Here are the iron ore charts for July 20, 2015:
Spot gyrations have thrown up a big rally with Tianjin up 3.8% to $51.90. 12 month swaps have caught the fever and backed away from new lows. Dalian jumped yesterday but flew overnight to 391. Rebar average even added a few pennies. Chinese iron ore port stocks fell a very modest 150k tonnes last week and CISA fast data for steel output was down 1.5% in early July and is down 5.5% on the comparable period from last year.
Before any of you ask, no the bottom is not in. No, the rally will not last. We appear to have a little excitement over Chinese growth stabilisation and reductions in steel output. That is supposed to support steel prices and by extension iron ore buying. But if output is falling that fast and iron ore supply still rising then…well…you know the rest. As well, we still have quite low iron ore stockpiles in China so there’s a little restocking continuing.
