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Gold/Mining/Energy : Breakwater Resources (T.BWR) -- Ignore unavailable to you. Want to Upgrade?

To: Stephen O who wrote (471)	7/17/1998 11:33:00 AM
From: Giraffe	Read Replies (1) \| Respond to of 962

From Financial Times ... In base metals, Merrill Lynch holds out a glimmer of hope, in that it considers "all that bearishness" resulting from Asia's economic slowdown "is now fully discounted in base metal prices", with the additional bullish view that Europe faces the "likelihood of strong economic growth" in the next two to three years. WEDNESDAY JULY 15 1998 Commodities PRICES: Commodities 'to remain depressed' By Gary Mead Commodity prices are likely to remain depressed well into 1999, with serious consequences for the economic growth of countries dependent on commodities, according to a mid-year analysis of the commodity markets by Merrill Lynch, the US investment bank. Although Australia, Canada, South Africa and Russia "may have benefited from lower grain, meat and sugar prices, this has been more than offset by the fall in energy and metals prices", falls in the latter being particularly damaging for Russia, which depends on them for 60 per cent of export revenues, said Merrill. Low international oil prices mean about one-third of the 140,000 oil wells controlled by the six biggest oil companies in Russia are loss-making, according to industry analysts. Russia exported 2.54m barrels of crude oil in 1997, but in January-February this year lost $500m because of the collapse in oil prices. With international prices of nickel down almost 40 per cent from this time last year, copper down 37 per cent and aluminium down 18 per cent, Russia's foreign earnings will be badly dented this year. "The decline in commodities could not have come at a worse time for Russia," says Merrill Lynch. The report gives a particularly bleak projection for the economic growth of Asian commodity-dependent countries, expecting a negative 5.3 per cent for Thailand, a drop of 2.2 per cent for Malaysia, and a collapse of 12.5 per cent for Indonesia, "much of this the result of reduced Japanese imports from the region". In base metals, Merrill Lynch holds out a glimmer of hope, in that it considers "all that bearishness" resulting from Asia's economic slowdown "is now fully discounted in base metal prices", with the additional bullish view that Europe faces the "likelihood of strong economic growth" in the next two to three years.