Noranda Income Fund Unit T.NIF.UN

RE:US Price Premium now 25 to 30 c per pound

[ljp0101]

We're getting a fixed 0.07/lb as physical premium until the end of April. Order of magnitude Glencore made 20m for facilitating the 'hedge'. And a 0.18/lb spread is equivalent to 200/t in TCRCs. I don't think the premium is sustainable at this level through summer though as metal flows west and probably partially migrates into benchmark TCRCs, which Glencore is unlikely to offer to NIF. Next winter is when things get interesting again maybe. Believe it or not but CEZ net income is probably somewhere near net income breakeven right now (EBITDA is positive). Post April it will be much better so long as production doesn't get disrupted by the expansion.