CHINA SOUTH AMERICA HAS MOVED

CHINA SOUTH AMERICA HAS MOVED

October 21, 2009 by chinasouthamerica

Please visit http://chinasouthamerica.com/home to access all the content you see here on ChinaSouthAmerica and for future updates.

Posted in Uncategorized | Tagged china south america, chinasouthamerica, csa | Leave a Comment »

New potential strikes looming for Peru’s mining industry

October 17, 2009 by chinasouthamerica

Shougang is not the only miner down in Peru for which trouble is brewing. Peru’s national federation of mine workers said on Friday (yesterday), it is planning to hold walkouts across the entire sector next week.

libcom.org

“The position of the workers is to go on strike on Monday starting at 9 a.m. (1400 GMT) and leave the mines,” Luis Castillo, the federation’s director, told Reuters.

Reuters reports some unions have agreed to stay on the job, but considering that Peru is the largest producer of silver in the world, #2 of zinc, #3 of copper, #4 of lead, and #6 in gold—such a walk out does have the potential ripple over into global spot prices for the above mentioned metals.

When miners held a similar strike in mid-2008 and the strike helped push copper prices toward a record high—although this was at the peak of bull markets, the market effect is no less noted. The underlying point; markets are watching and investors pay attention to these kinds of things.

Company’s which will be affected include, Volcan (VOL_pb.LM), Newmont (NEM), Freeport-McMoRan’s (FXN), Xstrata’s (XTA.L), Buenaventura (BVN), Southern Copper (PCU) and BHP Billiton (BHP).

Click here to access a more details story on this topic from Reuters.

As always, CSA will keep you up to date with relevant developments as they unfold.

~ Benito

Posted in -- C.S.A. -- Perspectives & Analysis by Benito, Australia, Commodities,Commodity, Copper, Finance / Investments, Gold, Latam, Lead, Metals, Molybdenum,Peru, Silver, South America, Zinc | Leave a Comment »

Shougang Hierro strike approaching its end as an agreement is reached

October 13, 2009 by chinasouthamerica

Progress is being made down in Peru between Chinese miner Shougang Hierro and the workers who have been protesting for weeks now against unfair wages and treatment by their Chinese owners. Nothing new… for the record, there are few international companies which invest in the Peruvian mining industry and thereafter roll out the red carpet for their workers. It’s mining, not investment banking…

The 1200 striking workers have begin working again according to manager Julio Ortiz, who said they returned to work because the company said it would commit to some of the workers demands.

Currently workers earn a salary of 1,770 ($614) Peruvian soles a month and the company has released a statement saying Shougang is willing to raise the daily salary by 5.50, or 165 soles a month—bringing the new total to 1935 soles ($677).

According to this Reuters article (in Spanish), Shougang earned a solid 417 million soles last year ($144.7 million dollars), a increase over the year before of 50%.

All in all, it seems Shougang won this battle… CSA will continue to bring you updates on this matter in the weeks to come.

Posted in -- C.S.A. -- Perspectives & Analysis by Benito, and Peru, China, China,Commodities, Commodity, Finance / Investments, Industry Headlines, Iron Ore, Latam,Peru, South America | Tagged China, china-peru, china-peru fta, chinese investment in peru, chinese miner shougang, chinese owners, Commodities, csa, earnings, Iron Ore,julio ortiz, Metals, mining, Peru, shougang, strike, workers | Leave a Comment »

Bolivia to buy Chinese jets to battle drugs reports Bloomberg

October 13, 2009 by chinasouthamerica

Coca Leaves Being Dryed

Bolivia plans to buy six Chinese light military aircraft worth nearly $58 million to fight drug traffickers in the world’s No. 3 cocaine producer, leftist President Evo Morales said on Saturday.

“Last week we issued a supreme decree to … acquire six K-8 aircraft from China,” said Morales in a speech in La Paz to mark the 52nd anniversary of the Bolivian air force.

Morales said his government decided to acquire the K-8, a jet trainer that can be used as a light attack aircraft, after the U.S. government blocked the country from buying similar planes from the Czech Republic.

Click here to read the complete article from Reuters

Posted in and Bolivia, Bolivia, China, Foreign Policy, Latin America, Newswire, Sino-Latin American Relations, South America, South-South Cooperation | Tagged Bolivia, bolivian airforce, china-bolivia, chinese light military aircraft, czech republic, 玻利维亚, 玻利维亚 - 中国, evo morales, k-8 aircraft, la paz, sino-bolivian relations, Sino-Latin American Relations,u.s. government, 中国 | Leave a Comment »

Commodity Boom Will Thrive on Shortages, Rogers Says

October 13, 2009 by chinasouthamerica

Newswire: Jim Rogers

“I don’t see any adequate-supply situation in any commodity market over the next decade or two,” Rogers, the chairman of Singapore-based Rogers Holdings, said today in an interview in New York. “The commodities boom is not over and the bull market has several years to go.”

“I own some cotton,” Rogers said. “I own some sugar,” he said. “Sugar will go much, much higher over the course of the bull market.”

“Oil could reach between $150 and $200 a barrel,” because known reserves of crude are declining, Rogers said. He said international relations, particularly between the U.S. and Iran, will help guide prices.

“Natural gas is very cheap,” he said in the interview between sessions at an ETF Securities Ltd. investor conference.

Commodities ‘Best Place’

“Commodities are the best place to be, if you ask me, based on supply and demand,” Rogers said. He said he hasn’t invested in equities outside of China in two years.

“Everything has gone through the roof,” Rogers said of equities prices, adding that he may consider buying stocks “if something collapses.”

Click here to read the complete Bloomberg article

Posted in Agricultural, Asia, China, China, Commodities, Commodity, Crude Oil, Energy,Finance / Investments, Jim Rogers, Natural Gas, Singapore, Sugar, United States, Zinc | Tagged agricultural commodities, Commodities, commodities boom, cotton, Jim Rogers,markets, natural gas, oil, rogers, rogers holdings, Sugar, supply | Leave a Comment »

Newswire: Commodities

October 13, 2009 by chinasouthamerica

China Nurtures Futures Markets in Bid to Sway Commodity Prices - WSJ

ZHENGZHOU, China — Chinese leaders are concerned that their nation’s enormous economic expansion is becoming an excuse for foreign suppliers to inflate commodity costs. So, they hope to use their three futures exchanges to fight back.

“It is true we have a long-term goal of increasing our influence in terms of pricing, but to do that we have to create conditions and do it step by step,” Jiang Yang, chief futures-industry policy maker and assistant chairman of the China Securities Regulatory Commission, said in an interview. “But as the Westerners say: ‘Rome was not built in a day.’

But Beijing believes hosting big futures markets will enhance the country’s economic security by essentially advertising what the world’s biggest customer for some commodities considers a fair price. For the rest of the world, the exchanges could mean less guesswork about China’s buying habits, possibly reducing volatility in the global market.

Silver Lining: Jim Rogers Talks Up Commodities – Time Magazine

Jim Rogers’ daughters may not have been born with silver spoons in their mouths, but they’ve got them now. Not silver spoons, exactly, but silver bullion. “My little girls don’t own stocks — they own commodities,” he says, “and that’s why they’ll be able to take care of me in retirement.”

Rogers sees three big secular trends now, and he’s acting on all of them. First, America’s role as the dominant economic power is declining, so why own American stocks? (He doesn’t.) Second, China is emerging, and even though it may have crises from time to time, it is a good place to invest. (He does.) Third — and this is the biggie — emerging nations including China are greatly increasing the future demand for commodities such as oil. (He’s in with both feet.)

“Thirty years ago, 3 billion people were not even participating in the world economy, and now they are trying to live like we do,” he notes. That emerging megaforce, says Rogers, will put a supertight squeeze on commodity prices across the board, from beef to bullion.

Oil Climbs Above $73, Nat. Gas Rallies as Equities Fly High – Rigzone

Jumping toward $74 a barrel on an American holiday, crude oil rallied more than $1 from last week’s closing price, bolstered by a weaker dollar and a rise in the equities market. Also gaining today, natural gas closed 12 cents below $5 as the energy commodity continues to strengthen despite bearish fundamentals.

After rallying to an intra-day high of $73.84, the price of crude oil settled slightly lower to $73.27 on the NYMEX Monday, a gain of $1.50 from Friday’s close. Additionally, the US dollar eased against a basket of foreign currencies, helping to spur a rally in today’s commodity prices.

China Iron Ore Imports Exceed Real Demand, CISA Says – Bloomberg via Chinamining.org

Iron ore imports by China, the world’s largest buyer, have exceeded real demand by 50 million metric tons this year, the country’s steel association said.

China’s iron ore imports surged to a record this year, hurting the group’s bid to negotiate a contract price cut bigger than the 33 percent offered by Rio Tinto Group and BHP Billiton Ltd. The nation is looking at cutting the number of licensed importers, industry minister Li Yizhong reiterated today.

Posted in Agricultural, Asia, Australia, BRIC Countries, China, China, Commodities,Commodity, Commodity FP, Crude Oil, Energy, Finance / Investments, Foreign Policy,Iron Ore, Jim Rogers, Metals, Natural Gas, Newswire, Singapore, Steel, United States | Tagged China, china commodities futures, china iron ore demand, China Securities Regulatory Commission, Commodities, Copper, Crude Oil, currencies, forced liquidation,Iron Ore, Jim Rogers, marc faber, nat gas, platinum, short US dollar, Silver, Soybeans, 农产品, 原油, 商品 | Leave a Comment »

China’s Sinohydro to build hydroelectric project in Ecuador

October 12, 2009 by chinasouthamerica

Ecuadorian President Rafael Correa signed a contract today with Chinese company Sinohydro Corportation.  The company will be in charge of building the Coca-Codo-Sinclair hydroelectric project along Ecuador’s Amazon river.

The project is valued at $2 billion usd and will become Ecuadors largest hydroelectric facility.  Once completed, the hydroelectric facility will be capable of meeting 75% of the country’s total power supply, reports Xinhua.

According to this Xinhua article, the Export-Import Bank of China will cover 85 percent of the project’s total cost, with the remaining 15 percent covered by the Ecuadorian government.

President Correa said that “the launching of this project would be a historical event as it represents one of the biggest foreign investments in Ecuador and will create about 4,000 direct jobs and 15,000 indirect jobs in Ecuador.”

Posted in -- C.S.A. -- Perspectives & Analysis by Benito, and Ecuador, China, China,Commodities, Ecuador, Energy, Finance / Investments, Industry Headlines, Latam,Renewable, Sino-Latin American Relations, South America, South-South Cooperation | Tagged China, coca-codo-sinclair, Ecuador, energy, export-import bank of china, foreign investment, hydroelectric power, hydroelectric project in ecuador, quito, Rafael Correa,renewable energy, sinohydro, sinohydro corporation, 厄瓜多尔, 水力电气的, 中国, 中国-厄瓜多尔 | 1 Comment »

Welcome to China South America @ World Press

October 11, 2009 by chinasouthamerica

Welcome to the CSA of WorldPress.  I apologize if you are a first time reader and you happen to stumble upon some posts which have yet to be scanned for mistakes which may have occured when transferring the content of this blog.

Categories are still be updated / organized so that they reflect the tags, previously found on the previous host of CSA.

Posted in -- C.S.A. -- Perspectives & Analysis by Benito | Tagged bennett reiss, China,china south america, chinasouthamerica, Commodities, csa, iberico, Microfinance, Peru,sino-latin relations | Leave a Comment »

China and rare earth metals

October 11, 2009 by chinasouthamerica

The Economist has just published a new article about China’s abundant and ever more precious rare earth metals. This adds to a flurry or articles, which have recently made it into major English language publications here in the US and Canada—including the Wall Street Journal, Market Watch and the Canadian Business Week.

The value of global rare-earth trade last year was just $1.25 billion, and it is projected to grow to about $3 billion by 2015—not much by most accords. However, the metals in question are absolutely essential for many high tech industries because of their phosphorescent and magnetic properties.

Rare earth metals include terbium, dysprosium, yttrium, thulium, lutetium, neodymium, europium, cerium, and lanthanum. These metals, as described by The Columbia Encyclopedia usually occur together in minerals as their oxides ( rare earths ) and are somewhat difficult to separate because of their chemical similarity.

The state-controlled Inner Mongolia Baotou Steel Rare-Earth Hi-Tech Company dominates production of “rare earth metals” in China. Alistair Stephens of Arafura Resources in Australia, explains, “the Chinese realized the strategic importance of rare earths decades before the West.”

Producing the latest flat screen TV’s, smart phones, wine turbines, solar panels and even electric batteries which power America’s new Chevy Volt (battery powered car), are all simply not possible without these rare earth metals.

I am not one to doubt the incredible potential of the free market system, but in this particular situation, Deng Xiaoping was wise not to trust in the free market to dictate his “rare earth metals” policy in the 80’s.

As commodity prices fell in the mid 80’s, rare earth producers in the United States and Canada were priced out of the market. Deng Xiaoping, the man associated with introducing markets in China, instead encouraged the development of mines in the mid-1980s as prices fell dramatically.

Rare earth metals may not generate as much revenue as oil does for Saudi Arabia or Russia, but it is clear if China chokes off supply and begins consuming more of their rare earth metals domestically, the developed world will need to find new sources.

Additional articles on rare earth metals:

Will China Tighten ‘Rare Earth’ Grip? – The Wall Street Journal

Rare earths are vital; and China owns them all – Market Watch

Rare-earth metals: The new China syndrome – The Canadian Business Week

Posted in -- C.S.A. -- Perspectives & Analysis by Benito, China, Commodities, Metals,Rare Earth, Sino-U.S. Relations, United States | Tagged cerium, China, Commodities,dysprosium, energy, europium, Inner Mongolia Baotou Steel Rare-Earth Hi-Tech Company, lanthanum, lutetium, mongolia, neodymium, precious rare earth, rare earth metals, rare-earth trade, terbium, thulium, yttrium | Leave a Comment »

South America; Energy Newswire

October 11, 2009 by chinasouthamerica

[Venezuela & Ecuador]– Venezuela, Ecuador Exploring for Gas in Gulf of Guayaquil

Venezuela and Ecuador’s state energy firms said Wednesday that exploration is under way at a test well in Ecuador’s Gulf of Guayaquil, with expectations of finding up to 1.3 trillion cubic feet of natural gas.

The two firms, Petroecuador and Petroleos de Venezuela, or PdVSA, announced their plans a year ago to drill for gas in the gulf’s 300,000-hectare block 4.

[Colombia] – Petrolifera Executes Onshore Colombian License Contract with ANH

Petrolifera has executed the Magdalena exploration contract with the Agencia Nacional de Hidrocarburos (“ANH”) for the conversion of the Sierra Nevada II TEA into the Magdalena License, covering lands adjacent to the company’s Sierra Nevada License in the Lower Magdalena Valley, onshore Colombia. The Magdalena License comprises approximately 595,000 acres that is considered to be mainly prospective for natural gas and natural gas liquids. The minimum work commitment associated with the Magdalena License for the initial 15 month phase is primarily 150km2 of 3D seismic. As required by ANH, Petrolifera has established and funded a US $4.1MM trust, which in effect funds the assigned value of the initial work commitment of the License.

[Brazil] — Chevron: New Oil Law Reduces Opportunities in Brazil

Changes to Brazil’s oil laws don’t allow much space for international oil companies to take part in recent offshore oil finds, the vice president for global upstream and gas at U.S. oil major Chevron Corp. said Wednesday.

In September, Brazil’s government proposed changes to the country’s regulatory framework, giving the government a greater stake in the discoveries and state-run energy giant Petrobras the lead role in development.

Posted in Brazil, Colombia, Crude Oil, Ecuador, Energy, Natural Gas, South-South Cooperation, Venezuela | Tagged Brazil, Chevron, Colombia, Ecuador, guayaquil,magdalena, natural gas, oil laws, PDVSA, Petroecuador, petroleum, petrolifera, sierra nevada, Venezuela | Leave a Comment »

Peruvian Micro-Entrepreneurs head to China

October 9, 2009 by chinasouthamerica

It’s been awhile since CSA last ventured into the world of MicroFinance.  Well today some news caught my attention.

About sixteen Peruvian Micro-Entrepreneurs (if that’s the correct term to call them) from various sectors will travel to Guangzhou, China to participate in the 106^th Guangzhou Import and Export fair.  With a total of 209 countries in attendance, and thousands of exhibitors, this is a big deal for these small Peruvian businesses.

I question if these business are truly worthy of being called the products of micro-finance.  I hope that they are, but my gut is telling me it’s quite possible corruption and classic South American favoritism probably led the Peruvian government to carefully handpick a few to send to China.

Ministra de la Producción, Mercedes Aráoz, inauguró Feria de Beneficios y Oportunidades de Foncopés en IPAE. Foto: ANDINA/Norman Córdova.

On the other hand, if they are truly small micro-enterprises which earned this trip to China through participating in a micro-finance program of some sort, this would be a case and point example of the potential of micro-finance institutions to empower the poor with the tools they need to succeed.

If you can read Spanish please click here to access the article which served the basis for this post.

Posted in APEC, China, Microfinance, Peru, Sino-Latin American Relations | Tagged China,empowering the poor, MFI, Microfinance, Peru, peruvian government, South-South Cooperation | Leave a Comment »

Al-Qaeda declares holy war on China over repression of Uighurs

October 8, 2009 by chinasouthamerica

According to this Bloomberg article, Abu Yahya al-Libi, the alleged successor to Osama Bin Laden has declared a holy war against the Chinese state for its repression of its Uighur.

Abu Yahya al-Libi has been quoted saying:

“The state of atheism is heading to its fall.”

“China will suffer the same fate as the “Russian bear.”

How China is going to deal with this new threat remains to be seen. Also, how Abu Yahya al-Libi plans to wage this holy war is far from clear. Foreign policy buffs describe some obvious concerns such as the growth of the Xinjiang-based East Turkistan Islamic Movement, which is based in the Taliban-rules areas of Pakistan.

This declaration of sorts comes on the heels of The July riots in the capital of Xinjiang which were the deadliest in China in decades. Bloomberg writes, “Al-Libi’s speech, entitled ‘East Turkistan, the Forgotten Wound,’ echoed complaints of the Uighurs that decades of government-sponsored migration to the province is making them a minority in their homeland.”

Personally, this blogger feels a threat such as a Pakistan based, anti-Chinese (Han) movement is not a major problem in the short-term, but it will no less force China to become more involved over the future of Afghanistan and Pakistan.

All eyes will be watching next week when members of Shanghai Cooperation Organization meet in Shanghai to discuss regional issues. This group includes China, Russia, Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan. Xinjiang, or East Turkistan, as many in the Muslim world refer to it lies at the heart of this grouping of Central Asian countries.

Click here to access Bloomberg’s article on this topic

Posted in China, Foreign Policy, Newswire, Sino-African Relations, Sino-U.S. Relations | Tagged Abu Yahya al-Libi, afghanistan, al-libi, al-qaeda, China, china-middle east, East Turkistan Islamic Movement, Foreign Policy, muslims in china, pakistan, Russia, shanghai cooperation organization, tajikistan, uighur, uzbekistan, xinjiang | Leave a Comment »

Everyone wants a piece of Uruguay

October 8, 2009 by chinasouthamerica

Hot off the presses… “Investors from Brazil, Argentina, Basque Province of Spain AND China flock to Uruguay.” So hot in fact, the article seems to be running on “Future Standard Time,” because despite the fact it is still October 7th in the US (where I’m writing from) and in Uruguay, its quite curious how the article was published at 12:39am UTC on October 8th…

You can click the highlighted article title above to access the article directly and read all the juicy details about how Uruguay seems to be the place to be.

Interestingly enough it is not because the country is swimming in resource wealth, a cheap labor sector or any of the cliché niches of a “developing country.” Rather because of its excellent record of political stability, the existence of a judicial system which is fair and honors the law and in my opinion… also because of its unique position next door to Brazil—Uruguay’s major economic partner at the moment.

Major investments highlighted in the article include:

Argentina: No particular companies mentioned, but the article describes how Argentina’s investment community has become “disenchanted with the unorthodox policies and uncertainties of their country they have crossed to Uruguay looking for investment opportunities.”

Brazil: In Sept 2009 Brazilian food processing giant, Marfrig acquired a 51% in the Uruguayan Tannery Zenda. Zenda produces upholstery for some of the most prestigious German car brands

Spain (Basque Province): Cultural heritage links many Uruguayans to “la madre patria” aka, the mother country of Spain, and specifically to the Basque region. Finance minister Alvaro García met with Basque entrepreneurs who expressed “a firm interest to invest in different sectors.”

China: In Sept 2009, a delegation of Uruguayan entrepreneurs attended China’s International Investment and Trade Fair and returned with news Chinese investors were interested in investing in Uruguay’s infrastructure sector; including its ports, energy sector and water treatment facilities.

Posted in Argentina, Brazil, China, Finance / Investments, Latam, Spain, Uruguay | Tagged alvaro garcia, Argentina, basque region, Brazil, China, investment, marfrig, Spain,tannery, upholstery, Uruguay, zenda | Leave a Comment »

October fire sale! Russian credit & Rubles accepted

October 6, 2009 by chinasouthamerica

Rigzone reported today that a Russian oil consortium would not have the pay the $1 billion usd Venezuela had previously requested as a down payment in order to partake in tapping Venezuela’s Orinoco oil fields.

Instead, the Russian consortium will only have to pay $600 million usd. Sounds like a nice 40% bargain to this blogger. It’s a nice deal if you ask me, which coincidentally comes on the heels of Venezuela’s securing a large credit line from Russia to buy military equipment.

Orinoco Belt Regions – [Rigzone, 10-6-09]

According to this Dow Jones Newswire published by Rigzone,

The Chavez-led government has talked about plans for nearly $70 billion in oil investments over the coming years as this oil-rich nation seeks to ramp up dwindling production numbers and boost its sagging economy.

But so far, nearly all those plans are based only on memorandums of understanding, with no solid investment commitments from foreign oil companies.

Sounds like Venezuela is becoming increasingly hungry not only for foreign investment, but also to cement its relations with a geopolitical power like the Russian Federation.

Click here to read the newswire article from Rigzone, which I must admit does a far better job at detailing the situation than the concise, and slightly cynical analysis published here at China South America (CSA).