LIVE Gold Prices $  | E-Mail Subscriptions | Update GoldSeek | GoldSeek Radio 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page 

 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

GoldSeek.com to Launch New Website
By: GoldSeek.com

Is Gold Price Action Warning Of Imminent Monetary Collapse Part 2?
By: Hubert Moolman

Gold and Silver Are Just Getting Started
By: Frank Holmes, US Funds

Silver Makes High Wave Candle at Target – Here’s What to Expect…
By: Clive Maund

Gold Blows Through Upside Resistance - The Chase Is On
By: Avi Gilburt

U.S. Mint To Reduce Gold & Silver Eagle Production Over The Next 12-18 Months
By: Steve St. Angelo, SRSrocco Report

Gold's sharp rise throws Financial Times into an erroneous sulk
By: Chris Powell, GATA

Precious Metals Update Video: Gold's unusual strength
By: Ira Epstein

Asian Metals Market Update: July-29-2020
By: Chintan Karnani, Insignia Consultants

Gold's rise is a 'mystery' because journalism always fails to pursue it
By: Chris Powell, GATA

 
Search

GoldSeek Web

 
SWOT Analysis: Why Mining Companies Could Expect Many Benefits to Be Had


 -- Published: Monday, 22 December 2014 | Print  | Disqus 

By Frank Holmes

 

Strengths

  • Gold traders were bullish for the fourth-consecutive week. The increased optimism related to gold prices stems from the recent turmoil in global markets as well as the continued dovish stance by the Federal Reserve.
  • The Swiss National Bank introduced a negative interest rate on deposits this week. The move, aimed at relieving upward pressure on the franc, should make gold relatively more attractive than franc-denominated assets.
  • Gold exports out of Switzerland reached the highest level this year. Furthermore, in order to meet rising demand from Asia, Swiss refineries are working at full capacity.

Weaknesses

  • President Barack Obama indefinitely withdrew more than 52,000 square miles of waters off Alaska’s coastline in order to protect the wildlife in the area. However, miners should get some leeway when it comes to the new law if the Republican-backed proposal bans the Endangered Species Act from applying to the sage grouse for one year.
  • Barrick Gold Corp. is suspending its Lumwana operations in Zambia following a newly established increase in the mining royalty rate. The rate is set to increase from 6 percent to 20 percent for all open-pit mines.

Opportunities

  • With diamond prices on the rise due to short global supply, retailers are looking for opportunities to invest in, or secure supplying deals directly from, individual mines. This would allow them to avoid the intermediate processes all together. Chow Tai Fook, the world’s largest listed jeweler, said it is specifically looking at Canadian projects, providing a great opportunity for many mining companies to make a deal.


 

  • Moving into 2015, many benefits are expected to be had by mining companies given the current environment. Specifically, declining energy prices and depreciating operating currencies could lead to lower costs and expanding margins. The chart above illustrates that costs seem to be rolling over now. Additionally, more mining companies could close their cash-negative assets, focusing attention on productive assets instead. Consolidation remains an opportunity for the industry as well, especially given the recent correction in gold prices.
  • Australia & New Zealand Banking Group Ltd. expects gold prices to recover next year due to increasing demand from China and India. The bank forecasts a gold price of $1,280 by the end of 2015.

Threats

  • Contrary to other positive forecasts, Oversea-Chinese Banking Corporation (OCBC) is predicting a continued slide in gold prices down to $1,000. This is because of higher interest rates alongside tamed inflation due to falling oil prices.
  • India’s government is taking a wait-and-see approach before making any official policy decisions to stem rapidly growing gold imports. Gold imports have risen six times, substantially weakening the country’s trade account.
  • The recent damage done to the Russian economy and the ruble are leading some to speculate that the government will begin selling gold. The desperate move could put downward pressure on bullion prices.

 


| Digg This Article
 -- Published: Monday, 22 December 2014 | E-Mail  | Print  | Source: GoldSeek.com

comments powered by Disqus



 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2019



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer


Map

The views contained here may not represent the views of GoldSeek.com, Gold Seek LLC, its affiliates or advertisers. GoldSeek.com, Gold Seek LLC makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, Gold Seek LLC, is strictly prohibited. In no event shall GoldSeek.com, Gold Seek LLC or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.