Fr i d ay 2 7 , M a rc h 2 015
News &
Report Analysis
Currency Market
Precious Metal
Base Metal
Energy Market
 India manage to get US solar pledge
worth $160 billion for Solar Power push
 Cancelling JSPL’s winning bid wrong, says
High Court
 Demand for RINL-NMDC merger grows
thick and fast
 MMTC expects exports of pig iron to pick
up pace soon
 Fimi estimates iron ore production in
2015-16 at 135 mt
2
Friday 27, March 2015
Daily
MMR Landed Prices
London Metal Exchange : Thursday 26, March 2015
Pr. Sell
(1)
Morning Session
Buy
Sell * (2)
Afternoon Session
Buy
Sell
Kerb
Change
(2) - (1)
Value
Stk(tns)
change
$/ton
Rs/ton
Copper Grade A
Spot
6134.50
6229.00
6230.00
NA
NA
6199.00
95.5
3,39,600 MMR LP
3-mth
6110.00
6213.00
6215.00
NA
NA
6173.00
105.0
-3025 14-D MA
3,63,713
PP (HCL)
3,88,044
Average
10-days - 5920.20
20-days - 5869.10
30-days - 5822.40
4,22,888
Tin High Grade
Spot
17400.00
17260.00
17265.00
NA
NA
17175.00
-135.0
9,975
--
--
3-mth
17450.00
17445.00
17450.00
NA
NA
17225.00
0.0
-120
--
--
--
--
Average
10-days - 17266.10
20-days - 17560.80
30-days - 17739.80
--
Lead
Spot
1830.00
1842.00
1844.00
NA
NA
1850.00
14.0
2,36,750 MMR LP
1,30,084
3-mth
1832.00
1847.00
1848.00
NA
NA
1853.00
16.0
-525 14-D MA
1,12,724
PP (HZL)
1,31,800
1,52,014
Average
10-days - 1769.70
20-days - 1773.50
30-days - 1776.60
Zinc Special High Grade
Spot
2065.50
2094.50
2095.50
NA
NA
2078.00
30.0
5,20,125 MMR LP
3-mth
2076.50
2105.00
2105.50
NA
NA
2088.00
29.0
-50 14-D MA
1,32,794
PP (HZL)
1,53,500
Average
10-days - 2022.80
20-days - 2020.10
30-days - 2041.40
Aluminium
Spot
1764.00
1783.00
1783.50
NA
NA
1787.00
19.5
39,64,975 MMR LP
1,42,620
3-mth
1772.00
1790.50
1791.00
NA
NA
1792.00
19.0
-4200 14-D MA
1,27,511
Average
10-days - 1769.90
20-days - 1772.10
30-days - 1781.30
PP (Nalco)
1,46,900
Aluminium Alloy
Spot
1730.00
1720.00
1730.00
NA
NA
NA
0.0
26,220
3-mth
1750.00
1740.00
1750.00
NA
NA
NA
0.0
-80
Average
10-days - 1735
20-days - 1770
30-days - 1776.60
Nickel
Spot
13680.00
13610.00
13615.00
NA
NA
13650.00
-65.0
4,32,792
--
--
3-mth
13750.00
13650.00
13660.00
NA
NA
13700.00
-90.0
-1188
--
--
--
-01-Mar
11-Mar
Average
10-days - 13808.90
20-days - 13898.40
30-days - 14011.60
Note: 1. MMR LP = MMR Landed Prices, excluding excise duty. 2. PP = Producer Prices ex-smelter, excl. excise
Copper
Aluminium
Minor Metals ($/LB)
Antimony
99.65%
9,100
Cadmium
99.80%
90.00
Cobalt HG Moly.oxide
99.80%
14.00
9.00
Tantalite
30% Ta2O5
81.00
Titanium Ferro-vana
Con. Ti02
550.00
24.90
Silicon Zinc
Lead
2,050
23-Mar
23-Mar
Week ended Avg of Steel Prices: 21/03/2015 (Incl. Excise duty)
Sponge Iron
Pig Iron
Alum. Alloy :
Mandi
26,400 HMS
31,600 CRP(LSLP)
Mumbai Mkt rates in kgs :
Mumbai
Kolkata
28,900
29,600
28,900
ADC 12 138.5
Delhi
Chennai
Bhiwandi
29,600
27,200
MS Ingots
39,200
28,800
AlSi 9 Cu3 140
LM6
154
Indicative Domestic Market Rates (Rs./kg)
Mumbai
26-Mar
Prev
Virgin Metals
Copper Pat
Copper W/Bar
Delhi
26-Mar
Comex Copper (cents/lb)
Chennai
Prev
26-Mar
Prev
Mar'15
- Apr'15
417.0
- May'15
-
-468.0
-463.0
418.0
-
Alum Ingot
Zinc Slab
Lead Ingot
Tin Slab
Nickel (4x4)
Scrap
Copper Heavy
Copper Uten.
158.0
170.0
134.0
1,350.0
1,030.0
158.0
167.0
133.0
1,360.0
1,023.0
158.0
181.0
130.0
1,350.0
1,015.0
158.0
180.0
129.0
1,348.0
1,013.0
442.0
415.0
438.0
409.0
---
---
154.0
-
Copper Mixed
Brass Utensil
Brass Huny
Brass Sheet
Alum Utensil
-323.0
323.0
330.0
127.0
-320.0
321.0
328.0
127.0
403.0
--138.0
402.0
--138.0
-
154.0
-
Metal
Gold Std
Silver
Gold
Silver
Gold
Silver
Rate
282.15
282.05
281.10
Change
0.6
0.7
0.7
Kanpur
38,800
Durgapur
35,200
Comex Al (cents/lb)
Rate
-
Change
-
Precious Metals : Indicative Rates
Market
Mumbai
Mumbai
London
London
Comex
Comex
Unit
Rs./10g
Rs./kg
$/tr.oz.
$/tr.oz.
$/tr.oz.
$/tr.oz.
26-Mar
26,900
38,900
1,203.2
17.13
1,205.1
17.12
Prev
26,650
38,300
1,195.6
16.94
1,197.3
16.98
Forex: Mar 26, 2015 (Rs/Unit Currency)
- Buy
- Sell
- Buy
USD
62.74
62.65
EURO
69.02
GBP
93.70
93.60
SGD
45.97
----AUD
49.36
YEN
0.5286
0.5278
SFR
65.70
Sell
68.94
45.89
49.32
65.66
Customs Notified Rates: Mar 06, 2015 [Rs.(Imp/Exp)]: US$ 62.30/61.80;Pound Sterling 98.10/93.95;Euro 69.10/93.95
US equity market closed on a negative note
average closed off 40.31 points, or 0.23 percent,
USD/INR Overnight VAR
Data releases today
17:00
0.3518
Forecast
Previous
2.2%
to 17,678.23, the S&P 500 lost 4.9 points, or 0.24
USD Final GDP q/q
2.4%
percent, to 2,056.15 and the Nasdaq Composite
USD Final GDP Price Index q/q
0.1%
dropped 13.16 points, or 0.27 percent, to
4,863.36. In Asia region, Japan's Nikkei share
16:00
to 4,863.36.Wall Street's Dow Jones industrial
15:00
the Nasdaq Composite dropped 13.16 points,
14:00
the S&P 500 lost 4.9 points, to 2,056.15 and
13:00
industrial average fell 40.31 points, to 17,678.23,
12:00
on the support of economic data. The Dow Jones
11:00
day but off lately it recovered from the day's low
USD/INR - 26/03/15
62.54
62.57
62.60
62.63
62.66
62.69
62.72
62.75
9:00
yesterday. The stocks fell for consecutive fourth
10:00
Daily
3
Friday 27, March 2015
0.1%
Source : Mecklai Financial
a fourth time in the past two weeks.
average edged up on Friday morning in choppy
US dollar fell against traditional safe havens
trade as Investors bought stocks on the dips
the Swiss franc on yesterday and the yen after
after the previous day's falls, while Panasonic
warplanes from Saudi Arabia and other Arab
Corp attracted buying after it announced an
countries struck Shi'ite Muslim rebels fighting to
acquisition plan. Japan's consumer inflation
oust Yemen's president. The dollar later recovered
data out earlier in the day had little impact to
against the franc and was last up 0.4 percent at
the stock market. The headline core CPI, which
0.9633 francs. Against the yen, the dollar was last
includes oil but excludes volatile fresh food
at 119.26 yen, off 0.18 percent. The dollar was
prices, rose 2.0 percent on-year in February,
down earlier against the euro but recovered in
short of a median forecast for a 2.1 percent rise,
New York trading on the view that central bank
government data showed.
policy was more favorable for the U.S. currency.
Currency Market
The euro was last off 0.80 percent at $1.0884.
The dollar later recovered against the franc
US dollar currency saw the currency trading
and was last up 0.4 percent at 0.9633 francs.
broadly higher early in Asia on Friday, but still
Against the yen, the dollar was last at 119.26
on track to end softer for a second straight
yen, off 0.18 percent. The dollar was down
week. Since the U.S. Federal Reserve's dovish
earlier against the euro but recovered in New
steer last week, dollar bulls have been much
York trading on the view that central bank
more cautious. But a set of encouraging data
policy was more favorable for the U.S. currency.
on Thursday and a rise in U.S. Treasury yields
The euro was last off 0.80 percent at $1.0884.
helped the greenback stage a modest rebound.
The Australian dollar, for example, is back near
The dollar index climbed to 97.397, bouncing
78 U.S. cents, down from a two-month high of
off a three-week trough of 96.170. Against the
$0.7939 set earlier in the week. USDINR opened
yen, it rallied to 119.28 yen, from a one-month
at 62.80 levels, high against its previous close of
low of 118.33. The euro eased back to $1.0876
62.66 levels. The pair is expected to remain in a
from $1.10525, failing to stay above $1.1000 for
range of 62.50-63.00 levels for the day.
4
Friday 27, March 2015
Daily
6 mth
LIBOR
Major
Currencies
Today’s
Crosses
Spot
Cash
v/s INR
0.40
USD / INR
-
ATM Options (put/call)
0.15
Forward Rates v/s INR (Export/ Import)
March
April
May
August
November
February
62.71/ 72
62.65/ 67
63.20/ 23
63.59/ 63
64.03/ 07
65.26/ 30
66.44/ 48
67.52/ 56
-
-
-
0.47/0.47
0.67/0.68
0.83/0.84
1.22/1.27
1.52/1.63
1.78/1.96
EUR / USD
1.0881
68.23/ 24
68.16/ 19
68.79/ 82
69.24/ 28
69.75/ 79
71.21/ 24
72.64/ 68
73.82/ 84
0.14
USD / JPY(100)
119.33
52.54/ 56
52.49/ 52
52.98/ 01
53.33/ 37
53.72/ 76
54.83/ 87
55.94/ 98
56.90/ 97
0.68
GBP / USD
1.4852
93.13/ 15
93.04/ 08
93.87/ 92
94.40/ 47
95.03/ 10
96.82/ 88
98.57/ 63
100.39/ 46
0.68
GBP / USD
1.4852
93.13/ 15
93.04/ 08
93.87/ 92
94.40/ 47
95.03/ 10
96.82/ 88
98.57/ 63
100.39/ 46
3.06
AUD / USD
0.7807
48.95/ 97
48.90/ 93
49.25/ 27
49.47/ 50
49.73/ 76
50.45/ 48
51.16/ 18
51.61/ 64
Source : Mecklai Financial
months in February, data showed on Thursday, as
Precious Metal
purchases slowed in the world's second-biggest
Gold held on to gains from a seven-day rally
gold consumer amid weaker prices.
on Friday and looked set to post its second
straight weekly gain on expectations U.S.
Base Metal
interest rates will stay low for longer and as
Copper futures pared gains as mines began
escalating tensions in the Middle East boosted
restarting after flooding in Chile, the world’s
safe-haven bids. Last week, gold prices posted
biggest producer. Codelco, the top copper
strong gains while it also managed to cut back
miner, said late Wednesday that its Atacama
all of its losses in 2015 as weaker US Dollar which
Desert sites were gradually resuming operations
supported investment in yellow metal.
after shutting down earlier in the day. Futures
Prior to last week ended 13th March, Bullion
prices fell heavily as markets moved into the
earlier jumped as much as 2.8 percent as the
rains also forced Lundin Mining Corp.
FED monetary policy on expectations that
The benchmarket metal advanced 3.7 percent
policy outcome would be hawkish. However as
last week after labor protests in Indonesia
of the actual policy update, FOMC in its meeting
shut production at Freeport-McMoRan Inc.’s
came out with more dovish expectations over
Grasberg mine, the second-largest for the metal
US economy and interest rates in the near-term,
by capacity. close its Candelaria mine and Pan
thus pushing the US Dollar lower while adding
Pacific Copper Co. to shutter Caserones.
value to Gold.
On the London Metal Exchange, copper
In news from China’s physical markets
for delivery in three months rose 0.8 percent
imports from Hong Kong fell to their lowest in six
to $6,174 a metric ton ($2.80 a pound), after
Market Highlights - Gold (% change)
Gold
Gold (Spot)
Gold
(Spot -Mumbai)
Comex Gold
MCX Gold
(Apr’15)
Unit
Last
Prev.
day
as on March 26, 2015
WoW MoM
YoY
touching $6,294.50, the highest since Jan. 2.
Also on the LME, aluminum, nickel, lead
and zinc rose, while tin fell. Escalating violence
$/oz
1204.0
0.73
2.8
0.0
-8.1
Rs/10
gms
26700.0
1.52
3.5
0.6 -10.4
$/oz
1205.1
0.65
3.1
-0.6
-8.1
Rs /10
gms
26801.0
1.20
3.2
2.6
-7.3
in Yemen sparked a rally across energy
commodities and metals. Higher energy prices
Source: Angel Broking
lift mining output costs.
On the IPO market, Vale SA is proceeding
Daily
Friday 27, March 2015
with a plan to sell shares in its base metals
on oil supplies as the country was only a small
unit as it expects nickel and copper prices to
crude exporter and tankers could avoid passing
rebound. “We are preparing the working agenda
its waters to reach their ports of destination.
of this IPO to be ready to make a decision,”
Oil prices soared as much as 6 percent the
Chief Executive Officer Murilo Ferreira told
previous day after a Saudi-led coalition of Arab
analysts during a conference call on Thursday.
nations began strikes on Shi'ite Houthis and
“We have received visits from countless banks.
allied army units who have taken over much of
Everybody is bringing their projects and making
Yemen and seek to oust President Abd-Rabbu
presentations.”
Mansour Hadi.
Energy Market
Global oil prices fell over a percentage point
on Friday as traders estimated that the threat
"While Yemen is a small producer (145,000
barrels per day in 2014), the price rally is driven
by fears of potential escalation and the proximity
of the Bab el-Mandeb strait," Goldman said.
of a disruption to world crude supplies from
Closure of the strait could affect 3.8 million
Saudi Arabia-led air strikes in Yemen was low.
barrels a day of crude and product flows, but
Goldman Sachs said in an overnight note that
analysts said tankers could be diverted to travel
the strikes in Yemen would have little effect
around Africa instead of passing Yemen.
5
Friday 27, March 2015
Daily
Market Highlights - Crude Oil (% change)
as on March 26, 2015
Crude Oil
Unit
Last Prev.
day
WoW
MoM
YoY
Brent (Spot)
$/bbl
56.9
4.9
6.2
-5.8 -47.3
Nymex Crude
(Apr’ 15)
$/bbl
51.4
4.5
17.0
3.4 -48.7
ICE Brent Crude
(Apr’15)
$/bbl
59.2
4.8
8.7
-4.0 -44.7
MCX Crude
(Apr ’15)
Rs/bbl
3369.0
5.0
17.7
4.3 -44.0
Source: Angel Broking
"At the moment, the fighting is located in the
central part of the country around the capital of
Sanaa. Even if fighting did progress south and
which has lent to solar and wind programs, sold
potentially threaten tankers moving through
the country’s first green dollar bonds in a $500
the Bab el-Mandeb Strait, they could simply
million issue of 2.75 percent notes March 24.
take the longer route around Africa," ANZ bank
India’s issuance of overseas securities meeting
said on Friday.
environmental criteria overseen by the Zurich-
Analysts also said that the less than 40 km
based International Capital Market Association
narrow strait between Yemen and Djibouti was
could surge to as much as $1.5 billion annually
heavily militarized by the West, with the United
in the next two to five years, according to
States and France both operating bases in
Commerzbank AG.
Djibouti and NATO and other allies having a fleet
presence in the Gulf of Aden to combat piracy.
Modi got a pledge from U.S. President Barack
Obama for unspecified funding to raise solar
ANZ said that a bigger impact from the Middle
production to 100 gigawatts by 2022 from about
East on oil prices might come from a potential
3 gigawatts, and is fishing for more aid ahead
nuclear deal with Iran, which could result in a
of a climate summit in Paris in December. The
loosening of western sanctions against Tehran
former leader of the state of Gujarat pioneered
and rising exports of its oil reserves.
India’s first solar incentives and restored wind-
News & Report
Analysis
farm tax benefits in July after a two-year hiatus.
India manage to get US solar
pledge worth $160 billion for
Solar Power push
That’s driven a rally in convertible notes of Suzlon
Energy Ltd., the turbine maker that caused India’s
biggest default of such debt in 2012.
“The government’s thrust is on building
green renewable sources of energy, and that
should prompt more local issuance,” said
As Indian Prime Minister Narendra Modi
Jaideep Iyer, Mumbai-based group president
was winning headlines garnering U.S. support
for financial management at Yes Bank Ltd. “We’ll
for a $160 billion solar-power push, the bond
continue to seek the development of the market
market was putting together more concrete
for green bonds.”
funding plans. Export-Import Bank of India,
6
Daily
Exim Bank priced its five-year securities to
Friday 27, March 2015
an interim arrangement for the blocks.
yield 147.5 basis points over similar Treasuries,
The court's observations are seen as a
Bloomberg-compiled data show. That compares
setback for the government, which has seen
with an average 263 basis points on international
several legal challenges to auction of coal blocks,
bonds from Indian issuers, according to Bank of
particularly by firms that lost out. However, the
America Merrill Lynch indexes.
Centre is pleased about the auction as a whole
Cancelling JSPL’s winning bid
wrong, says High Court
as it has received high bids. It plans to auction
The Delhi High Court has observed that the
rejection of winning bids of Jindal Power & Steel
Ltd (JSPL) for two coal blocks in Chhattisgarh
was 'prima facie' wrong as the government was
making a mistake in comparing the bids with
quotes received for other blocks.
The government rejected the bids, which
were much lower than the price quoted for
other blocks, on the ground that they did not
reflect the fair value of the blocks. The court in
the course of hearings on Thursday, observed
that this did not seem fair, and amounted to
comparing apples with oranges.
The high court will again hear the case on
Friday and asked the government to work out
more blocks next month.
The court's observations also come as a
relief to JSPL and Bharat Aluminum Company
(Balco) that took legal recourse after the coal
ministry on Friday cancelled auction process for
three blocks for which the companies emerged
as successful bidders. On Monday, a bench of
justices BD Ahmed and Sanjeev Sachdeva had
restrained the government from allotting the
Tara mine to Coal India.
The government had disapproved bids for
JSPL's Gare Palma IV/2&3 and Tara mine and
Gare Palma IV/1 for which Balco emerged as
the best bidder. The coal ministry allotted these
mines to Coal India Ltd. Both these blocks are
operational mines and as per Supreme Court's
September 2014 verdict that cancelled 204
7
Daily
Friday 27, March 2015
captive mine allotments, producing mines have
has its headquarters in Hyderabad is the State-
to be surrendered by the previous allottee.
controlled mineral producer and has long-
JSPL made the best bid for the Gare Palma
term agreement with RINL to supply iron ore
IV2&3 coal block at a price of Rs 108 per tonne
extracted from Bailadilla mines in Chattisgarh
while foregoing the mining cost. Tara coal
to meet raw material requirement of VSP.
block auction closed at Rs 126 per tonne. Balco
VSP is now stabilising expanded units under
emerged as the best bidder for the Gare Palma
its 6.3 million tonne project executed at a cost
IV/1 at a price of Rs 1,585 per tonne.
of Rs.12,300 crore. Incidentally, both RINL and
After rejection of its bid, JSPL had said it
NMDC are under administrative control of
was "puzzled" by the government's decision. It
Ministry of Steel. NMDC is establishing three
said it had followed a consistent and prudent
million tonne steel plant near Jagdalpur in
bidding strategy throughout the coal auction
Bastar. On the other hand, RINL has a rich land
with a serious long-term business perspective.
bank with 25,000 acres under its ownership with
Demand for RINL-NMDC
merger grows thick and fast
dream to make VSP as the largest single location
Demand for merger of Rashtriya Ispat Nigam
Limited and National Mineral Development
which was dropped after the latter expressed its
integrated steel plant in future.
NMDC, which is expected to produce 30
million tonne of iron ore during 2014-15, has set
a target to produce 50 millon tonne by 2018-19
and 100 million tonne by 2024-25.
disinclination, is gaining momentum again with
many clamouring for it.
Mooted in 2008 by RINL management as a
MMTC expects exports of pig
iron to pick up pace soon
mutually beneficial solution to its raw material
Pig iron exports by MMTC controlled
insecurity and NMDC’s plan to foray into steel
Neelachal Ispat Nigam Ltd (NINL) are expected
manufacturing, the proposal is being broached
to pick up steam within a year mainly on the
by the employees of Visakhapatnam Steel Plant.
back of revival in US economy and steady GDP
“We want to represent to Ministry of Steel
growth rate posted by China.
shortly to consider the suggestion, which
Though MMTC has been floating tenders to
mutually beneficial for RINL and NMDC,” Visakha
export pig iron produced by NINL, it has been
Steel Employees’ Congress (recognised union)
struggling to find buyers due to tepid demand
general secretary Mantri Rajasekhar said.
in the export market. The trading firm hopes for
VSP unions including those belonging to
CITU and AITUC are of the opinion that merger
will be the best option. An official of RINL said
merger would also help both the entities to
emerge as a formidable force both in India and
overseas market.
RINL, which is in the process of getting listed,
is the corporate entity of VSP. NMDC, which
a turnaround in the next 12 months. NINL where
8
Daily
9
Friday 27, March 2015
MMTC holds 49.9 per cent stake, is the biggest
to pave the way for higher ore production, a lot
pig iron exporter in the country
depends on how quickly state governments set
"Recessionary economic trends have hit pig
iron exports. We are finding it tough to find
the ball rolling in terms of auction of mining
leases.
overseas buyers. But we hope the scenario to
According to the ministry of mines, 199
reverse in a year's time. The US economy which
concessions, including 15 iron ore leases, are
impacts most of the world's economies is on
expected to be auctioned by various state
revival. China has been maintaining more or less
governments in the next few months. Unless
steady growth in its GDP," said MMTC's chairman
state
and managing director Ved Prakash.
production in the coming year is unlikely to be
governments
act
immediately,
ore
Despite lukewarm response to its tenders
better than the past few years. The Federation
in February, MMTC has floated a fresh global
of Indian Mineral Industries (Fimi) estimates iron
tender for pig iron exports on March 17 for
ore production in 2015-16 at 135 million tonne
30,000 tonne of pig iron. The latest tender is due
(mt), a mere eight per cent growth over the
for opening on April 6.
current financial year.
Apart from MMTC, another public sector
In 2014-15, the production is estimated at 125
steel maker Rashtriya Ispat Nigam Ltd (RINL) is
mt. Of this, Odisha will be the major contributor
also finding it tough to find overseas buyers.
at 50 mt, followed by Chhattisgarh at 25 mt.
Over the past couple of months, tenders floated
Jharkhand and Karnataka stand at subsequent
by these two steel PSUs have failed to elicit
places with 19 mt and 17 mt, respectively.
enough interest from the overseas buyers.
Fimi estimates iron ore
production in 2015-16 at 135 mt
With the passage of the Mines and Minerals
(Development and Regulation) Amendment Bill
in Parliament, action will now shift to mineralbearing states. Although the new Act is expected
“A minor growth in production could be seen
in Karnataka next year. Goa will start production
only towards the second half of the next financial
year. If all goes well, Goa could produce around
10 mt, while Karnataka might add 5 mt more.
Odisha will continue to be the largest producer
next year as well,” Basant Poddar, senior vicepresident, Fimi, said.