Metals Mosaic unlocking the macro outlook by riteshbhansali

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									                                                                                                               Metals & Minerals




Metals Mosaic: unlocking the macro outlook
Chinese policy response looking less likely; downside risks

Weak Chinese demand leading to across the board inventory build
While on the face of it China’s growth rates look robust, we are monitoring significant inventory build throughout the
industrial materials complex which implies to us that demand is not as strong as headline data would suggest. China’s
manufacturing PMI is consistent at above 50 and still indicates growth but the rate of growth seems to be relatively
anaemic. We note relatively depressed levels of retail sales growth, continued efforts to slow residential construction
and fixed asset investment focused on less-materials intensive transportation rather than more intensive utilities. We
note that inventories of key metals such as copper, aluminium and zinc are on the increase and we believe that even
though port inventories of iron ore are falling that inventories at mills are increasing. We are tracking inventory build in
manufactured goods as well which further raises concerns with regard to China’s demand.

US residential construction the only beacon of light
While the US, and indeed the Western World consumer, remains relatively constrained a key area of strength in recent
months has been US residential construction. With inventories now under control the recovery in activity looks more
sustainable and could start to be significant to global materials demand over the next 12-18 months; prior to the US
property collapse construction accounted for 40-50% of US metals demand. In addition a recovery in US property could
have a longer-term impact on a consumer which remains concerned with high unemployment and negative impact.

Chinese policy response key…few positive signs in the near-term
However in the near-term we see limited positive catalysts for industrial materials, with signs that the recovery in
activity may be petering out in late-February and early-March. In our view Chinese policy response is likely to be the
only major near-term catalyst for demand. Recent comments have not suggested that the Chinese will oblige with
materials-intensive policies although they have re-iterated their commitment to urbanisation as a long-term goal. We
believe that the recent re-acceleration in inflation is a major concern to the Chinese. In our view we need to see
renewed Chinese focus on major power and transport infrastructure projects in the near-term to stimulate a material
demand acceleration. In the longer term we are looking for policies that support consumer demand.

Binary solution set: status quo negative for industrial materials; China response would be positive
We see two possible near-term outcomes: (1) If there is no near-term Chinese policy response then we believe that the
industrial materials complex is likely to continue to fall in the near-term and that defensive materials, such as gold, are
likely to outperform; (2) If the Chinese do announce a change of policy in the near-term then we expect it to catalyse a
re-acceleration in materials demand. Key materials that would benefit would be steel, steelmaking raw materials and
copper.

Strategy: focus on US-centric materials markets
With significant uncertainties prevailing globally, we believe that materials leveraged to the US residential construction
recovery are likely to outperform others. While we expect North American lumber to continue to be a strong performer,
we also highlight that pigment (paint; a product of mineral sands) should be highly leveraged to a recovery in residential
construction and highlight Mineral Deposits as our preferred stock in that segment.



Prepared by GMP Securities Europe LLP
Please see important disclosures on the last page of this report.

March 15, 2013                                Matt Fernley                     +44-20-7647 2806              matt.fernley@gmpeurope.com
                                              Wael Jaber                       +44-20-7647 2812               wael.jaber@gmpeurope.com
                                                         March 15, 2013




                             TABLE OF CONTENTS
Key charts of the month                              3
Risk measures                                        4
Global economic trends…                              5
Global manufacturing and trade trends                6
Currency behaviour and impact on commodity prices    7
US railcars                                          8
Other US production indicators                       9
US: Construction trends                             10
US: Consumer trends                                 11
US: Inventory trends                                12
Base metals inventory levels                        13
Base metals inventories trends                      14
Aluminium                                           15
Copper                                              16
Nickel                                              17
Zinc                                                18
Bulk materials and freight                          19
Other commodities                                   20
Commodities vs equities                             21
Commodity price performance                         22
Commodity performance ranking                       23
                                                                                                                                                                                                                   March 15, 2013




KEY CHARTS OF THE MONTH
US new and existing housing inventory vs residential constr’n

 5,000                                                                                                                                             800,000             Signs that US residential construction activity is
 4,500                                                                                                                                             700,000             starting to recover sustainably.
 4,000                                                                                                                                             600,000             US housing inventory now at multi-year lows.
 3,500                                                                                                                                             500,000
 3,000                                                                                                                                             400,000             Recovery in US housing could have major follow-on
 2,500                                                                                                                                             300,000             impacts on US consumer confidence (as negative
 2,000                                                                                                                                             200,000
                                                                                                                                                                       equity starts to ebb) and hence on US and global
                                                                                                                                                                       GDP growth.
 1,500                                                                                                                                             100,000
                Jan-01
                          Jan-02
                                   Jan-03
                                            Jan-04
                                                     Jan-05
                                                              Jan-06
                                                                       Jan-07
                                                                                Jan-08
                                                                                           Jan-09
                                                                                                     Jan-10
                                                                                                               Jan-11
                                                                                                                        Jan-12
                                                                                                                                 Jan-13




                   US Housing Inv Kunits LHS                                                          US resi constr'n US$m RHS


Source: Bloomberg


No. of days of metals inventories on exchange

 60                                                                                                                                                                    The magnitude of the rise in LME metal inventories
                   Day s                                               Copper                                                                                          and indeed metal inventories generally is
 50                                                                    Aluminium
                                                                       Zinc                                                                                            unprecedented in recent years.
                                                                       Nickel
 40                                                                    Av erage                                                                                        Even in days of consumption terms inventories are
 30                                                                                                                                                                    at multi-year highs.
 20                                                                                                                                                                    Off exchange inventories have also built significantly.
 10                                                                                                                                                                    Inventories are high throughout the industrial
  0
                                                                                                                                                                       material complex suggesting that demand is
                                                                                                                                                                       depressed and that producers need to cut
       Jul-99
                 Jul-00
                            Jul-01
                                      Jul-02
                                               Jul-03
                                                         Jul-04
                                                                  Jul-05
                                                                            Jul-06
                                                                                         Jul-07
                                                                                                    Jul-08
                                                                                                              Jul-09
                                                                                                                        Jul-10
                                                                                                                                 Jul-11
                                                                                                                                          Jul-12
                                                                                                                                                   Jul-13




                                                                                                                                                                       production.

Source: Bloomberg, COMEX, Shanghai Futures Exchange, GMP estimates


Gold price vs copper, platinum and oil

 4.0                                                                                                                                                        0.40       Gold continues to underperform against key
 3.5                                                                                                                                                        0.35
                                                                                                                                                                       industrial commodities.
 3.0                                                                                                                                                        0.30
 2.5                                                                                                                                                        0.25
 2.0                                                                                                                                                        0.20
 1.5                                                                                                                                                        0.15
 1.0                                                                                                                                                        0.10
 0.5                                                                                                                                                        0.05
 0.0                                                                                                                                                        0.00
        01/00
                   02/00
                             04/00
                                       06/00
                                                07/00
                                                          09/00
                                                                   11/00
                                                                            12/00
                                                                                         02/01
                                                                                                    04/01
                                                                                                              06/01
                                                                                                                        07/01
                                                                                                                                 09/01
                                                                                                                                          11/01
                                                                                                                                                   12/01




                  Gold/platinum LHS                                             Gold/oil LHS                                     Gold/copper RHS
Source: Bloomberg




                                                                                                                                                                   3
                                                                                                                                                                                          March 15, 2013



RISK MEASURES
US TED spread                                                       Global 10Y-3M spread

 5%                                                      10%          4%

 4%                                                                   3%

 3%                                                                   2%
                                                         1%
 2%                                                                   1%

 1%                                                                   0%

 0%                                                      0%          -1%




                                                                           Jan-00
                                                                                    Jan-01
                                                                                             Jan-02
                                                                                                      Jan-03
                                                                                                               Jan-04
                                                                                                                        Jan-05
                                                                                                                                 Jan-06
                                                                                                                                          Jan-07
                                                                                                                                                   Jan-08
                                                                                                                                                            Jan-09
                                                                                                                                                                     Jan-10
                                                                                                                                                                              Jan-11
                                                                                                                                                                                       Jan-12
                                                                                                                                                                                                Jan-13
      Jan-05
       Jul-05
      Jan-06
       Jul-06
      Jan-07
       Jul-07
      Jan-08
       Jul-08
      Jan-09
       Jul-09
      Jan-10
       Jul-10
      Jan-11
       Jul-11
      Jan-12
       Jul-12
      Jan-13
       Jul-13


            Ted spread LHS         Ted spread (Log scale RHS)                                US                                           China                                          Germany


Source: Bloomberg                                                   Source: Bloomberg


US dollar index vs MSCI World

 95                                                     1900                 No signs of financial system distress.
                                                        1700
 90                                                                          US dollar index at multi-year highs.
                                                        1500
 85
                                                        1300
 80
                                                        1100
 75
                                                        900
 70                                                     700
 65                                                     500
      Jan-05
       Jul-05
      Jan-06
       Jul-06
      Jan-07
       Jul-07
      Jan-08
       Jul-08
      Jan-09
       Jul-09
      Jan-10
       Jul-10
      Jan-11
       Jul-11
      Jan-12
       Jul-12
      Jan-13
       Jul-13




             US dollar index LHS       MSCI World Index RHS


Source: Bloomberg


3M and 12M US$ LIBOR rates                                          VIX vs MSCI World

 7%                                                                  90                                                                                                                              1900
 6%                                                                  80                                                                                                                              1700
                                                                     70
 5%                                                                                                                                                                                                  1500
                                                                     60
 4%                                                                                                                                                                                                  1300
                                                                     50
 3%                                                                  40                                                                                                                              1100
 2%                                                                  30
                                                                                                                                                                                                     900
 1%                                                                  20
                                                                     10                                                                                                                              700
 0%
                                                                      0                                                                                                                              500
       Jul-05

       Jul-06

       Jul-07

       Jul-08

       Jul-09

       Jul-10

       Jul-11

       Jul-12

       Jul-13
      Jan-05

      Jan-06

      Jan-07

      Jan-08

      Jan-09

      Jan-10

      Jan-11

      Jan-12

      Jan-13




                                                                          Jan-05
                                                                           Jul-05
                                                                          Jan-06
                                                                           Jul-06
                                                                          Jan-07
                                                                           Jul-07
                                                                          Jan-08
                                                                           Jul-08
                                                                          Jan-09
                                                                           Jul-09
                                                                          Jan-10
                                                                           Jul-10
                                                                          Jan-11
                                                                           Jul-11
                                                                          Jan-12
                                                                           Jul-12
                                                                          Jan-13
                                                                           Jul-13




               3M US$ LIBOR               12M US$ LIBOR
                                                                                              VIX LHS                                                       MSCI World Index RHS


Source: Bloomberg                                                   Source: Bloomberg




                                                                4
                                                                                                                                                                                                                                                                 March 15, 2013




GLOBAL ECONOMIC TRENDS
Global Developed Economies y/y Real GDP growth trends                                                                            Global Developing Economies y/y Real GDP growth trends

  10%                                                                                                                             15%


   5%                                                                                                                             10%


   0%                                                                                                                              5%


  -5%                                                                                                                              0%


 -10%                                                                                                                              -5%




                                                                                                                                         Mar-99
                                                                                                                                                   Mar-00
                                                                                                                                                            Mar-01
                                                                                                                                                                     Mar-02
                                                                                                                                                                              Mar-03
                                                                                                                                                                                       Mar-04
                                                                                                                                                                                                 Mar-05
                                                                                                                                                                                                          Mar-06
                                                                                                                                                                                                                   Mar-07
                                                                                                                                                                                                                            Mar-08
                                                                                                                                                                                                                                     Mar-09
                                                                                                                                                                                                                                               Mar-10
                                                                                                                                                                                                                                                        Mar-11
                                                                                                                                                                                                                                                                  Mar-12
                                                                                                                                                                                                                                                                           Mar-13
         Mar-99
         Mar-00
                     Mar-01
                     Mar-02
                     Mar-03
                                         Mar-04
                                         Mar-05
                                                         Mar-06
                                                         Mar-07
                                                                          Mar-08
                                                                          Mar-09
                                                                                            Mar-10
                                                                                            Mar-11
                                                                                                          Mar-12
                                                                                                          Mar-13



                                                                                                                                                  China                                India                                Indonesia                                     Brazil
                  US                          Germany                                                Japan


Source: Bloomberg                                                                                                                Source: Bloomberg


Composite leading indicators for key economies

 115                                                                                                                    30               No signs of GDP growth recovery in Q4/12 except in
 110                                                                                                                                     China, Brazil.
                                                                                                                        25
 105
 100                                                                                                                    20
                                                                                                                                         Japan leading indicator has ticked up.
  95                                                                                                                                     Signs that IP cycle have troughed but no significant
                                                                                                                        15
  90
                                                                                                                                         re-acceleration.
  85                                                                                                                    10
  80
                    Euro Area LHS                               US LHS                                                  5
  75                Japan LHS                                   China RHS
  70                                                                                                                    0
       Jan-99


                   Jan-01


                                Jan-03


                                              Jan-05


                                                                 Jan-07


                                                                                   Jan-09


                                                                                                 Jan-11


                                                                                                               Jan-13




Source: Bloomberg


Global Developed Economies IP growth trends                                                                                      Global Developing Economies IP growth trends

  35%                                                                                                                              30%
                                                                                                                                   25%
  25%
                                                                                                                                   20%
  15%                                                                                                                              15%
                                                                                                                                   10%
   5%
                                                                                                                                    5%
  -5%                                                                                                                               0%
                                                                                                                                   -5%
 -15%                               EU-27
                                                                                                                                  -10%
                                    US IP
 -25%                                                                                                                             -15%                           China                          Brazil                      India
                                    Japan IP
                                                                                                                                  -20%
 -35%
                                                                                                                                          Jan-00


                                                                                                                                                              Jan-02


                                                                                                                                                                                 Jan-04


                                                                                                                                                                                                     Jan-06


                                                                                                                                                                                                                        Jan-08


                                                                                                                                                                                                                                              Jan-10


                                                                                                                                                                                                                                                                 Jan-12
         Jan-00


                       Jan-02


                                     Jan-04


                                                       Jan-06


                                                                          Jan-08


                                                                                            Jan-10


                                                                                                           Jan-12




Source: Bloomberg                                                                                                                Source: Bloomberg




                                                                                                                             5
                                                                                                                                                                                                                            March 15, 2013




GLOBAL MANUFACTURING AND TRADE TRENDS
Manufacturing PMIs for key economies                                                                                     Manufacturing PMI New Orders indices for China and US

 65                                                                                                                       70
 60                                                                                                                       65
                                                                                                                          60
 55
                                                                                                                          55
 50                                                                                                                       50
 45                                                                                                                       45
                    US                                                                                                                                                                   US                      China
                    Germany                                                                                               40
 40
                    Eurozone                                                                                              35
 35                 Japan
                    China                                                                                                 30
 30                                                                                                                       25
      Jan-06

                    Jan-07

                                Jan-08

                                           Jan-09

                                                       Jan-10

                                                                   Jan-11

                                                                                 Jan-12

                                                                                                   Jan-13




                                                                                                                               Jan-06


                                                                                                                                            Jan-07

                                                                                                                                                        Jan-08


                                                                                                                                                                  Jan-09

                                                                                                                                                                              Jan-10

                                                                                                                                                                                            Jan-11


                                                                                                                                                                                                              Jan-12

                                                                                                                                                                                                                            Jan-13
Source: Bloomberg                                                                                                        Source: Bloomberg


Auto sales growth for US, India, China

 140%                                                                                                                              Global manufacturing cycle troughed in H2/12.
                                           US
 120%                                      China
 100%                                      India                                                                                   However, significant regional differentiation with US
  80%                                      Euro area                                                                               outperforming other regions and Chinese activity
  60%                                                                                                                              muted.
  40%
  20%                                                                                                                              Export growth volatile and retail sales growth
   0%                                                                                                                              (domestic consumption) in key regions remains
 -20%                                                                                                                              depressed.
 -40%
 -60%
           Jan-05

                       Jan-06

                                  Jan-07

                                           Jan-08

                                                     Jan-09

                                                                Jan-10

                                                                            Jan-11

                                                                                          Jan-12

                                                                                                            Jan-13




Source: Bloomberg


Export growth trends in key economies                                                                                    Retail sales trends in key economies

  60%                                                                                                                      30%
                                                                                                                                                     Eurozone               China                        Japan                           US
                                                                                                                           25%
  40%
                                                                                                                           20%
  20%                                                                                                                      15%
                                                                                                                           10%
   0%
                                                                                                                            5%
 -20%                                                                                                                       0%
                                                                                                                           -5%
 -40%                        Germany                China
                             Japan                  Korea                                                                 -10%
 -60%                                                                                                                     -15%
          Jan-05

                       Jan-06

                                Jan-07

                                           Jan-08

                                                     Jan-09

                                                                Jan-10

                                                                            Jan-11

                                                                                          Jan-12

                                                                                                            Jan-13




                                                                                                                                   Jan-05

                                                                                                                                              Jan-06

                                                                                                                                                        Jan-07

                                                                                                                                                                 Jan-08

                                                                                                                                                                           Jan-09

                                                                                                                                                                                       Jan-10

                                                                                                                                                                                                     Jan-11

                                                                                                                                                                                                                   Jan-12

                                                                                                                                                                                                                                Jan-13




Source: Bloomberg                                                                                                        Source: Bloomberg




                                                                                                                     6
                                                                                                                                                                                                                  March 15, 2013



CURRENCY BEHAVIOUR AND IMPACT ON COMMODITY PRICES
USD vs developed market currencies                                                                                      USD vs commodity currencies

                                                                                                                                                 USDAUD                      USDCAD
 150                     USDEUR                        USDJPY                                                            150                     USDZAR                      USDBRL
                         USDGBP                        USDKRW                                                                                    USDCLP
 130                                                                                                                     130

 110                                                                                                                     110
  90
                                                                                                                          90
  70
                                                                                                                          70
  50
                                                                                                                          50
       Jan-04

                Jan-05

                          Jan-06

                                     Jan-07

                                              Jan-08

                                                       Jan-09

                                                                     Jan-10

                                                                              Jan-11

                                                                                        Jan-12

                                                                                                 Jan-13




                                                                                                                               Jan-04

                                                                                                                                        Jan-05

                                                                                                                                                  Jan-06

                                                                                                                                                           Jan-07

                                                                                                                                                                    Jan-08

                                                                                                                                                                              Jan-09

                                                                                                                                                                                       Jan-10

                                                                                                                                                                                                Jan-11

                                                                                                                                                                                                         Jan-12

                                                                                                                                                                                                                    Jan-13
Source: Bloomberg                                                                                                       Source: Bloomberg


Recent performance of key global currencies vs US dollar
                                   Current             1M chg                     3M chg                  12M chg
                                                                                                                                 USD strengthening against most consumer and
USDEUR                                0.77                      3%                     2%                     0%
                                                                                                                                 commodity currencies in past month with noticeable
USDJPY                                96.4                      4%                     15%                   15%
                                                                                                                                 exception of AUD.
USDGBP                                0.67                      4%                     8%                     5%
USDKRW                               1,108                      2%                     3%                    -2%                 Weakest currency is ZAR which has weakened by
USDAUD                                0.97                      0%                     2%                     1%                 20% over the past year.
USDCAD                                1.03                      2%                     4%                     3%
USDZAR                                9.25                      5%                     7%                    20%
USDBRL                                1.97                      1%                     -5%                    9%
USDCLP                                 471                      0%                     -1%                   -3%
USDZMK                               5,390                      1%                     2%                     3%
USDCNY                                6.22                      0%                     0%                    -2%
USDINR                                54.2                      0%                     0%                     8%


Source: Bloomberg


Gold prices in producer currencies                                                                                      Gold prices in consumer currencies

 650                                                                                                                     550
                                   USD                          CAD                                                      500                      USD                          EUR
 550                               AUD                          ZAR                                                      450                      INR                          CNY

 450                                                                                                                     400
                                                                                                                         350
 350                                                                                                                     300
                                                                                                                         250
 250
                                                                                                                         200
 150                                                                                                                     150
                                                                                                                         100
  50                                                                                                                      50
       Jan-04

                Jan-05

                          Jan-06

                                     Jan-07

                                              Jan-08

                                                       Jan-09

                                                                     Jan-10

                                                                              Jan-11

                                                                                        Jan-12

                                                                                                 Jan-13




                                                                                                                               Jan-04

                                                                                                                                        Jan-05

                                                                                                                                                  Jan-06

                                                                                                                                                           Jan-07

                                                                                                                                                                    Jan-08

                                                                                                                                                                              Jan-09

                                                                                                                                                                                       Jan-10

                                                                                                                                                                                                Jan-11

                                                                                                                                                                                                         Jan-12

                                                                                                                                                                                                                    Jan-13




Source: Bloomberg                                                                                                       Source: Bloomberg




                                                                                                                    7
                                                                                                                                                                                                          March 15, 2013



US RAILCARS
Seasonality of US metals and products railcar shipments                                             Seasonality of US chemicals railcar shipments

 13                                                                                                  34
           000 cars                                                       10 y r av ge                        000 cars
 12
                                                                                                     32
 11                                                                                                               2013
                                                                                                                                                              2012
 10                                                                                                  30

   9                         2012                                                                                                         10 y r av ge
                                                                                                     28                                                                                           5 y r av ge
               2013
   8                                                                            5 y r av ge
                                                                                                     26
   7
   6                                                                                                 24
   5                                                                                                 22
       1         5       9    13    17    21    25      29   33    37      41    45      49               1           5           9       13 17 21 25                     29 33           37 41 45 49
                     5 y r av ge          10 y r av ge            2012           2013                                         5 yr avge                       1 yr avge
                                                                                                                                                               0                       2012            2013


Source: Association of American Railroads                                                           Source: Association of American Railroads


Seasonality of crushed stone, sand, gravel railcar shipments

 24                                                                                                           Discontinuation of some weekly series may be an
           000 cars                        10 y r av ge                                                       issue.
 22
                                                                                       2012
 20
               2013
                                                                                                              Bifurcation between construction related materials
 18                                                                                                           (lumber, cement) which are strong, and
                                                                         5 y r av ge
 16                                                                                                           manufacturing related materials (metals, chemicals)
 14                                                                                                           which are depressed.
 12
 10                                                                                                           Indicator suggests US IP may be bottoming out.
   8
       1         5       9    13 17 21          25 29 33 37               41 45 49
                5y r av ge               10 y r av ge              2012                  2013


Source: Association of American Railroads


Seasonality of US coal railcar shipments                                                            US processed materials railcar shipments* vs IP

 150                                                                                                  25%                                                                                                       10%
               000 cars                                                                                                                         IP y/y RHS
                                                              5-y r av ge
 140                                                                                                  15%                                                                                                       6%
                                    10-y r av ge
                                                                                                       5%                                                                                                       2%
 130
                                                                   2011
                                                                                                       -5%                                                                                                      -2%
 120                                                                         2012
                                                                                                     -15%                                                                                                       -6%
 110                                                                                                              Processed materials y/y chg
                  2013                                                                               -25%                                                                                                       -10%
 100
                                                                                                     -35%                                                                                                       -14%
           1         5   9     13   17     21   25      29   33    37      41    45      49
                                                                                                              01/03
                                                                                                                          01/04
                                                                                                                                      01/05
                                                                                                                                              01/06
                                                                                                                                                      01/07
                                                                                                                                                               01/08
                                                                                                                                                                       01/09
                                                                                                                                                                               01/10
                                                                                                                                                                                       01/11
                                                                                                                                                                                               01/12
                                                                                                                                                                                                       01/13




                2011           5yr avge            2012            0
                                                                  1 yr avge              2013



Source: Association of American Railroads                                                           Source: Association of American Railroads, Bloomberg. *Chemicals, Metals, Paper.




                                                                                                8
                                                                                                                                                         March 15, 2013



OTHER US PRODUCTION INDICATORS
US steel capacity utilisation                                                  US industrial capacity utilisation

 100%                                                                           100%

  90%                                                                            95%
                                                                                 90%
  80%
                                                                                 85%
  70%                                                                            80%
  60%                                                                            75%
  50%                                                                            70%
                                                                                 65%
  40%
                                                                                 60%
  30%




                                                                                        Jan-80
                                                                                        Jan-82
                                                                                        Jan-84
                                                                                        Jan-86
                                                                                        Jan-88
                                                                                        Jan-90
                                                                                        Jan-92
                                                                                        Jan-94
                                                                                        Jan-96
                                                                                        Jan-98
                                                                                        Jan-00
                                                                                        Jan-02
                                                                                        Jan-04
                                                                                        Jan-06
                                                                                        Jan-08
                                                                                        Jan-10
                                                                                        Jan-12
        Jan-80
        Jan-82
        Jan-84
        Jan-86
        Jan-88
        Jan-90
        Jan-92
        Jan-94
        Jan-96
        Jan-98
        Jan-00
        Jan-02
        Jan-04
        Jan-06
        Jan-08
        Jan-10
        Jan-12




Source: Bloomberg                                                              Source: Bloomberg


Seasonality of US power production

 100,000                                                                               Steel capacity utilisation recovering, but in line with
               bn kWh                                                                  seasonal trends. Not a trend yet.
  95,000
  90,000                                             5 y r av ge                       Power production up y/y in February.
  85,000
  80,000                    2013
  75,000
  70,000
               2012                   10 y r av ge
  65,000
  60,000
           1     5      9     13 17 21 25 29 33 37 41 45 49
                      5 yr avge         0
                                       1 yr avge      2012         2013



Source: Bloomberg


ISM Manufacturing PMI and New Orders/Inventories ratio                         CRB Raw Materials index vs US economic surprises index

 75                                                                  2.0         100               US ES index LHS                  CRB RM index RHS             650
                            ISM Mfg PMI LHS
 70                         ISM Mfg PMI New Orders/Inv s RHS         1.8                                                                                         600
 65                                                                               50
 60                                                                  1.6                                                                                         550
 55                                                                  1.4           0                                                                             500
 50
 45                                                                  1.2         -50                                                                             450
 40                                                                  1.0                                                                                         400
 35                                                                             -100
                                                                     0.8                                                                                         350
 30
 25                                                                  0.6        -150                                                                             300
                                                                                       Jan-06

                                                                                                Jan-07

                                                                                                         Jan-08

                                                                                                                  Jan-09

                                                                                                                           Jan-10

                                                                                                                                    Jan-11

                                                                                                                                             Jan-12

                                                                                                                                                      Jan-13
      Jan-80
      Jan-82
      Jan-84
      Jan-86
      Jan-88
      Jan-90
      Jan-92
      Jan-94
      Jan-96
      Jan-98
      Jan-00
      Jan-02
      Jan-04
      Jan-06
      Jan-08
      Jan-10
      Jan-12




Source: Bloomberg                                                              Source: Bloomberg




                                                                           9
                                                                                                                                                                                                                                                                                    March 15, 2013



US: CONSTRUCTION TRENDS
US housing starts, absolute activity vs y/y growth                                                                                                           US residential construction, absolute activity vs y/y growth

  60%                                                                                                                                          2800           900,000                                US Res Constr'n US$m LHS                                                              40%
                                                                                                                                                                                                     US Res Constr'n y /y RHS
                                                                                                                                               2400           800,000                                                                                                                      30%
  40%
                                                                                                                                               2000           700,000                                                                                                                      20%
  20%
                                                                                                                                                                                                                                                                                           10%
                                                                                                                                               1600           600,000
   0%                                                                                                                                                                                                                                                                                      0%
                                                                                                                                               1200           500,000
                                                                                                                                                                                                                                                                                           -10%
 -20%
                                                                                                                                               800            400,000
                                US Housing Starts y /y LHS                                                                                                                                                                                                                                 -20%
 -40%                                                                                                                                          400            300,000
                                US Housing starts absolute RHS                                                                                                                                                                                                                             -30%
 -60%                                                                                                                                          0              200,000                                                                                                                      -40%
          Jan-91
          Jan-92
          Jan-93
          Jan-94
          Jan-95
          Jan-96
          Jan-97
          Jan-98
          Jan-99
          Jan-00
          Jan-01
          Jan-02
          Jan-03
          Jan-04
          Jan-05
          Jan-06
          Jan-07
          Jan-08
          Jan-09
          Jan-10
          Jan-11
          Jan-12
          Jan-13




                                                                                                                                                                        Jan-02
                                                                                                                                                                                 Jan-03
                                                                                                                                                                                            Jan-04
                                                                                                                                                                                                     Jan-05
                                                                                                                                                                                                                Jan-06
                                                                                                                                                                                                                         Jan-07
                                                                                                                                                                                                                                  Jan-08
                                                                                                                                                                                                                                            Jan-09
                                                                                                                                                                                                                                                     Jan-10
                                                                                                                                                                                                                                                              Jan-11
                                                                                                                                                                                                                                                                        Jan-12
                                                                                                                                                                                                                                                                                 Jan-13
Source: Bloomberg                                                                                                                                            Source: Bloomberg


US Architectural billings index vs residential construction

 70                                                                                                                                            40%                  Residential construction recovery looks more
 65                                                                                                                                                                 sustainable particularly with housing inventory now at
 60                                                                                                                                            20%                  multi-year lows.
 55
 50                                                                                                                                            0%                   Non-residential construction not so robust but growth
 45                                                                                                                                                                 rate still holding above zero.
 40                                                                                                                                            -20%
 35
 30                                                                                                                                            -40%
                                 US Arch. billings index LHS
 25                              US Res Constr'n y /y RHS
 20                                                                                                                                            -60%
      Jan-02
               Jan-03
                            Jan-04
                                      Jan-05
                                               Jan-06
                                                          Jan-07
                                                                      Jan-08
                                                                                 Jan-09
                                                                                              Jan-10
                                                                                                         Jan-11
                                                                                                                  Jan-12
                                                                                                                             Jan-13




Source: Bloomberg


US residential construction vs NAHB Housing Market index                                                                                                     US non-res construction, absolute activity vs y/y growth

  30%                                                                                                                                              80         800,000                                                                                                                       30%
  20%                                                                                                                                              70         700,000                                                                                                                       20%
  10%                                                                                                                                              60                                                                                                                                       10%
                                                                                                                                                              600,000
   0%                                                                                                                                              50                                                                                                                                       0%
 -10%                                                                                                                                              40         500,000
                                                                                                                                                                                                                                                                                            -10%
 -20%                                                                                                                                              30         400,000
                                                                                                                                                                                                                                                                                            -20%
 -30%                                                                                                                                              20                                                     US Non-Res Constr'n US$m LHS
                                                                                                                                                              300,000                                     US Non-Res Constr'n y /y RHS                                                      -30%
 -40%                          US Res Constr'n y /y LHS                                                                                            10
                               NAHB Housing Market index RHS                                                                                                  200,000                                                                                                                       -40%
 -50%                                                                                                                                              0
                                                                                                                                                                        Jan-04

                                                                                                                                                                                   Jan-05

                                                                                                                                                                                                Jan-06

                                                                                                                                                                                                              Jan-07

                                                                                                                                                                                                                         Jan-08

                                                                                                                                                                                                                                   Jan-09

                                                                                                                                                                                                                                               Jan-10

                                                                                                                                                                                                                                                          Jan-11

                                                                                                                                                                                                                                                                       Jan-12

                                                                                                                                                                                                                                                                                  Jan-13
          Jan-00
                   Jan-01
                             Jan-02
                                      Jan-03
                                               Jan-04
                                                        Jan-05
                                                                   Jan-06
                                                                            Jan-07
                                                                                     Jan-08
                                                                                                Jan-09
                                                                                                         Jan-10
                                                                                                                  Jan-11
                                                                                                                           Jan-12
                                                                                                                                      Jan-13




Source: Bloomberg                                                                                                                                            Source: Bloomberg




                                                                                                                                                        10
                                                                                                                                                                                                                                              March 15, 2013



US: CONSUMER TRENDS
US retail sales growth vs consumer outlook                                                                                                       US unemployment trends

  15%                                                                                                                                  60         8000                      Initial claims LHS                                                      120%
                                                                                                                                                                            Continuing claims LHS
                                                                                                                                                  7000                      Total claims y /y grow th RHS                                           100%
  10%                                                                                                                                  55
                                                                                                                                                  6000                                                                                              80%
   5%                                                                                                                                  50         5000                                                                                              60%
   0%                                                                                                                                  45         4000                                                                                              40%
                                                                                                                                                  3000                                                                                              20%
  -5%                                                                                                                                  40
                                                                                                                                                  2000                                                                                              0%
 -10%                        US Retail Sales y /y LHS                                                                                  35         1000                                                                                              -20%
                             US consumer attitudes & spending index RHS
 -15%                                                                                                                                  30             0                                                                                             -40%




                                                                                                                                                          Jan-05

                                                                                                                                                                   Jan-06

                                                                                                                                                                               Jan-07

                                                                                                                                                                                        Jan-08

                                                                                                                                                                                                 Jan-09

                                                                                                                                                                                                          Jan-10

                                                                                                                                                                                                                   Jan-11

                                                                                                                                                                                                                            Jan-12

                                                                                                                                                                                                                                     Jan-13
        Jan-00
                 Jan-01
                          Jan-02
                                   Jan-03
                                            Jan-04
                                                     Jan-05
                                                              Jan-06
                                                                       Jan-07
                                                                                Jan-08
                                                                                         Jan-09
                                                                                                  Jan-10
                                                                                                           Jan-11
                                                                                                                    Jan-12
                                                                                                                             Jan-13




Source: Bloomberg                                                                                                                                Source: Bloomberg


US consumer credit growth vs employment growth

  25%                                                                                                                                 10%                 Retail sales growth decelerating.
  20%                                                                                                                                 8%
                                                                                                                                                          Consumer confidence seems to be returning but
  15%                                                                                                                                 6%
                                                                                                                                                          consumer comfort index still weak.
  10%                                                                                                                                 4%
   5%                                                                                                                                 2%                  Consumer credit now accelerating but revolving
   0%                                                                                                                                 0%                  credit growth (credit card debt) still depressed;
  -5%                                                                                                                                 -2%                 positive.
                                   US consumer credit grow th y /y LHS
 -10%                                                                                                                                 -4%
                                   US employ ment grow th RHS                                                                                             US consumer still relatively subdued; impacted by
 -15%                                                                                                                                 -6%
                                                                                                                                                          high unemployment and negative equity. Could the
        01/75
        01/77
        01/79
        01/81
        01/83
        01/85
        01/87
        01/89
        01/91
        01/93
        01/95
        01/97
        01/99
        01/01
        01/03
        01/05
        01/07
        01/09
        01/11
        01/13




                                                                                                                                                          housing recovery stimulate a US consumer
                                                                                                                                                          recovery?

Source: Bloomberg


US consumer credit and revolving credit growth                                                                                                   US consumer credit vs IP growth

  35%                                                                                                                                              25%
                                                                                US consumer credit grow th y /y                                                                    US consumer credit grow th y /y                            US IP y /y
                                                                                US rev olv ing credit grow th y /y                                 20%
  25%
                                                                                                                                                   15%
  15%                                                                                                                                              10%
                                                                                                                                                    5%
   5%                                                                                                                                               0%
                                                                                                                                                   -5%
  -5%
                                                                                                                                                  -10%
 -15%                                                                                                                                             -15%
                                                                                                                                                          01/75
                                                                                                                                                          01/77
                                                                                                                                                          01/79
                                                                                                                                                          01/81
                                                                                                                                                          01/83
                                                                                                                                                          01/85
                                                                                                                                                          01/87
                                                                                                                                                          01/89
                                                                                                                                                          01/91
                                                                                                                                                          01/93
                                                                                                                                                          01/95
                                                                                                                                                          01/97
                                                                                                                                                          01/99
                                                                                                                                                          01/01
                                                                                                                                                          01/03
                                                                                                                                                          01/05
                                                                                                                                                          01/07
                                                                                                                                                          01/09
                                                                                                                                                          01/11
                                                                                                                                                          01/13
        01/78
        01/80
        01/82
        01/84
        01/86
        01/88
        01/90
        01/92
        01/94
        01/96
        01/98
        01/00
        01/02
        01/04
        01/06
        01/08
        01/10
        01/12




Source: Bloomberg                                                                                                                                Source: Bloomberg




                                                                                                                                            11
                                                                                                                                                                            March 15, 2013



US: INVENTORY TRENDS
US business inventories (infl. adjusted), absolute vs y/y chg                      US business inventories vs ISM manufacturing inventories

 1,700                                                                 15%           10%                                                                                                60
 1,600                                                                 10%            5%                                                                                                55
 1,500                                                                 5%
                                                                                      0%                                                                                                50
 1,400                                                                 0%
 1,300                                                                 -5%           -5%                                                                                                45

 1,200                                                                 -10%         -10%                                                                                                40
 1,100                                                                 -15%
                                                                                    -15%            US bus inv s infl. adj. y /y % LHS                                                  35
         01/80
         01/82
         01/84
         01/86
         01/88
         01/90
         01/92
         01/94
         01/96
         01/98
         01/00
         01/02
         01/04
         01/06
         01/08
         01/10
         01/12                                                                                      US ISM Inv entories RHS
                                                                                    -20%                                                                                                30
              US bus. inv s absolute lev els (infl. adj) LHS




                                                                                           01/99
                                                                                           01/00
                                                                                                   01/01
                                                                                                           01/02
                                                                                                                   01/03
                                                                                                                   01/04
                                                                                                                           01/05
                                                                                                                                   01/06
                                                                                                                                           01/07
                                                                                                                                                   01/08
                                                                                                                                                   01/09
                                                                                                                                                           01/10
                                                                                                                                                                   01/11
                                                                                                                                                                           01/12
                                                                                                                                                                           01/13
              US business inv entories US$ (infl. adj.) y /y chg RHS


Source: Bloomberg                                                                  Source: Bloomberg


US and Japanese business inventory growth trends

  16%                                                              16%                     US business inventories back to multi-year highs (in
  12%                                                              12%                     inflation-adjusted terms).
   8%                                                              8%
                                                                                           Some signs of stabilisation of recent de-stocking
   4%                                                              4%
                                                                                           trend.
   0%                                                              0%
  -4%                                                              -4%                     LME inventories continue to increase.
  -8%                                                              -8%
 -12%                                                              -12%
                    Jpn business inv entories y /y % LHS
 -16%                                                              -16%
                    US business inv entories y /y chg RHS
 -20%                                                              -20%
         01/99
         01/00
         01/01
         01/02
         01/03
         01/04
         01/05
         01/06
         01/07
         01/08
         01/09
         01/10
         01/11
         01/12
         01/13




Source: Bloomberg


US business inv change vs LME metal invs (value terms)                             US business inventories vs IP, y/y change

  260%                                                                 26%           15%                                                                                           15%
                                                                                     10%                                                                                           10%
  180%                                                                 18%
                                                                                      5%
                                                                                                                                                                                   5%
  100%                                                                 10%            0%
                                                                                                                                                                                   0%
   20%                                                                 2%            -5%
                                                                                                                                                                                   -5%
                                                                                    -10%
  -60%                                                                 -6%                                                                                                         -10%
                                                                                    -15%
 -140%                                                                 -14%         -20%                                                                                           -15%
                                                                                           01/80
                                                                                           01/82
                                                                                           01/84
                                                                                           01/86
                                                                                           01/88
                                                                                           01/90
                                                                                           01/92
                                                                                           01/94
                                                                                           01/96
                                                                                           01/98
                                                                                           01/00
                                                                                           01/02
                                                                                           01/04
                                                                                           01/06
                                                                                           01/08
                                                                                           01/10
                                                                                           01/12
         01/99
         01/00
         01/01
         01/02
         01/03
         01/04
         01/05
         01/06
         01/07
         01/08
         01/09
         01/10
         01/11
         01/12
         01/13




              LME inv entories y /y chg 3MMA LHS
                                                                                               US IP y /y chg LHS
              US business inv entories US$ (infl. adj.) y /y chg RHS
                                                                                               US business inv entories US$ (infl. adj.) y /y chg RHS


Source: Bloomberg                                                                  Source: Bloomberg




                                                                              12
                                                                                                                                                                                                                                                                                     March 15, 2013



BASE METALS INVENTORY LEVELS
Copper inventories by region                                                                                                                        Aluminium inventories by region

 1,600                                                                                                                                               6,000
                      Kt                                                      Shanghai                                                                                   Kt
 1,400                                                                        Comex                                                                  5,000
 1,200                                                                        LME Americas
                                                                              LME Europe                                                             4,000
 1,000
                                                                              LME Asia                                                               3,000
   800
   600                                                                                                                                               2,000
   400                                                                                                                                               1,000
   200                                                                                                                                                      0
       0




                                                                                                                                                                Jan-00
                                                                                                                                                                         Jan-01
                                                                                                                                                                                  Jan-02
                                                                                                                                                                                           Jan-03
                                                                                                                                                                                                    Jan-04
                                                                                                                                                                                                             Jan-05
                                                                                                                                                                                                                      Jan-06
                                                                                                                                                                                                                               Jan-07
                                                                                                                                                                                                                                        Jan-08
                                                                                                                                                                                                                                                 Jan-09
                                                                                                                                                                                                                                                          Jan-10
                                                                                                                                                                                                                                                                   Jan-11
                                                                                                                                                                                                                                                                            Jan-12
                                                                                                                                                                                                                                                                                      Jan-13
           Jan-00
                     Jan-01
                              Jan-02
                                       Jan-03
                                                Jan-04
                                                          Jan-05
                                                                    Jan-06
                                                                                Jan-07
                                                                                         Jan-08
                                                                                                  Jan-09
                                                                                                           Jan-10
                                                                                                                    Jan-11
                                                                                                                             Jan-12
                                                                                                                                      Jan-13


                                                                                                                                                            LME Asia                         LME Europe                             LME Americas                                 Shanghai

Source: Bloomberg, Shanghai Futures Exchange, Comex                                                                                                 Source: Bloomberg, Shanghai Futures Exchange


Nickel inventories by region

 180                                                                                                                                                            Base metal inventories remained at high levels.
 160         Kt
 140
                                                                                                                                                                Exchange inventories increased across the board in
 120                                                                                                                                                            China with reports of significant builds in off-
 100                                                                                                                                                            exchange inventories.
  80
  60                                                                                                                                                            Mixed trends in Asia and the US but further
  40                                                                                                                                                            increases in Europe.
  20
   0
       Jan-00
                Jan-01
                          Jan-02
                                   Jan-03
                                            Jan-04
                                                         Jan-05
                                                                   Jan-06
                                                                             Jan-07
                                                                                         Jan-08
                                                                                                  Jan-09
                                                                                                           Jan-10
                                                                                                                    Jan-11
                                                                                                                             Jan-12
                                                                                                                                      Jan-13




                                       Asia                                                                     Europe

Source: Bloomberg


Zinc inventories by region                                                                                                                          Inventory score card
                                                                                                                                                                                  Aluminium                      Copper                          Nickel                              Zinc
 1,600
                    Kt                      Shanghai                                                                                                China                         High                           High                            NA                                  High
 1,400
                                            LME Americas                                                                                            US                            High                           Mid                             NA                                  High
 1,200                                      LME Middle East                                                                                         Europe                        High                           Mid                             High                                High
 1,000                                      LME Europe
                                                                                                                                                    Asia ex-China                 High                           High                            High                                Mid
   800                                      LME Asia
                                                                                                                                                    Middle East                   NA                             NA                              NA                                  Low
   600
                                                                                                                                                    Global                        High                           High                            High                                High
   400
   200
       0
           Jan-05

                         Jan-06

                                       Jan-07

                                                     Jan-08

                                                                       Jan-09

                                                                                         Jan-10

                                                                                                      Jan-11

                                                                                                                    Jan-12

                                                                                                                                 Jan-13




Source: Bloomberg, Shanghai Futures Exchange, GMP estimates                                                                                         Source: Bloomberg, Shanghai Futures Exchange, GMP estimates




                                                                                                                                               13
                                                                                                                                                                                                              March 15, 2013



BASE METALS INVENTORIES TRENDS
Total exchange inventories (absolute)                                            Total exchange inventories (days of consumption)

 1650                                                                             60
          Kt               Copper stocks LHS                         6500                         Day s
                           Zinc stocks LHS                                                                                                                      Copper
 1450                                                                                                                                                           Aluminium
                           Aluminium stocks RHS                                   50
 1250                                                                5500                                                                                       Zinc
                                                                                                                                                                Nickel
 1050                                                                4500         40

  850                                                                3500         30
  650
                                                                     2500         20
  450
  250                                                                1500
                                                                                  10
    50                                                               500
                                                                                   0
         Dec-04

         Dec-05

         Dec-06

         Dec-07

         Dec-08

         Dec-09

         Dec-10

         Dec-11

         Dec-12

         Dec-13
          Jul-04

          Jul-05
         Jan-04




         Jun-06

         Jun-07

         Jun-08

         Jun-09

         Jun-10

         Jun-11

         Jun-12

         Jun-13




                                                                                       Jul-99
                                                                                                Jul-00
                                                                                                         Jul-01
                                                                                                                  Jul-02
                                                                                                                           Jul-03
                                                                                                                                    Jul-04
                                                                                                                                              Jul-05
                                                                                                                                                       Jul-06
                                                                                                                                                                 Jul-07
                                                                                                                                                                          Jul-08
                                                                                                                                                                                   Jul-09
                                                                                                                                                                                            Jul-10
                                                                                                                                                                                                     Jul-11
                                                                                                                                                                                                              Jul-12
                                                                                                                                                                                                                       Jul-13
Source: Bloomberg, Shanghai Futures Exchange, GMP estimates                      Source: Bloomberg, Shanghai Futures Exchange, GMP estimates


Shanghai weekly aluminium, copper and zinc inventories

 600                                                                                       Inventories also rising in days of consumption terms.
 500
         Kt                                                                                Copper inventories approaching multi-year highs.
 400                                                                                       Large increase in copper inventories at odds with
 300                                                                                       seasonal trends
 200
 100
    0
        Dec-04

        Dec-05

        Dec-06

        Dec-07

        Dec-08

        Dec-09

        Dec-10

        Dec-11

        Dec-12

        Dec-13
        Jan-04
         Jul-04

         Jul-05

        Jun-06

        Jun-07

        Jun-08

        Jun-09

        Jun-10

        Jun-11

        Jun-12

        Jun-13




                        Copper stocks          Aluminium stocks
                        Zinc stocks


Source: Shanghai Futures Exchange


Seasonality of total exchange copper inventories                                 Seasonality of LME copper prices

 900                                                                              420            US¢/lb
          Kt
 800
                                                                                  370
 700
 600                                                                              320
 500
                                                                                  270
 400
 300                                                                              220
 200
                                                                                  170
 100
   0                                                                              120
         1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52                                 1 4 7 10 13 16 19 22 25 28 31 34 37 40 43 46 49 52

          5-y r av ge           10-y r av ge       2012           2013                             5-y r av ge                               10-y r av ge                            2012                         2013

Source: Bloomberg, Shanghai Futures Exchange, GMP estimates                      Source: Bloomberg, Shanghai Futures Exchange, GMP estimates




                                                                            14
                                                                                                                                                                                                                                                       March 15, 2013




ALUMINIUM
The five ages of aluminium – power theme back into vogue                                                                                                        Total exchange aluminium inventories vs price

                  160                                                                                                                                                         170
                                              1999-2003                    2004-07                  2008              2009              2010-13
                  140                                                                                                                                                         150
                                                                                                                                          ??
                  120                                                                                                                                                         130




                                                                                                                                                                   Price, US¢/lb
  Price, US¢/lb




                  100                                                                                                                                                         110

                   80                                                                                                                                                              90

                   60                                                                                                                                                              70

                   40                                                                                                                                                              50
                            0                       10           20          30           40                                                         50                                     0                10         20          30           40                50
                                                         Ex change stocks,day s of supply                                                                                                                      Ex change stocks, day s of supply


Source: Bloomberg, Shanghai Futures Exchange, GMP estimates                                                                                                     Source: Bloomberg, Shanghai Futures Exchange, GMP estimates


Shanghai/LME aluminium arbitrage

  20%                                                                                                                                                                              Inventories remain at elevated levels.
  15%
  10%
                                                                                                                                                                                   Back to Shanghai premium over LME.
   5%
   0%
  -5%
 -10%
 -15%
 -20%
 -25%
 -30%
                                                                                                  Dec-10

                                                                                                                Dec-11

                                                                                                                               Dec-12

                                                                                                                                                 Dec-13
                   Jan-06

                                  Jan-07

                                                    Jan-08

                                                                 Jan-09

                                                                                Jan-10




Source: Bloomberg, GMP estimates


Total exchange aluminium stocks vs average (days of cons’n)                                                                                                     Aluminium futures curve

 60                                                                                                                                                              2900                                                                                              122
                     Day s                                                                                                                                                              US$/t
 50                                                                                                                                                              2700                                                                                              113
 40                                                                                                                                                              2500
                                                                                                                                                                                                                                                                   104
 30                                                                                                                                                              2300
                                                                                                                                                                                                                                                                   95
 20                                                                                                                                                              2100
                                                                                                                                                                                                                                                                   86
                                                                                                                                                                 1900
 10
                                                                                                                                                                 1700                                                                                              77
   0
                                                                                                                                                                 1500                                                                                              68
                                                             Dec-04
                                                                      Dec-05
                                                                               Dec-06
                                                                                         Dec-07
                                                                                                   Dec-08
                                                                                                            Dec-09
                                                                                                                     Dec-10
                                                                                                                              Dec-11
                                                                                                                                        Dec-12
                                                                                                                                                  Dec-13
            Jan-00
                      Jan-01
                                Jan-02
                                           Jan-03
                                                    Jan-04




                                                                                                                                                                                   Mar-13



                                                                                                                                                                                                    Mar-14



                                                                                                                                                                                                                    Mar-15



                                                                                                                                                                                                                                Mar-16



                                                                                                                                                                                                                                           Mar-17



                                                                                                                                                                                                                                                          Mar-18




                                  Aluminium stocks                                                10-y r av ge Al in day s
                                                                                                                                                                                            Today                    3 months ago                   6 months ago

Source: Bloomberg                                                                                                                                               Source: Bloomberg




                                                                                                                                                           15
                                                                                                                                                                                                                   March 15, 2013



COPPER
The five ages of copper – supply tightness dominates outlook                                                             Total exchange inventories vs price

                  500                      1999-2003           2004-07           2008        2009       2010-13                             500                                 Current week
                  450                                                                                                                       450
                  400                               ??                                                                                      400
                  350                                                                                                                       350
  Price, US¢/lb




                                                                                                                            Price, US¢/lb
                  300                                                                                                                       300
                  250                                                                                                                       250
                  200
                                                                                                                                                                                           Including est'd non-exchange
                                                                                                                                            200
                  150                                                                                                                                                                                             stocks
                                                                                                                                            150
                  100                                                                                                                       100
                   50
                                                                                                                                             50
                            0            10               20          30           40                          50
                                                  Ex change stocks,day s of supply                                                                    0                10           20          30           40                50
                                                                                                                                                                            Ex change stocks,day s of supply


Source: Bloomberg, Shanghai Futures Exchange, GMP estimates                                                              Source: Bloomberg, Shanghai Futures Exchange, GMP estimates


Shanghai/LME copper arbitrage

  20%                                                                                                                                       Concern about copper inventory levels; starting to
  15%
                                                                                                                                            move outside existing price relationships…
  10%                                                                                                                                       Back to Shanghai premium over LME despite build in
      5%                                                                                                                                    Chinese inventory.
      0%
                                                                                                                                            Concern about off exchange inventories in China.
   -5%
 -10%                                                                                                                                       Still net speculative long position – concern.
 -15%
                                                                                                                                            Futures curve has inverted in past 6 months.
 -20%
                                                                        Dec-10

                                                                                    Dec-11

                                                                                               Dec-12

                                                                                                          Dec-13
                   Jan-06

                                Jan-07

                                         Jan-08

                                                      Jan-09

                                                               Jan-10




Source: Bloomberg, GMP estimates


COMEX net speculative position in copper                                                                                 Copper futures curve

  575                                     Net spec open interest (fut. & opt.)                           11000            8600                                                                                                 390
                        Kt                Copper price US$/tonne RHS                                                                              US$/t
  475                                                                                                    10000            8400                                                                                                 381
  375                                                                                                    9000             8200                                                                                                 372
  275                                                                                                    8000             8000                                                                                                 363
  175                                                                                                    7000             7800                                                                                                 354
                                                                                                                          7600                                                                                                 345
      75                                                                                                 6000
                                                                                                                          7400                                                                                                 336
   -25                                                                                                   5000
                                                                                                                          7200                                                                                                 327
 -125                                                                                                    4000
                                                                                                                          7000                                                                                                 317
 -225                                                                                                    3000
                                                                                                                                             Mar-13



                                                                                                                                                              Mar-14



                                                                                                                                                                                Mar-15



                                                                                                                                                                                            Mar-16



                                                                                                                                                                                                       Mar-17



                                                                                                                                                                                                                      Mar-18




 -325                                                                                                    2000
                   01/05
                   07/05
                   01/06
                   07/06
                   01/07
                   07/07
                   12/07
                   07/08
                   12/08
                   06/09
                   12/09
                   06/10
                   12/10
                   06/11
                   12/11
                   06/12
                   12/12
                   06/13
                   12/13




                                                                                                                                                      Today                      3 months ago                   6 months ago

Source: COMEX                                                                                                            Source: Bloomberg




                                                                                                                    16
                                                                                                                                                                                                                                                        March 15, 2013



NICKEL
The five ages of nickel – oversupply impacting                                                                                                                       LME nickel inventories vs price

                  3000                                                                                                                                                              3,000
                                                         1999-2003                   2004-07               2008              2009                2010-13
                  2500                                                                                                                                                              2,500
                  2000                                                                                                                                                              2,000
  Price, US¢/lb




                                                                                                                                                                        Price, US¢/lb
                                                                                                          ??
                  1500
                                                                                                                                                                                    1,500
                  1000
                                                                                                                                                                                    1,000
                   500
                                                                                                                                                                                        500
                           0
                                                                                                                                                                                            0
                                0                         10              20          30           40                                                      50
                                                                  Ex change stocks,day s of supply                                                                                                0              10        20          30          40                50
                                                                                                                                                                                                                  Ex change stocks, day s of supply


Source: Bloomberg, GMP estimates                                                                                                                                     Source: Bloomberg, GMP estimates


LME nickel inventories by region

 180                                                                                                                                                                                    Nickel inventories remain at elevated levels.
 160                   Kt
 140
 120
 100
  80
  60
  40
  20
   0
                  Jan-00
                            Jan-01
                                      Jan-02
                                                Jan-03
                                                          Jan-04
                                                                   Jan-05
                                                                            Jan-06
                                                                                     Jan-07
                                                                                              Jan-08
                                                                                                       Jan-09
                                                                                                                Jan-10
                                                                                                                         Jan-11
                                                                                                                                   Jan-12
                                                                                                                                             Jan-13




                                                  Asia                                                               Europe

Source: Bloomberg, GMP estimates


Total exchange nickel stocks vs average (days of cons’n)                                                                                                             Nickel futures curve

 50                                                                                                                                                                   19000                                                                                          906
                     Day s                                                                                                                                                                   US$/t
 40
                                                                                                                                                                      18000                                                                                          850
 30
                                                                                                                                                                      17000                                                                                          793
 20

 10                                                                                                                                                                   16000                                                                                          737

   0
                                                                                                                                                                      15000                                                                                          680
                                                                   Dec-04
                                                                            Dec-05
                                                                                     Dec-06
                                                                                              Dec-07
                                                                                                       Dec-08
                                                                                                                Dec-09
                                                                                                                          Dec-10
                                                                                                                                    Dec-11
                                                                                                                                              Dec-12
                                                                                                                                                       Dec-13
            Jan-00
                           Jan-01
                                     Jan-02
                                               Jan-03
                                                         Jan-04




                                                                                                                                                                                         Mar-13



                                                                                                                                                                                                        Mar-14



                                                                                                                                                                                                                       Mar-15



                                                                                                                                                                                                                                   Mar-16



                                                                                                                                                                                                                                             Mar-17



                                                                                                                                                                                                                                                            Mar-18




                                              Nickel stocks                                               10-y r av ge Ni in day s
                                                                                                                                                                                                Today                  3 months ago                   6 months ago

Source: Bloomberg, GMP estimates                                                                                                                                     Source: Bloomberg




                                                                                                                                                                17
                                                                                                                                                                                                                                                    March 15, 2013



ZINC
The five ages of zinc – China supply starting to re-assert itself                                                                                          Global zinc exchange inventories vs price

                  250                                                                                                                                                         250
                                                 1999-2003                   2004-07               2008             2009            2010-13
                  200                                                                                                                                                         200
                                                                                                                                                                                                            Current w eek
  Price, US¢/lb




                  150




                                                                                                                                                              Price, US¢/lb
                                                                                        ??                                                                                    150

                  100
                                                                                                                                                                              100
                   50
                                                                                                                                                                               50
                                                                                                                                                                                                                                 Including est'd SRB
                     0
                                                                                                                                                                                                                                                  stocks
                                                                                                                                                                                0
                          0                      10               20          30           40                                                  50
                                                          Ex change stocks,day s of supply                                                                                             0          10         20        30        40       50                    60
                                                                                                                                                                                                        Ex change stocks, day s of supply


Source: Bloomberg, Shanghai Futures Exchange, GMP estimates                                                                                                Source: Bloomberg, Shanghai Futures Exchange, GMP estimates


Global zinc exchange inventories(percentage terms)

        100%                                                                                                                                                                  Inventories stabilised at high levels.
              80%                                                                                                                                                             Recent price weakness.
              60%

              40%

              20%

                  0%
                         Jan-00
                         Jan-01
                         Jan-02
                         Jan-03
                         Jan-04
                         Jan-05
                         Jan-06
                         Jan-07
                         Jan-08
                         Jan-09
                         Jan-10
                         Jan-11
                         Jan-12
                         Jan-13




                  LME Asia                                 LME Europe                                    LME Middle East
                  LME Americas                             Shanghai


Source: Bloomberg, Shanghai Futures Exchange


Total exchange zinc inventories vs 5-year average                                                                                                          Zinc futures curve

 45                                                                                                                                                         2400                                                                                                109
                     Day s
 40                                                                                                                                                                               US$/t
                                                                                                                                                            2300
 35
                                                                                                                                                            2200                                                                                                100
 30
 25                                                                                                                                                         2100
 20                                                                                                                                                         2000                                                                                                91
 15                                                                                                                                                         1900
 10                                                                                                                                                         1800                                                                                                82
  5
                                                                                                                                                            1700
  0
                                                                                                                                                            1600                                                                                                73
                                                           Dec-04
                                                                    Dec-05
                                                                             Dec-06
                                                                                      Dec-07
                                                                                                Dec-08
                                                                                                         Dec-09
                                                                                                                  Dec-10
                                                                                                                           Dec-11
                                                                                                                                    Dec-12
                                                                                                                                             Dec-13
            Jan-00
                      Jan-01
                               Jan-02
                                        Jan-03
                                                 Jan-04




                                                                                                                                                                              Mar-13



                                                                                                                                                                                               Mar-14



                                                                                                                                                                                                             Mar-15



                                                                                                                                                                                                                        Mar-16



                                                                                                                                                                                                                                        Mar-17



                                                                                                                                                                                                                                                       Mar-18




                                        Zinc stocks                                            10-y r av ge Zn in day s
                                                                                                                                                                                       Today                  3 months ago                       6 months ago

Source: Bloomberg, Shanghai Futures Exchange, GMP estimates                                                                                                Source: Bloomberg




                                                                                                                                                      18
                                                                                                                                                                                                                                          March 15, 2013



BULK MATERIALS AND FREIGHT
Chinese iron ore import prices from Brazil corrected for freight                                                                          Chinese iron ore import prices from Aus corrected for freight

 250                 Tubarao-Beilun capesize freight                                                                                       250                W. Aus-Japan capesize freight
                     Calculated Brazilian FOB price                                                                                                           Calculated Australian FOB price
 200                                                                                                                                       200
                US$/tonne                                                                                                                                 US$/tonne
 150                                                                                                                                       150

 100                                                                                                                                       100

  50                                                                                                                                        50

    0                                                                                                                                         0
        06/06


                         06/07


                                           06/08


                                                           06/09


                                                                           06/10


                                                                                           06/11


                                                                                                             06/12


                                                                                                                             06/13




                                                                                                                                                  06/06


                                                                                                                                                              06/07


                                                                                                                                                                          06/08


                                                                                                                                                                                          06/09


                                                                                                                                                                                                      06/10


                                                                                                                                                                                                                      06/11


                                                                                                                                                                                                                                 06/12


                                                                                                                                                                                                                                                 06/13
Source: Bloomberg, GMP estimates                                                                                                          Source: Bloomberg, GMP estimates


Key global thermal coal prices

 250                                                                                                                                                Iron ore prices starting to roll over.
            US$/tonne
 200                                                                                                                                                Thermal coal prices look to have troughed but no
 150                                                                                                                                                evidence of recovery.

 100                                                                                                                                                Met coal also showing signs of troughing.
  50                                                                                                                                                Recovery in Panamax freight rates but Capesize
    0                                                                                                                                               rates falling.
        01/01
                 01/02
                           01/03
                                    01/04
                                               01/05
                                                          01/06
                                                                   01/07
                                                                            01/08
                                                                                       01/09
                                                                                                 01/10
                                                                                                           01/11
                                                                                                                     01/12
                                                                                                                             01/13




                New castle 6700kcal FOB                                             Richards Bay 6000kcal FOB
                Pennsy lv ania railcar FOB



Source: Bloomberg


Spot vs contract met coal prices                                                                                                          Comparison of bulk freight rates

 400                                               China domestic met coal calc'd                                                          16000                                                                                                         3000
                US$/t                              Australian HCC contract                                                                                                                    Capesize LHS
 350                                                                                                                                       14000
                FOB                                                                                                                                                                           Panamax LHS                                                2500
 300                                                                                                                                       12000                                              Handy size RHS
                                                                                                                                                                                                                                                         2000
 250                                                                                                                                       10000

 200                                                                                                                                        8000                                                                                                         1500

 150                                                                                                                                        6000
                                                                                                                                                                                                                                                         1000
 100                                                                                                                                        4000
                                                                                                                                                                                                                                                         500
                                                                                                                                            2000
  50
                                                                                                                                                  0                                                                                                      0
    0
                                                                                                                                                      07/08

                                                                                                                                                              01/09

                                                                                                                                                                      07/09

                                                                                                                                                                                  01/10

                                                                                                                                                                                           07/10

                                                                                                                                                                                                   01/11

                                                                                                                                                                                                              07/11

                                                                                                                                                                                                                        01/12

                                                                                                                                                                                                                                07/12

                                                                                                                                                                                                                                         01/13
        01/00
                 01/01
                          01/02
                                   01/03
                                             01/04
                                                       01/05
                                                               01/06
                                                                       01/07
                                                                               01/08
                                                                                         01/09
                                                                                                   01/10
                                                                                                           01/11
                                                                                                                     01/12
                                                                                                                             01/13




Source: Bloomberg, GMP estimates                                                                                                          Source: Bloomberg




                                                                                                                                     19
                                                                                                                                                                                                                                                                               March 15, 2013



OTHER COMMODITIES
Gold/oil and copper/oil ratio                                                                                                                             Gold/silver and gold/platinum ratio

 5.0                               Gold/oil ratio LHS                                                                                          160         110                                                                                                                                   1.2
                                   Copper/oil ratio RHS                                                                                                                                           Gold/silv er ratio LHS
 4.5                                                                                                                                           140         100                                                                                                                                   1.1
                                                                                                                                                                                                  Gold/platinum ratio RHS
 4.0
                                                                                                                                               120          90                                                                                                                                   1.0
 3.5
 3.0                                                                                                                                           100          80                                                                                                                                   0.9

 2.5                                                                                                                                           80           70                                                                                                                                   0.8
 2.0                                                                                                                                           60           60                                                                                                                                   0.7
 1.5
                                                                                                                                               40           50                                                                                                                                   0.6
 1.0
 0.5                                                                                                                                           20           40                                                                                                                                   0.5

 0.0                                                                                                                                           0            30                                                                                                                                   0.4




                                                                                                                                                                 01/00
                                                                                                                                                                          01/01
                                                                                                                                                                                  01/02
                                                                                                                                                                                          01/03
                                                                                                                                                                                                  01/04
                                                                                                                                                                                                            12/04
                                                                                                                                                                                                                    12/05
                                                                                                                                                                                                                             12/06
                                                                                                                                                                                                                                     12/07
                                                                                                                                                                                                                                             12/08
                                                                                                                                                                                                                                                      12/09
                                                                                                                                                                                                                                                              12/10
                                                                                                                                                                                                                                                                       12/11
                                                                                                                                                                                                                                                                               12/12
                                                                                                                                                                                                                                                                                         12/13
        01/00
                 01/01
                         01/02
                                   01/03
                                            01/04
                                                     12/04
                                                             12/05
                                                                      12/06
                                                                               12/07
                                                                                        12/08
                                                                                                   12/09
                                                                                                              12/10
                                                                                                                      12/11
                                                                                                                              12/12
                                                                                                                                       12/13




Source: Bloomberg                                                                                                                                         Source: Bloomberg


Gold ETF and COMEX position

 200                                                                                                                                                               Gold continues to underperform against oil, copper
                Moz                                                                                                                                                and platinum; stable against silver.
 150
                                                                                                                                                                   Significant reduction in net long platinum position.

 100                                                                                                                                                               Gold and silver net long positions stable.

  50


    0
        Oct-03

                    Oct-04

                                   Oct-05

                                               Oct-06

                                                             Oct-07

                                                                        Oct-08

                                                                                       Oct-09

                                                                                                     Oct-10

                                                                                                                  Oct-11

                                                                                                                              Oct-12

                                                                                                                                          Oct-13




           Gold ETF know n positions                                             COMEX total open position
Source: COMEX


Silver ETF and COMEX position                                                                                                                             Platinum ETF and COMEX position

 2000                                                                                                                                                      12000
                 Moz                                                                                                                                                      Koz
                                                                                                                                                           10000
 1500
                                                                                                                                                            8000

 1000                                                                                                                                                       6000

                                                                                                                                                            4000
  500
                                                                                                                                                            2000
       0                                                                                                                                                         0
           Apr-06


                          Apr-07


                                            Apr-08


                                                             Apr-09


                                                                              Apr-10


                                                                                                Apr-11


                                                                                                                 Apr-12


                                                                                                                                Apr-13




                                                                                                                                                                     Apr-07


                                                                                                                                                                                      Apr-08


                                                                                                                                                                                                          Apr-09


                                                                                                                                                                                                                            Apr-10


                                                                                                                                                                                                                                             Apr-11


                                                                                                                                                                                                                                                              Apr-12


                                                                                                                                                                                                                                                                                Apr-13




           Silv er ETF know n positions                                       COMEX total open position                                                                  Platinum ETF know n positions                                       NYMEX total open position

Source: COMEX                                                                                                                                             Source: Bloomberg




                                                                                                                                                     20
                                                                                                                                                                  March 15, 2013




COMMODITIES VS EQUITIES
Equity implied commodity price premium of copper vs actual*                           Equity implied commodity price premium of platinum vs actual*

  70%                                                                                    50%
                                                             Copper                      40%                                                       Platinum
  50%                                                                                    30%
                                                                                         20%
  30%                                                                                    10%
                                                                                          0%
  10%
                                                                                        -10%
 -10%                                                                                   -20%
                                                                                        -30%
 -30%                                                                                   -40%
                                                                                        -50%
 -50%




                                                                                               12/04
                                                                                               06/05
                                                                                               12/05
                                                                                               06/06
                                                                                               12/06
                                                                                               06/07
                                                                                               12/07
                                                                                               06/08
                                                                                               12/08
                                                                                               06/09
                                                                                               12/09
                                                                                               06/10
                                                                                               12/10
                                                                                               06/11
                                                                                               12/11
                                                                                               06/12
                                                                                               12/12
                                                                                               06/13
                                                                                               12/13
        12/04
        06/05
        12/05
        06/06
        12/06
        06/07
        12/07
        06/08
        12/08
        06/09
        12/09
        06/10
        12/10
        06/11
        12/11
        06/12
        12/12
        06/13
        12/13




Source: Bloomberg, GMP estimates                                                      Source: Bloomberg, GMP estimates

Equity implied commodity price premium of gold vs actual*

  20%                                                                                          Copper equity basket has de-rated less than copper;
                     Gold                                                                      now trading at a premium to the commodity
  10%
                                                                                               again…downside risk?
   0%
 -10%                                                                                          Gold seniors outperform the commodity on price
                                                                                               weakness. At highest level vs commodity since
 -20%
                                                                                               early-2012.
 -30%
 -40%
                                                                                               Silver equities underperform the commodity. At
                                                                                               lowest level vs the commodity since mid-2012.
 -50%
        12/04
        06/05
        12/05
        06/06
        12/06
        06/07
        12/07
        06/08
        12/08
        06/09
        12/09
        06/10
        12/10
        06/11
        12/11
        06/12
        12/12
        06/13
        12/13




Source: Bloomberg, GMP estimates


Equity implied commodity price premium of silver vs actual*                           Equity implied commodity price premia for key commodities*

  30%                                                                                    60%                      Copper               Platinum           Gold             Silv er
                                                   Silv er                               50%
  20%
                                                                                         40%
  10%                                                                                    30%
   0%                                                                                    20%
                                                                                         10%
 -10%
                                                                                          0%
 -20%                                   V                                               -10%
 -30%                                                                                   -20%
                                                                                        -30%
 -40%
                                                                                        -40%
 -50%                                                                                   -50%
        12/04
        06/05
        12/05
        06/06
        12/06
        06/07
        12/07
        06/08
        12/08
        06/09
        12/09
        06/10
        12/10
        06/11
        12/11
        06/12
        12/12
        06/13
        12/13




                                                                                               12/04

                                                                                                       12/05

                                                                                                               12/06

                                                                                                                       12/07

                                                                                                                               12/08

                                                                                                                                          12/09

                                                                                                                                                  12/10

                                                                                                                                                          12/11

                                                                                                                                                                   12/12

                                                                                                                                                                             12/13




Source: Bloomberg, GMP estimates                                                      Source: Bloomberg, GMP estimates

*Based on a basket of equities. Copper: Freeport-McMoran, Southern Copper, First Quantum, Antofagasta; Platinum: Angloplat, Impala, Lonmin; Gold: Barrick Gold,
Goldcorp, Newmont Mining, Newcrest; Silver: Coeur d’Alene, First Majestic, Hecla Mining, Pan American Silver, Silver Standard.




                                                                               21
                                                                                                                                                        March 15, 2013




  COMMODITY PRICE PERFORMANCE
                                                                         1M chg       3M chg      6M chg       1Y chg 5 yr high   5 yr low 10 yr high 10 yr low
    Base Metals                                 US¢/lb US$/tonne
    LME Aluminium                                   88       1,938          (9%)          (9%)     (11%)       (12%)        149       57        149         57
    LME Copper                                     352       7,762          (5%)          (4%)      (8%)        (9%)        453      126        453         71
    LME Nickel                                     770      16,985          (7%)          (4%)      (3%)       (12%)      1,506      400      2,427        352
    LME Zinc                                        89       1,954         (10%)          (5%)      (6%)        (6%)        123       47        210         34
    LME Lead                                       101       2,235          (7%)          (3%)      (0%)         7%         154       40        177         20
    LME Tin                                      1,089      24,000          (4%)           3%       12%          2%       1,497      454      1,497        204
    Precious Metals                             US$/oz
    Gold                                         1,593                      (1%)        (6%)       (10%)        (4%)      1,883       725     1,883        326
    Silver                                          29                      (3%)       (10%)       (17%)       (11%)         48        9.4       48         4.4
    Platinum                                     1,596                      (5%)        (1%)        (7%)        (5%)      2,167       801     2,167        606
    Palladium                                      774                       2%         10%         11%         10%         851       165       851        151
    Rhodium                                      1,270                       2%         15%          6%        (15%)     10,025     1,050    10,025        450
    Bulk                                                US$/tonne
    Baltic Dry Index                                           880          17%           12%       33%          2%      11,612      647     11,612        647
    Iron ore CIF China imports (63.5%)                         136         (13%)           5%       28%         (8%)        198       63        198         58
    Hard coking coal China***                                  280              -          1%        1%         (3%)        294      115        294         86
    Alumina Metallurgical grade FOB                            400              -           -          -            -       435      178        628        178
    Ilmenite FOB Australia                                     300            0%         -           -          54%         300       70        300         70
    Rutile FOB Australia                                     1,550           -9%        -30%       (30%)        46%       2,225      488      2,225        430
    Zircon FOB Australia                                     1,450            0%       (44%)       (44%)       (44%)      2,600      788      2,600        403
    Steel                                               US$/tonne
    China export HRC                                           600          (2%)          11%       19%         (7%)      1,030      445      1,030        370
    China Domestic HRC***                                      622          (7%)           -        15%         (9%)          0        0          0          0
    US domestic HRC*                                           549          (3%)          (6%)      (8%)       (13%)      1,095      382      1,095        382
    Europe domestic HRC                                        653          (4%)           1%       (1%)       (11%)          0        0          0          0
    China scrap price                                          450          (3%)           0%       19%        (13%)        607      241        607        241
    US scrap price                                             374           2%            3%        6%        (11%)        649      113        649        113
    Other materials                             US$/lb
    LME Molybdenum oxide**                          11                      (0%)          (5%)      (0%)       (24%)        18        10         18         10
    LME Cobalt**                                    11                      (0%)           7%      (10%)       (20%)        19        10         19         10
    Uranium - unrestricted                          42                      (3%)          (3%)     (12%)       (17%)        75        41        138         10
    Manganese, MB weekly                           115                       3%            1%       (5%)       (12%)       205        99        241          7
    Ferrochrome, European low carbon                2.1                      -             -        (6%)        (8%)         5         2          5          1
    Polished diamond price index                             138.6          (1%)           1%        1%        (10%)       172       107        172        100
    Energy
    WTI crude (US$/bbl)                              93                     (3%)           7%       (6%)       (11%)       145        32        145        26
    Brent crude (US$/bbl)                           111                     (8%)          (1%)      (6%)       (11%)       145        35        145        25
    Henry Hub gas (US$/MMBTU)                        3.7                    17%           19%       27%         80%         13        1.8        15        1.8
                                                           US$/tonne
    Thermal coal, Newcastle FOB                                    92       (1%)           2%         6%       (13%)       193         60       193         23
    Thermal coal, Richards Bay FOB                                 84       (2%)          (3%)       (2%)      (19%)       177         56       177         23
    Coal, Pennsylvania Spot FOB                                    62         0%          (4%)       (5%)      (11%)       138         43       138         29
    * Converted to metric tonnes; **Metal Bulletin price before start of LME contract; ***converted to US$/t

Source: Bloomberg, GMP estimates




                                                                                     22
                                                                                                                   March 15, 2013




  COMMODITY PERFORMANCE RANKING
                   1 month performance                                  6 month performance
               1   Henry Hub gas                       17%          1   Baltic Dry Index                    33%
               2   Baltic Dry Index                    17%          2   Iron ore CIF China (63.5%)          28%
               3   Manganese                            3%          3   Henry Hub gas                       27%
               4   US scrap price                       2%          4   China export HRC                    19%
               5   Palladium                            2%          5   China scrap price (RMB/t)           19%
               6   Rhodium                              2%          6   China Domestic HRC                  15%
               7   Coal, Pennsylvania Spot FOB          0%          7   LME Tin                             12%
               8   Ferrochrome, European low carbon     0%          8   Palladium                           11%
               9   Zircon FOB Australia                 0%          9   US scrap price                       6%
              10   Ilmenite FOB Australia               0%         10   Rhodium                              6%
              11   Alumina Metallurgical grade FOB        -        11   Thermal coal, Newcastle FOB          6%
              12   Hard coking coal China                 -        12   Polished diamond price index         1%
              13   LME Cobalt                           0%         13   Hard coking coal China               1%
              14   LME Molybdenum oxide                 0%         14   Ilmenite FOB Australia               0%
              15   Thermal coal, Newcastle FOB         -1%         15   Alumina Metallurgical grade FOB        -
              16   Gold                                -1%         16   LME Lead                             0%
              17   Polished diamond price index        -1%         17   LME Molybdenum oxide                 0%
              18   Thermal coal, Richards Bay FOB      -2%         18   Europe domestic HRC (€/t)           -1%
              19   China export HRC                    -2%         19   Thermal coal, Richards Bay FOB      -2%
              20   US domestic HRC                     -3%         20   LME Nickel                          -3%
              21   Uranium - unrestricted              -3%         21   Manganese                           -5%
              22   Silver                              -3%         22   Coal, Pennsylvania Spot FOB         -5%
              23   WTI crude                           -3%         23   Brent crude                         -6%
              24   China scrap price (RMB/t)           -3%         24   LME Zinc                            -6%
              25   LME Tin                             -4%         25   Ferrochrome, European low carbon    -6%
              26   Europe domestic HRC (€/t)           -4%         26   WTI crude                           -6%
              27   Platinum                            -5%         27   Platinum                            -7%
              28   LME Copper                          -5%         28   LME Copper                          -8%
              29   China Domestic HRC                  -7%         29   US domestic HRC                     -8%
              30   LME Nickel                          -7%         30   Gold                               -10%
              31   LME Lead                            -7%         31   LME Cobalt                         -10%
              32   Brent crude                         -8%         32   LME Aluminium                      -11%
              33   LME Aluminium                       -9%         33   Uranium - unrestricted             -12%
              34   Rutile FOB Australia                -9%         34   Silver                             -17%
              35   LME Zinc                           -10%         35   Rutile FOB Australia               -30%
              36   Iron ore CIF China (63.5%)         -13%         36   Zircon FOB Australia               -44%

Source: Bloomberg, GMP estimates




                                                              23
                                                                                                                                                                           March 15, 2013

Company name                                   Bloomberg code                                    Required disclosures
Mineral Deposits Ltd                           MDL AU                                            1,7




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