tradding holt, page-6

Guys this is an interesting article that came out yesterday.
This should explain a good part of why AGO has been rising in the last few days.

Australia's Port Hedland to Double Ore Exports as BHP Expands

Jan. 6 (Bloomberg) -- Iron ore shipments from Western Australia's Port Hedland, the world's largest bulk exporting port, will double in three years as BHP Billiton Ltd. expands its overseas sales of the steelmaking ingredient.

Exports of minerals, including iron ore, from the port will climb from a record 159.4 million tons in the year ended June 30, Port Hedland Port Authority Chief Executive Officer Andre Bush said today in an interview. Shipments are forecast to climb to 185 million tons this fiscal year and may triple in five years, he said.

BHP, the world's biggest mining company, will begin building the sixth stage of its Rapid Growth Project early this year, boosting its iron-ore export capacity to 240 million tons, Bush said. The company's current 152 million ton capacity is expected rise to about 205 million tons by the time the fifth stage expansion is completed in 2011.

China, the world's biggest iron-ore consumer, may buy more iron ore over the next five years than Australia ever shipped, said Rio Tinto Group, the world's second-largest iron-ore exporter. Global steel output may jump 12 percent this year to a record 1.4 billion tons and annual production may grow 4 percent through 2015, Goldman Sachs JBWere Pty said in an Oct. 6 report.

Port Hedland handled iron ore exports of 153.9 million tons in the last fiscal year, the highest in its history. BHP has shipped iron ore through the port since 1965, while Fortescue Metals Group Ltd. started shipments in May 2008.

BHP gained 1.3 percent to A$43.82 at the 4:10 p.m. Sydney time close on the Australian stock exchange. Fortescue shares rose 13 percent to A$5.20, its biggest gain since June 11.

BHP spokeswoman Samantha Evans declined to comment about the company's port expansion plans.

Port Development

Companies including BHP, Fortescue, Hancock Prospecting Pty. and Atlas Iron Ltd. aim to spend $5 billion to develop the port over the next five years, Bush said. The Port Authority is developing plans for a separate 400 million ton capacity in an outer harbor after 2014, with BHP proposing to use half the capacity, he said.

BHP and Rio Tinto Group last June agreed to combine their iron-ore operations in Western Australia's Pilbara region to save more than $10 billion. BHP could decide to ship more ore through Rio's ports at Dampier and Cape Lambert instead of developing Port Hedland's outer harbor, Bush said.

"It could influence the decision and the route that they take," Bush said. Still, BHP hasn't indicated any changes to its plans and has already done "significant" work on the proposed outer harbor, he said.

BHP reported record iron-ore production in the September quarter as steel companies resume output at mills in China, Europe and the U.S. It approved spending of $4.8 billion in November 2008 for the fifth stage of its Rapid Growth Project.