PRECIOUS-Gold up, silver ETF gains as price near 31-yr high
Reuters
TOKYO, Feb 21 (Reuters) – Gold inched up on Monday, adding to a weekly gain of nearly 3 percent last week as fears over a European debt crisis and growing unrest in the Middle East underpinned investor sentiment. * Spot gold XAU= was steady at $1390.50 …
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Gold Price Surges Amid Turmoil in Libya
GoldAlert
The gold price closed in on $1400 per ounce late Sunday night as violence in Libya helped propel the yellow metal higher. A revolt against Libya’s leader Qaddafi sparked concern that tensions in the region were spreading outside of Egypt and dictators …
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Oil, Gold Gain as Asian Stocks Decline on Middle East Tensions
San Francisco Chronicle
… percent and Korea Zinc Co., which produces gold and silver, rallying 2.7 percent. PetroChina Co. added 1 percent in Shanghai trading after the National Development and Reform Commission boosted gasoline and diesel prices by as much as 4.6 percent.
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MidEast tensions weigh on sentiment
Financial Times
Commodities – Silver has pushed above $33 for the first time in 30 years, riding on gold’s coat tails as the precious metal benefits from industrial and haven demand. Gold is up 0.6 per cent to $1397 an ounce taking the ratio between the gold price and …
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Barrick profit lifted by gold and copper prices
SteelGuru
Quarterly revenue rose 25% to USD 2.95 billion largely driven by a 22% increase in the average realized gold price in the period. Mr Paul Burchell analyst of Dundee Securities said that Barrick’s numbers were generally positive. …
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I wonder if the marked discrepancy between India and China household’s gold holdings, so starkly shown in the chart above, is due to China having a strong and perhaps speculative housing market, giving the mainland Chinese a second option for wealth accumulation?

Or is it simply that the accumulation of gold by China’s households/individuals hasn’t had time to build up following the removal of restrictions just a couple of years ago?

Or is it that India’s households have more heavily accumulated gold due to a long established cultural factor where poor Indians store their wealth as personal gold jewelery?

If the discrepancy is due to the “time in the market” factor then we probably can expect China’s massive rural population to emulate India’s and that would give the gold market a very substantial “second” leg.

I wonder what is going on… with RER up by 28% at 11.20am today…. No ASX announcement but big volumes.

Interesting movements over the past few months…

RER has a suite of projects mostly gold and all but one in Australia.

http://news.silverseek.com/SilverSeek/1297276845.php

“In most industrial applications, there is a small, but necessary amount of silver and rare earths used which is resistant to substitution. The chemical properties of silver and rare earth elements are usually unique in the specialized industrial applications which mandate their use. Generally, the consumption of silver and rare earth elements is price-inelastic, meaning sharply increasing prices of each do little to discourage consumption, due to the lack of substitutes. As was seen recently in the rare earth elements, the industrial users panicked when the supply was curtailed. This will also happen in silver, as I have long predicted.

Where do I get off with the statement that silver is the rarest earth element of them all? This point is the easiest of all to make and should prompt you to rush out to buy silver immediately. What separates silver from the REE’s is the one stark factor which is unique to only silver. You can actually buy and hold silver in its purest elemental form, unlike other rare earth elements. Try calling some dealer to invest in pure yttrium, or promethium or gadolinium. And if by some miracle you can find someone to buy from, try to imagine how you could possibly sell or determine a fair price?”

The  chart singles out the rare earth metals in red (the lanthanides, plus scandium and yttrium) from all other metals and rare metals by their 2009 production rate. It also identifies the 2010 rare metals as those beginning with, and including, silver, as well as all of those produced at a rate less than that of silver in 2009. Lifton

Just for Nick (Sarah’s dad)…. There seems to be just one ASX listed player with a possibly commercial amount of Tellurium… It is at Mt Wilgar next to CDU’s giant Rocklands Cu deposit. The Mt Wilgar deposit also has Selenium. Both Tellurium and Selenium are used for advanced solar panels.

With an abundance in the Earth’s crust comparable to that of platinum, tellurium is one of the rarest stable solid elements in the Earth’s crust. Its abundance is about 1 µg/kg.^[10] In comparison, even the rarest of the lanthanides have crustal abundances of 500 µg/kg

Over the last two weeks, gold futures are up more than 3.5%, silver futures are up nearly 9.7%, the Market Vectors Gold Miners ETF (NYSE: GDX) is up 7.7%, and the Global X Silver Miners ETF (NYSE: SIL) is up a whopping 15.8%.

Political unrest spewing forth in Egypt and Tunisia, inflationary pressures on the rise, and with renewed concerns about the viability of the U.S. government’s tenable fiscal positions and the economic penalty we’ll all pay to solve it, precious metals and the stocks of the companies that pull them out of the earth are pushing higher. worth a read

Update: Nice to see the run continuing silver gained another 3% last night.

I have posted several times about Focus Minerals (FML) one of the mid tier gold producers I own….

Activities Report for the Quarter Ended
31 December 2010
HIGHLIGHTS

• 37% increase in gold production to 21,039oz (Sept 2010 Qtr: 15,300oz).
• Continued downward trend in cash costs to A$877/oz (Sept 2010 Qtr: A$932/oz).
• Sales revenue of A$27.2 million from gold sales of 19,570oz at an average received price of A$1,388/oz – average cash operating margin of A$511/oz.
• Record ore processing through the Three Mile Hill plant with 327,319 tonnes processed @ 2.2g/t Au.
• Record mine production of 151,412 tonnes @ 3.56g/t Au from the Tindals Underground Mine.
• Production from The Mount Underground Mine and Tindals Open Pits on track to commence in the June 2011 Quarter with ore recovery commencing at The Mount from March 2011.
• Outstanding results achieved from exploration work at the Treasure Island Project with surface samples of 58.9g/t Au, 48.4g/t, 41.3g/t and 39.8g/t.
• At 31 December 2010, Focus had total cash and equivalents of $8.68 million.

Focus Minerals Limited (ASX: FML) is pleased to report a record-breaking December Quarter that saw continued growth in gold production, expansion of mine development and a further reduction in cash operating costs, putting the Company on track to achieve its targeted annualised production rate of 100,000 ounces of gold during calendar 2011.

Mine development continued at an aggressive rate during the Quarter with record mine production of 151,412 tonnes at an average grade of 3.56g/t Au from the Tindals Underground Mine, including production of 60,300 tonnes at 4.8g/t for the month of December – well above the targeted monthly average of approximately 45,000 tonnes for 2011.

A record total of 327,319 tonnes of ore was processed through the Three Mile Hill Processing Facility during the Quarter, which is a record over its 15+ year history and equivalent to an annualised throughput rate of 1.3 million tonnes.

Gold production increased by 37% to 21,039 ounces for the Quarter with the resulting cash operating cost of A$877/oz continuing the positive trend of reducing cash costs.

Exploration and development work at the Tindals Mining Centre continued at pace and the Company remains on track for the planned commencement of open pit operations at Tindals in the June Quarter.

In preparation for the start of open pit mining, the Company undertook grade control drilling, resource/reserve extension drilling and approvals work for the open pit operations with grade control returning outstanding results in many pending pit areas including 3m @ 32.7g/t and 4m @ 23.4g/t.
The Mount Underground Mine, which represents a wholly new area of production growth for the Company, also kicked off its second phase in November, with a new box-cut being excavated and 185m of decline development completed. The new underground development will enable Focus to ramp-up to full-scale production from The Mount in the second half of the year.

With the addition of The Mount and the open pits at the Tindals Mining Centre, Focus Minerals remains on track to substantially increase its production capacity during the first half of 2011.

During the Quarter, Focus formally acquired a direct 75% interest in the Lake Cowan tenement which hosts the Treasure Island Project. Greenfields exploration at Treasure Island has delivered some exceptional results including surface rock chip sampling grades of 59g/t, 39g/t, and 41g/t over outcropping strikes of more than 200 metres in three closely linked areas.

These preliminary results highlight the potential for an exciting new exploration opportunity for Focus Minerals along the world class Boulder-Lefroy fault system.
Capital investment and exploration expenditure for the Quarter totalled $5.5 million, comprising $2.2 million of mine capital development and $3.3 million of exploration expenditure. This included $1.6 million relating to The Mount development. At the end of the Quarter cash and bullion held by Focus = $8.68 million.

Campbell Baird
Chief Executive Officer

Compiled in PDF form by the World Gold Council: World Official Gold Holding

“The decision to sell the reserves was approved by then RBA governor Ian Macfarlane and then treasurer Peter Costello.”
The RBA revealed in July 1997 that over a six-month period, it had sold 167 tonnes, reducing Australia’s reserves to just 80 tonnes. At this time, the value of its gold assets fell from $3.6bn to about $1.1bn. The RBA’s sales pushed the world gold price down to an 11-year low, returning just $2.4bn for the gold (worth $7.4b today) that was sold via a single broker engaged without a tender.

A board paper recommending the decision to sell conceded that gold served as “insurance against a breakdown in the international financial system”, but it then dismissed the need for holding this valuable asset. The paper has been obtained by The Australian under Freedom of Information laws.

People might not remember but it was a fashionable idea to discount the value of gold (barbarous relic) and several treasurers followed it. Gordon Brown also cost the UK billions.

What Costello didn’t know is that he would precipitate a decade long decline in the Australian gold mining industry that is only now getting back on its feet.

Read The Australian