Commodity Prices End 2011 on a Record High Amid Global Mining Disputes

Strategic Insights -

A tumultuous year in the global mining sector came to a close with record commodity prices, despite a downturn in prices as 2011 drew to a close. Chile's Codelco has exercised an option to acquire a stake in Anglo American's Sur mining complex, while union disputes with Caterpillar and Rio Tinto have led to contract tensions. Meanwhile, Poland has eased a planned copper tax and Australian miner Lynas Corp. has applied for a rare-earth refinery license in Malaysia. The Indian government has also increased the export tax on iron-ore, while workers at Kansanshi Copper Mines in Zambia have gone on strike demanding better wages and conditions.

Key Takeaways:

  • Codelco will exercise an option to acquire a stake in Anglo American's Sur mining complex, marking a significant move in the global mining sector.
  • Union disputes between Caterpillar and Rio Tinto have led to contract tensions, with workers seeking better wages and conditions.
  • Poland has eased a planned copper tax by setting a lower maximum tax level, providing relief to the industry.
  • Australian miner Lynas Corp. has applied for a temporary license to operate a rare-earth refinery in Malaysia, further expanding the country's mining operations.
  • The Indian government has increased the export tax on iron-ore to 30%, which is expected to cripple shipments of low-grade ore from the world's third-largest supplier.
  • Workers at Kansanshi Copper Mines in Zambia have gone on strike demanding better wages and improved conditions of service, highlighting ongoing labor issues in the global mining sector.
  • Rwanda has discovered at least 20 new minerals sites in 2011, making mining a principal export earner for the country.
  • Base metals are mostly higher on the London Metal Exchange, starting the year on a relatively firm footing amid equity gains and a softer dollar.

Statistics:

  • Record commodity prices marked the end of 2011, despite a downturn in prices as the year drew to a close.
  • Codelco's acquisition of a stake in Anglo American's Sur mining complex marks a significant move in the global mining sector, with expected synergies and benefits.
  • Poland's copper tax decrease is expected to provide relief to the industry, with a lower maximum tax level set to come into effect.
  • Australian miner Lynas Corp. has applied for a temporary license to operate a rare-earth refinery in Malaysia, with a potential total yield of 12,000 tons per annum.
  • The Indian government's export tax increase on iron-ore to 30% is expected to cripple shipments of low-grade ore from the world's third-largest supplier.
  • Kansanshi Copper Mines in Zambia has seen a significant strike action, with workers demanding better wages and improved conditions of service.
  • Rwanda's mining sector emerged from near obscurity to become one of its principal export earners in 2011, with 20 new minerals sites discovered.

Sources:

  • Dow Jones Commodities News
  • Comtex
  • Dow Jones Newswires
  • The New Times Newspaper
  • Comtex News Network, Inc.