BHP Sells Iron Ore in Spot Market

123jump.com Staff
22 Apr, 2009
New York City

BHP reported that it is selling 28% of its iron ore output in the spot market as more steelmakers in China and Japan defer the demand. The spot prices are at least 33% lower than the contract prices. Australian inflation dipped at the end of the first quarter dimming the prospect of rate cut.

[R]3:00AM New York, 7:00PM Sydney- Australian consumer price index eases 0.1% in March. Skilled job vacancies fall 8.9% in April.[/R]

Australian stocks dipped 0.3% after the latest report on inflation showed a decline in inflation.

A survey indicating that skilled job vacancies declined in April also heightened market jitters.

In Sydney trading ASX 200 index dipped 0.3% or 9.2 to 3,668.20.

Of the ASX 200 index stocks, 73 gained, 110 declined, and 18 were unchanged. Linc Energy led gainers in the index shares with a rise of 13.6% after crude oil prices advanced 1.4% to $46.5 per barrel.

Energy stocks rebounded in a volatile trading this week. Panoramic Resources soared 5.9% and Mincor Resources gained 4.7%.

Inflation Eases to 0.1% in March Quarter

Australian Bureau of Statistics reported today that the Consumer Price Index fell 0.1% in the three months to March from a drop of 0.3% in the December quarter 2008.

The index also eased 2.5% through the year to March quarter 2009, compared to an increase of 3.7% to December quarter 2008.

According to the statistics bureau, significant price increases were registered in pharmaceuticals of 13.0%, in rents of 1.7%, in secondary education fees of 7.6%, in vegetables of 6.0%, and in electricity of 3.6%.

However prices fell in loan facilities by 14.1%, in automotive fuel by 8.1%, in domestic holiday travel and accommodation by 5.1% and in overseas holiday travel and accommodation by 4.0%.

Skilled Job Vacancies Fall 8.9% in April

The Department of Education, Employment and Workplace Relations skilled index, which measures skilled job vacancies, fell 8.9% from a month ago and 61% from a year earlier to 37.1 points in April.

Vacancies fell in all three occupational groups observed by the department, with vacancies in trade falling 10.4%, in associate professionals dipping 8% and in professionals slipping 7.2%.

Medical and science technical officers’ vacancies dropped the most, falling 25.1%.

All states had decreases in skilled vacancies in April, with vacancies in Western Australia declining the most by 16.9%.

Gainers & Losers

Linc Energy led advancers in the ASX 200 index shares with a rise of 13.6% followed by increases in PMP Ltd of 7.6%, in NRW Holdings of 7.6%, in Kagara Ltd of 6.6%, and Hastings Diversified Utilities of 6.2%.

Boart Longyear Group led decliners in the ASX 200 index shares with a fall of 21.4% followed by losses in Goodman Group of 17%, in Karoon Gas Australia of 17%, in GPT Group of 14%, and Aristocrat Leisure of 12.8%.

BHP Iron Ore Production Drops 1%

BHP reported today in its production report for the nine months ended March 31 iron ore that production dropped 1% and forecasted output at its Escondida copper mine in Chile will drop 30% to 366,000 tons.

BHP noted in the report that technical issues with Laguna Seca SAG that have affected output will be resolved by the September quarter.

BHP also reported that 28% of its iron ore production is sold at a spot price and 72% is sold on a long term contract prices to steelmakers. The spot prices are on average 30% lower than contract prices and are likely to be volatile and fall further if global economy remains weak.