China and the delicate state of the U.S. economy prevented further gains.
http://jlne.ws/Kcagf4

Demand for gold ETF may double this year: WGC
The Economic Times
Investments in gold via Exchange Traded Funds (ETF) are likely to double this year from 15 tonnes in 2011 on the back of robust demand, World Gold Council said today. While the US is the biggest ETF market is the world, Indian gold ETF market is "considered the largest in Asia" according to WGC.
http://jlne.ws/KcD1Ip

Commodities & Macroeconomics

ECB Stops Loans to Some Greek Banks as Draghi Talks Exit (Video)
Bloomberg
The European Central Bank said it will temporarily stop lending to some Greek banks to limit its risk as President Mario Draghi signaled the ECB won’t compromise on key principles to keep Greece in the euro area. The Frankfurt-based ECB said yesterday it will push the responsibility for lending to some Greek financial institutions onto the Greek central bank until they have sufficiently boosted their capital.
http://jlne.ws/JLs966

Gold price upturn likely once Greek turmoil crystalises – World Gold Council
MiningWeekly.com
An upturn in the gold price is likely once current Greek turmoil crystalises, says World Gold Council (WGC) investment MD Marcus Grubb. Current global macroeconomic concern is seen as a contributing factor to gold’s gradual fall since the end of February, when US Federal Reserve chairperson Ben Bernanke revealed that there would be no more quantitative easing in the near term in the US, which also led to a sharp fall in equities.
http://jlne.ws/JOavxA

CME Group Trims Grain-Trading Plan to 21 Hours a Day From 22
Bloomberg
CME Group Inc. (CME), the world’s largest futures exchange, amended a proposal for expanded trading in grains to 21 hours a day after withdrawing an earlier plan for 22 hours that drew complaints from clients.
http://jlne.ws/LX2YNC

Company & Production News

Russian billionaire Prokhorov files for copper-nickel Toronto IPO
MiningWeekly.com
Move over Mark Zuckerberg. Russia’s Mikhail Prokhorov, who Forbes ranks as the 58th richest person globally, has filed a prospectus to list his Intergeo MMC in Toronto, announcing it the day before Facebook goes public.
http://jlne.ws/KjTBFU

**Whoa, whoa, whoa. We're talking about something other than the Facebook IPO??

Output, costs hit Gold Fields' profits
MiningMX
Gold Fields’ operations in West Africa to some extent made up for production losses elsewhere in the first quarter of the 2012 financial year, with the group reporting a marginally weaker operational performance for the period under review. The group’s margins did take a hit though, with the operating profit and net profitability both down by 21%
http://jlne.ws/LX7ewE

Shareholders ask questions of AMSA CEO's pay hike
Mineweb
Shareholders were quick to ask questions at ArcelorMittal South Africa's AGM Wednesday particularly regarding the almost doubling of CEO, Nonkululeko Nyembezi-Heita's remuneration in 2011. The increase year on year for 2010 and 2011 in the CEO's base salary or guaranteed package amounted to 14% and 17% respectively.
http://jlne.ws/JzbB3Y

Some Chile Codelco workers protest, output unaffected
Reuters via MiningWeekly.com
Some subcontracted workers of Chilean copper giant Codelco blocked certain roads at the Andina, Chuquicamata, Gaby and Radomiro Tomic mines on Thursday, but the firm said operations were unaffected by the labor action.
http://jlne.ws/L39U9K

Regulatory News

Oxfam sues SEC over failure to issue final rule on transparency
Mineweb
Fed up with the SEC's slow pace toward issuing a rule requiring disclosure of payments from mining and oil and gas companies made to U.S. and foreign officials, Oxfam America Wednesday sued the SEC.
http://jlne.ws/KTMg2d

National Strategic & Critical Minerals Act now goes to full vote of U.S. House
Mineweb
On a 27-10 vote, the U.S. House Natural Resources Committee Wednesday passed the National Strategic and Critical Minerals Act (H.R. 4402), aimed at streamlining the permitting process for U.S. mining. The bill now goes to a floor vote by the full House.
http://jlne.ws/KwiceG

Chalco Targeted as Mongolia Seeks to Limit State Deals
Bloomberg
Mongolia, the commodity-rich nation that posted the world’s fastest economic growth in 2011, is on course to pass a law by June that will bar foreign state-owned companies from controlling its key assets. The draft law, submitted to parliament two years ago, was accelerated after a public outcry following state-run Aluminum Corp. of China Ltd.’s move last month to take control of SouthGobi Resources Ltd. (SGQ), Vice Finance Minister Ganhuyag Chuluun Hutagt said in an interview.
http://jlne.ws/JO74a4

Miscellaneous News

Go For The Gold
Wmagazine.com
http://jlne.ws/J2Ltd4

**I know the office will miss my gold-colored sweaters and jackets, so I had to include this one.