Australia’s first-half gold production slows
SYDNEY–Gold mining output in Australia, the world’s second-largest producer of the precious metal, dropped 5% in the first half of 2012 compared with a year earlier, international metals consultancy GFMS said Wednesday.
Production fell as mining companies recovered less gold from processed ore and some operations neared the end of their lifespans, according to the consultancy, a unit of Thomson Reuters Corp.
Australian gold production was 122.5 metric tons in the first half, down from 129.1 tons a year earlier, GFMS said. It added that a key contributing factor to the decline was lower output at Newcrest Mining Ltd.’s Cadia Valley operations, after the company processed lower-grade stockpiles.
Recovery rates at Australia’s two largest gold mines–Newmont Mining Corp. /quotes/zigman/235723/quotes/nls/nem NEM -0.53% and Barrick Gold Corp.’s /quotes/zigman/12772/quotes/nls/abx ABX +1.42% Kalgoorlie Super Pit, and Newmont’s own Boddington mine–also declined, it added.
Production at other Australian mines, including Ramelius Resources’ Wattle Dam operation, slowed as they neared the end of their lives, GFMS said.
The world’s top gold producer, China, meanwhile continued to race ahead, with production growing by 7% in the first six months of the year, taking output of the yellow metal to 182 tons.
More than half of the top-10 gold producers worldwide reported a drop in production as grades declined across the industry, construction and commissioning was delayed, and amid a slower-than-expected ramp-up of operations in key producing nations such as the U.S., South Africa and Russia.
Gold production globally was flat at 1,366 tons, GFMS said.
The consultancy said mining costs in Australia also remained under pressure. The average cost of producing a troy ounce of gold in the first half of the year was US$856, up from US$756 a year earlier.
"General inflationary pressures, a skilled labor shortage and lower output at a number of properties drove costs higher," GFMS said in its report.
Still, Australian producers benefited from a small increase in the gold price relative to other countries. In Australian dollar terms, the gold price rose 1.2% in the first half of 2012, compared with an 0.03% increase in U.S. dollar terms and a 1% rise in yuan terms.
Statistics: Posted by DIGGER DAN — Tue Dec 04, 2012 9:28 pm
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Drought crimps rise in U.S. Midwest farmland values
Reuters | Updated: August 16, 2012
The price of prime farmland in the drought-hit U.S. Midwest grain belt rose 1 percent in the second quarter, the smallest quarterly increase in two years, the Federal Reserve Bank of Chicago said on Thursday.
But while the district’s worst drought in nearly a quarter century will dramatically shrink soybean and corn output, land values this quarter were not expected to fall, the Fed said in its quarterly survey of 205 bankers in the district.
The Chicago Fed district includes the heart of the U.S. Corn Belt states of Iowa, Illinois and Indiana, and parts of Wisconsin and Michigan.
"The drought did not seem to have stifled all the momentum of rising agricultural land values," the Chicago Fed said in its August Ag Letter.
Just 4 percent of those surveyed expected farmland values to drop this quarter; more than 70 percent see farmland markets leveling off.
"Coming after several years of farm income that were better than average, the drought should not reverse the gains in farmland values, but there could be a pause while expectations about future earnings from crop production adjust to the short-term effects of this summer’s drought," the Fed said.
The value of district farmland rose 15 percent from a year earlier, the report said, a rise that "seems modest only in the context of exploding farmland values over the past few years."
In the Chicago Fed district, Iowa and Illinois combined produce about a third of the domestic corn and soybean crops. The United States is the world’s leading exporter of those food and industrial crops.
Farmland values are closely watched by Federal Reserve economists and by commercial bankers as a barometer of U.S. banking assets and as a benchmark for agricultural balance sheets. Farmland is a basic collateral for farm loans.
The Kansas City Federal Reserve’s quarterly farmland survey on Wednesday showed values across Kansas, Oklahoma, Nebraska and parts of Missouri rose 3 percent from the prior quarter.
While the drought in the Chicago Fed district is considered the harshest since 1988, the wider drought affecting the rest of the Midwest and the Plains states has been called the worst one in 56 years.
CREDIT CONDITIONS LEVEL
Higher crop prices and crop insurance payments will partially offset the drought’s impact, but the drought — the worst in the district since 1988 — has hit livestock operations particularly hard, the Fed report said.
Higher feed costs and the lack of extensive insurance coverage for corn and soybean prices have cut dairy, hog, poultry and cattle enterprises.
The district has already incurred "severe losses" in farm income in 2012, the Chicago Fed report said.
Still, agricultural credit conditions in the Corn Belt were resilient, with funds availability at a record high, and repayment rates for non-real-estate farm loans improving.
While interest rates on agricultural operating loans and mortgages set new lows, demand for non-real-estate loans was "feeble" compared to a year ago, it said. The average loan-to-deposit ratio, at 68.1 percent, was 10 percentage points below the average level that respondents said was optimal.
A few bankers thought repayment problems would increase because of the drought, the survey said. Respondents expected overall non-real-estate agricultural loan volumes to fall this quarter compared with a year ago, while farm mortgage volumes were forecast to rise slightly.
The Fed said that Iowa farmland values remained the strongest in the district with a year-over-year increase of 24 percent.
Land values in Illinois, Indiana and Wisconsin were up 15 percent, 12 percent, and 13 percent, respectively. (There were too few responses in Michigan to generate data this quarter, it said). Non-real-estate farm loan volumes were expected to rise in Indiana and Wisconsin, the report said.
Statistics: Posted by yoda — Thu Aug 16, 2012 2:55 pm
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Truck Cancellations Hit Two-Year High as Rebound Slows
By Natalie Doss and Mark Clothier – May 10, 2012
North American heavy-truck orders are hitting a speed bump, with cancellations jumping to the fastest pace in about two years as a stagnating economic recovery prompts fleet owners to delay or scrap purchases.
The March rate shot up to 9 percent from 6.1 percent a month earlier, according to data compiled by Bloomberg. North American freight shipments fell 1.3 percent in March and grew less than 1 percent in April, according to Cass Information Systems Inc.’s Freight Shipment Index.
Buyers are being squeezed by slower cargo volumes, tighter credit and diesel fuel prices exceeding year-earlier levels even with recent declines. That may erode profits at truck makers such as Paccar Inc. (PCAR) and Navistar International Corp. (NAV), and damp the manufacturing rebound that has bolstered U.S. job growth.
It “creates a situation where these guys say, ‘You know what? I’m just going to hold on for a little bit and maybe cancel or move my order out a bit,’” said Eric Starks, president of Nashville, Indiana-based forecaster FTR Associates.
Preliminary April orders for Class 8 trucks added to evidence of a surprise slowdown by falling to the lowest since September 2010, according to FTR data. Continued weakening in orders may lower industry expectations, Peter Nesvold, a Jefferies Group Inc. analyst, wrote in a note to clients May 4.
That’s already happened at FTR. As recently as March, the firm was predicting Class 8 shipments of 285,000 units, or 12 percent more than a year earlier. It has since cut that estimate to 275,027 units, an 8 percent increase, as truckers delay purchases to refresh the oldest fleet since at least 1980.
Sales and earnings are at risk for Paccar, whose brands include Peterbilt and Kenworth, and Navistar as high inventory and declining orders threaten production rates, according to Karen Ubelhart, a Bloomberg Industries analyst in New York.
March’s cancellation rate was the highest since the same month in 2010, excluding what Ubelhart said was an aberration in November, probably from manufacturers doing a periodic “backlog cleaning” to cull orders from buyers that aren’t fully committed.
Navistar’s first-quarter loss widened more than analysts had estimated after the Lisle, Illinois-based company said it was recalling vehicles because of faulty brakes. Profit at Bellevue, Washington-based Paccar beat estimates as sales advanced 45 percent.
Paccar Treasurer Robin Easton didn’t respond to a voice- mail request for comment about the company’s sales outlook, and Katy Troester, a spokeswoman, didn’t return an e-mail. A Navistar spokesman, Stephen Schrier, declined to comment.
The truck makers’ stocks have tumbled from this year’s highs, foreshadowing a drop in the broader market amid concern that Europe’s debt crisis will threaten global demand as developed nations cut spending to improve their finances.
Paccar has fallen 17 percent since its 2012 peak on March 15, closing yesterday at $39.45. That pared the shares’ gain this year to 5.3 percent. Navistar closed at $30.81, down 19 percent for the year. That has erased a 2012 gain of as much as 25 percent as of Feb. 6. The Standard and Poor’s 500 Index has dropped 4.3 percent since its April 2 year-to-date high.
The slowdown in truck orders follows last month’s report that U.S. gross domestic product rose at a 2.2 percent annual rate in the first quarter, slower than the prior three months and missing economists’ estimates.
Daily Tonnage Drops
“Slow and inconsistent economic growth” helped drag the freight unit of trucker Arkansas Best Corp. (ABFS) to a drop of about 9 percent in daily tonnage in the first 3 1/2 weeks of April, said Amy Mendenhall, director of investor relations. Rate increases at the Fort Smith, Arkansas-based company and “tough comparisons” from prior periods also damped volumes, she said.
One freight-company investor said the drop in truck shipments may be due to unusual weather, not a faltering economy.
Slower March and April deliveries may be the result of truckers being able to move more goods during a mild winter, said Eric Marshall, director of research at Dallas-based Hodges Capital Management Inc., which oversees about $700 million. The firm’s holdings include trucker Saia Inc. (SAIA) and railroads Union Pacific Corp. (UNP) and Kansas City Southern. (KSU)
Trucker earnings are increasing even with slow freight growth, and Marshall said the carriers are able to raise rates after cutting capacity during the recession.
“You’re seeing decent pricing power,” he said.
Beating Price Increases
Some truckers also may have accelerated vehicle purchases before manufacturers’ price increases went into effect this year, damping sales now, said analyst Nesvold, who is based in New York.
While profits have increased at Echo Global Logistics Inc. (ECHO) as the Chicago-based arranger of freight shipments takes market share and boosts rates, freight demand shows an economy that’s “still soft,” Chief Executive Officer Doug Waggoner said.
The economy is “recovering, but a lot less so than you would hope,” Waggoner said in a telephone interview. “We’re still stagnating.”
From the vantage point of YRC Worldwide Inc. (YRCW), the Overland Park, Kansas-based trucker that averted bankruptcy last year with new credit agreements, the economic indicators are at least pointing in a positive direction, Chief Financial Officer Jamie Pierson said.
Manufacturing isn’t “setting the world on fire,” Pierson said in an interview at Bloomberg’s New York headquarters. “The good news is, for us, it’s expanding. We just need it to expand.”
Statistics: Posted by yoda — Sat May 12, 2012 12:40 am
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The spring housing market has slowed to a crawl in Vancouver, with April seeing the fewest monthly sales in more than a decade and the number of unsold houses piling up.
The Real Estate Board of Greater Vancouver said Wednesday there were 2,799 sales in the region in April, down 13.2 per cent from a year ago and 2.6 per cent lower than a weaker-than-usual March. The spring market is key for buyers and sellers, as families try and arrange summer moves.
It was the lowest for April sales since 2001, and 16.9 per cent below the 10-year average.
Market watchers have expressed concern that the city may be experiencing a bubble, as cheap credit helps push prices higher and families deeper into debt. While the concern is for markets across the country, there is particular worry about Vancouver and Toronto.
Despite the weak sales, prices continue to edge higher in the city. The index the board uses to track prices showed them up 3.7 per cent from a year ago, to $683,800.
The number of new listings increased 3.6 per cent from March. The number of houses for sale is 6.7 per cent above the region’s 10-year average, as sellers look to cash out at what may be the top of the market. There are 16,538 houses for sale in the region, the board said, up 16 per cent from a year ago.
Toronto reports its numbers Thursday, and the Canadian Real Estate Association reports national figures on the 15th of each month.
Statistics: Posted by yoda — Wed May 02, 2012 1:53 pm
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Land market slows as higher farm costs bite
The rate of farmland price growth in the US has "slumped", despite increasing interest from non-farm investors, as higher agricultural costs bit deeper.
A farmland index compiled by Creighton University came in at 69.4, down from 78.7 in March, and the weakest figure for six months.
The slowdown was particularly notable in the states of Missouri, Nebraska and Wyoming, where index levels fell below 55, if remaining above the 50 mark which denotes a flat market.
The easing in the market defied increasing interest in agricultural land from non-farm investors, who accounted for an estimated 21% of purchases.
"It is clear that non-farm investor interest in purchasing farmland is growing," said Ernie Goss, the Creighton economist in charge of the survey.
However, Professor Goss – who has long voiced concerns over the extent of farmland price rises, warning last month that rising interest rates and softer crop markets would "take some of the air out of the farmland price bubble as early as mid-year" – flagged setbacks to the market from higher costs.
"We are seeing some signs that higher energy and fuel prices are slowing [economic] growth for areas dependent on agriculture," he said.
"The Federal Reserve’s cheap money and low interest rate policies continue to support the agriculture sector, including farmland and farm equipment.
"However, higher energy prices and somewhat slower global growth are taking some of the air out of the farm sector."
‘Have to be very bullish’
The comments follow forecasts from land experts last week, at a summit in Washington, of a slowdown in growth in farmland prices which, on US Department of Agriculture, have doubled over the last decade.
Jason Henderson, of the Kansas City Federal Reserve Bank, unveiled a forecast of "slower growth in farmland values".
Ken Keegan, the chief risk officer at agriculture lender Farm Credit Services in Omaha, said that the market had "reached levels where you have to be very bullish" on farm profitability to justify price appreciation.
Indeed, Purdue University economist Brent Gloy said that prices were reaching levels which required corn prices of $5 a bushel to justify – a historically high level.
"The potential to get ahead of ourselves is high," he said.
"My sense is the farmland market is, hopefully, ready to slow down."
Statistics: Posted by yoda — Sat Apr 21, 2012 2:38 am
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As foreign drug companies began cutting high-paying jobs in Quebec in recent years, Sandoz International GmbH looked like it was bucking the trend.
After paying $565-million for Quebec generic drug maker Sabex Holdings in 2004, Sandoz, a division of Swiss pharma giant Novartis International AG (NVS-N56.59-0.02-0.04%), was positioned to become a leader in one of the fastest-growing areas in the global pharma business: generic injectable drugs.
It invested close to $100-million between 2007 and 2009 to build new facilities at Sandoz Canada’s base in Boucherville, Que. and made the plant, home to 800 workers, a “worldwide centre of excellence for injectable products” within Sandoz.
Today, Sandoz Canada’s reputation lies in tatters after chronic problems at its state-of-the-art plant on Montreal’s south shore caught the eye of U.S. regulators. Much of its production is halted as it tries to fix the problems, leaving pharmacists and health-care providers alarmed at what could be months of shortages of injectable medications that treat everything from nausea among cancer patients and abnormal heart rhythms to endometrioisis.
Last week, Sandoz told Canadian health-care providers it would discontinue certain products and temporarily suspend production of other injectable products on the heels of a scathing “warning letter” from the U.S. Food and Drug Administration three months ago that criticized the plant’s “ineffective quality system.”
“As we progress with our remediation activities, all production processes will be affected, significantly reducing output from our Boucherville plant and likely resulting in temporary supply disruptions,” Sandoz Canada president Michel Robidoux said in a Feb. 16 letter to pharmacists, obtained by The Globe and Mail. He didn’t specify how long the disruption would last, but that Sandoz Canada would focus on “optimizing” supplies of medically necessary drugs to the Canadian market and had halted production of ointments, ophthalmics, suppositories and all non-medically necessary drugs.
The FDA’s Nov. 18, 2011 letter to Novartis CEO Joseph Jimenez – which came a year after Sandoz began a company-wide quality improvement program – accused the Boucherville plant of sloppy, error-prone or incomplete documentation, validation and investigation practices. In three investigations during 2011, the FDA found Sandoz did not follow proper procedures “to prevent microbiological contamination of drug products purporting to be sterile,” nor had it thoroughly investigated “inconsistent and inaccurate” media fill tests, or simulated procedures drug companies carry out to ensure their normal manufacturing conditions are sound.
The FDA alleged Sandoz failed to adequately investigate after crystals appeared in some of its finished injectable liquid treatments released for distribution in the US – and that it “failed to adequately determine the cause of this crystallization problem.”
Furthermore, the company repeatedly failed to provide field alert reports that would have alerted the FDA to any contamination or related issues within the required three days. “We remind you that you are responsible for ensuring that your firm’s drug manufacturing operations comply with applicable requirements,” the FDA said, threatening to withhold approval of any new drug applications.
In a tightly-scripted statement to The Globe and Mail, Sandoz Canada said it was intensifying efforts “to ensure high quality standards” and stood behind the safety and efficacy of its products, none of which have been recalled. It said the decision to halt production was voluntary and related to efforts to restore “high quality standards in manufacturing operations” and said it had no plans to close the Boucherville plant. Sandoz didn’t respond to questions about how the problems developed or why they weren’t dealt with to the FDA’s satisfaction after they were first identified.
In total, Sandoz said it had committed a total of over $170-million (U.S.) to improve quality at the Boucherville plant as well as two other plants in Colorado and North Carolina that were also cited in the FDA letter. Sandoz said those “remediation” efforts were already under way when it received the FDA letter
Statistics: Posted by yoda — Sun Feb 19, 2012 8:27 am
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