54 LEXPERT MAGAZINE
|
MARCH 2017
| MINING |
e global nature of mining — be it on
the financing side or the mining side —
makes fluctuating prices almost impossible
for anyone to predict. Who can say what is
the sine qua non of any one increase or de-
crease in the market?
price increases at the end of 2016, it seems
that most of the analysts I spoke to feel that
the main cause was linked to speculation
on increased infrastructure spending by
the US rather than a reflection of a sudden
imbalance between supply and demand."
To hear Pletcher tell it, "Copper mean-
dered at $2.00-2.30/lb. prices for the first
nine months of [2016], before a late rally
in the last quarter lied prices by nearly
30%. Zinc, coal and nickel also certainly
performed surprisingly well, particularly in
the last half of the year — leading to Teck
Resources being the best performer on the
TSX." e US is not the only player that
drives the market. Far from it.
Pletcher continued to explain the good
performance of base metals as "in part due
to supply disruptions stoked by specula-
tion concentrated on the Chinese market."
Who knows where it will go from here?
Pletcher: "All of these commodities have
since come off their highs. While there
are some analysts who are calling for zinc,
nickel and gold to continue to gain ground
in 2017, most expect copper, aluminum,
coal and iron ore prices to slide back from
currently inflated levels due to oversupply.
As for potash and uranium, things were
not good in 2016 and do not look good in
the short term either — evidenced by mine
closures and production curtailment.
FRED PLETCHER
BORDEN LADNER
GERVAIS LLP
"I wouldn't call
it a resurgence yet,
rather the patient has come
off life support and left
the hospital under her own
power, albeit with the aid of
a cane. … A better market?
Certainly. A resurgence?
That might be a too
strong a characterization.
Maybe in 2018."
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