Viking Minerals Inc.: China Intensifies Purchases of Copper
September 27 2011 - 8:30AM
Marketwired
VIKING MINERALS INC (OTCBB: VKML) (www.vikingmineralsinc.com).
Company comments on Financial Times article August 31, 2011.
Chinese companies and investors are stepping up their purchases
of industrial commodities such as copper, in a show of confidence
in the global economy that stands in contrast to the turmoil in
western markets.
The wave of buying is providing support for metals and minerals
prices after commodities prices fell this month at worries about a
double-dip. Senior executives at trading houses, mining companies
and banks said Chinese consumers had used the recent drop in prices
to rebuild stocks.
"China is significantly less pessimistic relative to people in
the western world," said Raymond Key, head of metals trading at
Deutsche Bank. "On dips they are restocking, especially in copper."
An executive at an important Chinese trading house added: "There is
no doubt some traders have been buying (copper) recently."
The surge in copper buying benefits the largest exporting
nations, including top producers Chile and Peru, and miners such as
Freeport McMoRan Copper & Gold, BHP Billiton and Xstrata, and
trading houses such as Glencore and Trafigura.
Viking Minerals President Charles Irizarry commented "Investors
in resource companies such as Viking must keep a global perspective
when looking at North American exploration companies. It is not
Europe and the United States that we look at when making decisions
on what to mine and where. It is countries like China (which
consumes nearly 40% of the world's production of copper) and where
China's economy and demand are heading that is important. Global
production of copper simply is not going to keep pace with demand,
this leads to higher copper prices and larger producers looking for
new deposits. Despite economic turmoil in the western world proving
up a large Copper deposit today will pay huge dividends
tomorrow"
Copper prices fell to a 8-month low of $8,446 a tonne in early
August, but since then prices have risen more than 9.0 per cent to
$9,225 on Tuesday.
China accounts for 38 per cent of global copper demand, and as
such has the power to almost single-handedly prop up the market
even if companies in the west are holding back. Nonetheless,
traders warned that Chinese buyers could rapidly step back from the
market if they believed prices would fall further.
The buying by China marks a reversal of the trend in the first
half of this year, when consumers in the country made minimal
purchases of metals such as copper, choosing instead to run down
their inventories as the government's drive to tighten credit
reduced their ability to import large volumes. China's net copper
imports in the first seven months of the year were down 37 per cent
from the same period in 2010.
Glencore, the world's largest commodities trader, said that
so-called bonded warehouses stockpiles had seen a "significant
drawdown". It estimated that stocks have "at least halved" since
the beginning of the year.
ELKO COUNTY NEVADA AREA PLAY
There are 298 mines in Elko County, Nevada, located between Reno
and Salt Lake City and is a prolific copper mining area. Two of the
most noteworthy mines include the Robinson Mine which is an open
pit copper and gold mine that has operated continuously since 2005
producing averagely 121 to 126 million pounds per year of copper.
And the Bingham Canyon Mine, which is the world's largest open pit
mine and has produced more copper than any other mine in history -
approximately 14.5 million tons.
ABOUT VIKING MINERALS
Viking Minerals is engaged in the acquisition and development of
near-term producing copper, gold and silver properties in the
United States and Canada. Viking is focusing on developing its
Dolly Varden properties in northeastern Nevada, adjacent to the
Victoria Copper mine. The Large resource of copper in this area has
been well documented and hosts two large operating mines - Battle
Mountain and Robinson. With solid management, an experienced
technical team, and a large copper-rich land position in
mining-friendly Nevada, Viking Minerals is well positioned to be
North America's next great mining company.
FORWARD-LOOKING STATEMENT
This news release contains forward-looking statements that are
based on Viking Minerals Inc.'s current expectations and estimates.
For the complete "Forward-Looking Statement" please go to
http://www.vikingmineralsinc.com/newsdisclaimer.html
Contacts: Viking Minerals Inc. Charles Irizarry President &
CEO www.vikingmineralsinc.com