Manufacturing Contracts in Australia

Chandrasekhar Atreya
01 Oct, 2010
New York City

Shares in Sydney fell marginally and the Australian dollar gained for the seventh week in a row. Manufacturing activity contracts in September. Australia has the wettest September in more than a century. For the week, the benchmark index declined 0.5%.

[R]6:00 PM Sydney, Australia – Shares in Sydney fell marginally and the Australian dollar gained for the seventh week in a row. Manufacturing activity contracts in September. Australia has the wettest September in more than a century.[/R]

Australian stocks fell in the final session pushing the benchmark index down by a fraction. The Australian dollar traded near record high as gained for the seventh week in a row.

The ASX 200 Index fell 0.08% or 3.7 points to close at 4,579.20.

Australian manufacturing activity contracted for the first time this year in September as firms complained about soft domestic demand and a high local labor costs.

The performance of manufacturing index dropped 4.4 points to 47.3 in September, the Australian Industry Group and PricewaterhouseCoopers said in a survey release Friday in Canberra.

Australian dollar gained for the seventh week in a row as the U.S. dollar continues to slide and commodities prices remain elevated.

The Australian dollar traded at 96.67 U.S cents in Sydney from 96.71 cents. The currency gained 0.8% in the week and 8.3% since August 13.

Wesfarmers Ltd said Friday its December quarter process for metallurgical coke exports from its Curragh mine in Queensland will fall by about 11% compared with the previous quarter.

Billabong International said it agreed to buy 38 retail stores including the Surf Drive ‘n’ Ski retail banner from the General Pants Group. The purchase will also include the Jetty Surf retail banner and two licensed Billabong stores, the Gold Coast-based company said in a statement today.

“The purchase brought together two businesses with a strong heritage in the surf and wider broad sports sector,” said Billabong CEO Derek O’Neill Friday.

Australia had its wettest September in more than 100 years but extreme dry years are in store, the Bureau of Meteorology said Friday. BOM senior climatologist Blair Trewin said September saw an average of 49 mm of rain countrywide, the highest since 41mm recorded in 1906 and almost three times above the long-term average of 17 mm a year.

He also said there was evidence that increased levels of greenhouse gases contributed to the increase precipitation.

The Australian government set October 28 as deadline for submissions on the controversial mining tax as it starts a series of consultations with miners.

Sydney Airport is the latest Australian issuer to tap the U.S. dollar bond market when it raised a $500 million issue of 10 years and six months duration. The airport received over $1 billion in bank debt commitments.

Arafura Resources Ltd is in talks to raise funds for its $1 billion rare earth project in Australia after China restricted exports of these minerals used in hybrid cars and laptops. The company plans to produce 22,000 tons a year of rare earth oxides from 2013 for over 20 years from its Nolan mine in Northern Territory, with a processing complex to be built at Whyalla in South Australia.

“With the outlook for the market, the robustness of the project, we have every chance of raising the needed money,” said CEO Steve Ward in an interview Friday.

Wheat production in Western Australia, the nation’s largest growing state, may drop 45% from last year because of inadequate rains, a farmer’s group said.

“A lot of people have virtually come to the conclusion that the rain season is done and it is not looking good,” Mike Norton President of the Western Australian Farmers Federation said.

Resource News

Eight coal producers funding the proposed $5 billion Wiggins Island Coal Export Terminal in Queensland received capacity commitments totaling 27 million tons a year.

Henix and Straits Resources said Friday announced an initial resource estimate for Canbelego copper project in New South Wales.

Carrick Gold said it achieved depth extensions at its Lindsay’s Parrot Feathers prospect in Western Australia.

Cockatoo Coal was selected as 3 million tons per annum user of the proposed Wiggins Island Coal Export terminal at Gladstone in Queensland.

Great Western Exploration made the decision to continue its drilling at Doolgunna project in Western Australia.

Gainers & Losers

Carnarvon Petroleum Ltd led gainers in the ASX with a gain of 8.05% to A$0.47 followed by Karoon Gas Australia Ltd 7.02% to A$8.08, Paladin Energy Ltd 4.74% to A$3.76, White Energy Company Ltd 4.1% to A$4.06 and Roc Oil Company Ltd 3.95% to A$0.395.

Perseus Mining Ltd led decliners in the index with a drop of 5.52% to A$2.74 followed by Ausenco Ltd 4.23% to A$2.72, Infigen Energy 4.08% to A$0.705, Isoft Group Ltd 4% to A$0.12 and Abacus Property Group 3.45% to A$0.42.