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COMMODITY NEWSBRIEFS: 20 NOVEMBER 2014 Please note that these articles are available in electronic format and can be requested and delivered via e-Mail.

(http://intra.spoornet.co.za) Natasha.Havenga@transnet.net

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FAST MOVING CONSUMER GOODS CPI IN LINE WITH MARKET EXPECTATION (News24, 2014) The headline Consumer Price Index (CPI) rate at 5.9% in October makes it the second consecutive month it is below the SA Reserve Bank's target limit, economists said on Wednesday. The Nedbank Group economic unit said the CPI was in line with market expectation and below the Sarb's 6% upper target limit after six months above it. "Inflation is likely to remain relatively contained in the coming months on the back of lower commodity - especially oil and food - prices," the unit said in a statement. "The volatile rand though does pose an inflation risk and we might start seeing the effects of the rand coming through in the numbers further on in 2015." The unit said it had pencilled in a 0.25 percentage point interest rate hike when the Sarb monetary policy committee (MPC) announced the rates on Thursday. Statistics SA (Stats SA) on Wednesday said the headline CPI annual inflation rate remained 5.9% in October. "This rate was the same as the corresponding annual rate of 5.9% in September 2014. On average, prices increased by 0.2% between September 2014 and October 2014," Stats SA said. In July CPI was 6.3%. Investec economist Annabel Bishop said while CPI remained within the target range it was likely to fall further over the remainder of 2014. STEEL UNFORSEEN DELAYS IN RESTARTING NEWCASTLE BLAST FURNACE – AMSA (Engineering News, 20/12/2014) Steel producer ArcelorMittal South Africa (AMSA) on Wednesday advised shareholders that it had experienced unforeseen delays in restarting the blast furnace at its Newcastle Works following the completion of the furnace reline at the end of October. The JSE-listed company noted that the delays were “being attended to urgently”. “Management is confident that the contingency plans in place will ensure delivery to most customers throughout December. The December shutdown period is expected to ease the pressure on the plants and customer orders for the new year will not be impacted,” AMSA said. In August, AMSA said the reline project had hit snags and that the reline, which had initially been scheduled for completion in September, would be delayed until October. That delay had been estimated to add $20-million to the overall project cost, which rose to $100-million. The reline of the blast furnace was expected to improve efficiencies at the plant, increasing steel production at Newcastle Works to 1.9-million tonnes a year, compared with the previous 1.7-million tonnes a year.

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FUEL HUGE PETROL PRICE DROP NEAR? (iAfrica, 20/11/20140 Motorists could be forking out a little less for fuel next month with a 73c/litre drop in the petrol price predicted for December. This is according to the latest calculation by the energy department. The predicted decrease is attributed to the decline in the international oil price. This though has been offset by the weaker rand against the US dollar, Automobile Association of South Africa (AA) spokesperson Marius Luyt said. "Over the past 15 days the international oil price has dropped by 10%. On the other hand, the rand has only weakened slightly during the same time," Luyt was quoted. "The slump in the international oil price is likely to continue over the longer term as world demand for oil is forecast to fall. This is positive for consumers as it will result in more money in their pockets. This is also positive as it is almost the December holidays when many people will be travelling far distances while on holiday," Luyt added. The price of diesel could fall by 50c/litre while illuminating paraffin may fall by 44c/litre. COAL TONNES OF COAL DRIVES WESCOAL TO EXTEND STAY (Business Day, 20/11/2014) Wescoal bought the Sarie Marais prospecting right next to its Khanyisa colliery for R4.6m, extending the life of the mine beyond 2016. Wescoal, a coal miner and trader, with cash and cash equivalents of R94m, bought the prospecting right from Catwalk Investments in terms of an agreement signed on Tuesday. Sarie Marais has about 1.1-million tonnes of coal in the ground, which will be mined out within 15 months, CEO Andre Boje said yesterday. Wescoal will continue with its mining operations across the boundary to access the fresh coal deposits, putting in an application for a mining permit as it awaits a mining licence, he said. This will ensure an uninterrupted flow of coal. Wescoal would like to conclude another big transaction within the next eight months to add more resources to Khanyisa, he said. The firm expects the export market for coal to remain subdued for up to two years because of enormous oversupply of coal from projects started around the world in the past six years, he said. “Demand is there but there is huge oversupply. It’s all the countries producing sea-borne thermal coal are in an over-supply position.” Citing input from a coal conference in Copenhagen two months ago, there is no new coal production coming on line, he said. Glencore, for example, has said it will shut all its Australian coal mines for three weeks in December because of the oversupplied nature of the global coal market. The shutdown will take about 5million tonnes of coal off the market, Glencore said, adding it believed the “supply and demand balance will be restored in the medium term”. DIVIDEND-BOUND KEATON FIRMING UP NEW COAL PROJECTS (Mining Weekly, 20/11/2014) Coal-mining junior Keaton Energy, which invested R275-million in operations while boosting its cash position by 63% to R113.2-million in the six months to September 30, is firming up two new coal-mine projects that will nudge the JSE-listed company towards producing five-million tons of coal a year and committing itself to the payment of dividends. Gross first-half (H1) profit rose 6% to R124.5-million on 7% higher coal sales at 1.45-million tons and the board has approved a dividend policy that will be implemented during H2. Keaton CEO Mandi Glad said that Moabsvelden would be developed as a remote pit to the company’s existing Vanggatfontein, the long-life cash-generating colliery that attained optimal H1 production levels as well as an improved safety performance. In the second half, the company expected the life-of-mine enhancement project at Vaalkrantz colliery – where H1 production of domestic and export anthracite rose 24% to 191 898 t – to begin delivering results as well as greater domestic offtake from the State electricity utility Eskom. Keaton CFO Jacques Rossouw reported a 10% increase in revenue to R783-million, 73% of it from Eskom and 18% from the anthracite market. The cost of sales rose 11% and cash costs rose 3%. NON-FERROUS METALS SOUTH AFRICA’S EXXARO SEEKS EXIT FROM VEDANTA ZINC PROJECT (Bloomberg, 20/11/2014) Exxaro Resources Ltd. (EXX) said it will exit a mining venture with Vedanta Resources Plc (VED) as the group founded by Indian billionaire Anil Agarwal plans to develop a $630 million zinc operation in South Africa. Exxaro is bound by an agreement to remain a 26 percent shareholder in London-based Vedanta’s Gamsberg zinc project in the country until at least 2016, Hilton Atkinson, a spokesman for the Johannesburg-based company, said yesterday in an e-mailed response to questions. It will seek to dispose of the stake later, he said. Vedanta will build the $630 million mine in South Africa’s Northern

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Cape province and a $152 million refinery for the steel-making ingredient in neighboring Namibia, the company said Nov. 13. It needs a venture partner such as Exxaro, which is controlled by black South Africans, to meet the conditions of its mining permit, a requirement meant to narrow economic disparities created by apartheid rule. “Exxaro divested from its zinc portfolio over the past two years,” Atkinson said, referring to the sale of the Rosh Pinah mine in Namibia and the closing of its Zincor refinery in South Africa. “Our ultimate strategy is still to exit from zinc” completely, he said. Exxaro will have to meet its financial obligations to the project until it decides to dispose of its stake, Kishore Kumar, chief executive officer of Vedanta’s zinc business, said in an interview near the project’s site. GENERAL NAMIBIA MULLS PRIVATE INVESTMENT FOR RAILWAY LINK (Cargo Info Africa, 20/11/2014) Namibia may seek private investors to fund a railway line linking the north of the country with Zambia and the Democratic Republic of Congo (DRC), as mineral shipments from those nations through the port at Walvis Bay increase, reports Bloomberg News. “The railway, which will run from the Zambezi region in northeastern Namibia to the town of Grootfontein, a distance of about 800 kilometres, is part of efforts to create a logistical hub in Namibia for landlocked southern African countries,” Peter Mwatile, permanent secretary at the country’s Transport and Works Ministry, told Bloomberg by phone this week. He said financing was however a problem. “Having the line in place will contribute to creation of a logistical hub in Namibia and boost trade flows in the Trans-Caprivi corridor,” said Mwatile. Private investors may be invited to join the project once a detailed feasibility study is done, he said, adding that the DRC and Zambia, two of Africa’s largest copper producers, were making increasing use of Namibia’s deep-water port at Walvis Bay to ship minerals and import equipment. CURRENCIES AND PRICES

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ALSI: 3 month to 19 Nov 14

(Mail & Guardian, 20/11/2014)

JSE AS AT 17:00PM 19 NOVEMBER 2014

All Share Index 19/11 50,150

- 221.57 - 0.44%

Industrials Index 19/11 47,607

- 23.40 - 0.05%

Financials Index 19/11 40,432

+ 71.20 + 0.18%

Top 40 Index 19/11 44,523

- 279.51 - 0.62%

Industrial 25 Index 19/11 61,003

- 439.86 - 0.72%

Financial 15 Index 19/11 15,474

- 12.46 - 0.08%

Resources 10 Index 19/11 46,951

- 359.57 - 0.76%

Alt-X Index 19/11 1,373

+ 19.79 + 1.46%

WORLD INDICATORS

FOREX

Rand/Dollar 06:28 11.0772

+ 0.05 + 0.47%

Rand/Pound

06:30 17.3243

+ 0.13 + 0.74%

Rand/Euro 06:30 13.8910

+ 0.08 + 0.57%

COMMODITIES

Gold (usd/oz) 06:27 1,180.03

- 18.47 - 1.54%

Platinum (usd/oz)

06:27 1,186.88

- 19.12 - 1.59%

Brent (usd/barrel) 06:24 78.18

- 0.29 - 0.37%

WORLD MARKETS

Wall St (DJIA) 19/11 17,686

- 2.09 - 0.01%

Germany (DAX)

19/11 9,473

+ 166.45 + 1.79%

Japan (Nikkei) 06:27 17,333

- 10.97 - 0.06%

(Business Report, 20/11/2014) COPPER A – SETTLEMENT PRICE – 6715 FORWARD RATES - Dollar/rand 4pm close: R11, 05

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Petrol/ Diesel Price

YR2014

01-Jan-

14

05-Feb-

14

05-Mar-

14

02-Apr-

14

07-May-

14

04-Jun-

14

02-Jul-

14

06-Aug-

14

03-Sep-

14

01-Oct-

14

05-Nov-

14

03-Dec-

14

COASTAL

95 LRP (c/l) 1320.00 1359.00 1395.00 1398.00 1383.00 1361.00 1392.00 1392.00 1325.00 1320.00 1275.00

95 ULP (c/l) 1320.00 1359.00 1395.00 1398.00 1383.00 1361.00 1392.00 1392.00 1325.00 1320.00 1275.00

Diesel 0.05% (c/l) 1260.55 1284.75 1311.95 1299.15 1269.37 1245.79 1259.79 1254.17 1228.79 1215.79 1154.79

Diesel 0.005% (c/l) 1263.95 1288.15 1316.35 1304.55 1274.77 1249.19 1263.19 1258.57 1234.19 1221.19 1161.19

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Illuminating Paraffin (c/l) 963.828 975.828 991.828 953.028 934.028 924.028 947.028 940.028 921.028 907.028 855.028

Liquefied Petroleum Gas

(c/kg) 2260.00 2314.00 2372.00 2350.00 2346.00 2319.00 2377.00 2365.00 2257.00 2269.00 2164.00

GAUTENG

93 LRP (c/l) 1336.00 1375.00 1411.00 1416.00 1401.00 1379.00 1408.00 1408.00 1341.00 1343.00 1298.00

93 ULP (c/l) 1336.00 1375.00 1411.00 1416.00 1401.00 1379.00 1408.00 1408.00 1341.00 1343.00 1298.00

95 ULP (c/l) 1357.00 1396.00 1432.00 1439.00 1424.00 1402.00 1433.00 1433.00 1366.00 1361.00 1316.00

Diesel 0.05% (c/l) 1287.15 1311.35 1338.55 1329.75 1299.97 1276.39 1290.39 1284.77 1259.39 1246.39 1185.39

Diesel 0.005% (c/l) 1290.55 1314.75 1342.95 1335.15 1305.37 1279.79 1293.79 1289.17 1264.79 1251.79 1191.79

Illuminating Paraffin (c/l) 1009.728 1021.728 1037.728 1003.228 984.228 974.228 997.228 990.228 971.228 957.228 905.228

Liquefied Petroleum Gas

(c/kg) 2442.00 2496.00 2554.00 2532.00 2528.00 2501.00 2559.00 2547.00 2439.00 2451.00 2346.00

YR2013

02-Jan-

13

06-Feb-

13

06-Mar-

13

03-Apr-

13

01-May-

13

05-Jun-

13

03-Jul-

13

07-Aug-

13

04-Sep-

13

02-Oct-

13

06-Nov-

13

04-Dec-

13

COASTAL

95 LRP (c/l) 1151.00 1192.00 1273.00 1283.00 1210.00 1202.00 1286.00 1318.00 1313.00 1293.00 1265.00 1282.00

95 ULP (c/l) 1151.00 1192.00 1273.00 1283.00 1210.00 1202.00 1286.00 1318.00 1313.00 1293.00 1265.00 1282.00

Diesel 0.05% (c/l) 1086.67 1104.47 1162.85 1170.01 1114.45 1110.47 1188.67 1221.63 1235.45 1233.45 1218.25 1228.37

Diesel 0.005% (c/l) 1091.07 1108.87 1167.25 1175.41 1118.85 1114.87 1193.07 1226.03 1240.85 1238.85 1221.65 1231.77

Illuminating Paraffin (c/l) 807.128 833.128 890.128 860.328 802.328 803.328 878.328 903.328 928.328 924.328 908.328 924.828

Liquefied Petroleum Gas

(c/kg) 2047.00 2120.00 2238.00 2183.00 2102.00 2107.00 2236.00 2258.00 2267.00 2227.00 2186.00 2204.00

GAUTENG

93 LRP (c/l) 1165.00 1206.00 1287.00 1297.00 1224.00 1216.00 1300.00 1332.00 1327.00 1308.00 1280.00 1297.00

93 ULP (c/l) 1165.00 1206.00 1287.00 1297.00 1224.00 1216.00 1300.00 1332.00 1327.00 1308.00 1280.00 1297.00

95 ULP (c/l) 1186.00 1227.00 1308.00 1320.00 1247.00 1239.00 1323.00 1355.00 1350.00 1330.00 1302.00 1319.00

Diesel 0.05% (c/l) 1111.37 1129.17 1187.55 1196.61 1141.05 1137.07 1215.27 1248.23 1262.05 1260.05 1244.85 1254.97

Diesel 0.005% (c/l) 1115.77 1133.57 1191.95 1202.01 1145.45 1141.47 1219.67 1252.63 1267.45 1265.45 1248.25 1258.37

Illuminating Paraffin (c/l) 849.028 875.028 932.028 906.228 848.228 849.228 924.228 949.228 974.228 970.228 954.228 970.728

Liquefied Petroleum Gas

(c/kg) 2229.00 2302.00 2420.00 2365.00 2284.00 2289.00 2418.00 2440.00 2449.00 2409.00 2368.00 2386.00

(SAPIA online)

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Daily prices for 19 November 2014

LME Official Prices, US$ per tonne

Contract Aluminium Alloy Aluminium Copper Lead Nickel Tin Zinc NASAAC

Cash Buyer 2000.00 2024.50 6714.00 2025.50 15845.00 19695.00 2231.00 2095.00

Cash Seller & Settlement 2010.00 2025.00 6715.00 2026.00 15850.00 19705.00 2231.50 2105.00

3-months Buyer 2020.00 2014.00 6643.00 2028.00 15900.00 19695.00 2242.00 2130.00

3-months Seller 2030.00 2015.00 6644.00 2030.00 15905.00 19705.00 2242.50 2140.00

Dec 1 Buyer 2020.00 2022.00 6555.00 2053.00 15970.00 2248.00 2165.00

Dec 1 Seller 2030.00 2027.00 6565.00 2058.00 16070.00 2253.00 2175.00

15-months Buyer 19715.00

15-months Seller 19765.00

Dec 2 Buyer 2048.00 6495.00 2080.00 15900.00 2233.00

Dec 2 Seller 2053.00 6505.00 2085.00 16000.00 2238.00

Dec 3 Buyer 2085.00 6450.00 2090.00 15800.00 2208.00

Dec 3 Seller 2090.00 6460.00 2095.00 15900.00 2213.00

(London Metal Exchange, 20/11/2014)

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