Workers at Peru's top copper mine to start new strike Wednesday -union

Workers at Peru's biggest copper and zinc mine, Antamina, will start a new indefinite strike on Wednesday to continue pushing for a bonus and other benefits, union leader Jorge Juarez said.

The union ended a 19-day strike on Nov. 30 after Peru's work authority declared it illegal. The mine said the stoppage did not affect production that had been running at around 30,000 tonnes per month.

BHP Billiton and Glencore Xstrata each have 33.75 percent stakes in Antamina. Teck Resources holds 22.5 percent and Mitsubishi Corp 10 percent.

"We are going to start the strike at 00:00 Wednesday (0500 GMT) for the same reasons as the previous strike," said Juarez, the secretary general of the SUTRACOMASA union.

Unionized workers hoped to secure a bonus to offset shrinking proceeds from a revenue-sharing agreement and other benefits as production slips on lower ore grades.

Antamina urged the union to reconsider staging another stoppage.

"The strike it led nearly two weeks ago only hurt the workers, whose salaries had to be reduced as a result of the action," the company said in an emailed statement.

Antamina has said it will probably produce about 336,000 tonnes of the red metal this year, down 27 percent from 2013. 

Antamina, in the Peruvian highlands region Ancash, produces about 30 percent of Peru's copper and 20 percent of its zinc. Peru is the world's third largest copper producer.

Gold price surges as stocks correct

The price of gold spiked as much as $44 an ounce higher in midday trade Tuesday on the back of another day of selling on equity markets and after finding support from a softer dollar and a stronger oil price.

On the Comex division of the New York Mercantile Exchange gold for February delivery was changing hands for $1,232.70 an ounce, up $37.80 or 3.2% from Monday's close.

The gold price jumped out of the starting gates on Tuesday rising to a high of $1,239.00 by 10am EST in heavy volumes of more than 20m ounces traded by noon.

Silver traders followed the gold market higher with March contracts adding over 5% to $17.11, down from a day high of $17.23 an ounce early on.

A correction on global stock markets – some say a long overdue one – after a relentless seven week rally to record highs in the US was the main factor behind gold's strength this week.

Gold's gains since hitting four-year lows early November reached 7.5% today while silver has advanced 10.6% over the same period.

While the drop in the Dow Jones and S&P500 indices was far from dramatic, Chinese stocks were hammered down 8% overnight on increasing worries about a slowdown in the world's largest economy and fears of a return to crisis mode in Europe after trouble in Greece and other peripheral economies saw equity markets in the trading bloc sell off heavily.

Gold has been uncharacteristically strong against a rampant US dollar which jumped to a more than 8-year high against the currencies of its major trading partners following Friday's blockbuster jobs report in the US.

Gold and the dollar usually move in opposite directions, and another retreat in the dollar index and slight improvement on oil markets on Tuesday provided additional support to the metal.

Gold's gains since hitting four-year lows early November reached 7.5% today while silver has advanced 10.6% over the same period.

Speculators in gold futures and options reduced their bearish bets on gold by 16% last week, cutting back shorts from near record levels reached in October and adding to long positions at the same time.

Net long positions held by large investors like hedge funds jumped to just over 79,300 contracts or close to 8m ounces in the week to December 2 according to Commodity Futures Trading Commission data.

Unlike hedge funds retail buyers did not increase their exposure to gold

That's more than double the number of bets that prices will rise held by speculators a year ago, when gold was hovering near the same levels.

Silver price speculators cut bets that the price will fall by 23% increasing their net long position substantially.

The rally in precious metals over the last month hasn't convinced investors in physical gold and silver-backed exchange traded funds however.

Unlike large investors retail buyers of gold remains negative about gold prospects and have been selling into rallies. The latest weekly data show the holdings of gold and silver ETFs dropping again.

Net sales were modest – only 4.6 tonnes – but did drop overall holdings back to five-year lows of 1,610.8 tonnes. Gold bullion holdings hit a record 2,632 tonnes or 93 million ounces in December 2012.

Outflows from gold funds are nowhere near as dramatic as 2013 when 800 tonnes were pulled out, but year-to-date gold ETFs have experienced outflows of 152 tonnes, an 8.6% drop.

Investors in silver continue to reduce their exposure to physical silver-backed ETFs which at the start of October reached a record 20,182 tonnes.

Last week 134.2 tonnes left silver funds reducing total holdings to 19,846 tonnes, but so far this year silver vaults have added 470 tonnes or 7.8%.

This is why India needs a gold policy — WGC

India, the world’s second largest gold consumer after China, should start a bullion board to regulate trade and a spot exchange to offer uniform prices across the country, according to the World Gold Council.

In a study published Tuesday, the market development organization for the gold industry outlines seven key policy recommendations to monetize the 22,000 tons of gold stocks kept by Indian households:

1.     Establish an India Gold Exchange to ensure pricing standardization, increase transparency and improve supply and demand analysis.

2.     Establish a Gold Board to manage imports, encourage exports and facilitate development of the infrastructure needed to ensure the Indian gold market functions to maximum effect.

3.     Develop accredited refineries in line with international standards including upscaling the current domestic refineries.

4.     Allow Indian banks to use gold as part of their liquidity reserves. This would incentivize them to introduce gold-based savings products.

5.     Drive monetization of gold by incentivizing banks, revitalize Gold Deposit Schemes, introduce gold-backed investment and savings products.

6.     Create a more active marketing strategy for Indian handcrafted jewellery. This could boost exports and highlight India’s expertise in this highly-valued sector e.g. by promoting handcrafted ‘India-made jewellery’ like the Swiss-made watches.

7.     Drive the standardization of gold so that buyers and sellers can have faith in both the quality and price of their products. Introduce guidelines for compulsory quality certification of all forms of gold to encourage accountability and foster an environment of trust.

The report also assesses the policies adopted in countries like Turkey and China, which have faced challenges similar to India, but chose to devise public policies to monetize the local stock of gold. Here, some of the key findings:

Popping The Chinese Stock Market Mania

If you are wondering what triggered the PBOC to pull the punchbowl of leveraged collateral away from the 'wealth-creating' stock market exuberance in China... wonder no more. The last 2 weeks saw the biggest surge in new Chinese brokerage accounts ever, with this week alone the highest since October 2010 and January 2008 with a stunning 228,000 new accounts opened. On both prior occasions of such a maniacal surge in speculative accounts, the Shanghai Composite made a significant top and fell dramatically in the ensuing months.

How oddly dis-similar the PBOC is to the Fed!! Instead of encouraging open leveraged speculation, the central bank of China appears more risk averse, recognizing the potential medium-term disastrous consequences from such boom-bust moves (and likely has no cheer-leading CNBC channel to take care of).

U.S. aluminum imports highest for October since 2008

U.S. aluminum imports in October were at their highest for the month since 2008 as bigger inflows from Canada offset a slowdown in material from Russia, according to International Trade Commission data released on Monday.

Imports totaled 268,000 tonnes in October, up 18 percent from a year earlier and an 11 percent rise from the prior month, for third-highest monthly total so far this year.

The bulk of the inflows came from Canada, typically the top foreign supplier into the United States, with about 1.91 million tonnes coming across the border, up 17 percent from October 2013 and a rise of almost a quarter from September.

The Canadian imports were the second-highest for the year so far and came even as Rio Tinto has closed older Soederberg-technology potlines at its major Kitimat smelter as part of a major modernization of the technology.

The smelter's output fell in the third quarter, but that will ramp up next year as the facility fires up expanded capacity of 420,000 tonnes per year.

The upswing from Canada in October bucks an overall downtrend for the year to date. Canadian imports are down 4 percent at 1.65 million tonnes from a year earlier.

The overall rise in imports reflects a general trend so far this year as soaring premiums that fabricators and merchants pay on top of benchmark London Metal Exchange prices for delivery to the Midwest lure units to the United States.

Cuts in domestic smelting capacity due to low LME prices and high energy costs have also forced companies that use aluminum in cars and construction to buy more metal from abroad, from countries such as Saudi Arabia.

Goldman Sachs says India to outpace China in coming years

Goldman Sachs is saying that India could surpass China in the next two years in terms of real gross domestic product expansion

• Projects India’s real GDP growth rate will remain behind China’s this year and next
• But surpass it in 2016 with 6.8% GDP expansion as China’s growth slows to 6.7%
• Goldman predicts that India will extend that lead over the following two years
• Goldman says India will have one of the highest growth rates in the world in 2016  – more than triple the growth rates of Brazil, Russia, Japan or Europe

China Fixes Yuan At Strongest Since March As Trade Surplus Hits Record Highs

Chinese imports and exports dramatically missed expectations this evening but it is imports that was thereal driver that pushed the trade surplus to $54.47 billion (higher than the $43.95 billion expected) record highs. Exports rose just 4.7% YoY (against expectations of an 8.0% rise and previous 11.6% rise) for the slowest growth since April. Imports utterly collapsed; plunging 6.7% YoY (against expectations of a 3.8% rise and prior 4.6% YoY rise). This is the biggest drop since March and 4th largest plunge since Aug 2009. Of course, in any real world this means 'the rest of the world' should be suffering from huge drops in exports... but we are sure, by the magic of fradulent invoicing that will not be the case. The PBOC may have got a glimpse and fixed CNY at its strongest since March and highest premium to the market since August.

Both imports and exports miss dramatically

Pushing the trade surplus to record highs...

PBOC fixed the Yuan at its strongest against the USDollar since
March as the market's view of USDCNY started to rapidly weaken...