Wednesday, 3 February 2016

"Don't mention the elephant in the room" - Radio NZ testifies to the growing depression

My letter to Radio NZ (unacknowledged of course) this morning:

Don't mention the elephant in the room. Radio NZ mentioned in separate reports that:
--- Wall St is down
--- oil prices are down to $33 a barrel (actually below $30)
--- dairy prices have taken yet another tumble (down 7.4%)
--- Coal's worth to Kiwi Rail is down from $50 million to $23 million 

World dairy prices drop sharply

International dairy prices slumped further in the latest auction overnight.

no captionGraphic: GlobalDairyTrade Ltd

3 February, 2016

The overall price index in the GlobalDairyTrade auction fell almost 7.4 percent to $US2276 a tonne.

The benchmark whole milk powder price dived 10.4 percent to $US1952 a tonne, the lowest it has been since August.

Three other New Zealand dairy companies, Synlait, Westland Milk Products and Open Country, have lowered forecast payouts in the past month to between $4 and $4.45 - under the $5 figure most farmers need to break even.

Fonterra signPhoto: 123RF

KiwiRail revenue hit by lower coal volume

KiwiRail has given details of how much the collapse of state coal mining company Solid Energy has cost it.

3 February, 2015

Solid Energy went into voluntary administration last year after accumulating unpayable debts of $400 million.

KiwiRail transports the bulk of the company's coal.

KiwiRail chief executive Peter Reidy told Parliament's transport and industrial relations select committee that Solid Energy's failure has hit his company hard.

He said 64 percent of its revenue comes from carrying bulk materials like coal, which has slipped in two years from being a $50 million-a-year business for KiwiRail to a $23m business.

Mr Reidy said many coal wagons were lying empty on unused tracks.

Not $33 - below $30

WTI Crude Crashes Back Below $30

What goes up (on short-squeeze-driven hope and rumors), must come down (on spply, demand reality and denials)...

After a 26% spike off the late-January lows, WTI Crude is now down 14% from last Thursday's highs...

Turns out - surprise surprise - that most OPEC members are against an emergency meeting!

ANZ commodity price index falls 2.3 pct in January

It's been a weak start to the New Year for commodities with no let up in the softer prices and markets for New Zealand's main primary export.

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