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					                            North America United States
Company
                            Industrials Metals & Mining

                            14 February 2011
                                                                                                                                            Periodical
                            Metals in the Americas
                            Weekly Wrap on Rocks
                                                                                                                                            Table of contents
                                                                                                                                            Headline & company summary ........................ Page 01
  Global Markets Research




                                                                                                                                            Base and precious metals summary ................ Page 02
                                                                                                                                            Steel summary ................................................. Page 04
                                                                                                                                            News flow ........................................................ Page 06
                                                                                                                                            Valuation summary ........................................... Page 18

                            Jorge Beristain, CFA                         David S Martin                                                     Top picks
                            Research Analyst                             Research Analyst                                                   Cliffs (CLF.N),USD87.51                                             Buy
                            (+1) 203 863-2381                            (+1) 212 250-5580                                                  Patriot Coal (PCX.N),USD24.62                                       Buy
                            jorge.beristain@db.com                       david.s.martin@db.com                                              Walter Energy (WLT.N),USD119.23                                     Buy

                            US HRC 'spike' not over yet; if prices rise we see X and NUE as winners                                         Companies featured
                            Somewhat to our surprise (we heard rumblings on this move), AK announced that                                   Cliffs (CLF.N),USD87.51                                            Buy
                            it would hike steel prices another $50/t to ~$900/st. If anyone needs this increase,                                             2009A        2010E                              2011E
                                                                                                                                            EPS (USD)          1.56         7.26                               9.72
                            it is AK given its 'naked' iron ore position and we therefore appreciate its                                    P/E (x)            18.1         12.0                                9.0
                            leadership. However, some view this move as an attempt to 'shore up' market in                                  EV/EBITDA (x)       7.2          7.1                                5.0
                            face of slowing seasonal demand, and lastly, we continue to believe that proposed                               Newmont Mining (NEM.N),USD56.88                                    Buy
                            HRC price levels are not fully justified and stand by our view that US steel prices                                              2009A        2010E                              2011E
                                                                                                                                            EPS (USD)          2.65         4.12                               6.68
                            are near a peak; following a $350/st or 64% increase in HRC since October.                                      P/E (x)            16.4         13.8                                8.5
                                                                                                                                            EV/EBITDA (x)       5.9          5.3                                3.1
                            Goldcorp increases reserves                                                                                     Alpha Natural Resources (ANR.N),USD53.79                           Buy
                            Goldcorp increased its proven and probable gold reserves in 2010 by 23% to                                                       2010A        2011E                              2012E
                            60.1m oz, and its measured and indicated gold resources by 13% to 25.7m oz,                                     EPS (USD)          2.16         4.46                               7.15
                            after recent discoveries at its gold projects in Argentina and Canada.                                          P/E (x)            20.5         12.1                                7.5
                                                                                                                                            EV/EBITDA (x)       7.0          5.5                                3.7
                            Steel distys: Steel distys: feels like a peak                                                                   Patriot Coal (PCX.N),USD24.62                                      Buy
                            MSCI SC Dec inv's (NA) totaled 9.1m t or 2.8 MOS, and Jan statistics will be                                                     2010A        2011E                              2012E
                                                                                                                                            EPS (USD)         -1.95         0.52                               3.58
                            released on 2/16. ~90% of our respondents expect to build inventories, similar to                               P/E (x)               –         47.2                                6.9
                            the prior month; we conclude that inventory plans are not excessive and are                                     EV/EBITDA (x)      80.7          9.3                                3.7
                            roughly inline with customer shipments. We estimate that US HRC prices are now                                  Nucor (NUE.N),USD47.81                                             Buy
                            $830/st, ~$10?20 above some published prices and vs ~$740/st in Jan. Also, most                                                  2010A        2011E                              2012E
                                                                                                                                            EPS (USD)          0.44         2.01                               4.02
                            respondents believe prices will remain steady in the coming months; with a                                      P/E (x)            95.0         23.7                               11.9
                            minority forecasting declines of ~$100/st.                                                                      EV/EBITDA (x)      16.3         10.6                                6.6

                            Valuation wrap                                                                                                  Research team
                            We value our universe using a NAV methodology. Key risks include changes to                                     Wilfredo Ortiz
                            metal prices; currency, M&A valuation and integration (see pg 20 for more details).                             (+1) 212 250-3251
                                                                                                                                            wilfredo.ortiz@db.com
                            Figure 1: Company performance summary                                                                           Paul Cheng
                                                                              Last   Weekly       YTD     12M    52-Wk    52-Wk   MktCap    (+1) 212 250-2760
                            Company                 Rating                   Price    % CH       % CH    % CH     High      Low     ($m)    paul.cheng@db.com
                            Mining
                            Alcoa                   Buy                     17.14       6%        11%     30%     17.32   10.00    17,599
                            Barrick Gold            Buy                     48.11       2%       -10%     34%     54.83   34.57    47,966
                            Cliffs                  Buy                     90.27       9%        16%    117%     91.05   40.53    12,296
                            Coeur d'Alene Mines     Buy                     24.62       4%       -10%     66%     27.93   13.55     2,197
                            Freeport-McMoRan        Hold                    56.76       7%        -5%     62%     60.92   29.09    54,149   Related recent research                                          Date
                            Goldcorp                Hold                    41.64       2%        -9%     17%     47.83   34.41    33,193   Cliffs Alert: Notes from the road
                            Kinross Gold            Hold                    16.95       0%       -11%      -1%    19.66   15.16    19,227   Jorge Beristain                           7 Feb 2011
                            Newmont Mining          Buy                     56.97       4%        -7%     23%     64.94   44.41    28,086   Teck Resources Alert: 4Q10 results miss on volumes,
                            Silver Standard         Buy                     23.77       2%       -15%     24%     29.50   16.39     1,890   EPS impacted by one-offs
                            Southern Copper         Buy                     46.32       5%        -5%     67%     49.59   26.19    39,372   Jorge Beristain                           8 Feb 2011
                            Teck Resources          Buy                     62.51       8%         1%     96%     65.10   29.36    36,850   Alpha Natural Resources Alert: ANR 4Q first look: few
                            Thompson Creek          Buy                     14.24       6%        -3%     21%     15.45    8.24     2,380   surprises; ’12 outlook inline with DB
                            Vale                    Buy                     34.40       1%         0%     34%     37.08   23.95   183,146   David Martin                              9 Feb 2011
                            Steel/Coal
                            AK Steel                Hold                    15.84       2%        -3%    -22%     25.00   11.52     1,736
                            Allegheny Technologies Hold                     66.89       5%        21%     63%     66.89   40.33     6,522   Upcoming events                                                  Date
                            Alliance Resource L.P. Hold                     71.11       4%          8%    82%     71.69   38.17     2,611   DB Fieldtrip (ANR, ATI, X)
                            Alpha Natural Resources Buy                     53.09      -8%       -12%     29%     67.38   32.07     6,351   Pittsburgh                             14 Feb 2011
                            Arch Coal               Hold                    33.50       1%        -4%     59%     35.71   19.32     5,442   DB Lunch with PLATTS Scrap & Iron Ore Team
                            Massey Energy           Hold                    62.40       9%        16%     57%     64.75   26.31     6,352   New York                               28 Feb 2011
                            Nucor                   Buy                     47.97       6%          9%    19%     48.21   36.38    15,174   DB Access India Conference
                            Patriot Coal            Buy                     25.10      -1%        30%     68%     28.44   10.05     2,283   Mumbai                                7-9 Mar 2011
                            Peabody Energy          Hold                    63.48       4%        -1%     51%     64.92   35.59    17,089
                            US Steel                Hold                    58.17       4%          0%    30%     69.71   37.66     9,505
                            Walter Energy           Buy                    123.78      -3%         -3%    83%    138.58   59.23     6,550
                            Source: Deutsche Bank estimates, Bloomberg Finance LP


                            Deutsche Bank AG/London
                            All prices are those current at the end of the previous trading session unless otherwise indicated. Prices are sourced from local
                            exchanges via Reuters, Bloomberg and other vendors. Data is sourced from Deutsche Bank and subject companies. Deutsche
                            Bank does and seeks to do business with companies covered in its research reports. Thus, investors should be aware that the firm
                            may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single
                            factor in making their investment decision. DISCLOSURES AND ANALYST CERTIFICATIONS ARE LOCATED IN APPENDIX 1.
                            MICA(P) 007/05/2010
14 February 2011              Metals & Mining Metals in the Americas


Figure 2: Base and precious metals price
                                            Units          Spot       WK      QTD       YTD       12M 1Q09A 2Q09A 3Q09A 4Q09A                                                                       2009A                  2010E                   2011E               2012E
                                                           price     %CH      %CH       %CH       %CH

Base Metals
Aluminum                                 (USc/lb)           112       -2%         1%        1%    22%                62                     68                   82                  92                      76                   99                   120                      137
Copper                                   (USc/lb)           452       -1%         3%        3%    44%               156                 212                  265                     304                   235                    343                  465                      522
Molybdenum                               (US$/lb)            18        1%         7%        7%    14%                10                       9                  14                  18                      13                   16                          22                25
Nickel                                   (USc/lb)          1,283       0%         14%   14%       54%               478                 586                  795                     799                   665                    991              1,236                  1,361


Precious Metals
Gold                                     (US$/oz)          1,357       1%         -4%       -4%   24%               908                 922                  960              1,104                        974              1,226                  1,600                  2,000
Silver                                   (US$/oz)            30        3%         -3%       -3%   91%                13                     14                   15                  18                      15                   20                          38                50
Source: Deutsche Bank estimates and Bloomberg Finance LP



Figure 3: Aluminum spot vs spread to 3 month forward                                              Figure 4: Copper spot vs spread to 3 month forward

  3,200                                                            Price                80          10,600                                                                                                Price                                                         140
                                                                   Spread (US$)                       9,800                                                                                               Spread (US$)                                                  110
                                                                   Aluminum SPOT                      9,000                                                                                                SPOT                                                         80
                                                                   Price (US$/t)        60                                                                                                                 Price (US$/t)                                                50
  2,700                                                                                               8,200
                                                                                                                                                                                                                                                                        20
                                                                                                      7,400
                                                                                                                                                                                                                                                                        -10
                                                                                        40            6,600                                                                                                                                                             -40
  2,200                                                                                               5,800                                                                                                                                                             -70
                                                                                        20            5,000                                                                                                                                                             -100
                                                                                                      4,200                                                                                                                                                             -130
                                                                                                                                                                                                                                                                        -160
  1,700                                                                                               3,400
                                                                                        0                                                                                                                                                                               -190
                                                                                                      2,600                                                                                                                                                             -220
                                                                                                      1,800                                                                                                                                                             -250
  1,200                                                                                 -20           1,000                                                                                                                                                             -280
            Jan- 08
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Source: Deutsche Bank and Bloomberg Finance LP                                                    Source: Deutsche Bank and Bloomberg Finance LP




Figure 5: Nickel spot vs spread to 3 month forward                                                Figure 6: Molybdenum spot (US$/lb)

                                                               Price                                 40
   35,000                                                                               350
                                                               Spread (US$)
                                                                                        300          35
   30,000                                                      Nickel Spot price
                                                               ($/t)                    250          30
   25,000                                                                               200          25
                                                                                        150
   20,000                                                                                            20
                                                                                        100
                                                                                                     15
   15,000                                                                               50
                                                                                        0            10
   10,000
                                                                                        -50           5
     5,000                                                                              -100          0
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Source: Deutsche Bank and Bloomberg Finance LP                                                    Source: Deutsche Bank and Bloomberg Finance LP




Page 2                                                                                                                                                                                                       Deutsche Bank AG/London
14 February 2011                            Metals & Mining Metals in the Americas


Figure 7: Gold spot (US$/troy oz)                                                                                                                                      Figure 8: Silver spot (US$/troy oz)

    1,500                                                                                                                                                                 32

    1,400                                                                                                                                                                 29

    1,300                                                                                                                                                                 26

    1,200                                                                                                                                                                 23

    1,100                                                                                                                                                                 20

    1,000                                                                                                                                                                 17

      900                                                                                                                                                                 14

      800                                                                                                                                                                 11

      700                                                                                                                                                                   8
              Jan- 08

                        A 08

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Source: Deutsche Bank and Bloomberg Finance LP                                                                                                                         Source: Deutsche Bank and Bloomberg Finance LP




Figure 9: LME vs Shanghai copper prices                                                                                                                                Figure 10: LME vs Shanghai aluminum prices

   12000                                                                                                                                                                  3500


   10000                                                                                                                                                                  3000

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                                                                                                                                                                          1000
                               Shanghai Copper spot price $/tonne                                                                                                                                                           Shanghai Aluminum spot price $/tonne
     2000
                               LME Copper spot price $/tonne                                                                                                                500                                             LME Aluminum spot price $/tonne

          0                                                                                                                                                                       0
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Source: Deutsche Bank and Bloomberg Finance LP                                                                                                                         Source: Deutsche Bank and Bloomberg Finance LP




Deutsche Bank AG/London                                                                                                                                                                                                                                                                                                                     Page 3
14 February 2011                                   Metals & Mining Metals in the Americas


Figure 11: Steel and scrap price movement in the last week
Steel (US$/tonne)                                                     Spot price                          WK %CH QTD %CH YTD %CH 12M %CH                                                                2007A                           2008A                              2009A                        2010E                          2011E                        2012E

US Prices
HRC US Midwest                                                                         992                             7%                        29%                    29%      43%                               585                         946                              531                          665                            725                             745
CRC US Midwest                                                                        1102                             6%                        22%                    22%      33%                               681                       1,050                              637                             na                                na                          na
Reinforced Bar US                                                                      865                             0%                        16%                    16%      51%                               636                         883                              600                             na                                na                          na
Merchant Bars US                                                                       953                             0%                             7%                 7%      14%                               725                         990                              785                             na                                na                          na
HRC US Import                                                                          733                        20%                            29%                    29%      22%                               604                         988                              500                             na                                na                          na
International Prices
China 3mm HRC                                                                          769                                 na                         8%                 8%      31%                               561                         743                              558                             na                                na                          na
China 5# Angle                                                                         724                                 na                         4%                 4%      31%                               459                         718                              539                             na                                na                          na
CIS Billet export                                                                      635                             0%                             5%                 5%      37%                               501                         748                              387                             na                                na                          na
CIS Rebar export                                                                       695                             0%                        11%                    11%      43%                               552                         833                              438                             na                                na                          na
Scrap (US$/tons)
No 1. busheling; Chicago                                                               485                             0%                        10%                    10%      21%                               313                         527                              261                             na                                na                          na
Shredded auto scrap; Chicago                                                           455                             0%                        12%                    12%      32%                               290                         415                              235                             na                                na                          na
Source: Deutsche Bank estimates, AMM and Bloomberg Finance LP



Figure 12: Price movements ($/tonne)                                                                                                                                          Figure 13: Steel license data vs US census bureau data
                                                                                                                                                                              on steel imports
                                                                                                                                                                                 5
   1,400                      US HRC (left)                                                                                                                     1,000                                                                                                      Actual Imports (MM tons)

   1,200                      China HRC (left)                                                                                                                  900                                                                                                        Import Licenses (MM tons)
                                                                                                                                                                                 4
                                                                                                                                                                800
                              No 1 Busheling (right)
   1,000                                                                                                                                                        700
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                                                                                                                                                                600
     800
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     600                                                                                                                                                                         2
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     400                                                                                                                                                        300
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     200
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Source: CRU and AMM                                                                                                                                                           Source: Deutsche Bank and US Census Bureau




Figure 14: US weekly steel production                                                                                                                                         Figure 15: Baltic freight rates

                                                   Net out put (000s t ons)                                                   Capabilit y ut ilizat ion                          20,000                                                                                                                         Baltic Capesize Index

    2,200                                                                                                                                                           90           18,000                                                                                                                        Baltic Freight Index
                                                                                                                                                                                 16,000
    1,950                                                                                                                                                           80
                                                                                                                                                                                 14,000
                                                                                                                                                                    70           12,000
    1,700
                                                                                                                                                                    60           10,000
    1,450
                                                                                                                                                                    50            8,000
    1,200                                                                                                                                                                         6,000
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       950                                                                                                                                                          30            2,000
       700                                                                                                                                                          20                     0
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Source: Deutsche Bank and AISI                                                                                                                                                Source: Deutsche Bank and Bloomberg Finance LP




Page 4                                                                                                                                                                                                                                                                                              Deutsche Bank AG/London
14 February 2011                              Metals & Mining Metals in the Americas


Figure 16: Coal price movement in the last week
                                                               Spot price                   WK %CH QTD %CH YTD %CH 12M %CH                                                                  2007A                    2008A                      2009A                           2010E                    2011E                           2012E

International coal prices ($/tonne)
Steam coal JFY                                                                  139                        1%                       4%                           4%       36%                       56                        125                        71                             98                     115                         135
Met coal JFY                                                                    350                        0%                   56%                         56%           59%                       96                        300                     129                            200                       300                         260
US steam coal prices ($/ton)
CAPP                                                                            77                         0%                       9%                           9%       34%                       45                         92                        53                             65                             73                     80
IB                                                                              48                         0%                       1%                           1%       14%                       32                         60                        47                             43                             48                     50
NAPP                                                                            73                         0%                       5%                           5%       33%                       46                        100                        55                             63                             65                     69
PRB                                                                             14                         9%                   10%                         10%           36%                       10                         14                               9                       13                             14                     15
WBIT                                                                            41                         0%                       0%                           0%        2%                       29                         48                        52                             40                             44                     45
Oil & gas
Natural gas ($/MMBtu)                                                           4.7                        -9%                 -11%                       -11%           -29%                      7.2                        9.1                      4.1                            4.3                        4.4                          5.4
Oil - WTI ($/bbl)                                                               89                         -4%                      -6%                          -6%      20%                       72                        100                        62                             79                             96                     98
Benchmark used: Steam coal = Japanese Benchmark Thermal Coal; Met coal = Premium Hard Coking Coal; CAPP = Central Appalachia 12,500 Btu, 1.2 SO2 Coal; IB = Illinois Basin 11,800 Btu, 5.0 SO2 Coal; NAPP = Northern
Appalachia 13,000 Btu, <3.0 SO2 Coal; PRB = Powder River Basin 8,800 Btu, 0.8 SO2 Coal; WBIT = Uinta Basin 11,700 Btu, 0.8 SO2
Source: Deutsche Bank estimates, CRU and Bloomberg Finance LP




Figure 17: International price movements ($/tonne)                                                                                                                     Figure 18: US price movements ($/ton)

                                              Steam coal                                                                Met coal                                                                                                 CAPP                                                         IB
                                                                                                                                                                                                                                 NAPP                                                         WBIT
     450                                                                                                                                                                  160                                                                                                                                                             20
                                                                                                                                                                                                                                 PRB (RHS)
     400                                                                                                                                                                  140                                                                                                                                                             18
     350                                                                                                                                                                                                                                                                                                                                  16
                                                                                                                                                                          120
     300                                                                                                                                                                                                                                                                                                                                  14
                                                                                                                                                                          100                                                                                                                                                             12
     250
                                                                                                                                                                            80                                                                                                                                                            10
     200
                                                                                                                                                                            60                                                                                                                                                            8
     150
                                                                                                                                                                                                                                                                                                                                          6
     100                                                                                                                                                                    40
                                                                                                                                                                                                                                                                                                                                          4
      50                                                                                                                                                                    20                                                                                                                                                            2
     -                                                                                                                                                                     -                                                                                                                                                              0
            Jan- 07
                      A 07
                             Jul- 07


                                              Jan- 08
                                                        A 08
                                                               Jul- 08


                                                                                Jan- 09
                                                                                          A 09
                                                                                                 Jul- 09


                                                                                                                   Jan- 10
                                                                                                                             A 10
                                                                                                                                     Jul- 10


                                                                                                                                                       Jan- 11
                                       O 07




                                                                         O 08




                                                                                                            O 09




                                                                                                                                               O 10




                                                                                                                                                                                  Jan- 07
                                                                                                                                                                                            A 07
                                                                                                                                                                                                   Jul- 07


                                                                                                                                                                                                                    Jan- 08
                                                                                                                                                                                                                              A 08
                                                                                                                                                                                                                                     Jul- 08


                                                                                                                                                                                                                                                      Jan- 09
                                                                                                                                                                                                                                                                    A 09
                                                                                                                                                                                                                                                                           Jul- 09


                                                                                                                                                                                                                                                                                            Jan- 10
                                                                                                                                                                                                                                                                                                      A 10
                                                                                                                                                                                                                                                                                                             Jul- 10


                                                                                                                                                                                                                                                                                                                               Jan- 11
                                                                                                                                                                                                             O 07




                                                                                                                                                                                                                                               O 08




                                                                                                                                                                                                                                                                                     O 09




                                                                                                                                                                                                                                                                                                                        O 10
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Source: CRU and Bloomberg Finance LP                                                                                                                                   Source: Deutsche Bank and Bloomberg Finance LP




Figure 19: US weekly coal production                                                                                                                                   Figure 20: US weekly coal inventories – at utility plants

                                                                                                                                                                                                               Coal stocks                                                                            YoY%
                                       US coal w eekly output                                                         YoY%
  24                                                                                                                                                  25%                190                                                                                                                                                        40%

  23                                                                                                                                                  20%
                                                                                                                                                                         180                                                                                                                                                        30%
  22                                                                                                                                                  15%
                                                                                                                                                      10%                170
  21                                                                                                                                                                                                                                                                                                                                20%
                                                                                                                                                      5%
  20                                                                                                                                                                     160
                                                                                                                                                      0%                                                                                                                                                                            10%
  19                                                                                                                                                                     150
                                                                                                                                                      -5%
  18                                                                                                                                                                                                                                                                                                                                0%
                                                                                                                                                      -10%               140
  17                                                                                                                                                  -15%
                                                                                                                                                                         130                                                                                                                                                        -10%
  16                                                                                                                                                  -20%
  15                                                                                                                                                  -25%               120                                                                                                                                                        -20%
                                                                                                                                                                               Jan- 09
                                                                                                                                                                               Feb- 09
                                                                                                                                                                               M 09
                                                                                                                                                                               A 09
                                                                                                                                                                               M 09
                                                                                                                                                                               Jun- 09
                                                                                                                                                                                Jul- 09
                                                                                                                                                                               A 09


                                                                                                                                                                               N 09

                                                                                                                                                                               Jan- 10
                                                                                                                                                                               Feb- 10
                                                                                                                                                                               M 10
                                                                                                                                                                               A 10
                                                                                                                                                                               M 10
                                                                                                                                                                               Jun- 10
                                                                                                                                                                                Jul- 10
                                                                                                                                                                               A 10


                                                                                                                                                                               N 10
                                                                                                                                                                               Sep- 09
                                                                                                                                                                               O 09

                                                                                                                                                                               D 09




                                                                                                                                                                               Sep- 10
                                                                                                                                                                               O 10
         Jan- 09
         Feb- 09
         M 09
         A 09
         M 09
         Jun- 09
          Jul- 09
         A 09


         N 09

         Jan- 10
         Feb- 10
         M 10
         A 10
         M 10
         Jun- 10
          Jul- 10
         A 10


         N 10

         Jan- 11
         Sep- 09
         O 09

         D 09




         Sep- 10
         O 10

         D 10




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Source: Deutsche Bank and EIA                                                                                                                                          Source: Deutsche Bank and Genscape




Deutsche Bank AG/London                                                                                                                                                                                                                                                                                                            Page 5
14 February 2011   Metals & Mining Metals in the Americas




                                 Mining Newsflow
                                 Chile could lower voltages due to drought
                                 Chile said it could lower voltages and save water in hydroelectric reservoirs to head off an
                                 energy squeeze due to a prolonged drought. Worries over energy woes hurting copper
                                 output in Chile helped push international prices higher.

                                 (Source: Reuters)

                                 Strike slows down Peruvian mineral exports
                                 A strike at Peru's port of Callao, used to export zinc and other minerals from Peru's central
                                 Andes is slowing down mineral exports. Around 11 boats are waiting to be loaded or
                                 unloaded.

                                 (Source: Reuters)

                                 Chinese copper treatment and refining charges up 66% y/y
                                 Chinese smelters have fixed 2011 copper treatment and refining charges with global miner
                                 BHP Billiton at $77/ton and 7.7c/lb, up 66% in fees from the 2010 benchmark price.

                                 (Source: Market Watch)

                                 Collahuasi gets approval to export through Iquique port
                                 Collahuasi has obtained approval to export up to 70k tpm of copper concentrates through
                                 Chile's northern port of Iquique for six months. This represents close to half of its monthly
                                 output of ~160k tons of concentrates.

                                 (Source: Metal Bulletin)

                                 Alcoa resumes smelter talks with Iceland
                                 Alcoa has resumed talks with Iceland's government on building an aluminum smelter in the
                                 north of the island.

                                 (Source: Bloomberg)

                                 Sterlite completes acquisition of Black Mountain
                                 Sterlite Industries has completed the acquisition of a 74% stake in Black Mountain zinc mines
                                 in South Africa from Anglo American for $260m. The company will also replace a shareholder
                                 loan of $88m.

                                 (Source: The Hindu)

                                 Indian court allows 400k tons of backed up iron shipments
                                 The Supreme Court of India has allowed traders to ship the ~400k tons iron that was cleared
                                 before the July ban by the state of Karnataka. Decision on further exports pushed back now
                                 until 4 April.

                                 (Source: Livemint)



Page 6                                                                                                Deutsche Bank AG/London
14 February 2011   Metals & Mining Metals in the Americas


                                 Vale buys land for new port construction in Para
                                 Vale has bought land for the construction of a new port in the state of Para. The project
                                 would help reduce the distance between the Carajas mines and shipment, but faces
                                 opposition from environmental groups. Construction is unlikely to begin before 2015.

                                 (Source: Reuters)

                                 Dutch pension fund to slash gold holdings to between 1-3%
                                 A Dutch pension fund has been told to slash its substantial holdings in gold from 13% to
                                 between 1-3%, after the country's pensions regulator ruled its excessive exposure to the
                                 metal.

                                 (Source: Financial News)

                                 Newmont to double production in Africa by 2015
                                 Newmont Mining expects to more than double its African gold production to 1.2 m oz by
                                 2015, driven by its projects in Ghana, and is awaiting board approval in Mar for an investment
                                 of $700m to $1bn to develop its Akyem project.

                                 (Source: Reuters)




Deutsche Bank AG/London                                                                                                 Page 7
14 February 2011   Metals & Mining Metals in the Americas




                                 Steel & Coal Newsflow
                                 US coking coal prices rise
                                 US coking coal prices rise as industry benefits from low freight rates; Aus prices lower as
                                 Chinese buyers favor domestic supply. US high-vols at $230/t (+5.5% w/w) and low/mid-vols
                                 at $265/t (+6.4%w/w). Australia coking coal is now $311/t (-3.5% w/w).

                                 (Source: Argus)

                                 Massey sells low-vol coking below international benchmark prices
                                 Massey sells low-vol coking coal at $310-320/t to an Indian steelmaker, below some
                                 international benchmarks but the gap appears to be narrowing.

                                 (Source: McCloskey)

                                 EIA's Feb S-T Outlook = higher production forecast
                                 The latest Energy Information Administration S-T Energy Outlook expects coal production of
                                 1,090m tons in ‘11 to increase 0.5% y/y (-0.4% prior) vs. DBe of +2.3% in ’11. Coal
                                 consumption of 1,040m tons is expected to decline 0.8% y/y in ‘11 (vs -1.3% prior and DBe
                                 of +2.4%) due to lower power plant demand (-0.7%) and retail consumption (-7.1%). ’11
                                 exports expected to increase by 9% y/y to 87m t (-0.6% prior; DBe +6.5%); imports to
                                 decline by 4% y/y to 19m t (+0.5% prior; DBe +12.5%); utilities’ inventories to increase by
                                 0.5% y/y to 174m t (+1.7% prior; DBe –15.7%).

                                 (Source: Energy Information Administration, Deutsche Bank)

                                 U.S. coal railroad shipments down 5.7% w/w
                                 U.S. coal railroad shipments for the week ending 2/4 were 125,717 railcars -5.7% w/w,
                                 +0.3% y/y). YTD, railroad shipments were up 9.6% to 648,044 railcars.

                                 (Source: Bloomberg Finance LP)

                                 US coal output down 4.7% w/w
                                 US coal output for the week ending 2/5 was 20.4m tons (-4.7% w/w, -1.2% y/y). Production
                                 in Appalachia, Western region and the interior region declined 0.3%, 8.3% and 1.2% w/w
                                 respectively. YTD production is 106.2m tons (+1%).

                                 (Source: Department of Energy & Energy Information Agency)

                                 Coal shipments from Newcastle down 14% w/w
                                 Coal shipments from Australia's Newcastle port for the week ending 2/7 were 1.98m tons (-
                                 14.3% w/w, -2.4% y/y). The average waiting time to load coal rose to 13.21 days from 12.91
                                 days the previous week, while the backlog of ships waiting to load decreased to 9 from 14
                                 the previous week. YTD, coal shipments from Newcastle are now up 18.8% to 13.46m tons.

                                 (Source: Bloomberg Finance LP)




Page 8                                                                                              Deutsche Bank AG/London
14 February 2011   Metals & Mining Metals in the Americas


                                 US natural gas storage fell 9% w/w
                                 US natural gas storage for the week ending 2/4 was 2,144 Bcf (-8.9% w/w, -3.2% y/y). All
                                 three regions witnessed w/w declines; Eastern (-9.4% w/w; -7% y/y), Western (-9.6% w/w; -
                                 12.8% y/y) and the producing region (-7.8% w/w; +7.2% y/y). Current stocks are down 2.1%
                                 vs. its 5-yr average.

                                 (Source: Department of Energy & Energy Information Agency)

                                 US power generation up 2% w/w
                                 US power generation (ex NE/WC) for the week ending 2/4 was 70.5TWh (+2% w/w, +18.1%
                                 y/y). Regions witnessing the largest w/w increases were South Central (+19.6%) and Rocky
                                 Mountains (+8.5%). YTD power generation is also stable 351TWh.

                                 (Source: Bloomberg Finance LP)

                                 US rig count down 18 points w/w
                                 US rig count, as reported by BHI, was 1,721 during last week (vs 1,739 previous week).
                                 Largest increase was in Louisiana (+2) and Texas (+1) and decrease was in Oklahoma (-6) and
                                 Colorado (-4). Rig count for natural gas was 906; -5 w/w.

                                 (Source: Baker Hughes Inc.)

                                 Coal consumption at US power plants up 0.3% w/w
                                 US coal burned for the week ending 02/11 was 20.37m tons +0.3% w/w, -4.2% y/y). YTD
                                 121.9m tons of coal have been used at US power plants, down 2.8% y/y.

                                 (Source: Genscape)

                                 Heating degree days rose 9.4% w/w
                                 US heating degree days for the week ending 2/5 were 244 days (+9.4% w/w, +8.4% y/y),
                                 which is 9% above the 5-yr weekly average. YTD, HDD now total 1394 (+3% y/y), which is
                                 5% above the 5-yr average.

                                 (Source: Bloomberg Finance LP)

                                 US HRC 'spike' not over yet; if prices rise we see X and NUE as winners
                                 Somewhat to our surprise (we heard rumblings on this move), AK announced that it would
                                 hike steel prices another $50/t to ~$900/st. If anyone needs this increase, it is AK given its
                                 'naked' iron ore position and we therefore appreciate its leadership. However, some view
                                 this move as an attempt to 'shore up' market in face of slowing seasonal demand, and lastly,
                                 we continue to believe that proposed HRC price levels are not fully justified and stand by our
                                 view that US steel prices are near a peak; following a $350/st or 64% increase in HRC since
                                 October.

                                 (Source: Company, Deutsche Bank)

                                 Essar restart 2.8m tpy mill
                                 Essar's Algoma (2.8m tpy) steel mill has restarted after shutting down in late-January to
                                 repair a water leak.

                                 (Source: Steel Business Briefing)

Deutsche Bank AG/London                                                                                                 Page 9
14 February 2011   Metals & Mining Metals in the Americas


                                 International ferrous scrap market inactivity continues, as purchases have dropped.
                                 The Platts assessment for export US shredded scrap fell $30/lt to $435/lt, reflecting poor
                                 demand and following a $15/lt drop in the Feb price for domestic shredded. Traders believe
                                 the unrest in Egypt has added to the lull.

                                 (Source: Steel Business Briefing, Platts)

                                 US shredded scrap benchmark price down $15/lt
                                 US shredded scrap price declines $15/lt to $455/lt according to SBB. This benchmark had
                                 risen by $65/lt and $45/lt the previous two months. This price change is inline with our
                                 channel from early last week but more recent reports suggest the market declined ~$30/lt as
                                 export demand has waned via Middle East concerns.

                                 (Source: Steel Business Briefing, Deutsche Bank)

                                 CRU HRC weekly assessment shows 1% w/w increase
                                 CRU Weekly HRC Price (used for index-linked contracts) shows US HRC at $806/st (+1%
                                 w/w, +$10/st), increasing for the thirteenth consecutive week. 1Q11 average is $758/st, vs.
                                 4Q10 and 3Q10 averages of $575/st and $583/st, respectively. Also, lead times are down
                                 slightly (5.8 wks vs 6.1 wks prior) on restarts and possible changes in consumer buying.

                                 (Source: CRU & SBB)

                                 European blast furnaces restarting
                                 European blast furnaces restarting, including (1) Poland's Krakow (1.3m tpy) to start in mid-
                                 Mar; (2) Romania's Galati (2.5m tpy) restarted in Jan; (3) Czech Rep's Ostrava (1.1m tpy) with
                                 no stated timeframe; (4) Germany's Eisenhüttenstadt (~1m tpy) in coming weeks; and (5)
                                 Florange, France plant (~1m typ) restarted in Feb.

                                 (Source: Steel Business Briefing, Platts)

                                 Nucor raises base prices for rebar and merchant bar
                                 Nucor raising base prices on rebar and merchant bar by $15/t effective 3/1, which will offset
                                 a similar reduction in its scrap surcharge.

                                 (Source: Metal Bulletin)

                                 US steel production up 0.4% w/w
                                 US steel output up 0.4% w/w for week ending 2/5. Production was 1.79m tons (+11.5% y/y)
                                 and utilization 74%. Southern region (+28k tons; +4.5%) saw largest w/w increase, while
                                 Detroit had biggest decrease (-21k tons; -19.1%). YTD production is 9.0m tons (+13.2% y/y)
                                 and utilization 72.6%.

                                 (Source: American Iron and Steel Institute)

                                 U.S. steel imports rose 5% in December
                                 December steel imports were 1.87m tons (+5% m/m, +33% y/y), 3% above the preliminary
                                 estimate and 1% above the October import permits figure. Billets/slabs (+27%, 76k tons) and
                                 cut length plates (+38%, 21k tons) experienced the largest m/m increases. Brazil (+55%, 68k
                                 tons) and Mexico (+40%, 62k tons) recorded the largest m/m increases. F10 imports were up
                                 47% to 23.9m tons. The products experiencing largest y/y increases were billets/slabs

Page 10                                                                                               Deutsche Bank AG/London
14 February 2011   Metals & Mining Metals in the Americas


                                 (+148%, 3.0m tons) and oil country goods (+49%, 782k tons), and the originating countries
                                 recording largest increases were Canada (+55%, 2.4m tons) and Mexico (+61%, 1.1m tons).

                                 (Source: U.S. Census Bureau)

                                 Steel import permit applications up 12% in January
                                 Steel import permit applications rise 12% m/m (+26% y/y) to 2.07m tons in January, vs
                                 December imports of 1.81m tons. The products recording the largest m/m increases were
                                 pipe tubing (28% or 120k tons) and semi finished (10% or 35k tons). The countries
                                 witnessing m/m increases were Mexico (49% or 109k tons) and Germany (103% or 68k
                                 tons).

                                 (Source: US import administration)




Deutsche Bank AG/London                                                                                            Page 11
14 February 2011    Metals & Mining Metals in the Americas




                                  Recent Research
                                  Cliffs Alert: Notes from the road

 February 7, 2011                 We recently spent time on the road with Cliffs’s management visiting investors. The C$5bn
                                  Consolidated Thompson (CLM) deal remains at fore-front, with most investors agreeing on
                                  benefits of adding scale and exposure to iron ore seaborne market and EPS accretion
                                  potential. In our view CLM consensus forecasts appear conservative, when considering iron
                                  ore prices near IODEX (QTD average of $181/ton vs implied price of $133/ton). Further,
                                  agreement with 3rd largest steel producer, Wuhan Iron and Steel (600005.SS, NR, CNY4.38)
                                  (WISCO) increases likelihood deal reaches finish line. CLF appeared more open regarding
                                  non-performing coal assets within its portfolio implying 2011 as a bit of "litmus" test year. Re-
                                  it Buy.

                                  WISCO support of deal is strategic as Chinese steel producer unlikely to side with another
                                  steel producer (given its 25% stake in Bloom Lake) or a major iron ore producer should an
                                  interloping bid emerge. Further CLF to benefit from CLM’s agreements with 3 Asian
                                  customers (incl. WISCO) and pricing for long-term supply contracts fully floats with iron ore
                                  seaborne prices. These new relationships will expand CLF’s current NA iron ore segment’s
                                  customer base away from historical NA steel makers (~45% of current revenue). CLF
                                  reiterated intention to maintain credit rating and is likely to issue ~$1bn in equity around deal
                                  close.

                                  Though 2011 focus will be integration of CLM, CLF will work on completion/evaluation of
                                  current coal projects pipeline which includes: shaft at Oak Grove, completion of prep plant,
                                  upgrade in Pinnacle and new long wall recently commissioned. On Feb 4, CLF announced a
                                  preliminary update on its Black Thor chromite deposit indicating an inferred resources base of
                                  ~70m tons, with pre-feasibility study underway (production slated for 2015).

                                  (Source: Jorge Beristain, Deutsche Bank)

                                  Teck Resources Alert: 4Q10 results miss on volumes, EPS impacted by one-offs

 February 8, 2011                 Teck Resources (Teck) reported l-t-e 4Q10 adj. EPS of C$0.93, -18% vs DBe and -20% vs
                                  Bloomberg consensus. Reported EPS came in at C$0.61 which included one-off debt
                                  refinancing expense of C$341m and stock based compensation of C$70m. Results came in
                                  lighter on l-t-e volumes for coal on extreme weather conditions and copper due to lower
                                  production at Highland mine. EBITDA came in at $1.3bn (+15% QoQ; -10% DBe). Re-it Buy.

                                  Coal sales volumes was 6.0m tons (+8% QoQ; -5% DBe) at a unit cash cost of C$89/ton (-
                                  6% QoQ). Copper volumes came in at 81k tons (+14% QoQ; -8% DBe) with successful
                                  startup of Andacollo concentrator being the highlight. Realized copper prices came at
                                  $4.24/lb (+18% QoQ; +8% DBe) while realized prices for coal were steady at $204/t. Zinc
                                  sales volumes came in at 310k tons (+18% QoQ; +9% DBe).

                                  2011 guidance: Coal production of ~25.0m tons (DBe 26.0m tons), with company citing
                                  downside risk on ongoing labor issues. Copper and zinc production of ~350k tons (378k tons)
                                  and ~905k tons (990k tons) respectively. Capex of ~C$1.4bn (C$900m) with C$615m for
                                  growth and rest for maintenance. New development plan at Highland Valley expected to
                                  increase mine life by 5 years to 2025. Quebrada Blanca expansion feasibility and Relincho
                                  pre-feasibility both expected completion in 1Q12 while Galore Creek pre-feasibility expected
                                  in 2Q11. 1Q11 coal volume guidance of 5.0-5.5m tons at ~$208/t ($204/t) realized price and
                                  costs of ~C$93/t (C$105/t).



Page 12                                                                                                  Deutsche Bank AG/London
14 February 2011     Metals & Mining Metals in the Americas


                                   (Source: Jorge Beristain, Deutsche Bank)

                                   Alpha Natural Resources Alert: ANR 4Q first look: few surprises; ’12 outlook inline with
                                   DB

 February 09, 2011                 ANR 4Q adjusted EPS was $0.27, inline with DBe of $0.27 and consensus of $0.49. This
                                   result also compares to prior period figures of $0.58 in 3Q10 and $0.51 in 4Q09. The adjusted
                                   EPS includes an $8.7 M&A expense, $52.8m of pre-tax coal amortization cost, $14m tax
                                   benefit, and excludes other revenue of $18.1m related to a modified supply agreement.

                                   Also, EBITDA was $156m ($7.1/t), vs. DBe of $144m ($6.5/t).         Overall, there were few
                                   surprises given ANR had preannounced in Jan.

                                   4Q10 shipments increased 5% q/q to 22.1m tons (+4% y/y) and -0.3% vs. DBe.

                                   Revenues/ton declined 5% q/q to $44.9/t; 2% above DBe and vs. prior periods of $47.3 in
                                   3Q10 and $42.0 in 4Q09. Cash cost/ton was $37.8/t; 10% below DBe and vs. $35.5 in 3Q10
                                   and $30.3 in 4Q10. EBITDA/t declined 28% q/q to $7.1/t but was 9% above DBe of $6.5/t.

                                   For FY11, ANR maintains prior guidance of Western shipments of 48-52m t; Eastern steam
                                   shipments of 22-25m t; and Eastern met shipments of 13-14.5m t. As of 1/26, all ’11 PRB
                                   shipments are priced at $11.8/t; 94% of Eastern steam priced at $65.4/t; 68% of Eastern met
                                   priced at $142.2/t. Cost guidance unchanged with Eastern cost/t of $62-66/t; Western cost/t
                                   of $9.25-9.75/t. Capex of $340-440m expected in ’11.

                                   ANR offers the following ’12 guidance on a standalone basis – PRB shipments of 48-52m t
                                   (DBe of 51m t) with 62% priced at $12.5/t; Eastern steam of 22-25m t (DBe of 25.5m t) with
                                   16% priced at $69.9/t; Eastern met of 13-14.5m t (DBe of 14m t) with 9% priced at $133.7/t.

                                   (Source: David Martin, Deutsche Bank)

                                   Goldcorp Alert: Reserves increase while Osisko sale shores up cash

 February 10, 2011                 Goldcorp (GG) reported a 23% YoY increase in its gold proven and probable (P&P) reserves to
                                   60.1m oz from prior 48.8m oz, while gold measured and indicated (M&I) resources increased
                                   by 13% to 25.7m oz (prior 22.7m oz). Acquisitions in 2010 helped boost reserves, El Morro
                                   (5.7m oz) and Andean Resources’ Cerro Negro (2.1m oz, initial reserve estimate), while sale
                                   of San Dimas (~0.9m oz) had minimal impact. The biggest gain came from initial reserve
                                   declaration at Eleonore of ~3m oz. Silver P&P reserves remained largely unchanged at 1.3bn
                                   oz, whereas copper reserves increased ~4.5x YoY to 5.4bn lbs (prior ~1.2bn lbs) largely due
                                   to incorporation of El Morro’s reserves.

                                   Cerro Negro also adds 2.7m oz (~5% increase from 2.5m oz estimate since deal
                                   announcement) to GG's M&I resources. GG is expecting further upside at Cerro Negro from
                                   exploration of higher grade areas. 2011E exploration spend to be $170m with focus on Cerro
                                   Negro, El Morro and Red Lake. P&P reserves were estimated using gold prices of $950/oz
                                   (prior $825/oz), silver of $15/oz ($13/oz) and copper of $2.0/lb (unchanged). We consider this
                                   increase in underlying estimation to be in tune with the strong gold and silver prices
                                   prevailing currently, and expect other gold producers in our coverage (Barrick, Newmont and
                                   Kinross) to raise underlying commodity price estimates which would help them increase
                                   reserves.

                                   GG also announced the sale of its 10.1% equity stake in Osisko mining (OSK.TO, C$13.86,
                                   NR) for C$13.75/share for total cash consideration of ~C$530m. The shares were sold on an
                                   underwritten block trade basis. This move should shore up cash (and follows similar
                                   divestitures of non-core assets) to help fund capex requirements ($1.8bn guidance for 2011).

Deutsche Bank AG/London                                                                                                  Page 13
14 February 2011     Metals & Mining Metals in the Americas


                                   This cash inflow would partly offset the C$765m cash payment on recent purchase of
                                   Andean Resources.

                                   (Source: Jorge Beristain, Deutsche Bank)

                                   Metals & Mining Alert: Steel distys: Steel distys: feels like a peak

 February 11, 2011                 Respondents uniformly noted higher volumes since Dec, suggesting shipments are up 12-
                                   13% m/m. Given there were 2 fewer shipping days in Jan, this trend points to a robust start
                                   to '11. However, we conclude the market is experiencing a rather typical seasonal
                                   improvement as Jan has historically gained ~25%. Also, just over 60% of respondents
                                   expect sales to increase in the coming 3 months; down from 80+% in our prior survey and
                                   some contacts note that order-entry & shipments have slowed in Feb, as normal.

                                   ~90% of our respondents expect to build inventories, similar to the prior month; we conclude
                                   that inventory plans are not excessive and are roughly inline with customer shipments. MSCI
                                   SC Dec inv's (NA) totaled 9.1m t or 2.8 MOS, and Jan statistics will be released on 2/16.

                                   Mill lead times are now ~7.5 wks vs 8.0 wks in early Jan and the majority of our respondents
                                   (~ 90%) suggest that imports remain unattractive.

                                   We estimate that US HRC prices are now $830/st, ~$10?20 above some published prices
                                   and vs ~$740/st in Jan. Also, most respondents believe prices will remain steady in the
                                   coming months; with a minority forecasting declines of ~$100/st.

                                   We reiterate our cautious steel view, which is supported by our belief that (1) demand will
                                   ease seasonally; (2) US steel margins & prices are not sustainable with a HRC-scrap spread
                                   of nearly $450/st; (3) elevated steel prices will trigger a supply response that will shorten
                                   lead-times and weaken prices; (4) cost momentum is easing; mainly scrap at this point; and
                                   (4) steel consumers will take a more cautious stance in the coming months. Our only Buy in
                                   the sector is Nucor.

                                   (Source: David Martin, Deutsche Bank)




Page 14                                                                                                Deutsche Bank AG/London
14 February 2011                 Metals & Mining Metals in the Americas



Figure 21: 4Q10 Earnings Calendar
                 Monday                        T uesday                             Wednesday                                 Thursday                         Friday
                                                                                     February
                     14                           15                                      16                                      17                               18
W alte r En e rg y (W L T )                                     Kin ross G o ld (KG C )                 B arrick G o ld (A B X)
After market close                                              After market close                      Conference Call 9:30am ET
Conference Call 10:00am ET on Feb-15                            Conference Call 8:00am ET on Feb-17     Dial in #: 800-931-3971
Dial in #: 888-790-1724                                         Dial in #: 800-319-4610
PIN: W LT
                                                                C l iffs (C L F )
                                                                After market close
                                                                Conference Call 10:00am ET on Feb-17


                        21                        22                                      23                                      24                               25
                                                                Val e (VA L E)                          N e w m o n t Min in g (N EM)
                                                                After market close                      Before market opens
                                                                Conference Call 10:00am ET on Feb-24    Conference Call 10:00am ET
                                                                                                        Dial in # 888-566-1822


                                                                                                        Vale (VAL E)
                                                                                                        After market close
                                                                                                        Conference Call 10:00am ET on Feb-25


                                                                                                        G ol d co rp (G G )
                                                                                                        Release after market close
                                                                                                        Conference Call 10:00am ET on Feb-25
                                                                                                        Dial in # 800-408-3053
                                                                                                        Access # 3536617
                        28
T h o m p so n C re e k (T C )
After market close
Conference Call 8:30am ET on Mar-1




                                                                                      March
                                                   1                                       2                                      3                                 4
                                                                C o e u r d 'A le n e Min e s (C D E)                                          Silv e r Stan d ard (SSO)
                                                                Before market opens                                                            Before market opens
                                                                Conference Call 1:00pm ET                                                      Conference Call 11:00am ET




                        7                          8                                      9                                       10                               11




Source: Deutsche Bank and company data




Deutsche Bank AG/London                                                                                                                                                     Page 15
Page 16




                                                                                                                                                                                                            14 February 2011
                          Figure 22: Metal and mining valuation table (closing prices as of February 11, 2011)
                                                                                            Rep   Close   Target   Mkt cap   EV/EBITDA            P/E            P/BV Div. Yld    ROE FCF Yld      ND/Eq.
                          Company                                   Ticker           Rec    Ccy   Price    Price   (US$m)    2010E   2011E     2010E    2011E   2010E   2010E    2010E    2010E    2010E
                          Alcoa                                     AA.N             Buy    USD    17.4     22.0    17,835     6.5       5.3    12.5      8.7     0.9      0.7     8.0      3.6       38
                          Barrick Gold                              ABX.N            Buy    USD    47.5     76.0    47,348     5.5       3.5    10.1      6.9     1.9      1.0    21.1      8.1        -1
                          Cliffs                                    CLF.N            Buy    USD    87.5    115.0    11,920     5.0       3.6     9.0      7.2     2.4      0.4    30.0      9.5        -6




                                                                                                                                                                                                            Metals & Mining Metals in the Americas
                          Coeur d'Alene Mines                       CDE.N            Buy    USD    24.8     54.0     2,217     3.5       1.8     8.6      4.6     1.0      0.0    11.8     12.1        0
                          Freeport-McMoRan                          FCX.N            Hold   USD    53.5     65.0    51,058     3.9       3.0     8.2      6.6     2.4      1.9    34.5     11.4       -18
                          Goldcorp                                  GG.N             Hold   USD    43.0     60.0    34,261     9.0       5.6    16.7     10.4     1.7      0.8    11.0      3.9        -3
                          Kinross Gold                              KGC.N            Hold   USD    16.4     23.0    18,649     5.6       3.8    15.0      9.9     1.2      0.6     8.7      4.9       -10
                          MMX                                       MMXM3.SA         Buy    BRL     9.2     17.0    10,444   234.2    33.1       nm      76.1    25.4      0.0    -11.3     -3.8     186
                          Newmont Mining                            NEM.N            Buy    USD    56.9     93.0    28,042     3.1       1.9     8.4      6.6     1.4      1.1    18.6     14.9       -21
                          Silver Standard                           SSO.TO           Buy    USD    23.9     37.0     1,905     6.9       4.3    15.5      9.0     1.8      0.0    12.4      4.1        -6
                          Southern Copper                           SCCO.N           Buy    USD    44.4     64.0    37,740     5.5       4.2     9.3      6.9     7.4      8.3    88.3      9.4        7
                          Teck Resources                            TCK.N            Buy    CAD    58.8     77.0    34,668     4.9       3.9     9.4      8.1     1.7      1.0    19.7     11.0        6
                          Thompson Creek                            TC.N             Buy    USD    13.7     18.0     2,291     6.1       5.4     9.7      9.3     1.4      0.0    15.2     -12.2       4
                          Vale                                      VALE.N           Buy    USD    34.4     48.0   182,986     4.7       3.8     6.2      5.3     1.8      1.5    32.7      3.7       10
                          Mining Average                                                                           481,363    10.1       4.4     8.7      8.3     2.7      1.8    29.7      6.6        6
                          AK Steel                                  AKS.N            Hold   USD    15.8     17.0     1,733     7.4       4.0    38.5      9.2     2.6      1.3     6.9      2.8       61
                          Allegheny Technologies                    ATI.N            Hold   USD    67.5     60.0     6,578    10.1       8.6    20.5     16.2     2.8      1.2    14.3      0.8       28
                          Alliance Resource L.P.                    ARLP.OQ          Hold   USD    72.8     72.0     2,673     5.6       5.2     9.5      8.8     4.4      7.7    52.9      6.6       68
                          Alpha Natural Resources                   ANR.N            Buy    USD    53.8     78.0     6,436     5.5       3.7    11.9      7.4     2.0      0.0    18.5      1.2        4
                          Arch Coal                                 ACI.N            Hold   USD    32.9     38.0     5,351     6.9       4.9    15.4      9.2     2.1      1.2    14.5      5.6       51
                          CSN                                       SID.N            Buy    BRL    16.5     26.0    24,951     7.2       6.3    11.2      9.3     4.4      5.1    42.9      3.3      100
                          Gerdau                                    GGB.N            Buy    BRL    14.0     18.0    19,866     8.1       5.8    15.7      9.5     1.5      1.6    10.1      0.7       52
                          Massey Energy                             MEE.N            Hold   USD    63.1     60.0     6,423     7.4       5.6    15.2     10.7     2.9      0.4    21.3      1.3       43
                          Nucor                                     NUE.N            Buy    USD    47.8     50.0    15,124    10.6       6.6    23.7     11.9     2.0      3.0     8.6      3.5       38
                          Patriot Coal                              PCX.N            Buy    USD    24.6     34.0     2,239     9.3       3.7    46.7      6.8     2.5      0.0     5.5      2.0       24
                          Peabody Energy                            BTU.N            Hold   USD    62.8     70.0    16,917     7.1       5.3    12.6      9.3     2.8      0.5    25.3      1.2       22
                          Ternium                                   TX.N             Buy    USD    35.9     54.0     7,205     3.9       3.3     9.6      9.0     0.9      1.8    10.3      4.8       -22
Deutsche Bank AG/London




                          US Steel                                  X.N              Hold   USD    58.9     57.0     9,628     8.5       5.8    21.5     10.5     2.3      0.3    11.0      1.6       71
                          Usiminas                                  USIM5.SA         Hold   BRL    19.1     33.0    11,297     8.7       5.6    17.0      9.4     1.0      1.1     6.3     -16.0      38
                          Walter Energy                             WLT.N            Buy    USD   119.2    162.0     6,310     5.2       4.1     8.6      7.4     4.6      0.4    73.3      4.0       -18
                          Steel/Coal Average                                                                       142,729     7.7       5.6    15.9      9.8     2.6      2.0    22.0      1.0       45
                          Source: Deutsche Bank estimates and Bloomberg Finance LP
Deutsche Bank AG/London




                                                                                                                                                                                   14 February 2011
                          Figure 23: Metal and mining price performance (closing prices as of February 11, 2011)
                                                                                                  52 W          Close   Target                Absolute Performance
                          Company                                                    Ticker     High     Low    Price    Price   1W     1M          3M         6M    12M    YTD
                          Alcoa                                                      AA.N        17.4    10.0    17.4     22.0   1%    10%         30%        63%    31%    13%
                          Barrick Gold                                               ABX.N       54.8    36.7    47.5     76.0   -1%    0%          -5%       11%    29%    -11%
                          Cliffs                                                     CLF.N       91.1    44.5    87.5    115.0   -3%    0%         30%        50%    91%    12%




                                                                                                                                                                                   Metals & Mining Metals in the Americas
                          Coeur d'Alene Mines                                        CDE.N       27.9    14.0    24.8     54.0   1%     0%          9%        71%    72%    -9%
                          Freeport-McMoRan                                           FCX.N       60.9    29.1    53.5     65.0   -6%   -9%          5%        53%    45%    -11%
                          Goldcorp                                                   GG.N        47.8    36.4    43.0     60.0   3%     2%          -6%        8%    16%    -7%
                          Kinross Gold                                               KGC.N       19.7    15.2    16.4     23.0   -3%   -5%          -9%        8%    -10%   -13%
                          MMX                                                        MMXM3.SA    14.4     8.8     9.2     17.0   -3%   -21%        -34%      -25%    -41%   -18%
                          Newmont Mining                                             NEM.N       64.9    46.5    56.9     93.0   0%     0%          -6%        0%    22%    -7%
                          Silver Standard                                            SSO.TO      29.5    16.4    23.9     37.0   1%     2%          -6%       41%    28%    -14%
                          Southern Copper                                            SCCO.N      49.6    26.2    44.4     64.0   -4%   -4%          2%        52%    48%    -9%
                          Teck Resources                                             TCK.N       65.1    29.4    58.8     77.0   -6%   -8%         20%        83%    64%    -5%
                          Thompson Creek                                             TC.N        15.5     8.2    13.7     18.0   -4%   -9%          9%        54%     7%    -7%
                          Vale                                                       VALE.N      37.1    24.0    34.4     48.0   0%    -5%          6%        24%    28%    -1%
                          Mining Average                                                                                         -2%    -4%          4%       30%    32%     -5%
                          AK Steel                                                   AKS.N       25.0    11.5    15.8     17.0   0%     5%         21%        21%    -27%   -3%
                          Allegheny Technologies                                     ATI.N       67.5    40.3    67.5     60.0   1%    16%         30%        53%    59%    22%
                          Alliance Resource L.P.                                     ARLP.OQ     72.8    39.8    72.8     72.0   2%     4%         19%        45%    82%    11%
                          Alpha Natural Resources                                    ANR.N       67.4    32.1    53.8     78.0   1%    -16%        11%        37%    22%    -10%
                          Arch Coal                                                  ACI.N       35.7    19.3    32.9     38.0   -2%   -7%         14%        35%    52%    -6%
                          CSN                                                        SID.N       20.8    13.4    16.5     26.0   -3%   -8%          -3%        0%     5%    -1%
                          Gerdau                                                     GGB.N       18.0    11.6    14.0     18.0   2%    -5%          7%        -1%    -1%     0%
                          Massey Energy                                              MEE.N       64.8    26.3    63.1     60.0   1%    10%         33%       101%    50%    18%
                          Nucor                                                      NUE.N       48.2    36.4    47.8     50.0   0%     7%         21%        26%    16%     9%
                          Patriot Coal                                               PCX.N       28.4    10.1    24.6     34.0   -2%   -7%         69%       120%    53%    27%
                          Peabody Energy                                             BTU.N       64.9    35.6    62.8     70.0   -1%   -2%          9%        38%    41%    -2%
                          Ternium                                                    TX.N        43.3    29.8    35.9     54.0   -9%   -16%         5%        11%    16%    -15%
                          US Steel                                                   X.N         69.7    37.7    58.9     57.0   1%     6%         27%        31%    23%     1%
                          Usiminas                                                   USIM5.SA    31.5    18.3    19.1     33.0   1%    -6%         -14%      -21%    -17%   -1%
                          Walter Energy                                              WLT.N      138.6    59.2   119.2    162.0   -4%   -13%        25%        64%    55%    -7%
                          Steel/Coal Average                                                                                     -1%    -3%         11%       24%    21%     1%
                          Source: Deutsche Bank estimates and Bloomberg Finance LP
Page 17
14 February 2011   Metals & Mining Metals in the Americas




                                 Sector valuation and risks
                                 We continue to employ a NAV valuation methodology for our coverage universe stocks. We
                                 generally apply a 1x multiple to our NAVs to derive our target prices but we adjust these
                                 multiples based on our assessment of historical valuation, specific metal fundamentals, M&A
                                 activity etc.

                                 Key risks include lower metal prices vs the changes in the supply and demand dynamics,
                                 currency, M&A valuation and integration, raw material costs, geopolitical, project delay &
                                 costs etc.




Page 18                                                                                             Deutsche Bank AG/London
14 February 2011    Metals & Mining Metals in the Americas




Appendix 1
Important Disclosures
Additional information available upon request
For disclosures pertaining to recommendations or estimates made on a security mentioned in this report, please see
the most recently published company report or visit our global disclosure look-up page on our website at
http://gm.db.com/ger/disclosure/DisclosureDirectory.eqsr.


Analyst Certification
The views expressed in this report accurately reflect the personal views of the undersigned lead analyst about the subject
issuers and the securities of those issuers. In addition, the undersigned lead analyst has not and will not receive any
compensation for providing a specific recommendation or view in this report. David S Martin




Equity rating key                                             Equity rating dispersion and banking relationships

Buy: Based on a current 12- month view of total share-
holder return (TSR = percentage change in share price               500                            51 %
                                                                    450       47 %
from current price to projected target price plus pro-              400
jected dividend yield ) , we recommend that investors               350
                                                                    300
buy the stock.                                                      250
                                                                    200            39 %                34 %
Sell: Based on a current 12-month view of total share-
                                                                    150
holder return, we recommend that investors sell the                 100
                                                                                                                      1 % 25 %
stock                                                                50
                                                                      0
Hold: We take a neutral view on the stock 12-months
                                                                                Buy                 Hold                Sell
out and, based on this time horizon, do not recommend
either a Buy or Sell.
                                                                               Companies Covered     Cos. w/ Banking Relationship
Notes:
1. Newly issued research recommendations and target                                    North American Universe
prices always supersede previously published research.
2. Ratings definitions prior to 27 January, 2007 were:
     Buy: Expected total return (including dividends) of
     10% or more over a 12-month period
     Hold: Expected total return (including dividends)
     between -10% and 10% over a 12-month period
     Sell: Expected total return (including dividends) of -
     10% or worse over a 12-month period




Deutsche Bank AG/London                                                                                                             Page 19
14 February 2011   Metals & Mining Metals in the Americas


Regulatory Disclosures
1. Important Additional Conflict Disclosures
Aside from within this report, important conflict disclosures can also be found at https://gm.db.com/equities under the
"Disclosures Lookup" and "Legal" tabs. Investors are strongly encouraged to review this information before investing.




2. Short-Term Trade Ideas
Deutsche Bank equity research analysts sometimes have shorter-term trade ideas (known as SOLAR ideas) that are consistent
or inconsistent with Deutsche Bank's existing longer term ratings. These trade ideas can be found at the SOLAR link at
http://gm.db.com.




3. Country-Specific Disclosures
Australia: This research, and any access to it, is intended only for "wholesale clients" within the meaning of the Australian
Corporations Act.
Brazil: The views expressed above accurately reflect personal views of the authors about the subject company(ies) and
its(their) securities, including in relation to Deutsche Bank. The compensation of the equity research analyst(s) is indirectly
affected by revenues deriving from the business and financial transactions of Deutsche Bank.
EU countries: Disclosures relating to our obligations under MiFiD can be found at http://globalmarkets.db.com/riskdisclosures.
Japan: Disclosures under the Financial Instruments and Exchange Law: Company name - Deutsche Securities Inc. Registration
number - Registered as a financial instruments dealer by the Head of the Kanto Local Finance Bureau (Kinsho) No. 117.
Member of associations: JSDA, The Financial Futures Association of Japan. Commissions and risks involved in stock
transactions - for stock transactions, we charge stock commissions and consumption tax by multiplying the transaction
amount by the commission rate agreed with each customer. Stock transactions can lead to losses as a result of share price
fluctuations and other factors. Transactions in foreign stocks can lead to additional losses stemming from foreign exchange
fluctuations. "Moody's", "Standard & Poor's", and "Fitch" mentioned in this report are not registered as rating agency in Japan
unless specifically indicated as Japan entities of such rating agencies.
New Zealand: This research is not intended for, and should not be given to, "members of the public" within the meaning of the
New Zealand Securities Market Act 1988.
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appraisal or evaluation activity requiring a license in the Russian Federation.




Page 20                                                                                               Deutsche Bank AG/London
Deutsche Bank AG/London

North American locations

Deutsche Bank Securities Inc.                            Deutsche Bank Securities Inc.                             Deutsche Bank Securities Inc.                             Deutsche Bank Securities Inc.
60 Wall Street                                           One International Place                                   222 South Riverside Plaza                                 3033 East First Avenue
New York, NY 10005                                       12th Floor                                                30th Floor                                                Suite 303, Third Floor
Tel: (212) 250 2500                                      Boston, MA 02110                                          Chicago, IL 60606                                         Denver, CO 80206
                                                         United States of America                                  Tel: (312) 537-3758                                       Tel: (303) 394 6800
                                                         Tel: (1) 617 217 6100

Deutsche Bank Securities Inc.                            Deutsche Bank Securities Inc.                             Deutsche Bank Securities Inc.
1735 Market Street                                       101 California Street                                     700 Louisiana Street
24th Floor                                               46th Floor                                                Houston, TX 77002
Philadelphia, PA 19103                                   San Francisco, CA 94111                                   Tel: (832) 239-4600
Tel: (215) 854 1546                                      Tel: (415) 617 2800




International locations

Deutsche Bank Securities Inc.                            Deutsche Bank AG London                                   Deutsche Bank AG                                          Deutsche Bank AG
60 Wall Street                                           1 Great Winchester Street                                 Große Gallusstraße 10-14                                  Deutsche Bank Place
New York, NY 10005                                       London EC2N 2EQ                                           60272 Frankfurt am Main                                   Level 16
United States of America                                 United Kingdom                                            Germany                                                   Corner of Hunter & Phillip Streets
Tel: (1) 212 250 2500                                    Tel: (44) 20 7545 8000                                    Tel: (49) 69 910 00                                       Sydney, NSW 2000
                                                                                                                                                                             Australia
                                                                                                                                                                             Tel: (61) 2 8258 1234
Deutsche Bank AG                                         Deutsche Securities Inc.
Filiale Hongkong                                         2-11-1 Nagatacho
International Commerce Centre,                           Sanno Park Tower
1 Austin Road West,Kowloon,                              Chiyoda-ku, Tokyo 100-6171
Hong Kong                                                Japan
Tel: (852) 2203 8888                                     Tel: (81) 3 5156 6770




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