WEEK-IN-BRIEF: BHP demerger plans; Glencore results; aluminium rally; Russian trade; and much more

It was a big week for major miners, with BHP Billiton flagging up its demerger plans, and others releasing their financial results. Here, Metal Bulletin Deputy Editor Fleur Ritzema takes a look back at some of the key stories from the week.

It was a big week for major miners, with BHP Billiton flagging up its demerger plans, and others releasing their financial results. Here, Metal Bulletin Deputy Editor Fleur Ritzema takes a look back at some of the key stories from the week.

BHP ceo Andrew Mackenzie said he wants the core group to focus on the large-scale, big-tonnage businesses – or what he called the “exceptionally large resource basins”. That means Pilbara iron ore, copper, and most of the coal assets including the 85% stake in Queensland Coal, plus petroleum and potash.

So what does this mean for aluminium, manganese, nickel, among others? Here’s a breakdown of the plans.

And if you’re interested in getting equity exposure to aluminium, there’s a new opportunity to do so, writes Andrea Hotter.

News of the demerger slightly overshadowed BHP’s financial results, which showed that underlying earnings rose 7% in the year to June 30. Click here for more on this.

Glencore, meanwhile, revealed it has already returned more than its initial public offering proceeds to its shareholders.

It saw underlying earnings rise 8% in the half year to June 30 2014, thanks largely to the contribution from its growing copper business.

The markets took notice when ceo Ivan Glasenberg said nickel and zinc prices will be lifted by supply growth decline, and eventually by a likely fall in supply in absolute terms.

Copper miner Kazakhmys, meanwhile, recorded a net income of $50 million in the first half of 2014, thanks to the disposal of non-core assets.

And in very sad news, the world of copper laid to rest one of its most loved traders, Barry Feldman, following his death on Friday August 15. In this obituary, Metal Bulletin takes a look at his achievements.

On the LME, traders and brokers were looking for signs of producer hedging and production restarts in the aluminium market after a price rally of nearly 20% over the past three months.

Aluminium prices rose to their highest level since February 2013 on the London Metal Exchange, and were retesting those highs again on Friday August 22.

UC Rusal’s initial aluminium premium offers to Japanese buyers were 13-15% higher than the current-quarter premiums. Market participants argued the hike was too high. All eyes will be on other sellers, especially Rio Tinto, next week.

And Qingdao Port has been sued by Glencore’s warehousing division over undelivered aluminium, and named as a party in a lawsuit brought by ABN Amro.

Political unrest, meanwhile, continued to weigh on markets. Tension between Russia and the rest of the world has been impeding trade in some metal markets.

And Chinese selenium traders may not be able to see profits in the minor metal’s trading but they certainly haven’t lost the knack for making money.

And finally, in China, the 110th anniversary of the birth of the country’s former leader Deng Xiaoping has been marked by a wave of official commentary and commemoration. Metal Bulletin’s Asia Editor looks at his legacy for commodities markets in Comrade Xiaoping, author of the supercycle.

Fleur Ritzema
Twitter: FleurRitzema_MB

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