The Successful Investor Hotline – Friday, February 19, 2010

Article Excerpt

TECK RESOURCES LTD., $39.78, Toronto symbol TCK.B, rose 5% this week after the company announced that it had signed a new shipping agreement with Westshore Terminals Income Fund (Toronto symbol WTE.UN). Teck ships coal from its British Columbia mines to Westshore’s Vancouver port, which loads and ships more coal than any other port on North America’s west coast. From there, trains carry Teck’s coal to its North American customers, and ships carry it to Asian steelmakers. Under the new deal, Westshore will process 3 million tonnes of coal a year for the next two years at fixed rates. That’s about 12% of the 25 million tonnes of coal that Teck should produce this year. Westshore’s rates varied with the price of coal under the old deal. Switching to fixed rates should increase Teck’s profits, particularly now that coal prices are likely to go up later in 2010. The company is still negotiating new contracts with its main customers. Its current deals expire…

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