Metals Markets Steel For Price Rises As Australia Pushes To Save Cultural Sites
Kanebridge News
    HOUSE MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $1,480,538 (+0.01%)       Melbourne $960,899 (-0.26%)       Brisbane $805,943 (+0.49%)       Adelaide $760,890 (+0.51%)       Perth $651,708 (+0.03%)       Hobart $728,895 (+0.57%)       Darwin $613,579 (0%)       Canberra $946,216 (+2.14%)       National $956,035 (+0.37%)                UNIT MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $696,616 (-0.38%)       Melbourne $470,588 (+0.14%)       Brisbane $450,511 (+0.19%)       Adelaide $370,041 (+0.13%)       Perth $363,377 (-0.48%)       Hobart $568,887 (+1.25%)       Darwin $342,547 (-0.28%)       Canberra $488,335 (+0.42%)       National $491,956 (+0.17%)                HOUSES FOR SALE AND WEEKLY CHANGE     Sydney 7,426 (+91)       Melbourne 10,303 (-71)       Brisbane 8,928 (-39)       Adelaide 2,407 (+20)       Perth 7,995 (-258)       Hobart 874 (-2)       Darwin 238 (-2)       Canberra 758 (-3)       National 38,557 (-264)                UNITS FOR SALE AND WEEKLY CHANGE     Sydney 6,833 (-17)       Melbourne 6,618 (-36)       Brisbane 1,828 (-2)       Adelaide 460 (-11)       Perth 2,177 (-9)       Hobart 126 (-3)       Darwin 336 (+5)       Canberra 425 (+7)       National 18,641 (-66)                HOUSE MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $680 (+$15)       Melbourne $500 ($0)       Brisbane $560 (-$10)       Adelaide $520 (-$10)       Perth $550 ($0)       Hobart $560 (-$5)       Darwin $700 (+$5)       Canberra $700 (-$20)       National $606 (-$3)                    UNIT MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $600 ($0)       Melbourne $450 ($0)       Brisbane $498 ($0)       Adelaide $420 (-$8)       Perth $480 ($0)       Hobart $485 (+$13)       Darwin $550 ($0)       Canberra $550 (-$10)       National $514 (-$1)                HOUSES FOR RENT AND WEEKLY CHANGE     Sydney 6,843 (+487)       Melbourne 6,880 (+741)       Brisbane 4,325 (+498)       Adelaide 1,251 (+157)       Perth 1,748 (+277)       Hobart 262 (+34)       Darwin 133 (+14)       Canberra 709 (+61)       National 21,516 (+2,269)                UNITS FOR RENT AND WEEKLY CHANGE     Sydney 8,300 (+770)       Melbourne 5,973 (+745)       Brisbane 1,753 (+273)       Adelaide 410 (+74)       Perth 731 (+171)       Hobart 119 (+13)       Darwin 249 (+21)       Canberra 641 (+63)       National 17,293 (+2,130)                HOUSE ANNUAL GROSS YIELDS AND TREND       Sydney 2.34% (↑)      Melbourne 2.69% (↑)        Brisbane 3.58% (↓)       Adelaide 3.60% (↓)     Perth 4.40% (↑)        Hobart 4.04% (↓)     Darwin 5.81% (↑)        Canberra 3.76% (↓)       National 3.30% (↓)            UNIT ANNUAL GROSS YIELDS AND TREND       Sydney 4.47% (↑)        Melbourne 5.00% (↓)       Brisbane 5.88% (↓)       Adelaide 6.19% (↓)     Perth 7.21% (↑)      Hobart 4.59% (↑)      Darwin 8.41% (↑)        Canberra 5.89% (↓)       National 5.43% (↓)            HOUSE RENTAL VACANCY RATES AND TREND       Sydney 1.6% (↑)      Melbourne 1.8% (↑)      Brisbane 0.5% (↑)      Adelaide 0.5% (↑)      Perth 1.0% (↑)      Hobart 0.9% (↑)      Darwin 1.1% (↑)      Canberra 0.5% (↑)      National 1.2% (↑)             UNIT RENTAL VACANCY RATES AND TREND       Sydney 2.3% (↑)      Melbourne 2.8% (↑)      Brisbane 1.2% (↑)      Adelaide 0.7% (↑)      Perth 1.3% (↑)      Hobart 1.4% (↑)      Darwin 1.3% (↑)      Canberra 1.3% (↑)      National 2.1% (↑)             AVERAGE DAYS TO SELL HOUSES AND TREND       Sydney 35.4 (↑)      Melbourne 35.9 (↑)      Brisbane 42.8 (↑)      Adelaide 34.8 (↑)      Perth 43.1 (↑)      Hobart 37.2 (↑)      Darwin 49.3 (↑)      Canberra 38.3 (↑)      National 39.6 (↑)             AVERAGE DAYS TO SELL UNITS AND TREND       Sydney 39.7 (↑)      Melbourne 36.4 (↑)      Brisbane 43.7 (↑)      Adelaide 33.8 (↑)      Perth 46.2 (↑)      Hobart 48.9 (↑)        Darwin 45.9 (↓)     Canberra 33.7 (↑)      National 41.0 (↑)            
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Metals Markets Steel For Price Rises As Australia Pushes To Save Cultural Sites

Delays to mining projects in Western Australia could push commodity prices higher and exacerbate shortages.

Wed, Dec 16, 2020 3:42amGrey Clock 3 min

SYDNEY—Rio Tinto PLC’s destruction of two ancient caves in Australia to expand an iron-ore mine could have ramifications for global commodity markets if local lawmakers intensify scrutiny of mining activities that threaten heritage sites.

Among the most controversial recommendations made by a federal-government inquiry into the destruction of the rock shelters at Juukan Gorge in Western Australia in May is a moratorium on expansions of existing mines or new pits that encroach on sites of cultural or historical significance. Even if lawmakers opt for a less hard-line approach, experts warn of potential delays to production and higher costs that could affect supply of key raw materials such as iron ore, used to make steel.

None of the recommendations handed down by the inquiry in its interim report on Wednesday are binding, but miners risk inflaming tensions with some investors who feel the industry needs to show greater sensitivity to environmental and cultural issues if they don’t accept them. They also face sensitive negotiations with indigenous groups that are the traditional owners of the land.

Metals prices have been rallying as China’s economy bounces back strongly and other major markets recover from the coronavirus crisis. Copper prices have risen to their highest level in almost eight years. Iron ore is one of the best-performing assets this year, fetching $150.75 a metric ton on Wednesday, its highest price since early 2013.

China’s unexpectedly strong appetite for these commodities has raised concerns over whether there’s enough supply, with many analysts predicting market deficits for iron ore and copper through at least the middle of next year.

Delays to mining projects in Western Australia, where companies dig up metals including copper and gold, could push commodity prices higher and exacerbate shortages already worsened by pandemic-driven disruptions to operations elsewhere. Iron ore is considered to be most at risk because Australia accounts for more than half of the world’s trade in the commodity by sea.

“This could be a watershed moment for the Western Australia mining industry and could impact Western Australia iron-ore production, and possibly other commodities, in 2021 and beyond,” Goldman Sachs said.

Already there are tensions between miners and some investors following the report into the loss of the Juukan caves, which contained a trove of artifacts that indicated they had been occupied by humans more than 46,000 years ago.

Fortescue Metals Ltd., the world’s fourth-largest iron-ore exporter by volume, rejected the idea of a voluntary moratorium on new heritage consents. “We do not believe that this is either a feasible or practical solution,” Elizabeth Gaines, Fortescue’s chief executive, said.

Fortescue said it had worked with indigenous groups to protect and avoid nearly 6,000 heritage sites threatened by its mining activities.

Miners must balance the need to replace the ore that they unearth with respecting the interests of indigenous groups. Fortescue pointed out that the iron-ore industry has been a pillar of Australia’s economy as it emerges from a first recession in 29 years.

“A moratorium would unnecessarily stall mining, infrastructure and other activities for an unknown and possibly extended period,” said Tania Constable, chief executive of Minerals Council of Australia, an industry group.

Still, many investors feel the industry needs to do more, and have pushed for leadership changes when standards fall short. Rio Tinto Chief Executive Jean-Sébastien Jacques and two other executives were ousted after several investors criticized the company’s initial response to the caves’ destruction because no one had been held accountable.

Hesta, an Australian pension fund for health-care workers, said it strongly supports the recommendation that companies with existing heritage approvals, known as Section 18 permissions, suspend related works until they can verify consent by traditional landowners.

“The inescapable findings of the inquiry are that Aboriginal heritage sites remain vulnerable to destruction,” said Debby Blakey, Hesta’s chief executive. “It would be unacceptable to investors that boards of mining companies are not actively and transparently seeking to understand their exposure to this risk.”

Kim Christie, an iron-ore analyst at Wood Mackenzie, said a near-term squeeze on commodities supply from Australia isn’t likely. The final report from the inquiry won’t be finalized until next year. Still, there is a risk of higher mining costs and delays to expansions or new mines later as miners sharpen their focus on heritage issues and consultation with traditional owners, she said.

“Certainly moving forward if there is going to be that greater level of tightness [in supply] it could support prices higher than we otherwise would have thought,” Ms Christie said.

Scrutiny will especially fall on Rio Tinto. A moratorium on new heritage consents could affect up to 12 projects that Rio Tinto has planned over the next five or so years to maintain its iron-ore production at current rates, Goldman Sachs said. That means there is a risk that Rio Tinto won’t ship 327 million tons of iron ore next year as the bank had earlier forecast.

Rio Tinto said it is reassessing its mining operations in places with identified heritage sites that could be affected over the coming two years.

“I think Rio Tinto would rather forgo a few tons than their reputation,” said Ms Christie, of Wood Mackenzie.


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Mortgage holders should brace themselves for more pain as the Reserve Bank of Australia board prepares to meet tomorrow for the first time this year.

Most economists and the major banks are predicting a rise of 25 basis points will be announced, although the Commonwealth Bank suggests that the RBA may take the unusual step of a 40 basis point rise to bring the interest rate up to a more conventional 3.5 percent. This would allow the RBA to step back from further rate rises for the next few months as it assesses the impact of tightening monetary policy on the economy.

The decision by the RBA board to make consecutive rate rises since April last year is an attempt to wrestle inflation down to a more manageable 3 or 4 percent. The Australian Bureau of Statistics reports that the inflation rate rose to 7.8 percent over the December quarter, the highest it has been since 1990, reflected in higher prices for food, fuel and construction.

Higher interest rates have coincided with falling home values, which Ray White chief economist Nerida Conisbee says are down 6.1 percent in capital cities since peaking in March 2022. The pain has been greatest in Sydney, where prices have dropped 10.8 percent since February last year. Melbourne and Canberra recorded similar, albeit smaller falls, while capitals like Adelaide, which saw property prices fall 1.8 percent, are less affected.

Although prices may continue to decline, Ms Conisbee (below) said there are signs the pace is slowing and that inflation has peaked.

“December inflation came in at 7.8 per cent with construction, travel and electricity costs being the biggest drivers. It is likely that we are now at peak,” Ms Conisbee said. 

“Many of the drivers of high prices are starting to be resolved. Shipping costs are now down almost 90 per cent from their October 2021 peak (as measured by the Baltic Dry Index), while crude oil prices have almost halved from March 2022. China is back open and international migration has started up again. 

“Even construction costs look like they are close to plateau. Importantly, US inflation has pulled back from its peak of 9.1 per cent in June to 6.5 per cent in December, with many of the drivers of inflation in this country similar to Australia.”

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