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January 26, 2009 Dear Friend, Apologies for being a little slow completing the weekly Spot Market Review and Critique of Rio Tinto's production report and developments. My flight was cancelled yesterday returning from Mercator Minerals via Las Vegas, and I got back 7 hours late at 6 am today. The upside was that Katie Stam, crowned Miss America Saturday evening, was on my flight as well. She patiently posed with about 100 people at the gate who wanted a photo with her. The continuing large rises in nonferrous inventories, typically 0.2% of annual consumption last week, suggest global could fall another 5% to 10% in 2009 from year ago levels. None of the metals industries have cut output enough to match declining demand. Rio Tinto has made a much better effort to cut output in its prior core business, iron ore, than its new major business, aluminum. In fact, it increased bauxite and alumina output in the fourth-quarter of 2008. We cut earnings estimates nearer to breakeven for 2009. We continue to finalize our next metals conference for March 31, 2009 in New York. Faithfully, John C. Tumazos |
Copyright © 2008 John Tumazos Very Independent Research,
LLC
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