Daily iron ore price update (soft steel)

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Here are the iron ore charts for January 19, 2015:

1
dfwe 3 4 5

Fairly hum drum action with short term paper markets still firm and long term still hovering near lows. Qingdao is weak and benchmark fell a little to $67.80. The big mover right now is steel prices, in the wrong direction of course, and the if the slide in rebar were to persist then one would have to bring forward forecast H2 2015 weakness. Steel mills could accelerate destocking, although the last chart shows their margins remains strong (provided they use imported ore). Or, mills could do the following, from Reuters:

“Considering the current weakness in the steel market, I think some mills could cut capacity in the near term and that means they might reduce their purchase volume for raw material,” said an iron ore trader in China’s eastern Shandong province.

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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.