To hear the mainstream media tell it, the commodities bubble has burst. Commodities are plunging across the board in response to the latest U.S. data, most of which seems to suggest that the American economic recovery is waning. Oil, which closed at $100 a barrel yesterday, was particularly hard hit, which is why so many suggest the commodities bubble has met its end.
Potash Mining News
Canada's Allana Potash Corp said drilling results showed that the potential of its Dallol project in Ethiopia could be extended beyond the original resource estimate, helping its shares pare some of their losses. Shares of the potash explorer, which were down as much as six percent midday before the news, recovered to trade down two percent at C$1.70 on the Toronto Venture Exchange. More than 2.5 million shares were traded by late afternoon.
Has oil moved into backwardation yet? What does corn’s roll yield look like? How do you know when it’s time to buy — or sell? Each week, we investigate the futures curves of the U.S.’ most important commodities, helping investors better understand the market and seize buy-and-sell opportunities as soon as they arise.
You don't need to be a farmer or an economist to understand that weather events can have a dramatic impact on agricultural production from one year to the next. Much of the country has received above-average rainfall in the past few months and there has been widespread flooding as a result. The Mississippi River, for example, is currently experiencing a 100-year flood event. If you live in most parts of the country – such as the West Coast, the East Coast, or the Midwest, you might not realize that Texas and the greater Southwest have scarcely received any rain at all this year. In fact, much of Texas is currently suffering through an "exceptional" drought – the highest level achievable. In other words, if the drought in Texas were a hurricane it would be a "Category 5." A drought simply doesn't get any worse than this and the present conditions
Latin America used to be known for its economic and political instability. But it fought off the global financial crisis with relative ease. Poverty is now falling, the middle classes are growing rapidly and asset […]
Vulcan Minerals Inc. ("the Company")(TSX VENTURE:VUL) is pleased to announce its intention to undertake a corporate re-organization whereby the Company will spin-out certain of its mineral exploration assets into a separate publicly traded subsidiary company (NewCo). These assets consist of the mineral rights in the Bay St. George basin of western Newfoundland where the Company has discovered the Captain Cook potash deposit. The Captain Cook potash discovery was made with a core hole in 2002 and consists of a 5 meter gross interval grading up to 20.40% potassium oxide (K20) at a depth of 287 meters. It occurs in rocks which are geologically similar to those containing the Sussex potash mine in New Brunswick operated by the Potash Corporation of Saskatchewan. (Visit www.vulcanminerals.ca for further information.)
Allana Potash Corp. (TSX VENTURE:AAA) ("Allana" or the "Company") is pleased to announce that it has further extended the potential of its Dallol deposit with the completion of additional drilling and assay activity in areas beyond those included in the original resource estimate completed in 2008. This work is part of the upcoming update to Allana's National Instrument 43-101 ("NI 43-101") technical report. Drill hole DK-11-15 ("Hole 15") has intersected significant potash mineralization up to 52.40% KCl over 0.80 metres. Hole 15 intersected two strong zones of potash mineralization which appear to correlate with the Sylvinite Zone and Kainitite Zone.
Exploration junior Mesa Exploration Corp. hopes to kick off a drilling program soon at its potash project in Utah after filing a positive technical report in May. The property is adjacent to the Cane Creek mine where potash has been mined for 45 years. Listed on the TSX Venture Exchange with a market cap just shy of $10m and only 12.6m shares outstanding, Mesa recently changed its name from Mesa Uranium Corp. to reflect its broader exploration focus which include among others its flagship Green Energy Project, a large brine deposit containing 40% dissolved solids, also in Utah.
On the same day the premiers of New Brunswick and Nova Scotia toured a potash mine in Penobsquis, NB's mining commissioner began hearing from residents of a nearby town who blame the mine, operated by Potash Corp. for a loss of 60 water wells about six years ago. The mining company initially provided the residents with bottled water, but the provincial government has since installed a municipal water system.
Motley Fool puts Saskatchewan’s Potash Corp. through the Warren Buffet test this week. Ilian Moscovitz of the investment site rates the world’s biggest fertilizer manufacturer in terms of the criteria – consistent earnings, good management and a simple business among others -- laid out by the legendary investor in Berkshire Hathaway's most recent annual results filing. There is renewed interest from investors in Potash Corp., which operates six mines in the Canadian province, on the back of rising global food prices, record earnings at the company, and after BHP Billiton’s nearly $40bn hostile takeover bid was scuppered by the federal government in November last year.
Encanto Potash Corp said it is on track to meet its target of doubling resources at its flagship Saskatchewan project after a First Nation council transfers mineral rights to Canada, sending the company's shares up 18 percent in afternoon trade. Encanto, which explores and develops potash properties, expects further drilling at its Muskowekwan property to commence after a referendum by First Nation on transferring the mineral rights on the reserved land to Canada.
As the chart below demonstrates commodity prices are driven by different factors. The precious metals prices have been the hyperbolic driver of headline commodities news relative to the broader based commodities index and oil. The latter two are more geared to industrial use as gold’s commercial use is limited. The chart highlights the divergence in the components of the commodities index. iShares S&P GSCI Commodity-Indexed Trust (GSG) tracks 24 different commodities including energy (67%), industrial metals (16%), livestock (7%) and precious metals (3%).
Advances in energy and agriculture are creating demand for previously ignored metals such as scandium, tellurium and indium. In this exclusive interview with The Energy Report, Mining Analyst John Kaiser, editor of Kaiser Research Online, explains the science that could exponentially increase the value of overlooked stocks.
While China continues to make asset driven economic decisions and now looks like a traction control experiment where the economy is like a car that is driving on ice that doesn't yet know it, QE2 ignited the bunsen burner for commodity price speculation. Last I checked, Ben Bernanke has decided to continue on with QE2 but has decided that QE3 is probably a bad idea because the true positive impact of additional money coming into the economy would be more than offset by inflation. In my opinion he's making the right call, but this call is likely going to put downward pressure on commodities and other assets.
QE, of course, only happens when interest rates hit the zero bound, so it’s impossible to disentangle the effects of QE from the effects of G3 interest rates all coming down to 1% or lower. But the effect of all these investment flows is clear: if you look at commodities as an asset class, total commodity assets under management have risen from just over $150 billion at the end of 2008 to over $400 billion today.
Commodity prices took a beating today. This Bloomberg headline sums it up well: Commodities Sink Most Since 2008 as Stocks Fall. But how can this be? We have been told repeatedly that the surging commodity […]
With rising global demand for food comes escalating cash flows that enable farmers to purchase additional fertilizers to further boost yields. Dundee Securities Senior Analyst Richard Kelertas follows junior potash explorers that have been red hot for much of the past six months. In this exclusive interview with The Energy Report, Richard shares some names that he believes could develop into bumper-crop multiples for investors.
Has oil moved into backwardation yet? What does corn’s roll yield look like? How do you know when it’s time to buy—or sell? Each week, we investigate the futures curves of the U.S.’ most important […]
Allana Potash Corp. (TSX VENTURE:AAA) ("Allana" or the "Company") is pleased to announce that drill hole DK-11-17 intersected significant potash mineralization of 31.03% KCl over 1.00 metre starting at a depth of 74.20 metres. Hole […]
Though the hurdles of government approval and project financing remain, Orocobre (ASX: ORE; TSX: ORL) released a strongly positive feasibility study of Olaroz, its lithium-potash brine project in Jujuy state, Argentina.
With silver spiraling out of control, it's worth checking in on some of the other commodities. Indeed the agricultural or soft commodities have, as a group, been surging in recent times, sending the Dow Jones UBS commodities index up over 30% year on year. Not only have they inflated returns on broad based commodity investment products but they've inflated prices, political tensions, and economic risks around the globe.
We feel that some commodity prices are getting overextended and very close to their tipping pint. Far from an ultimate top but ready for a healthy correction. Crude traded to its highest level in two […]
When Potash Corporation of Saskatchewan released its Q1 financial statements on Saturday, it said there were more good things happening in the industry. "With rising demand putting pressure on global supplies of a wide range […]
Potash Corporation of Saskatchewan Inc. (PotashCorp) today reported record first-quarter earnings of $0.84 per share1 ($732 million), 71 percent above the $0.49 per share ($444 million) earned in the same period last year. Strong demand and improved prices for all three nutrients resulted in record first-quarter gross margin of $1.1 billion, significantly above the $729 million earned in last year’s first quarter. Earnings before finance costs, income taxes and depreciation and amortization (EBITDA)2 of $1.1 billion and cash flow prior to working capital changes2 of $899 million substantially exceeded the first-quarter 2010 totals of $776 million and $633 million, respectively.
Ringbolt Ventures Ltd. (the "Company" or "Ringbolt") (TSX VENTURE:RBV)(OCTBB:RNGTF)(FRANKFURT:3OZ) is pleased to announce that it has received a permit to carry out an initial drilling program. The State of Utah, Department of Natural Resources, Division of Oil, Gas, and Mining has approved a "Notice of Intent of Conduct Exploration" for drilling. The planned exploration will primarily consist of drilling to a depth of approximately 5,000 feet to test the potash and salt horizons on one of its state leases.