Commodity
2009 Performance Review and The Complete List of Mining ADRs
Mining stocks are extremely volatile. However they can return handsome gains if the commodity prices rise. In recent years due to high demand from many developing countries commodity prices like iron ore, copper, gold, etc. have soared.
Copper prices rose by almost 140% last year. The rise is attributed to “Unprecedented levels of Chinese imports, new investor cash, improving economic data and a weaker dollar”. Similarly gold gained around 25% in 2009 and closed at $1,096.20 an ounce.
The 2009 gains of other precious metals gains:
Platinum = 58.7%
Palladium = 220%
Silver = 49.1%
Overall in 2009, commodities recorded the best year since 1973. It must be noted that while most of the mining stocks listed below had impressive gains last year, they fell hard during the global credit crisis in 2008 .For example, Vale was down 61% in 2008.
The Complete List of Mining ADRs with their 2008 performance is listed below:
| S.No. | Company | Ticker | Country | 2009 Returns |
|---|---|---|---|---|
| 1 | AngloGold Ashanti | AU | South Africa | 45.00% |
| 2 | BHP Billiton | BHP | Australia | 78.51% |
| 3 | BHP Billiton | BBL | United Kingdom | 65.50% |
| 4 | Compania de Minas Buenaventura | BVN | Peru | 68.02% |
| 5 | DRDGOLD | DROOY | South Africa | 22.80% |
| 6 | Gold Fields | GFI | South Africa | 32.02% |
| 7 | Harmony Gold Mining | HMY | South Africa | -7.29% |
| 8 | Lihir Gold | LIHR | Australia | 33.20% |
| 9 | Randgold Resources | GOLD | Jersey | 80.19% |
| 10 | Rio Tinto | RTP | United Kingdom | 142.26% |
| 11 | Vale SA | VALE | Brazil | 143.50% |
| 12 | Yanzhou Coal Mining | YZC | China | 190.29% |
Note: Canadian stocks are not included here as they trade as inter-listed stocks in the U.S.
The Top 5 Coal and Iron Ore Exporting and Importing Countries
Countries such as Canada, Australia, Brazil ,etc are blessed with plenty of natural resources and they are big exporters of commodities such as Natural Gas, Iron Ore, Coal, Natural gas, etc. In this post let us take a look at the top five coal and iron ore exporters and importers in the world.
Via Reserve Bank of Australia Bulletin, January 2009, Australia and the Global market for Bulk Commodities
From the above table, we can infer that China is the largest producer and consumer of coal (thermal and coking) in the world.This is due to the heavy industrialization taking place in China in recent years.Nearly 75% of thermal coal in the world is produced and consumed by China, USA and India since the demand for coal is high in these countries. In the USA, coal is still the major resource for generating electricity. Despite the movement to go green, coal will continue to the main source for electricity production in the USA for many years to come as per a report by the Energy Information Adminstration.
Electricty Generation by Fuel in USA
Source: EIA’s Annual Energy Outlook, 2009
Coking coal is used in the production of steel.China produces 20% of iron oreand uses the coking coal to produce steel. Since demand exceeds local supply, China imports additional iron ore from other countries such as Brazil and Australia.
Europe and Japan consume large quantities of all coal and iron ores but have to import them.Australia was a major exporter of coking coal and iron ore. China is the largest consumer of iron ore and Brazil and Australia are the largest exporters accounting for 64% of the total supply.
Related Commodity and Country ETFs:
Market Vectors Coal ETF (KOL)
Market Vectors Steel ETF (SLX)
iShares MSCI Austrlia ETF (EWA)
iShares MSCI Canada ETF (EWC)
iShares MSCI Brazil ETF (EWZ)
