2010-03-26 16:36:20 - Tropoje, Albania

Economic growth is starting to pick up and as a result metal and mining businesses are expecting particularly strong growth in China, Qatar, U.S., Japan, Australia, Brazil, Canada, India, Germany and some E.U. countries. Albanian Minerals in New York and her sister company Bytyci ShPK in Tropoje, Albania forecast that global growth will move from a decline of 1% in 2009 to a astonishing gain in the future. Demand for raw materials to pick up from chrome ore, ferro chrome, nickel, copper, aluminum, steel for infrastructure, construction in all real estate sectors, gas pipes, multi-billion investments, railroads, auto and aircraft production.

Investors worldwide will continue using metals as a hedge to protect against risk, sovereign debt issues and inflation.

in the long term metal prices will rise due to trillions of dollars of stimulus money injected into the world economy.

Now opportunity to invest in minerals is at optimal levels due to low prices, predictable inflation, rising population demands especially in China, India and the Middle East, and due to the fact that investors are seeking tangible investments and moving away from high-tech sectors which quickly shift in value due to the emergence of superior products.

The mining industry, which accounts for 15 per cent of South Africa’s electricity consumption, has already experienced rationing from Eskom. At the start of 2008, the utility was forced to limit electricity supplies after heavy rain damaged coal stocks. It began a system called load shedding, which involved rolling blackouts across parts of the country. South Africa’s largest miners, including Anglo American, Anglo Platinum and AngloGold Ashanti, were forced to shut down operations for several days.
The miners remained rationed for months and the sudden drop in production caused metal prices to spike.

China will need to import raw materials at an astonishing rate for some time to come. This should benefit, Albania, Africa, Australia, Canada, Brazil and Eurasian Natural Resources. The two most significant commodities as far as ENRC is concerned are ferrochrome and iron ore. In 2009, ferroalloys constituted 48pc of its earnings before interest, tax, depreciation and amortisation with iron ore generating 33pc. The outlook for both these products this year is positive.

Kazakhstan-focused ENRC is the world's largest producer of ferrochrome, which is used in the production of stainless steel. It is a lower cost producer than South African mining groups, which also face energy supply issues. Smelters that produce ferrochrome, an alloy of chromium and iron, are very energy intensive and there is speculation that major mining groups in South Africa have been asked to limit energy usage during the World Cup later this year. There are real fears of rolling blackouts in the country as global media and hundreds of thousands of fans arrive. These power interruptions would be positive for ENRC.

Ferrochrome contract prices are set in quarterly price talks – but there has been no settlement of the second quarter price. It is expected that prices will rise by between 20 – 30 cents per pound, compared $1.01 in the first quarter.

An interesting trend has also been happening recently which could boost demand further. there has been market share growth for 400-series stainless steel which contains more chrome, largely at the expense of higher-nickel 300 series.

The market share of 400 series in the first quarter of 2009 was 25.2pc of production, but this rose to 31.1pc by the fourth quarter of the year. The company is also highly exposed to iron ore. The largest producers in the world – Vale, BHP Billiton and Rio Tinto – are looking for an increase in prices close to 100pc. BHP and Vale have also been very vocal about wanting to move away from annual pricing talks to more short-term price setting, which is positive for producers in a bull market