Australia

Home sales surged in May and major producer Australia cut its iron ore forecast further.

US Home Sales Hit 9-Year High

Contracts to buy existing homes in the US rose in May to their highest level in over nine years, boosting the housing market and the broader economic outlook.

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The National Association of Realtors said on Monday that its pending home sales index, based on contracts signed last month, increased 0.9% to 112.6, the highest level since April 2006. Contracts have now increased for five straight months.

Australia Cuts Iron Ore Price Forecast

Australia, on Tuesday, cut its price forecast for iron ore in 2015 by 10% to $54.40 a metric ton, citing a weak outlook for the commodity’s main market, China’s steel sector. The forecast by the Department of Industry and Science is a sharp decrease from the $60.40 per mt predicted three months ago and is way off the $94 a mt touted in January.

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A major aluminum producer challenged a US regulator’s authority to intervene in a foreign warehousing dispute and another nation placed tariffs on Chinese silicon this week.

Alcoa Challenges CFTC’s Authority

Alcoa Inc. on Monday challenged a federal commodities regulator’s authority to intervene in the contentious overhaul of the London Metal Exchange‘s warehouse policy that has caused an unprecedented drop in aluminum prices.

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In March, the Commodity Futures Trading Commission deferred a decision about the LME’s 2012 application to be registered as a “foreign board of trade,” telling the exchange it should do more to address concerns about long waiting queues.

Alcoa has questioned whether the agency even has the legal authority to intervene, and on Monday filed a request under the Freedom of Information Act (FOIA) to find out what had caused the CFTC to delay its decision on the LME.

“Our goal is to learn the extent to which the CFTC has engaged in substantive discussions with the London Metal Exchange,” Alcoa said in a statement. “The CFTC should examine any LME aluminum contract performance issues only through an open, inclusive and transparent process where all affected market participants have the opportunity to present their views,” it said.

The CFTC declined to comment.

Australia Puts Tariffs on Chinese Silicon

Australia has issued an anti-dumping notice on silicon metal exported from China after an investigation into dumping and subsidization.

Following the investigation the Australian Government Anti-Dumping Commission set dumping and subsidy margins for Hua’an Linan Silicon Industry Co. Ltd., and Guizhou Liping Linan Silicon Industry Co. Ltd. at 18.3% and 6.3% respectively. Both companies will be subject to an effective rate of combined interim countervailing duty and interim dumping duty of 12%, according to a statement by the MOC trade remedy and investigation bureau.

The commission announced dumping margin and subsidy margin for “uncooperative, and all other exporters” of 27% and 37.6% respectively, with an effective rate of combined interim countervailing duty and interim dumping duty of 58.3%.

Australia began its investigation in February last year after allegations of dumping and subsidization of silicon metal goods that originated from China with a total value of $12.78 million dollars, according to the MOC statement.

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It is one of those delicious ironies of life that India, the world’s largest consumer of gold, has very little to show when it comes to actually mining the yellow metal.

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That’s poor form because India sits on very large resources of gold, revealed by several geological studies in the past. One such study pegged India’s primary gold resources at about 491 metric tons. Despite its 6,000-year mining history, the country mines just around a pitiful 25 mt of gold annually.

Imports Flourishing

India is one of the biggest importers of gold, despite a punitive 10% import tax. In the financial year ended March 31, gold imports had touched 900 mt, up 36% from a year ago.

Perhaps keeping all this in mind, and the fact that gold mining could mean earning some big bucks, Western Australia recently expressed interest in developing gold mines in India, as part of the bilateral cooperation in minerals and energy sectors between the two nations.

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A beleaguered Indian Government finds itself with its back to the wall where the supply of iron ore to the local steel ministry is concerned.

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The fluidity of the import-export situation vis-à-vis the mining of iron ore has left it walking a tightrope.

Earlier this month, the government had affirmed its resolve in not banning, or even limiting, exports of iron ore as demanded by domestic steel majors. There was a massive shortage of ore in India following the more than 2-year long, court-imposed ban on mining, partially lifted a few months ago.

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After India and Australia signed a civil nuclear deal in September, Australia’s uranium industry may be able to start sending trial shipments to India next year.

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Australian Prime Minister Tony Abbott and his Indian counterpart, Narendra Modi, discussed this during the latter’s visit to Australia. On Tuesday Abbott addressed the federal parliament saying if everything went to plan, uranium exports from Australia to India with suitable safeguards would start, “because cleaner energy is one of the most important contributions that Australia can make to the wider world.”

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Indian Prime Minister Narendra Modi and Australian PM Tony Abbott concluded a long-pending civil nuclear deal, which involves the supply of uranium from Canberra to India.

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The deal is very popular in India, Prime Minister Tony Blair has faced a backlash in Australia for supplying uranium to a nation that some say wants to expand its nuclear arsenal.

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Indian Prime Minister Narendra Modi and Australian PM Tony Abbott concluded a long-pending civil nuclear deal, which involves the supply of uranium from Canberra to India. The Indian press hailed it as the “most significant step” taken by India in the wake of the 2006 India-US civil nuclear deal.

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All uranium is welcome in India, which currently has 20 small nuclear reactors within six plants but operates only a few.

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Australian Environment Minister Greg Hunt has been a strong advocate of Adani Group’s recently signed $15.5 billion deal to mine and export coal from the Carmichael area to Adani’s native India.

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He tried to counter protests from environmentalists by explaining in great detail how the project would boost Australian economy. He explained that at full export capacity, the project was expected to contribute almost $930 million to the Mackay region’s gross regional product and $2.97 billion to the Queensland economy each year for the next 60 years. The mining project will generate an estimated 2475 construction jobs and a further 3,920 jobs during the operations phase.

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It’s the Australian and Indian governments and the Adani Group vs. environmentalists and near-nude models in the fight over the Carmichael Coal Mining project in Queensland.

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At full export capacity, the project is expected to contribute almost $930 million to the Mackay region’s gross regional product and $2.97 billion to the Queensland economy each year for the next 60 years.

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Just weeks before Australian Prime Minister Tony Abbott’s first visit to India, the Australian government, conditionally cleared a long-pending coal mining project from India’s Adani Group, sparking protests in Australia.

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Australia approved the approximate $15.5-billion (AUS $16.5 billion) Carmichael coal project in Queensland that could yield up to 60 million tons of coal per year, but only after imposing “strict conditions to protect the environment.”

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