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February 1, 2011 Dear Friend,
Due to popular
client demand we updated our prior September 7th
copper industry report with various graphs of
exchange inventories back to 1988, an analysis of
monthly seasonal patterns back to 1988, an analysis
of erratic annual inventory trends, our summary
demand-supply balance, our demand forecast by
nation, our mine output forecast by nation and our
comparison of copper demand trends to nickel, lead
and zinc based on WBMS data recently published. We
continue to estimate negative 3 mmt of copper
inventory in 2014 to 2016 due to insufficient
output. We urge you to be patient as copper demand
is seasonally poor in December, January and
February, and wait for stronger demand in March
through June. Do not be of weak spirit as the late
phases of winter hibernation conclude.
We reduced our
long-term earnings estimates for Neutral Weight
rated Plum Creek as we removed "wood pellet" fuel
plants from our long-term earnings models, taking
contributions out beginning in 2012.
Our Spot Markets
report focuses on the expected swing to inventory
drawdowns after the Lunar New Year this week, but
near record levels of aluminum, nickel, lead and
zinc inventories. This report has several pages
dedicated to each major industrial material.
My good
friend Len Boselovic of the Pittsburgh-Post Gazettte
http://post-gazette.com/pg/11031/1121868-28.stm calculated
that the S&P 500 enjoys an average gain of 20.9%
when the Pittsburgh Steelers reach the Super Bowl
and 21.4% when the Green Bay Packers reach the Super
Bowl. So whether the Steelers get #7 or the Packers
take their #4 Lombardi Trophy, we should all stay
long a good while longer. Seems safer than waiving
a yellow towel when you are down to just one of the
original starting offensive linemen.
Faithfully,
John C. Tumazos,
CFA
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Copyright © 2008 John Tumazos Very Independent Research,
LLC
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