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We maintain a separate Verizon land line
732 946 3809, which we use for Comcast failures such as with Hurricane Irene
(in Greek Irene means "peace" ironically). You may also reach me directly on
my cell 732 740 3574 or my son Charles' cell phone 732 882 6984. My work
station has email and internet via a Verizon wireless card, while the rest
of our staff are limited to cellular phones for email and internet access.
We apologize for this inconvenience.
· On August 26th the GLD gold ETF fell to 1,230.8 tonnes down from 1,290.8 tonnes on August 19th that was almost back to the June 30, 2010 all-time high of 1,320 t after falling almost to 1,200 t. Gold futures margin requirements were tightened a second time to 27%. The $54.80 gold price drop last week to $1,794.10 and $1.481 drop in silver to $40.947 is consistent with an almost 5% aggregate withdrawal from the GLD ETF. The U.S. dollar weakened about 1% against major currencies last week to the benefit of gold.· July 2011 world steel output rose 11.5% from July 2010, although it fell to 4.112 mmt per day or a 79.7% operating rate from 4.258 mmt per day or an 83.1% rate in June. China fell to 1.913 mmt per day in July from 1.9977 in June, but was 15.5% above July 2010. The rest of world fell to 2.199 in July from 2.260 mmt per day in June. YTD 2011 world output rose 8.3%. · July global aluminum monthly output was the second highest ever, even though it fell marginally to 121,400 mtpd from 122,000 mtpd in June. Output outside of China rose to 70,200 mtpd in July from 69,900 mtpd both in June and May, and was just short of the 70,300 mtpd all-time April 2011 record. Chinese output did not fall as much as expected in the July mid-summer, at its second-highest month ever at 51,300 mtpd down from the June 2011 record at 52,100 mtpd. YTD global smelter output is up 5.5% through July. · The August 22nd semiannual capacity survey of the Int’l Alum. Institute reported up to 2% higher than previously estimated global capacities for 2010, 2013 and 2014 in particular. The IAI smelter capacity survey ignores China. It increased its year-end 2010 capacity level 490,000 tonnes, 2011 135,000, 2012 295,000, 2013 705,000 tonnes, and 2014 604,000 tonnes, and we raised our 2015 estimate 230,000 tonnes and cut our 2016 estimate 281,000 tonnes. The capacity gains were in the Mideast, Latin America, Iceland and Russia. · On August 26th the IAI reported July month-end producer inventories at 2.647 mmt, up 114,000 tonnes from June. This means July month-end producer + exchange inventories were 7.937 mmt down from 8.287 mmt peaks in May. · On August 22nd the IAI reported global alumina output in the 2011 first-half at 42.904 mmt up from 39.514 mmt last year, an 8.58% gain faster than the 5.5% gain in world smelter output through July. The excess alumina output is near 0.5 mmt, or roughly handling losses or spillage. · LME steel billet futures closed at $690 per metric tonne or $620 per short ton, which exceeds the $665 Nynex hot-rolled sheet future after considering the value-added of rolling sheets. The U.S. $210 per ton price drop since March places U.S. prices below world levels, which should greatly cut steel imports and supports our Overweight recommendation for U.S. Steel. Faithfully, John C. Tumazos, CFA |
Copyright © 2008 John Tumazos Very Independent Research,
LLC
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