Stock Preacher

Ford Motor Co said Thursday it is adding shifts at its truck plants in Michigan and Missouri in response to increased demand for its F-150 pickup trucks and Escape SUVs. Ford’s Dearborn, Michigan, truck plant will return to a three-shift operation in September from two shifts, a move that will boost production of F-150 pickup trucks by about 10,000 this year. Ford is also adding a third shift at its Kansas City assembly plant in Missouri in October, which will increase production of Ford Escape and Mercury Mariner SUVs by 2,400 by the end of October. Read more

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US carmaker Ford Motor Co. announced yesterday that it is boosting Q-3 production in North America by another 10,000 units to meet increased demand for its vehicles. According to Ford Americas President Mark Fields, the company’s third-quarter production goal is now 495,000 units, about 18% higher than a year ago. Ford also increased its production targets for the fourth quarter to 570,000 vehicles, a 33% increase over the same period last year. Ford is one of the biggest beneficiaries of the federal government’s “cash for clunkers” program. Its Ford Focus compact has been one of the most popular choices for customers taking advantage of the program, which provides up to US$4,500 to motorists trading in gass guzzlers for new, more fuel-efficient vehicles. Recently US President Barack Obama signed into law a US$2B extension of cash for clunkers program after Transportation Secretary Ray LaHood warned Congress the program was about to use up the initial US$1B allocated by lawmakers.

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BHP Billiton Ltd. Pc announced that they would cut 6,000 jobs and close the giant Ravensthorpe nickel mine in Australia, writing off US$1.6 B, as the global resources giant battles a collapse in commodity prices. Until now BHP, the world’s largest miner, had set itself apart by maintaining production and just last month said sales volumes were holding up despite a global downturn.

But as it became increasingly apparent there would be no quick fix to the slump in commodity prices, BHP was forced to close mines and cut jobs.”Clearly their balance sheet is in a respectable position. But they are not immune from the commodity price environment that we’re seeing, and earnings are going to suffer,” said Neil Boyd-Clark, managing partner at Fortis Investment Partners.BHP Chief Financial Officer Alex Vanselow warned last week that more mines could be closed given the uncertainty in commodity markets, with the Australian metallurgical coal mines already slated to reduce output by 10-15%.

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Over the past several months, commodities supplier have virtually stopped production investments. That means that by the beginning of the Q2- 2009, commodity supplies across the board will begin to shrink fast, and ramping up production quickly is not possible.

Demand = price (D=P), it is wise to be positioned ahead of the Demand Curve.

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Wednesday OPEC announced a record 2.2MM bbl a day cut on top of the recent 2MM bbl a day cut in an attempt to shore up falling Crude Oil prices.

With the additional cut OPEC tried to give maximum market impact to its action, making a confusing statement in which it said it was cutting production by 4.2m b/d from its September output level of 29.045MM bbl a day according to the Financial Times (London).

Crude Oil fell below $40bbl on the news, and for the first time in more than 4 years as OPEC failed to convince traders that the glut in Crude Oil (on the demand destruction) will diminish plus the US government said supplies climbed for the 11th time in 12 weeks.

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