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COMMODITY NEWSBRIEFS: 2 NOVEMBER 2015 Please note that these articles are available in electronic format and can be requested and delivered via e-Mail.

(http://intra.spoornet.co.za) Natasha.Havenga@transnet.net

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FAST MOVING CONSUMER GOODS DROUGHT A SWEET TREAT FOR SUGAR PRODUCER (Business Day, 2/11/2015) RCL Foods’ sugar subsidiary TSB, which supplies about 30% of SA’s sugar market, looks set to remain in a sweet spot if the worst drought SA has experienced in 23 years persists and continues to cut production of bigger rivals Tongaat and Illovo Sugar. Due to TSB’s strategic location in the largely irrigated region of Mpumalanga, the producer of the Selati branded sugar has been unaffected by the lack of rainfall that has hit the main sugar producing region of KwaZulu-Natal. Both Illovo, the continent’s biggest sugar producer, and Tongaat have operations in KwaZuluNatal, which has been declared a disaster area due to the drought. In the year ended 2015, TSB produced a record crop of 702,000 tonnes, helping boost RCL’s revenue by 20.1% over the period, RCL said in its recent year-end results. The sugar division contributes just over a quarter to group revenue. “In previous years, TSB would sell its sugar surplus to the international market at much lower prices, but this year, it would have been able to sell the majority of its production locally,” said an analyst, who asked to remain anonymous. INTERMODAL MINISTER HIGHLIGHTS BENEFITS OF LOCAL SHIPBUILDING AS NEW VESSEL NAMED (Engineering News, 2/10/2015) Trade and Industry Minister Dr Rob Davies has highlighted the job creation and investment benefits to the country from a R1.4-billion contract to build two offshore supply vessels in Cape Town. He was speaking on Thursday at the naming of the first of the two craft. He described the programme as a boost to the local shipbuilding industry, as it would lead to an investment in the country of R1.2-billion and create more than 500 jobs. He pointed out that the government had earmarked shipbuilding as a key economic force in the Ocean economy and that it was committed to supporting the growth of local manufacturing across the marine sector, to maintain competitiveness and preserve jobs. He reported that his department will give greater attention to accreditation and standards, and skills development.

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FUEL IRAN SEEN JOLTING OIL MARKET WITH 90-DAY SUPPLY AFTER SANCTIONS (Mineweb, 2/11/2015) Iran may roil global oil markets with plans to sell about 45 million barrels of fuel stored in tankers in the Persian Gulf within three months of the removal of sanctions on its economy, according to analysts. Most of the stored oil is condensate that contains a sulfur compound, which complicates sales because many refineries can’t process it, said Victor Shum of IHS Inc. and Robin Mills at Dubai-based Manaar Energy Consulting. To market this large amount of oil within three months — the equivalent of about half a million barrels a day — Iran will have to resort to offering deep discounts, they said. The country is seeking to claw back the market share it lost under sanctions by boosting oil exports after a July deal with world powers to return to energy and financial markets. The condensate in tankers moored off its southern coast will add to a worldwide oil glut, putting more pressure on crude prices that have dropped more than 40 percent in the last year. Sanctions curbed Iran’s sales of crude and condensate to 1.4 million barrels a day in 2014 from 2.6 million in 2011, the U.S. Energy Information Administration said in June. Iran pumped 2.8 million barrels of crude a day in September, making it the fifth-largest producer in the Organization of Petroleum Exporting Countries, according to data compiled by Bloomberg. It plans to boost crude production and exports by 500,000 barrels a day within a week after sanctions are lifted, Roknoddin Javadi, managing director of state-run National Iranian Oil Co., said Oct. 21 in an interview in Tehran. Iran will add another 500,000 barrels in daily sales within six months after curbs are removed, he said. Shipments of the 45 million barrels of condensate over three months would come on top of these planned crude exports, Javadi said, and surpass current expectations about the wave of Iranian oil poised to hit the market. COAL UNIVERSAL REPORTS LOWER OUTPUT IN SEPT QUARTER (Mining Weekly, 2/11/2015) South Africa-focused coal miner Universal Coal has reported a 13% decline in run-of-mine (RoM) coal production to 686 900 t for the quarter ended September, compared with the 790 687 t delivered in the previous quarter. The lower production was owing to a reconfiguration of the Kangala colliery pit and a greater focus on pre-stripping aimed at exposing more mining blocks to allow for production flexibility in anticipation of potential longer-term increases in demand and further improving pit stability following a geotechnical audit. Coal sales for the quarter rose 3%, from the 509 000 t sold in the June quarter, to 524 000 t, as export sales increased by 363% to 26 000 t, more than making up for a 1% drop in domestic coal sales. CEO Tony Weber said on Friday that having completed the acquisition of the New Clydesdale colliery, Universal was excited to start commissioning activities ahead of first production, which remained on track for year-end. OPTIMUM MAY EXTEND HENDRINA COAL SUPPLY (MiningMx, 2/11/2015) Optimum Colliery has offered to continue supplying coal to Eskom’s Hendrina power station at a heavily subsidised rate until the end of November while negotiations continue on the future of the mine. According to a spokesperson for the Optimum business rescue practitioners (BRPs) Eskom has yet to respond to the offer. Optimum is currently supplying coal to Hendrina at a price of around R150/t in terms of a 60 day interim agreement which is due to end on November 4. The cost of producing coal from Optimum is some R400/t and the difference is being funded by colliery owner Glencore while negotiations between the BRPs and Eskom continue. Optimum went into business rescue proceedings on August 4 and the BRPs suspended coal deliveries to Hendrina on August 20 in response to Eskom’s action in imposing R2bn in penalties on the colliery for supplying coal that was below quality specifications. The net effect of Eskom’s action would have been that Optimum would have received R1 per tonne of coal delivered whereas it previously received R150/t which Glencore said was way below the actual production cost of R400/t from the colliery. GRAIN DROUGHT THREATENS CROPS (Star, 2/11/2015) South Africans will have to pay more for food in the new year if the drought continues to wreak havoc on this year’s harvest. Christo Joubert of National Agricultural Marketing sounded this warning yesterday, following Water and Sanitation Affairs Minister Nomvula Mokonyane’s announcement on the state of the drought ravaging the country. “The situation is critical, but there is still some time to go. We usually produce between 9 to 10 million tons of maize annually, and because of the severe drought, it could be less. “The problem is that we can’t import white maize, as there isn’t a lot available in the world and it’s

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also a quality issue. There is also a possibility of inflation rising on food prices,” Joubert warned. “We currently have enough maize to carry us through to July next year, but how big the crop will be that is still to be harvested will be determined in January. “If we have a drought as serious as the 1982/1983, 1992/1993 and 1998 droughts, then we’ll run into trouble,” Joubert said. On Thursday, the Department of Agriculture, Forestry and Fisheries’ crop estimates committee released a statement detailing the intentions of farmers to plant summer crops for next year. It shows that farmers intend producing fewer commercial crops including white maize, yellow maize, sunflower seeds, soya beans, groundnuts, sorghum and dry beans. All of these are vital for the production of food and vital for the economy. Intentions to plant summer crops are based on the results of a non-probability survey conducted within the department and reflects the position as of the middle of last month. According to the survey, commercial producers intend to plant 2 551 000 hectares of maize for 2016, which is 3.8 percent or 102 050 hectares less than the 2 653 000 planted last season. “Producers indicated that less maize will be planted for the 2016 season because they are under pressure due to the current dry weather conditions. However, the rainfall can still influence farmers’ decisions.” Sunflower seed, sorghum and soya bean planting will also decrease due to the weather conditions. Joubert said maize was not only the country’s staple, but was also important for the poultry industry, and less maize produced would mean there was less feed available. As for winter crops such as wheat, the expected production is 1 542 000 tons, which is 93 050 tons less than the previous forecast of 1 635 000 tons. The main reason for the decrease is because of the low rain levels in the western parts of the Western Cape. TRANSNET PETERS CALLS FOR CRITICAL REVIEW OF NATIONAL TRANSPORT MASTER PLAN TO IMPROVE IT (Engineering News, 2/11/2015) Transport Minister Dipuo Peters has asked National Transport Master Plan (Natmap) Synopsis Update Colloquium participants, particularly those who do not stem from government, to not avoid being “very critical” of the plan. The long-delayed Natmap was designed to guide South Africa’s transport infrastructure development to 2050. The process of reviewing and updating Natmap started in January, with the scope of work including an update of the plan’s key data and information, its alignment with the National Development Plan, reviewing and updating transport issues of national importance and Natmap’s implementation plan and extensive stakeholder participation, including the PICC. The Department of Transport (DoT) in 2010 presented Parliament with an early version of Natmap, which included linking Johannesburg to Durban and Polokwane by rapid train networks, expanding the Port of Cape Town, and forming partnerships with the private sector to help fund projects and lower the burden on taxpayers, all with an estimated budget requirement of R750-billion. GENERAL SOUTH AFRICA’S TRADE DEFICIT NARROWS IN SEPTEMBER (Moneyweb, 2/11/2015) South Africa’s trade deficit narrowed sharply to R0.89 billion ($65 million) in September from a revised R10.14 billion shortfall in August, the national revenue agency said on Friday. Exports increased by 5.6% to R92.28 billion, while imports fell by 4.5% to R93.17 billion on a month-on-month basis, the South African Revenue Service said. SA’S BUDGET DEFICIT WIDENS Y/Y IN SEPTEMBER (Moneyweb, 2/11/2015) South Africa recorded a wider budget deficit of R5.55 billion in September, the sixth month of the 2015/16 financial year, compared with a R5.36 billion shortfall for the same month in 2014/15, data from the Treasury showed on Friday. The table in the article shows revenue and expenditure for September, compared with the same month in the previous financial year. Revenue and expenditure for the fiscal year to date are also expressed as a percentage of the 2015/16 budget forecast for the current year and the preliminary outcome for 2014/15. CURRENCIES AND PRICES

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ALSI: 3 mnth to 30 Oct 15

(Mail & Guardian, 2/11/2015)

JSE AS AT 17:00PM 30 OCTOBER 2015

All Share Index 30/10 53,794

+ 387.42 + 0.73%

Industrials Index 30/10 45,743

+ 221.83 + 0.49%

Financials Index 30/10 45,463

+ 121.52 + 0.27%

Top 40 Index 30/10 48,317

+ 376.44 + 0.79%

Industrial 25 Index 30/10 72,744

+ 656.69 + 0.91%

Financial 15 Index 30/10 16,926

+ 45.71 + 0.27%

Resources 10 Index 30/10 33,413

+ 295.83 + 0.89%

Alt-X Index 30/10 1,524

- 9.45 - 0.62%

WORLD INDICATORS

FOREX

Rand/Dollar 06:55 13.7871

- 0.10 - 0.69%

Rand/Pound

07:00 21.2451

+ 0.03 + 0.15%

Rand/Euro 07:00 15.2094

- 0.04 - 0.28%

COMMODITIES

Gold (usd/oz) 07:00 1,141.23

- 5.27 - 0.46%

Platinum (usd/oz)

07:00 978.84

- 19.16 - 1.92%

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Brent (usd/barrel) 07:00 49.56

+ 0.76 + 1.56%

WORLD MARKETS

Wall St (DJIA) 30/10 17,664

- 92.26 - 0.52%

Germany (DAX)

30/10 10,850

+ 18.18 + 0.17%

Japan (Nikkei) 06:58 18,725

- 357.93 - 1.88%

(Business Report, 2/11/2015)

(TFR Commercial Management: Business Performance Dept)

Petrol/ Diesel Price

YR2015

07-Jan-

15

04-Feb-

15

04-Mar-

15

01-Apr-

15

06-May-

15

03-Jun-

15

01-Jul-

15

05-Aug-

15

02-Sep-

15

07-Oct-

15

04-Nov-

15

02-Dec-

15

COASTAL

95 LRP (c/l) 1083.00 990.00 1086.00 1246.00 1246.00 1293.00 1334.00 1283.00 1214.00 1218.00

95 ULP (c/l) 1083.00 990.00 1086.00 1246.00 1246.00 1293.00 1334.00 1283.00 1214.00 1218.00

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Diesel 0.05% (c/l) 997.49 895.49 969.49 1090.09 1085.09 1134.09 1138.09 1062.27 1008.27 1061.27

Diesel 0.005% (c/l) 1001.89 899.89 973.89 1096.49 1091.49 1137.49 1141.49 1067.67 1016.67 1067.67

Illuminating Paraffin (c/l) 697.728 595.728 668.728 690.828 685.828 727.828 733.828 663.828 608.828 658.828

Liquefied Petroleum Gas

(c/kg) 1829.00 1679.00 1833.00 1918.00 1935.00 2035.00 2091.00 2002.00 1887.00 1898.00

GAUTENG

93 LRP (c/l) 1102.00 1009.00 1105.00 1261.00 1261.00 1308.00 1352.00 1301.00 1232.00 1230.00

93 ULP (c/l) 1102.00 1009.00 1105.00 1261.00 1261.00 1308.00 1352.00 1301.00 1232.00 1230.00

95 ULP (c/l) 1124.00 1031.00 1127.00 1289.00 1289.00 1336.00 1377.00 1326.00 1257.00 1261.00

Diesel 0.05% (c/l) 1028.09 926.09 1000.09 1122.79 1117.79 1166.79 1170.79 1094.97 1040.97 1093.97

Diesel 0.005% (c/l) 1032.49 930.49 1004.49 1129.19 1124.19 1170.19 1174.19 1100.37 1049.37 1100.37

Illuminating Paraffin (c/l) 747.928 645.928 718.928 743.828 738.828 780.828 786.828 716.828 661.828 711.828

Liquefied Petroleum Gas

(c/kg) 2011.00 1861.00 2015.00 2100.00 2117.00 2217.00 2273.00 2184.00 2069.00 2080.00

YR2014

01-Jan-

14

05-Feb-

14

05-Mar-

14

02-Apr-

14

07-May-

14

04-Jun-

14

02-Jul-

14

06-Aug-

14

03-Sep-

14

01-Oct-

14

05-Nov-

14

03-Dec-

14

COASTAL

95 LRP (c/l) 1320.00 1359.00 1395.00 1398.00 1383.00 1361.00 1392.00 1392.00 1325.00 1320.00 1275.00 1206.00

95 ULP (c/l) 1320.00 1359.00 1395.00 1398.00 1383.00 1361.00 1392.00 1392.00 1325.00 1320.00 1275.00 1206.00

Diesel 0.05% (c/l) 1260.55 1284.75 1311.95 1299.15 1269.37 1245.79 1259.79 1254.17 1228.79 1215.79 1154.79 1101.49

Diesel 0.005% (c/l) 1263.95 1288.15 1316.35 1304.55 1274.77 1249.19 1263.19 1258.57 1234.19 1221.19 1161.19 1106.89

Illuminating Paraffin (c/l) 963.828 975.828 991.828 953.028 934.028 924.028 947.028 940.028 921.028 907.028 855.028 805.728

Liquefied Petroleum Gas

(c/kg) 2260.00 2314.00 2372.00 2350.00 2346.00 2319.00 2377.00 2365.00 2257.00 2269.00 2164.00 2039.00

GAUTENG

93 LRP (c/l) 1336.00 1375.00 1411.00 1416.00 1401.00 1379.00 1408.00 1408.00 1341.00 1343.00 1298.00 1229.00

93 ULP (c/l) 1336.00 1375.00 1411.00 1416.00 1401.00 1379.00 1408.00 1408.00 1341.00 1343.00 1298.00 1229.00

95 ULP (c/l) 1357.00 1396.00 1432.00 1439.00 1424.00 1402.00 1433.00 1433.00 1366.00 1361.00 1316.00 1247.00

Diesel 0.05% (c/l) 1287.15 1311.35 1338.55 1329.75 1299.97 1276.39 1290.39 1284.77 1259.39 1246.39 1185.39 1132.09

Diesel 0.005% (c/l) 1290.55 1314.75 1342.95 1335.15 1305.37 1279.79 1293.79 1289.17 1264.79 1251.79 1191.79 1137.49

Illuminating Paraffin (c/l) 1009.728 1021.728 1037.728 1003.228 984.228 974.228 997.228 990.228 971.228 957.228 905.228 855.928

Liquefied Petroleum Gas

(c/kg) 2442.00 2496.00 2554.00 2532.00 2528.00 2501.00 2559.00 2547.00 2439.00 2451.00 2346.00 2221.00

(SAPIA online)

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Daily prices for 30 October 2015

LME Official Prices, US$ per tonne

Contract Aluminium Alloy Aluminium Copper Lead Nickel Tin Zinc NASAAC

Cash Buyer 1605.00 1447.00 5135.00 1680.00 10130.00 15020.00 1672.50 1665.00

Cash Seller & Settlement 1610.00 1447.50 5135.50 1681.00 10135.00 15025.00 1673.00 1675.00

3-months Buyer 1610.00 1478.50 5115.00 1698.50 10140.00 15000.00 1690.00 1680.00

3-months Seller 1620.00 1479.00 5116.00 1699.00 10145.00 15025.00 1691.00 1690.00

Dec 1 Buyer 1610.00 1518.00 5085.00 1728.00 10165.00 1728.00 1730.00

Dec 1 Seller 1620.00 1523.00 5095.00 1733.00 10265.00 1733.00 1740.00

15-months Buyer 14875.00

15-months Seller 14925.00

Dec 2 Buyer 1575.00 5080.00 1762.00 10235.00 1753.00

Dec 2 Seller 1580.00 5090.00 1767.00 10335.00 1758.00

Dec 3 Buyer 1642.00 5075.00 1782.00 10245.00 1768.00

Dec 3 Seller 1647.00 5085.00 1787.00 10345.00 1773.00

(London Metal Exchange, 2/11/2015)

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