Incitec Pivot Limited (ASX:IPL) produces and distributes fertilisers and explosives. IPL has operations throughout the United States, Canada, Mexico and Australia.

ASX 200 stock Incitec Pivot has delivered a strong annual profit, slightly beating market forecast.

Incitec recorded a 13% lift in net profit, which it contributes to the second half rise in fertiliser prices and demand for explosives.

The company declared an 8.2 cent dividend, compared to 6 cents the same time last year.

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Onesteel Ltd (ASX:OST) is Australia’s premier manufacturer of steel and finished steel products and is also a leading metal distributor.

OneSteel revised downward its earnings guidance for the 1H12, saying it will provide a trading update at its Annual General Meeting (AGM) on the 21^st of November 2011.

OST will revise down its earnings due to the collapse of iron ore prices, which are now around 30% below their the levels 3 weeks ago, and also the increase in the Australian dollar over the same period.

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Mineral Deposits (ASX:MDL) is an exploration and development company, focussing primarily on the Grande Cote Minerals Sands Project in Senegal.

Grande Cote is a world class ore body that extends more than 100 kilometres and boasts high quality zircon and ilmenite.

Growing demand for mineral sands means production from Grande Cote is likely to occur in a period of rising prices, boding well for future profitability.

The market has acknowledged this, and as a result MDL has been one of the hot stocks in recent times.

Although capex costs at the project are expected to be significant, MDL’s cash balance and JV with Eramet puts it in a good position to meet funding requirements.

Magnificent Mineral Sands

The mineral sands industry is expected to boom in coming years due to a widening supply deficit.

Global zircon supply is forecast to shrink over the next decade, which will coincide with soaring demand from high growth countries such as China.

Zircon demand is driven predominantly by its use in ceramics. With China modernising its economy, the demand for ceramics, such as tiles, is expected to surge.

This is likely to drive significant zircon price growth, which will benefit MDL as it begins production in 2013.

The supply deficit will take time to narrow given the more than seven years required to bring projects from exploration to commissioning.

Titanium is anticipated to follow a similar path to zircon, in that demand is likely to be fuelled from its use in paint, plastics and paper – key ingredients for China’s growing economy.

Tizir is born

On 28 July the group formed a 50/50 JV with French-based miner, Eramet, known as Tizir Limited.

Under the JV, Mineral Deposits will contribute its 90% interest in Grande Cote (Senegal’s government owns the other 10%), with Eramet contributing its Tyssedal titanium and iron plant in Norway, along with $30 million in cash.

The JV was crucial for MDL as it secures off-take for the majority of Grande Cote’s ilmenite. The ilmenite will be used in the production of titanium feedstock at the Tyssedal plant.

The agreement also secures additional titanium supply for Tyssedal, giving it the capacity to meet growing demand from pigment producers.

Therefore it appears the JV is a win/win for both companies.

Grande Cote is grand

The Grande Cote project is strategically placed in Senegal, located not too far from the Dakar coast. This reduces the time it will take to transport the minerals from the mine separation plant to the port for shipment.

The lack of significant vegetation and overburden also allows for an efficient processing of the mined ore.

Thus when production begins MDL will be operating towards the lower end of its cost curve, giving it a significant competitive advantage.

Grande Cote has the potential to be a Tier 1 asset, with an operating mine life of 25+ years, and expected annual production of 85,000 tonnes of zircon and 575,000 tonnes of ilmenite.

These output estimates will amount to approximately 7% of global supply, putting MDL on track to become one of the world’s bigger producers.

Cash is king

MDL is in sound financial shape, having secured US$136.2 million in a capital raising in June. The raising brought the group’s cash balance at the end of June to US$173.3 million.

Moreover, the company has no external borrowings.

Although Grande Cote requires approximately US$516 million in capex requirements, Mineral Deposits’ array of financing options, including the contribution from Eramet, will help ensure sufficient funding for the project.

Outlook

Mineral sands producers stand to reap significant benefits from China’s voracious demand for resources.

The supply deficit is expected to linger for a while yet, putting MDL in line to achieve major price increases at the same time it begins production.

Grande Cote appears to be a long-life, low-cost asset for MDL, thus giving it a competitive advantage in the mineral sands industry.

Importantly, the company is in sound shape with cash in the bank, no external debt, and a JV with Eramet that has secured off-take for its ilmenite.

Therefore the future appears bright for MDL, and it will be one of the stocks to watch in coming months.

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BHP Billiton (ASX:BHP) is the world’s largest diversified resources company, with a global portfolio of high quality assets and more than 100 operations in 25 countries.

It is the biggest listed company on the Australian share market and is widely considered among the blue chip stocks.

It is an industry leader in most of the major commodities markets, including aluminium, coking and thermal coal, copper, manganese, iron ore, uranium, nickel, silver and titanium. On top of this, BHP has sizeable interests in oil, gas, natural gas and diamonds.

Today, BHP reported a 28% on-year increase in 1Q11 iron ore output. The increase was driven by greater system capability of the group’s WA rail infrastructure.

Petroleum production increased 19% in the same period, with BHP’s acquisition of the Fayetteville and Petrohawk shale businesses helping the result.

However copper output declined 24% over the year amid strikes and lower ore grades at the Escondida mine in Chile.

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Northern Star Resources (ASX:NST) explores and develops mineral resources in the highly prospective Kimberley region.

NST is an emerging gold producer and explorer with a market capitalisation of around $180 million.

Its main project is the Paulsens gold mine which it purchased for $40 million.

The miner expects to release a resource upgrade later this month and a new mine plan for Paulsens this year.

NST recently acquired the 668,000 ounce (oz) Ashburton Gold Project which is close to the Paulsens mine.

Precious metal speed hump

We saw gold and silver futures slide recently as investors reacted to hikes in margin requirements for the contracts.

The CME Group raised margin requirements for both initial and existing positions in gold, copper and silver.

Margins are money investors must put up to be able to trade and hold futures contracts.

Gold lost more than US$100/oz on the announcement, printing a low of around US$1533/oz.

However, gold prices have since recovered from that low and are currently hanging at around US$1665/oz.

The fact of the matter is, the underlying fundamentals behind the gold price rally over the past year are still intact and we are likely to see gold continue to rise.

Ashburton acquisition

NST agreed to purchase the Ashburton Gold Project from Sipa Resources which will be paid for via a royalty on future production.

The deal includes 668,000oz resource and the Mt Olympus Gold Mine, which has previously produced 340,000oz.

This puts NST in a prime position to increase production rates, project life and create shareholder wealth through exploration.

Ashburton is a strategic asset for Northern Star Resources as it provides an immediate resource boost to the miner’s resource base.

High grade drilling results from Ashburton announced last week show NST is on track to grow production to 200,000ozpa.

Results

NST recently posted FY11 profit before tax of $20 million. This profit came after deducting $22 million for the acquisition of Paulsens gold mine and $24 million in depreciation and amortisation expenditure.

The result was aided by record production at Paulsens of 87,069oz at $588/oz cash cost.

NST has $30 million in cash on hand as at 27 September 2011 and is on track to exceed calendar 2011 forecast of $40 million surplus cash, 75,000oz production.

A resource upgrade is set for early 2012 with increases in mine life, production and cashflow expected.

The miner repaid the $40 million acquisition of Paulsens in just seven months.

Being unhedged, NST has maximum exposure to the strong gold prices and as a result it was one of the hot stocks over the course of 2011.

With strong cashflow and a robust balance sheet, NST is in a good position to grow.

Outlook

Gold is set to recover after recently suffering a setback from the CME’s decision to raise margin requirements.

NST’s strong financial position leaves it well placed for further acquisitions in line with its objective of building a major mining house.

With the potential for further acquisitions and strong gold prices backing the unhedged miner, we feel NST will be one of the stocks to watch in coming months.

Recent weakness presents an excellent opportunity for fresh entries.

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Sundance Resources (ASX:SDL) is an Australian-based international iron ore company developing the Mbalam Project in the Republic of Cameroon in the central west coast of Africa.

The group entered into a trading halt yesterday ahead of a planned announcement on the takeover offer from Hanlong.

The announcement, which was made today, said that SDL has backed a revised $1.65 billion bid from Hanlong.  The bid was sweetened from the previous $1.44 billion.

At 57 cents per share, the offer represents a 33% premium to SDL’s last closing price on 30 September.

SDL was one of the hot stocks in the weeks surrounding the original offer that was made in July.

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Paladin Energy (ASX:PDN) is a uranium miner, with projects located in Africa and Australia.

PDN’s long-term goal is to establish itself as a uranium producer through identifying, acquiring and evaluating advanced uranium projects.

The group’s current focus is on its African projects: Langer Heinrich (Namibia) and Kayelekera (Malawi).

PDN has been one of the shares to sell this year after facing a number of challenges including a nuclear crisis in Japan.

The future was looking bright for uranium companies like PDN as world energy needs surged on the back of expansion and industrialisation in China and India.

Nuclear energy seemed the next biggest thing until disaster struck this year following the earthquake and tsunami in Japan.

As Japan’s nuclear crisis deepened, the less attractive uranium looked as an energy source for the future.

Germany’s plans to move away from uranium entirely by 2022 have hurt uranium companies further.

In addition, a looming global economic crisis is threatening to slow energy demand worlwide.

Production lacks energy

PDN had a bad start to the year after downgrading its FY11 uranium production guidance to between 6.0 million – 6.3 million pounds (Mlb), from the previous 7 million pounds.

PDN said that second quarter production rose 7.6%, however full year output was going to be affected by power and maintenance disruptions at its Malawi-based Kayelekera mine.

Paladin Energy shares slid 7.7% following the update. To make matters worse, PDN’s final FY11 production came in at 5.7Mlb, completely missing the mark.

Following Japan’s nuclear crisis, PDN announced that it does not have any commercial relationship with Japanese utilities.

It further said that it had a strong balance sheet and is in a good position to meet global uranium demand given the expected supply disruptions.

FY results

Last month, PDN reported an FY11 net loss of US$82.3 million after costs related to acquisitions and mine expansions more than offset higher revenue from increased production.

This was wider than the US$52.9 million net loss reported in the previous year and was also larger than the average US$44 million net loss analysts had expected.

PDN said its costs rose due in part to lower uranium prices in the wake of Japan’s nuclear crisis.

Looking ahead

PDN and its uranium sector peers have been under pressure after a catastrophic earthquake and a tsunami crippled reactors at the Fukushima Dai-Ichi reactor in Japan.

The event has raised fears regarding uranium as an energy choice. Whilst uranium is one of the greenest forms of energy when contained, disasters such as Chernobyl have led to long-standing controversy regarding nuclear power.

With Germany looking to move away from uranium entirely by 2022, there are wide fears that other developed nations will also reconsider their stance on uranium.

This uncertainty is likely to see uranium miners under pressure in the medium to long term with potentially devastating long term effects.

PDN’s price action has suffered, reflecting the underlying issues the company has been facing.

We feel PDN will continue to struggle on a combination of high debt levels, a tough economic outlook and a weak uranium market.

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Rio Tinto (ASX:RIO) is one of the world’s largest miners, mining and processing a wide range of metals and minerals including all the key base metals, precious metals, diamonds, iron ore and energy products.

The company is one of the biggest on the Australian share market and is widely considered among the blue chip stocks.

Today RIO said it will invest US$833 million to upgrade its integrated power and gas network, and develop fuel supply projects, in the Pilbara region.

The projects will be required to support RIO’s targeted annual production capacity of 283 million tonnes by 2013.

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Mount Gibson (ASX:MGX) is Australia’s fourth-largest iron ore miner, based in Western Australia.

On 27 July, MGX announced an unaudited FY11 net profit of $239.5 million, which was up 80% on-year.

However, iron ore production fell 26% in the same period, with lower costs the primary driver of the profit result.

MGX shares slumped 4.3% on the day, making it one of the worst performers in the Australian stock market.

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BHP Billiton (ASX:BHP) is the world’s largest diversified resources company, with a global portfolio of high quality assets and more than 100 operations in 25 countries.  It is also the biggest company by market cap in the Australian share market, and is considered among the blue chip stocks.

It is an industry leader in most of the major commodities markets, including aluminium, coking and thermal coal, copper, manganese, iron ore, uranium, nickel, silver and titanium. On top of this, BHP has sizeable interests in oil, gas, natural gas and diamonds.

Last week, BHP made a US$15 billion takeover offer for US gas producer, Petrohawk Energy.

The all-cash offer will significantly expand BHP’s oil and gas assets, and in particular, its shale gas holdings in the US,

The deal also signals that BHP is betting the US will turn to unconventional sources of energy, such as shale gas, in an attempt to wean itself of foreign oil.

The offer was unanimously recommended by Petrohawk directors.

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