From the AFR:
“Fortescue is having to offer steeper and steeper discounts to clear tonnage,” Goldman Sachs analyst Craig Sainsbury said.
He estimates Fortescue is still making $15 a tonne profit, but that is before tax and interest payments.
…A Steel Home employee told The Australian Financial Review it received a phone call from FMG on Thursday regarding the new prices for July.
…For its slightly higher quality product – the 58 per cent to 59 per cent Fe Fortescue Blend – the discount will be increased to 8 per cent from 6 per cent.
…“They’re killing their own market,” said one analyst, who preferred not to be named.
…“FMG discounts are now approaching the highest level since the Global Financial Crisis,” said Tim Murray, the managing partner of J Capital Research.
Down, down, prices are down.
