All roads lead to China

Resources Corner

It is the era of the dragon as major miners Rio Tinto Limited (ASX:RIO) and BHP Billiton Limited (ASX:BHP) find themselves at the centre of price manipulation allegations out of China, while FNN’s expert analyst claims bulk commodity price increases will hinge on Chinese construction activity.
 
Bad weather blows out trade deficit
 
Australia’s trade deficit expanded more than expected at the beginning of this year, with weather affected halts on resource exports a factor. The Australian Bureau of Statistics reports the nation’s trade deficit has widened to $1.06 billion in January as exports fell 1 per cent.
 
‘Tis the winter of coal discontent
 
One in four superannuation holders would be prepared to shift investments if their fund were found to be investing in coal or coal seam gas extraction, according to the ‘Market Forces’ survey commissioned by the Australia Institute. The survey found that only 43 per cent of 1125 respondents would leave their holdings unchanged if their fund made such investments.
 
Commentary
 
FNN asksMacquarie Group Limited’s (ASX:MQG) Global Head of Economics, Richard Gibbs, if he feels bulk commodities are poised for price gains in 2013:
 
“Really on the bulk side, it is going to depend on whether we see some resurgence in construction activity in China. If we don’t see that in the next few months, well I think bulk commodities are likely to continue at their current levels.”
 
To watch more of the interview click here.
 
Rigging, regulation and shale speculation!
 
Rio Tinto Limited (ASX:RIO) and rival global mining company BHP Billiton Limited (ASX:BHP) have been indirectly accused of manipulating the price of iron ore by intentionally holding back supply. While China's main economic adviser has not named the companies, it says the world’s three major miners [Rio Tinto, BHP Billiton and Brazil's Vale] and some traders have delayed shipments and held back stocks to send a fake market signal of supply shortage.
 
The founder of iron ore producer Fortescue Metals Group Limited (ASX:FMG) Andrew Forrest has told the High Court the Federal Government’s mining tax is unconstitutional as it discriminates between states.
 
BHP Billiton Limited (ASX:BHP) is poised to take land positions in Australia’s growing shale gas industry. The expected move follows the miner’s largely successful US shale market push in 2011.
 
Eureka! Positive results and acquisitions
 
Iron ore developer WPG Resources Limited (ASX:WPG) has released the results of its preliminary feasibility study for the Giffen Well project in South Australia, revealing capital requirements for the project to be the lowest of any Greenfield magnetite project in Australia.
 
European focused gold miner Dragon Mining Limited (ASX:DRA) has announced further high grade intercepts from its Orivesi Gold Mine in Southern Finland.
 
Northern Star Resources Limited (ASX:NST) has upgraded the JORC reserves at its Paulsens Gold project in Western Australia by 81 per cent. Managing Director Bill Beament says the company now meets the full set of criteria required of modern-day gold miners.
 
Whitehaven Coal Limited (ASX:WHC) has taken control of the Vickery South Coal Project in a deal worth about $29.6 million with Japan’s Itochu Corporation.
 
Ramelius Resources Limited (ASX:RMS) has commenced mining at its Western Queen South project in Western Australia, expecting to produce approximately 23 thousand ounces of gold.