US - Initial estimates suggest sales in the four days from Thanksgiving to Sunday are likely to decline year on year on a fall in average spend, according to the National Retail Federation.
• Average spend would fall to US$407 from nearly US$424 last year taking the total to US$57.4bn.
• The number of shoppers climbed to 141m, up from 139m last year.
• Consumers are reported to remain concerned over the future economic growth, rising living costs, confusion over healthcare and political gridlock in Washington.
• Thanksgiving shopping is estimated to account for around 10% of retail sales in Nov and Dec.
• Top-selling items on Thursday, Friday and Saturday were clothing (28% of the total) followed by toys (11%).
China - Nov manufacturing PMI beats analysts’ estimates as official numbers showed the sector continued grow at the fastest rate in more than a year.
• Official manufacturing PMI remained at 51.4 in Nov, level on Oct numbers and up from 51.1 forecast.
• Private measure of the index prepared by HSBC/Markit came in at 50.8, compared with 50.9 in Oct and 50.5 forecast.
UK - David Cameron is on an official visit in China this week to promote free trade agreement between the EU and the second world’s largest economy.
• UK Prime Minster is looking to cut tariffs on 20 key sectors including vehicles, pharmaceuticals, mechanical and electrical goods, that together account for 36% of UK exports to China.
• In total, the EU is the largest Chinese export market while EU shipments to China are second only to the US.
• The EU trading commission expressed its concern regarding the pact citing significant differences between economies including subsidies, export credits and soft loans to companies. “I don’t believe that any time soon negotiations for a free trade agreement make a lot of sense, unless of a sudden the Chinese would dramatically change,” Karel De Gucht, the RU trade commissioner said in Oct.
• Manufacturing PMI climbed to 58.4 in Nov, compared with 56.5 in Oct and 56.1 forecast. This is the strongest reading since H1 2011.
Eurozone - Manufacturing sector grew at the fastest rate since 2011 in Nov. Factory PMI climbed to 51.6, up from 51.5 in Oct and forecast.
India - Manufacturing sector posts first monthly growth this month since Jul on an increase in new domestic orders. Factory PMI climbed to 51.3, up from 49.6 in Oct.
Ukraine - Protests spread across the country with hundred of thousands people flooding the centre of Kiev on Sunday and demanding a review of the decision by the government to stop EU integration agreements.
• Estimates suggest the number of participants in strikes have peaked at some 350,000 yesterday, which makes demonstrations the largest public gatherings since the 2004 Orange Revolution rallies.
• Many protesters called for the government to leave.
• Negotiations seem to shift into the national parliament today as opposition leaders are invited to a series of round table talks where “all sides will have an opportunity to express their thoughts”, according to the parliament speaker.
Zimbabwe - Pay negotiations between mining companies and the labour union reached a deadlock for 2014 as workers demand wages to be more than doubled.
• The dispute has now been referred to the government’s National Employment Council which is expected to meet on Jan 15 and is likely to pass the matter to an arbitrator.
• Demands included raising the minimum pay to US$800/month for diamond mine workers, US$700 for platinum mines and US$573 for gold and other mineworkers.
• Business lobby was offering to link wages to an official rate of inflation and arguing the industry can not afford to meet workers’ pay demand given escalating operating costs and falling commodity prices.
• Currently, miners’ pay stand at US$227 for all workers with annual inflation running at 0.59% in Oct.
US$1.3608/eur vs 1.3603/eur last week. Yen 102.26/$ vs 102.28/$. SAr 10.224/$ vs 10.193/$. $1.633/gbp vs 1.633/gbp
Gold US$1,238/oz vs US$1,248/oz last week - Gold is off this morning on the back of better than expected manufacturing PMI reports in the EU and China.
• SPDR gold holdings remained unchanged at 843.2t (27,110koz) valued at US$34.0bn, the lowest since Jan 2009, yesterday. Holdings lost nearly a third of the total from the start of the year.
Platinum US$1,371/oz vs US$1,360/oz last week
Platinum US$1,367/oz vs US$1,371/oz last week
Palladium US$722/oz vs US$723/oz last week
Silver US$19.87/oz vs US$19.95/oz last week
Copper US$ 7,040/t vs US$7,058/t last week
Aluminium US$ 1,750/t vs US$1,757/t last week
• Rio Tinto to close the Gove alumina refinery underscoring tough conditions facing the aluminium industry.
• The decision has been based on continuing low alumina prices and a high exchange rate leading to large after tax losses at the refinery.
• Rio plan to maintain their bauxite mines at Gove.
Nickel US$ 13,425/t vs US$13,444/t last week
Zinc US$ 1,874/t vs US$1,877/t last week
Lead US$ 2,074/t vs US$2,074/t last week
Tin US$ 22,630/t vs US$22,580/t last week
Oil US$110.9/bbl vs US$110.7/bbl last week
Natural Gas US$3.930/mmbtu vs US$3.930/mmbtu last week
Uranium US$36.25/lb (29/11/13) unchanged on the previous close
Iron Ore - US$136.4 (29/11/13) 62% Fe spot (cfr Tianjin) unchanged on the previous close
• Anglo Asian has today updated the market on the course of the latest exploration programme testing the Gedabek deposit and adjacent areas.
• 7 drill holes have been completed from January through June this year, with most of the activity focused on zones to the north-west of the Gedabek open pit.
• Drilling results point to the presence high grade gold mineralization which is different to the main quartz porphyry gold/copper/silver Gedabek pit.
• In particular one drilling hole (106) driven to a depth of 349m in October returned impressive results with good grades seen over two intervals:
• 233-241m with grades ranging from 4.96g/t (Au) and 14.07g/t (Ag) to 36.19g/t (Au) and 129.27g/t (Ag);
• 296-337m containing 41m at 7.6g/t (Au) including 1m at 101g/t (Au) and 78.7g/t (Ag) at 313m level.
• The area is 400m away from the existing Gedabek pit and should the mineralisation prove to be economic may be easily consolidated into mining plan with the ore to be processed at existing operations.
• The mineralisation appears 150m deeper than the top elevation of mineralisation in the northern part of the Gedabek pit, although the surface elevation is higher when compared to the Gedabek deposit.
• The company is currently drilling the next hole (107) in the area to a planned depth of 445m and 20m south of the existing drill hole (86) to test the continuity of the mineralisation. The plan is to drill 2 more holes (108 and 109) in the area using closely spaced grid for an additional 900m before the year end. This should bring total exploration drilling for the year to 3,220m.
• Location of drilling holes and geology map of the Gedabek deposit may be found using the link:
Conclusion: The Company is progressing well with their 2013 exploration programme with a prospective mineralization zone delineated to the north-west of the existing Gedabek pit. 3 more holes to be completed before year end should provide more information on the mineralisation and help the team to decide whether they should continue to drill out the area or rather target new zones.
We are looking forward to results of the continuing drilling programme.
The latest resource update of the Gedabek deposit has been released in October showing the flagship mine hosted 1,250,000oz (51.6mt at 0.75g/t) of contained gold in Measured, Indicated and Inferred categories.
* SP Angel acts as Nomad & Broker to Anglo Asian Mining
• The area has been cleared at the project for process infrastructure.
• Civil works are said to be advancing for primary and secondary crusher foundations and other processing areas.
• The ball mill shell is due for release from fabrication in Dec and is to be shipped to site in Q2 2014.
• Upgrade work to Daniels Town access road bridges is underway.
• Construction is progressing on the Camp staff accommodation.
Conclusion: Early stage construction work appears to be progressing well at the project.
FinnAust Mining* – Shares trade at a 35% premium on first day of trading
• FinnAust has started trading today following its readmission of its enlarged share capital.
• The shares are trading at a 35% premium this morning to the placing price of 5 pence on 247m shares.
• Western Areas retains 67.8% of the share capital.
• The assets and licenses have been put together by Western Areas Limited which has had good success in Australia with discoveries on other former Outokumpu mineral licenses. Outokumpu was the former Finish state mining company.
• FinnAust Mining was formed as a series of joint ventures with local license holders to utilise ideas and technology developed in Australia for the exploration of metal sulphides in Finland.
• Around €12m have been spent on exploring and drilling the assets by Western Areas to date plans to invest another €4.8m over the next two years in drilling and exploring targets generated by the Z-Tem and other surveys
• The license areas concerned cover two historic mines closed in the 1980s and 1990s and there are mine records and mine plans giving near certain evidence of copper and zinc orebodies within easy reach of existing mine infrastructure.
• Metal ores have been naturally deposited along the strike of these mines starting with nickel, zinc and copper with evidence suggesting deposits of gold, cobalt and PGMs. Gold was not previously tested for in drill assays and the team are looking to retest old cores to determine the potential for discovery.
• Metal rich ores were formed in Volcanic Metal Sulphide ‘VMS’ type deposits, naturally remobilised and concentrated before final deposition. The geological process has effectively sorted and concentrated the metals within massive sulphides to produce unusually high grade ores.
• Western Areas acquired licences previously held by Outokumpu in Australia and discovered two new mines producing nickel, copper and PGEs in short order. The team hope to repeat the experience in Finland using similar exploration techniques.
• Hammaslahti Mine: The mine has produced 7mt of copper ore at 1.16% copper and 0.3mt grading 1.6% zinc, 0.5% copper + meaningful gold and silver.
• First round drill results include: 3.4m grading 11.5% copper, 3.0g/t gold and 54.0g/t silver.
• Enonkoski Mine: Mine plans and exploration show potential for 3-4mt grading 4% metal.
• Outokumpu Mine Area exploration to test unexplored areas near the historic copper / nickel mine.
• Graphite mining potential from discrete orebody at Hammaslahti mine.
• Management: the FinnAust Team come out of Western Areas, a successful mining and exploration company in Australia.
• We believe their exploration techniques and methodology should bear valuable results in time.
• FinnAust know where to look – eg at known orebodies in existing mines.
• Finland: Low 24.5% corporate tax rate in Finland & no government royalty.
* SP Angel acted as lead broker to FinnAust in its reverse onto the LSE and acts as Nomad and Broker to the company.
• Companie Minera Zahena (CMZ) is to earn in to the Ilo Norte project for total consideration of US$3.65m in cash and exploration work commitments totalling US$4m.
• $1.35m is to be spent immediately on a 4,800m diamond drilling programme.
• Latin’s Peruvian subsidiary is to receive staged payments over 4 years totalling $3.65m.
• To earn in to 70% of Ilo Norte, CMZ has to do a minimum of 12 DC holes totalling 10,000m within 18 months.
• $4m has been estimated as additional spending to the $1.35m to be spent on 6 DC holes for a minimum of 4,800m.
• All permits and authorisations are in place for CMZ to start drilling.
• A geophysical survey at Ilo Norte completed in early 2013 established a large IP anomaly 2000m by 800m.
• Soil sampling at the project also found anomalous copper with values ranging from 700 ppm to 2430 ppm copper.
Conclusion: Finding a partner to earn in to this project is great news for the company whose geological team have done the ground work to identify potential drill targets. Deep drilling is required to establish the potential at this project and having a partner willing to finance this to earn in is a good step forward. Latin has a good track record of working with JV partners including Junefield on its Mariela project. This is the most sensible strategy for a junior company with large tenements in Peru to find capital to establish further value for their licences.
Early stage exploration work has been promising at Ilo Norte which is on the Peruvian Coastal Cordillera which hosts Andean type IOGC deposits and copper porphyry systems and we look forward to results from the drill programme.
*SP Angel analysts have visited the Latin Resources Projects including the Ilo Norte project.
• The company has signed an MOU to look at an offtake arrangement with an industry partner.
• The MOU will be in effect for 2 months till terms and conditions are negotiated.
• The company are undertaking drilling, mineralogical and metallurgical test work on Lode 2A as recommended by the PEA.
• The company has provided an update on the visual observations for drill hole CSD-13-005 at the Alpala prospect.
• This drill hole was sited to test the depth extension in the first drill hole at Alpala.
• The hole has been drilled to a much steeper angle and drilled to undercut the mineralised zones found in hole CSD-13-001.
• The planned depth of the drill hole is 850m with the current depth of 455m.
• The upper levels between 75 and 420m show visually significant intensities of stock work and sheeted quartz veining.
• Assay results are awaited to established potential copper grades.
• Meanwhile preparations have started for drill hole CSD-13-006 once CSD-13-005 is completed.
Conclusion: Early visuals are encouraging and we await assay results to establish grades and widths. The company have a 11 hole (6,600m) drill programme with initial drill results showing significant widths of mineralisation.
*SP Angel acts as broker to SolGold