ARI (Arrium) : At Rock bottom, ore not?

[percy]

I see we have a new substantial shareholder on the register. "Allan Grey Australia". They seem to be tied up with the Orbis family of investment funds. Anyone know anything about them?

SNOOPY

PS Share price up 0.5c to 33c as I write this. Arrium short position down to 1.46% as pe rthe latest available information (23rd October). That was the biggest fall in any short position for the week over the entire ASX.

Closed at 32.5cents,so I don't think you or Allan Grey must have brought enough,otherwise the share price would have gone up,not down. !!. lol.

[Joshuatree]

Yes they are the new name or a branch of Orbis.Think they have /had a pretty good success rate /reputation with their trades Snoopy. Im just watching the whole mining sector atm.

[Stranger_Danger]

I see we have a new substantial shareholder on the register. "Allan Grey Australia". They seem to be tied up with the Orbis family of investment funds. Anyone know anything about them?

SNOOPY

PS Share price up 0.5c to 33c as I write this. Arrium short position down to 1.46% as pe rthe latest available information (23rd October). That was the biggest fall in any short position for the week over the entire ASX.

I regard Simon Marais/Allan Gray as the best deep value investors in Australasia.

They don't get everything right and like all that like to play in the muck, they mistake the odd value trap for a hidden jewel. Overall though, they do very well. They've made good money on such dogs as F and P Appliances, Fairfax, amongst many others.

As a general rule, they buy too early - basically by design, as they're building pretty large positions - and their sell timing is usually pretty decent too.

If I'm playing with a deep value situation and terrified I'm missing something basic, the emergence of Allan Gray gives me heart that - normally - it'll turn out I'm not missing anything.

A google search on "Simon Marais profile/interview" will give you some insight into what sort of investors they are, I suspect they'll appeal to your investment style.

That said, STILL haven't bought yet, still being "too clever" in trying to time an entry.

Today's SSH probably suggests I should get moving.

[cloggs]

Article in The Bull today about port capacity that may affect ARI (?)

MINING PORT CAPACITY GETTING TIGHT

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By AAP | 30.10.2014 12:08 AM
Australia's mining exports are growing to record levels but the capacity of ports to ship them appears to be running out.
A Deloitte report said the surge in export volumes is putting a strain on the current port and railway facilities.
"The looming increase still begs the question of whether Australia's stock of export infrastructure will be sufficient to support very large increases in mineral and energy exports," the report said.
Deloitte said that additional coal and iron ore projects already underway are expected to add 140 million tonnes per annum (Mtpa) in production capacity but that won't be matched by the capacity of ports to ship higher volumes.
Coal and iron ore port capacity is expected to only increase by 110 Mtpa.
"That suggests that a number of projects in the planning phase will need to go ahead to prevent bottlenecks occurring," Deloitte said.
Deloitte also said the continue growth of Australia's mining export boom will depend on Chinese demand for coal and iron ore.
"Australian iron ore exports to China have grown sharply over the last decade," the report said.
"In value terms, total exports of iron ore and concentrates to China over 2013/14 was around $57 billion, equivalent to over 76 per cent of total Australian iron ore exports and 20 per cent of total merchandise exports for the year."

[Snoopy]

Article in The Bull today about port capacity that may affect ARI (?)

MINING PORT CAPACITY GETTING TIGHT

By AAP | 30.10.2014 12:08 AM
Australia's mining exports are growing to record levels but the capacity of ports to ship them appears to be running out.
A Deloitte report said the surge in export volumes is putting a strain on the current port and railway facilities.
"The looming increase still begs the question of whether Australia's stock of export infrastructure will be sufficient to support very large increases in mineral and energy exports," the report said.
Deloitte said that additional coal and iron ore projects already underway are expected to add 140 million tonnes per annum (Mtpa) in production capacity but that won't be matched by the capacity of ports to ship higher volumes.
Coal and iron ore port capacity is expected to only increase by 110 Mtpa.
"That suggests that a number of projects in the planning phase will need to go ahead to prevent bottlenecks occurring," Deloitte said.
Deloitte also said the continue growth of Australia's mining export boom will depend on Chinese demand for coal and iron ore.
"Australian iron ore exports to China have grown sharply over the last decade," the report said.
"In value terms, total exports of iron ore and concentrates to China over 2013/14 was around $57 billion, equivalent to over 76 per cent of total Australian iron ore exports and 20 per cent of total merchandise exports for the year."

Thanks for this Cloggs. Arrium fully own their own export port at Whyalla. So there will certainly be no shipping constraints on Arrium going forwards. They have also constructed their own rail line infrastructure to both primary mining areas: Middleback Range, and Southern Iron. So rail constraints won't affect them going forwards either.

As to whether their Whyalla port could use its capacity to service other outside exporter customers, well the port is being used to capacity by Arrium, so no. It is possible that Arrium might mothball some of its iron ore exporting capacity. That would free up export capacity. However, I suspect Whyalla is just too far away from other exporters mineral fields to be a competitive option.

I have read that some of Arriums marginally profitable steel production facilities in Newcastle are sitting on prime wharf precinct land. So perhaps if there was some plan to expand exports of other players through Newcastle, a deal could be done?

SNOOPY

[Snoopy]

Some information on steel milling in China mentioning Arrium's principal customer "Tangshan Guofeng Iron and Steel," Article dated Monday 24th February 2014.

http://www.reuters.com/article/2014/...A1N06Y20140224


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Many mills are already near bankruptcy because of slowing demand, plunging steel prices and a liquidity crisis that would have forced them to shut anyway, experts said.

…On the outskirts of Tangshan, a city of 7 million people that makes more steel a year than the whole of the United States, the hulking cranes and chimneys at the Qingquan Steel mill are frozen in inactivity. Workers unpaid for six months went on strike in October and haven’t returned.

Qingquan Steel is one of dozens of so-called zombie mills in Tangshan, where authorities have been ordered by the provincial government to draw up a list of plants to close so output can be cut by 10.8 million metric tons this year.

“In Tangshan and other parts of Hebei, the private mills are facing the most difficult time in their history,” said Xu. “Profits are poor and producers are all losing money – this has nothing to do with environmental measures: it is the economy.”

…Nevertheless, there has been some resistance.

An industry source said Tangshan had delayed an order to shut down 3 million metric tons of outdated steel production capacity at Tangshan Guofeng Iron and Steel, one of the city’s biggest producers, until next year because it was one of the few firms to make a profit in 2013.

While the Qingquan plant was reprimanded last year by local authorities no longer allowed to overlook environmental violations, orders to install costly new pollution controls would have made little difference to a facility with no access to funds and already incapable of paying its employees.

…”There are many others that have closed even though they haven’t declared bankruptcy. They aren’t formally shut because of the financial implications – they might be in debt and the banks would close in,” said a senior iron ore trader based in Tangshan.

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SNOOPY

[Snoopy]

From
http://www.wkrb13.com/markets/411340...sche-bank-ari/

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Deutsche Bank reiterated their hold rating on shares of Arrium (ASX:ARI) in a research note released on Tuesday morning (04-11-2015). (after a site visit and a price target of 34¢ a share.)

Arrium (ASX:ARI) opened at 0.325 on Tuesday. Arrium has a 52 week low of A$0.320 and a 52 week high of A$1.6298. The stock has a 50-day moving average of A$0.36 and a 200-day moving average of A$0.6. The company has a market cap of A$442.4 million and a price-to-earnings ratio of 2.18.

Other equities research analysts have also recently issued reports about the stock. Analysts at Citigroup Inc. downgraded shares of Arrium to a sell rating in a research note on Thursday, October 2nd. They now have a $754.00 price target on the stock.

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Not sure where that $754 came from. It isn't a typo by me!

SNOOPY

[percy]

From
http://www.wkrb13.com/markets/411340...sche-bank-ari/

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Deutsche Bank reiterated their hold rating on shares of Arrium (ASX:ARI) in a research note released on Tuesday morning (04-11-2015). (after a site visit and a price target of 34¢ a share.)

Arrium (ASX:ARI) opened at 0.325 on Tuesday. Arrium has a 52 week low of A$0.320 and a 52 week high of A$1.6298. The stock has a 50-day moving average of A$0.36 and a 200-day moving average of A$0.6. The company has a market cap of A$442.4 million and a price-to-earnings ratio of 2.18.

Other equities research analysts have also recently issued reports about the stock. Analysts at Citigroup Inc. downgraded shares of Arrium to a sell rating in a research note on Thursday, October 2nd. They now have a $754.00 price target on the stock.

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Not sure where that $754 came from. It isn't a typo by me!

SNOOPY

Exciting times??????????????????????????????????????
You sure they were not projecting the market cap of the whole company in a year or so's time???

[h2so4]

Not sure where that $754 came from. It isn't a typo by me!

SNOOPY

It's a pump and dump by snoopy.

You sly dog

[percy]

It's a pump and dump by snoopy.

You sly dog

Oh dear..!!!!! 30.5 cents ????