Iron ore price

6

Big iron melts

BHP is down marginally today as oil soars but RIO is down more solidly at 1.6% and FMG is reversing yesterday’s delight down 5%. All told markets continue to grotesquely misprice the iron ore war but I am getting the sense that RIO is under growing pressure. Perhaps after its own forthcoming good news cost-cutting

30

Fortescue will wreck Australia

The iron ore war is moving fast and not in a good direction. I began this year with guesses of a $50 average for 2015 and $40 average for next year but events are moving swiftly beyond these numbers. The major factor is the extraordinary death throes of Fortescue Metals Group. FMG is moving very fast

0

Moody’s downgrades iron ore and FMG

From Moody’s: Moody‘s Investors Service has lowered its price sensitivities for iron ore and metallurgical (met) coal, the rating agency says in a new report. The changes come in response to slowing steel production in China and rampant oversupply, particularly of iron ore, which will keep prices low through at least next year. Moody‘s downside price sensitivities for

2

Daily iron ore price update (Goldies)

A bad day for Qingdao spot despite paper markets still chewing through shorts. Tianjin benchmark did better up 30 cents to $50. Rebar is becalmed. Dalian closed up two and is up one more this morning. Reuters has texture: Chinese iron ore futures edged higher on Thursday, but weak buying interest in top consumer China and

23

Fortescue begs for intervention

From the AFR, Forescue’s Nev Power wants government to: …take “a really hard look at what is happening in the industry and how they want to manage it going forward. …He said that iron ore price predictions are the single biggest issue in federal and state budgets and were “causing uncertainty and concern” at the highest level

4

Big iron equity struggles again

BHP is up 2.2% today but not as much as it should be given the leap in oil. RIO is down marginally as Goldman tore its investment case to pieces and FMG is still up 6% after its stellar but futile cost cutting efforts. To the index: The idiocy spreads have finally bottomed and begun to

10

Fortescue mines future to survive

Fortescue has released it March QTR production report and here are the highlights: A few points: volume is unchanged on the quarter but it raised annual guidance from 150 to 155 to 160 to 165 million tonnes overburden removal is collapsing, down to 67mt from 91mt in a quarter. That tells you FMG is now mining only its

12

Herd turns on big iron

Not before time, from the AFR: Two staunch supporters of Australia’s mining sector, Pengana Capital and Fidelity, are adopting a wait-and-see approach…”We have enough,” Pengana Capital’s senior fund manager Tim Schroeders said. …Fidelity portfolio manager Paul Taylor said his firm is currently slightly underweight to BHP and Rio Tinto combined, relative to their benchmarks. Not underweight

30

Obsessed with iron ore, and rightly so

Select parts of Corporate Australia are being revealed as naked as the iron ore tide goes out. Yesterday we had this from Coles CEO Mike Durkin: Coles boss John Durkan…told The Australian’s Global Food Forum that Australia’s economy is not doomed because of falling mining commodity prices. “We at Coles fundamentally disagree with that, we

1

Daily iron ore price update (wood to chop)

Here are the iron ore price charts for April 15, 2015:    Spot retraced some with Tianjn benchmark back below $50 at $49.70. Paper was mixed with 12 month swaps down hard after short covering was exhausted and Dalian was flat (though it is up 3 points overnight at 395). Rebar average was silent. Reuters

2

Big iron struggles to rally

Despite tearaway rallies in iron ore, oil and equity in London, big iron ore is not responding well today in Australia. BHP is up a lousy 1.5% and RIO and FMG up 1.9%. All are selling though the day after the Chinese growth numbers. To the indexes: Idiocy spreads have flattened out: Juniors dead: Dalian

9

Atlas creditors move in for kill

From the AFR: A group of Atlas Iron’s lenders are reportedly pushing for the miner to enter voluntary administration so they can carry out a debt-to-equity conversion. The lenders represent more than half of the miner’s $US275 million Term B Loan and have sent a letter to the company warning they may accelerate the debt,

0

BHP dividends a “bear trap”

From the AFR: But Brad Potter, head of Australian equities at BHP shareholder Nikko Asset Management, said that the dividend policy was a “travesty”. “It wouldn’t surprise me if they accepted a credit downgrade instead of cutting the dividend,” Mr Potter told Fairfax Media. The miner has got itself caught in a progressive dividend “bear trap” but

26

For the good of the nation, Fortescue must die

Iron ore junior carnage is spreading fast. Yesterday afternoon we saw another small Pilbara mine shut: Sinosteel Midwest has become the latest WA iron ore miner to throw in the towel, announcing today it will close its Blue Hills operation near Geraldton. Sinosteel said the mine was expected to cease operations by the middle of

8

Daily iron ore price update (swoosh)

Here are the iron ore charts for April 14, 2015: A spot rocket as expected. Dalian is up another 3 points this morning as well to 395. It’s a big short covering rally now, from Reuters: Some steel producers in China’s Hebei and Shandong provinces that had either curbed or suspended production due to softer

17

Fortescue chops jobs

From the AFR: Fortescue Metals Group could slash more than 700 jobs across the Pilbara as it abandons boom time rosters in its latest bid to cut costs amid soft iron ore prices. The nation’s third-biggest miner told its 4,000 strong Pilbara workforce on Tuesday that it was switching its plum eight days on, six

8

Aurizon vision shunts to a standstill

Does anyone remember Lance Hockeridge of Aurizon and his heroic mission to build Comrade Colin’s West Pilbara vision, as well to build Comrade Campbell’s Galilee boondoggle? Today, it’s not just West Pilbara and the Galilee that have run off the rails but suddenly existing Aurizon contracts are also in peril, from UBS: Iron ore haulage accounts

6

Big iron equity ignores futures rocket

The iron ore price is going to rise very strongly today but you wouldn’t know it from watching big iron on the share market. BHP is down 1%, RIO is down 0.3% and FMG is flat. It’s something of an irony that the complex has begun its capitulation as prices rebound, not that it’ll get far. To the

20

Shuffling the deck chairs on FMG and RIO

A quick update here on the vital statistics of Fortescue and Big Fortescue (that is, RIO). After recent downgrades to the iron ore price, the sell side has reduced its outlook for RIO profits: However, as you can see, consensus remains miles behind reality, even of current spot prices, let alone what’s coming. Meanwhile, FMG’s

32

Iron ore capitulation begins

And so the inevitable begins. After months of denial and hope, a sudden breaking of the dam for government and sell side analysts alike. From the top, it began with Citi: Industrial commodities are mostly negative on a YTD basis, the strengthening US$ and ongoing macro concerns over China have impacted the precious metals and

0

S&P iron ore miner downgrades roll

From Standard and Poors: Several Iron Ore Producers Placed On CreditWatch Negative After S&P Revises Downward Its Price Assumptions OVERVIEW • In our view, the severe supply and demand imbalance in the iron ore  market could continue for the next two years. • We have lowered our price assumptions for iron ore for 2015, 2016,

3

RIO breaking down?

Big iron is getting worse as the afternoon wears on. RIO is down 2.5% now and it’s chart suggests a retest of recent lows is on the cards as it takes out recent supports in the mid-$55s. The huge descending triangle pattern is not bullish: There are supports in the mid $53s, $52s, $51s and then