RIO - Rio Tinto

[Private Trader]

Hello gang! Checked my RIO this a.m. on NYSE at the open (11 hours ago) and my jaw dropped. -15% , 20$ US I thought what the ???? Maybe this was the new price because of the rights issue, but I don't know. Isn't the price supposed to "settle" on the 10th? What do you think? I watch the ASX most of the night over here. I see that RIO was up yesterday for you. Which way is it expected to go today?

Thanks from the States......

Talk about a heart attack. To say that im involved with RIO would be to say they Google is invloved in the internet!

Yeah it's just a rights issue payment as you cannot participate in the actual rights issue.

Happy Trading!

 

[RIOINUSA]

Sure you got the right quote?

RIO Ltd doesnt have ADRs in US anymore,
RIO Plc is quoted as RTP

That's correct, RTP on NYSE. This is the performance info from 7/8.


Bid/Size 127.77/0

Ask/Size 129.00/0

Price Open 124.02

Previous Close 147.29

Day High 127.59

Day Low 120.00

 

[Kremmen]

My view is that by 2012 onwards, global demand for iron ore will be in full recovery mode and india will be the new china, rio will not be even able to keep up with suppling this massive country with their iron ore needs and therefore, iron ore prices will be higher than they were before the global recession.

Of course, the length of time is part of the reason for the depressed price. If other companies have more valuable resources and/or will recover more quickly, they are a better investment in the short-medium term than RIO.

Another issue for me is management. A board's primary objective is to maximise shareholder return. Let's see, which does that better, selling out to BHP at about $150/share, or even $100/share, or letting your share price tumble to $30? What wankers. Why would you trust them after a monumental failure like that?

(Yes, I held RIO at their high. Yes, I was waiting to sell when they accepted a takeover offer. Yes, I am bitter that the management was greedy and stupid.)

 

[Messenger]

China accuses Rio staff of bribing steel-makers
Fri Jul 10, 2009 11:03am

By Rob Taylor

CANBERRA (Reuters) - Chinese security officials accused four detained staff of Anglo-Australian miner Rio Tinto Ltd of bribery on Friday as Australia sought to avert a diplomatic row centring on the massive iron ore trade.

The Shanghai office of China's State Security Bureau accused the three local Rio staff and senior Australian executive Stern Hu of bribing Chinese steelmakers during tense iron ore price negotiations this year, said the China Securities Journal.

"This seriously damaged China's economic security and interests," said the paper, published by the state-run Xinhua news agency. "The activities of Stern Hu and the others violated Chinese law as well as international business morality."

Chinese security authorities arrested the four on Sunday, alleging they were involved in stealing state secrets.

Australia's Prime Minister Kevin Rudd, a Mandarin-speaking China expert, and Foreign Minister Stephen Smith both said Canberra was treading warily after the shock detentions, which have cast a shadow on ties between the two countries.

"Such a serious matter is a matter which goes very much to the relationship between Australia and China, so we are treating this as a very, very sensitive and difficult issue," Smith told reporters in Perth, adding Hu had been well treated.

The arrests come as iron ore talks between the two sides miss a June 30 deadline, and after Rio Tinto ditched a $19.5 billion tie-up with Chinese state metals firm Chinalco last month.

Chinalco, Rio's major shareholder, said the arrests were unrelated to dealings between the two firms and expressed "mutual concern for the current situation with their staff". Continued...

 

[mikes]

wonder what is the current official and unofficial positions in australia are about paying bribes & backsheesh, and commissions and introduction fees to well connected people in oz, china and rest of world.

disclosure - no rio held now, previously traded out, family owns bhp

 

[lianeisme]

I love RIO, BHP is a good steady stock like Westpac is to finance but RIO really is an exciting stock this is what I predict for today up for RIO 4.165% trading range $50.65 to $51.23 should dip to around lowest point at around 10.57 am today see if I'm right don't ask me how I know I have tried to explain my method earlier in this post I don't use charts its all maths my own method. As I have said I'm no expert. I am learning from all of you.I used to work in Hong Kong the Chinese love gifts nothing gets done without them China is another story have no idea what their take is but there is more to this than the media know.

 

[mfsperth]

Thre is nothing in the recent Rio announcements to the ASX about the Stern Hu issue, and yet this may involve sovereign risk.

Or it may or may not involve dealings which Transparency International would be interested in. Either way, isn't it time Rio made an announcement to the ASX about what is a significant event?

We need to be reassured that Australian companies competing in China for ore sales do not use unacceptable methods to gain an unfair advantage.

 

[Sean K]

I love RIO, BHP is a good steady stock like Westpac is to finance but RIO really is an exciting stock this is what I predict for today up for RIO 4.165% trading range $50.65 to $51.23 should dip to around lowest point at around 10.57 am today see if I'm right don't ask me how I know I have tried to explain my method earlier in this post I don't use charts its all maths my own method. As I have said I'm no expert. I am learning from all of you.I used to work in Hong Kong the Chinese love gifts nothing gets done without them China is another story have no idea what their take is but there is more to this than the media know.

So, where do I sign up for your magical numbers formula seminar?

It's already hit $49.69, so you're right on the mark!!

 

[skyQuake]

ADRs had +2% ish for RIO, and actually down a bit for BHP.

Rallied quite hard yesterday arvo though..

 

[oldblue]

Thre is nothing in the recent Rio announcements to the ASX about the Stern Hu issue, and yet this may involve sovereign risk.

Or it may or may not involve dealings which Transparency International would be interested in. Either way, isn't it time Rio made an announcement to the ASX about what is a significant event?

We need to be reassured that Australian companies competing in China for ore sales do not use unacceptable methods to gain an unfair advantage.

You're probably right in that RIO should make a formal announcement.

But it's not as if the main facts, or at least a version of them aren't already in the public domain so it's not as if the market is uninformed.
I can understand the desire not to escalate or inflame the issue by sounding off about it - that won't help anyone - so any statement from RIO is likely to be so moderate as to not add to our knowledge at this point.

 

[haunting]

China accuses Rio staff of bribing steel-makers...

** what constitute corruption? Does a gift of notebook PC fall into this category? The "stories" I have read about include the following:

1) the recent Airbus crash off Brazil's coast includes a few Chinese victims, wives and relatives of some Chinese officials who were invited as "guests" by certain company that has large commercial dealing in China. It seems this is one of the "triggers" behind the crack down on corrupt practices in the steel industry in China

2) during the Olympic games, big iron ore producers were found engaging in "questionable" mega dollar "entertainment events" - high officials from various big steel mills were specifically invited to such events - the "gift" items? $1000 per night hotel stay, dine and wine with entertainment provided by singers from shows such as "Cats" and "Mamma Mia", and god knows what else that is not visible in the public eyes

3) top office bearers from various big Chinese steel mills were target hired by the big iron ore producers as their front men as these "local" know how to deal with the system (translated, "gifting" mutual back scratching)

4) the iron ore price last year was about 7-800 per ton, but the smaller to medium size steel mills had to pay up to 1400 to get their stock from the big steel mills that have direct contract with the big producers, netting the big steel mill profit close to 200 bln as the "middleman" in the whole iron ore market chain

The Chinese government is cracking down on their own people and the weakness/corruption in the steel industry. The investigation is still on going. Did Stern Hu or Rio/BHP/Vale involve in malpractice in China? Dunno. It is subjective at this point to say what they are doing is just the "tradition" of doing business in China. May be that's some truth there. But may be it's more appropriate to say that tradition was flawed to start with and by following a flawed tradition does not make the argument sounds right or justified.

But since the Chinese government is not revealing anything, and I doubt if they will reveal publicly the finding, all these news, opinions and conjectures (including mine) are just hearsays and frankly hold very little truth. Are they doing this specifically targeting RIO or the Australian government? In someway yes. But in most way they are just carrying out their own house cleaning.

I would if I find my staffs are working with my rival company working against my interest.

So depending on your own individual bias and prejudice, draw your own conclusion in this matter but keep in mind of this fact - you/I don't know the truth. The Chinese investigation in this matter is still on going, there's every chance that they will not reveal the finding publicly but instead pass on in the quiet to the Australian government. You can bet they will do that to save the Australian government face if there is real and clear evidence against Stern Hu or his employer. Or to save their own face if there is no evidence whatsoever against Stern or Rio.

But let's trust our commonsense, with a history of corrupt business practices in China, esp when mega billion dollar is involved, it will be foolish at this point to assume it's totally guilt free on either side.

 

[haunting]

Anglo-Australian mining giant Rio Tinto has bribed executives from all 16 of China's major steel mills, one of the nation's most prominent state-run newspapers alleges...

 

[vincent191]

Let us not judge too quickly. "Gifts" is an acceptable way of doing business in China. It is their way of life. We have our Australian values and they have their own values.

Chinese executives do not get multi million dollars salary & bonus cheques like ours. Australian executives of failed Companies who award themselves multi million bonuses are they not just as culpable?

 

[haunting]

Corruption charges could mean big Mamma Mia or small mamma mia - depending on the "value" involved or how one is caught - click me and singalong.

 

[Sean K]

I love RIO, BHP is a good steady stock like Westpac is to finance but RIO really is an exciting stock this is what I predict for today up for RIO 4.165% trading range $50.65 to $51.23 should dip to around lowest point at around 10.57 am today see if I'm right don't ask me how I know I

So, what was the result?

Just one example, but I'm not sure if your black box theory is very sound.

 

[vincent191]

RIO has been accused of bribing 16 Chinese Steel Mills and I suggest RIO better get Malcom Turnbull to shut the hell up and play this game Kevin Rudd's way. Quietly, quietly through diplomatic channels.

One possible outcome if the Chinese really want to get nasty is to sue RIO in the International court in the Hague to return all the profits made illegally by obtaining an unfair advantage by bribing Chinese officials. This will send shivers down a few spines!!!!!

This is not theory, this sort of action had been done before, not by China but by the Phillipino Government when Marcos got kicked out. The plaintiffs the Phillipino Government, have won huge payments.

Do it Kevin's way. The Chinese concept of "saving face" is very important. The eyes of the International community is on China and see how they are going to behave. If they use some "underhand" method to satisfy their business goals then it wouldn't look good. Rudd must remind China if they want to look good and gain the respect of the International business community, it must behave in a responsible manner. IMO this is a better approach than behaving like a bull in a China shop.

 

[haunting]

I know I am sounding like a Rio knocker here in this post but never mind, I'd rather speak my mind and feeling sorry later than not speaking at all. If you are an existing RIO investor, you should take note.

1) According to news, RIO, of the big three has been the most vigorous iron ore player in the Chinese market. It has the most extensive sales network among the three and it has been taking a marketing and sales approach of market penetration than profit optimising comparing with the other two. Rio has been extremely successful with this strategy in China to date, mainly due to the good work done by Stern Hu and his team. But ever since the "Spygate" incident and with Stern and his team arrested, there has been a sea change in the Chinese iron ore market, according to those who are working in the industry and as usual "anonymous" speakers...

2) They said, the Rio sales network is now in complete shutdown or in ruin, which, in the Chinese market, especially among the small to medium size steel mills is the most important sales channel. Without this network, Rio sales will be greatly impacted. To make matter worse, because of the serious implication of spygate and its potential fallout, in terms of punishment to the "locals", not many steel mills are willing to deal with Rio for fear of being link to the matter. In fact they are saying right now no one is ordering any new stuffs and they are living on their current stockpile, adopting a wait and see attitude. There is extreme fear in the market and everyone is keeping their head low...

Because of spygate, the implication from here would mean life will be extremely difficult for Rio even after the spygate is all settled or buried because the steel mills are worried, if not, fearful of the implication of doing business with Rio and the implication of their state loyalty - which brings up the question on Rio's future - will they do well without the Chinese market?

3) The current business as usual claim by both Rio and BHP, according to these people, the business is mainly about the existing or "old" contract fulfilment. Once these contracts are cleared and comes time to negotiate new ones, it will be a totally new ball game with a different set of time frame and model and possibly vast rule changes. So, it is not a good idea to assume the same old same old will proceed as usual because the next round of talk will be "unprecedented" and outcome at best is completely uncertain, subjecting to many variables, which translated would mean RISK.

There is another element of risk being introduced by the merger of production between Rio/BHP as there is no telling how the Chinese will play their "anti-monopolistic" laws. Many are saying it is a toothless tiger but unless Rio/BHP are willing to gamble on the Chinese market, they should take that more seriously.

4) Here're some numbers - in 2008, the total iron ore sales for Rio in China is 83.38 million tons, representing an 18% growth, constituting 53% of total production. Also in that year, Rio's iron sales had exceeded their copper sales in China, making their iron ore business to be the most profitable unit... question: will the spygate expand to Rio's copper market practices?

5) Now you can take all these with a pinch of salt and ignore their credibility, or you can consider all these are just parts of the fog of war - market disinformation and misinformation - as part and parcel of the game ... but there is one thing you can do to protect your self interest as a Rio investor - watch Rio's share price movement closely. I would describe two possible scenarios you should pay attention to:

5.1) if and when you see a sudden big % plunge in Rio's stock price - that's a sign that big investors are exiting the stock; or

5.2) you begin to see a series of small price decline, a consistent but concerted selling through program selling

Those are the signals you should take heed.

Ok, I am done. Good luck to you lucky Rio investors. Don't say you have not been warned.

Good news week for Rio

 

[haunting]

More good news on Rio...

The end result is earnings per share (EPS) forecasts by the broker of US253c this year, US286.1c in 2010 and US298.5c in 2011, which compares to Citi at US241.8c, US321.1c and US336.5c respectively and Deutsche Bank's 2009 and 2010 forecasts of US225c and US307c. Credit Suisse is forecasting EPS of US247.8c in 2009, 231c in 2010 and US323.2c in 2011, showing brokers remain some way apart on their estimates.
...
The average price target according to the FNArena database is $63.50, with a fairly narrow range given Citi is equal top with its target and the lowest in the market is Credit Suisse at $60.00. Shares in Rio Tinto today are stronger in line with the broader market and as at 11.35am the stock was up $2.22 at $52.30.

** thought it's only fair I put the opposite of my view here for the record. This is the price of sticking out one's neck against the whole gamut of industry experts.

... do I feel a bit like Don Quixote? You bet!

 

[haunting]

Chinese burn holds more heat than fire

China's just digging itself a deeper hole

Remarkable journalistic insights, gotta say. Thought I like to highlight this - state secrets may be an excuse or a flimsy charge; but corruption is not. Corruption could not happen without two consenting parties. In this case the Chinese are saying there are possibly 16 Chinese steel mill officers involved in accepting bribes from Rio - this is quite easy to prove really because the penalty for these Chinese steel mill officers could mean big sh** if they are found guilty and no one is that stupid as to offer their life as a tool for the state to convict Stern and his staffs. Fair point?

... not sure why these Aussie journos are that "blind"?

Ok, now their Chinese counterparts reporting on the case...

Iron Ore Espionage Allegations Overshadow China Deals in Australia...

Note the difference between the "free world" journos vs the journos from a "corrupt autocratic system"?

 

[lianeisme]

So, what was the result?

Just one example, but I'm not sure if your black box theory is very sound.

The result RIO for that day was open $49.95 High $50.26 Low $49.52
Here is my example for today as I have said I am no expert ts my own way I don't fully understand charts I am trying to teach myself that.
RIO $52.26 to $52.60 will hit its low at around 10.10am and 11.38am
BHP $34.82 to $35.18 will hit its low at around 10.10am
CBA $39.00 to $39.33
WBC $19.95 to $19.99
Not taking into account any breaking news. Example tax debts to NZ
or
Rio detainees are taken out and shot????