Daily iron ore price update (Monorail!)

No prices today with CNY. But Vale is out with a solid production report, from Bloomie:

Vale SA, the largest iron-ore producer, reported a 2.1 percent increase in fourth-quarter production of the steel-making ingredient, capping a record year as large miners boost their share of an oversupplied global market.

Output excluding a stake in the Samarco Mineracao SA venture rose to 83 million metric tons from 81.3 million tons a year earlier, the company said in a statement Thursday.

About time! Production should continue to rise modestly until the tsunami building at Serra Sul S11D breaks in H2 next year. Interestingly, January was a wipeout for Brazil, from Platts:

Iron ore exports from Brazil to China in January fell 30.7% to 9.62 million mt from the 13.94 million mt exported in the same month in 2014, Brazil’s Ministry of Trade said Wednesday.

Sales values collapsed, falling 68.8% to $413.85 million, with Platts 62% Fe Iodex averaging $69.10/mt in January, compared with $129.90/mt in January 2014, CFR North China.

China accounted for 50% of Brazil’s January iron ore shipments, MDIC said.

Compared to December, January’s ore exports to China were down 52.9% and revenue fell 56%, from 20.51 million mt and $940.54 million FOB.

Not sure why. Any explanations welcome.

Other news today is all about hard-up miners embracing creatism, or is that eccentricness? From the SMH:

Mineral Resources managing director Chris Ellison said the company is looking to move away from iron ore mining and reinvent itself as a pure mining services company with the construction of a monorail in the Pilbara.

Mr Ellison said the company had patented its own elevated rail system, being designed in China, and hoped to commence the construction of a line from Port Hedland port to BC Iron’s Iron Valley mine in late December.

If it transpires, the monorail would be the first of its kind in the Pilbara.

“The purpose behind that is we want to connect our inland to the supply chain we have on the coast and we need to get a transport system that can put iron ore into China for the bottom quartile cost; less than $US45 a tonne landed in China,” Mr Ellison said.

Awesome, just don’t watch the Simpsons. Other’s are looking to trade financing, from Reuters:

Miners who can’t get financing for new projects from banks or traditional equity investors because metals prices have collapsed are turning to an alternative source: the engineering and construction companies, many from China and South Korea, who actually build their mines.

…China’s NFC and South Korea’s POSCO Engineering & Construction Co Ltd are among the companies pursuing these deals as they look to make up for business lost because of slowing infrastructure growth at home.

“The domestic order books of Chinese construction and equipment companies have been falling for a year, actually quite dramatically,” said Ingo Hofmaier, director at Hannam & Partners, a London-based corporate finance advisory firm. “To avoid underutilization and keep the music going, Chinese companies are now aggressively targeting foreign markets.”

It’s a bit of a doom loop, though, no?

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