Iron ore price

Viewing posts in the Iron ore price category

Valemax to dock in China

imgres From SCMP: Beijing's ban on Vale's giant ore carriers has been practically lifted after China Cosco Holdings' landmark deal with the Brazilian miner last Friday over a 25-year freight contract that involves 14 of the massive ships known as Valemax vessels, a person familiar with the matter said. "The current regulation actually already legitimises these vessels to berth at Chinese ports. If you look at how the ban was initiated in the first place, it will be unlikely for the government to make an official announcement with much fanfare that says the ban is loosened," said an executive at a...
read more

Our Nev cashes in

dfgse Must be stressful running the marginal cost producer in iron ore markets: Fortescue Metals Group chief executive Nev Power has been granted an 11.1 per cent pay rise, as the iron ore miner moves to reward the man who has overseen its near tripling in export volumes. In a move that could inflame relations with unions that are fighting for pay rises for tugboat workers at Port Hedland, Fortescue said a review of its executive structures had determined that the company was no longer paying competitive wages to its executives. Fortescue resolved to increase remuneration for executives by an...
read more

Iron ore recovery rolls on

idiot Chinese markets are in recovery mode again today with Dalian and rebar futures up 4 and 8 points each. Not tearaway but still up. Locally, miners are struggling to add to gains given the size of yesterdays bounce. In junior land, it's more of the same really, with ARI carnage the theme of the day: For majors, FMG is up 2.5% and trying to hold $4:   And the idiocy spreads are getting wider once...
read more

Rio Tinto a takeover target?

url Now I've seen it all: Rio Tinto is the latest resources company to be the subject of takeover speculation involving Switzerland’s Glencore. ...“The biggest issue now facing the mining industry is not so much operational as strategic. And we believe that some of the most important strategic challenges are those currently faced by Rio Tinto.” ...“If the price recovers (as we expect) it will, of course, strengthen Rio Tinto’s position,” Mr Gait says. “If it continues to decline then it will be painfully clear that their strategy of volume over price has failed. In which case a...
read more

Daily iron ore price update (good ‘ol days)

men-s-flying-anvil-t-shirt_design Here are the iron ore charts for September 15, 2014: Do not adjust your television set.  Markets went boom on the worst Chinese data since the GFC. It doesn't take Einstein to figure out why, from CNBC: While the Chinese government has indicated a greater tolerance for a slower growth, economists expect Beijing to turn on the stimulus taps to prop up the economy following a sharp deceleration in activity growth in August. "I think the data was sufficiently weak to lead to significant steps. When? Such responses tend to be quite fast in Beijing. I would expect to see steps, or...
read more

The amazing mispricing of iron ore equities

stock-photo-tens-of-arrows-that-have-missing-the-target-187173071 Regular readers will know that I'm more than a little amused by the current pricing of iron ore equities. To my mind it is screamingly obvious that the juniors are doomed and the majors are stuffed. The major reason is this chart which is, if anything, now too conservative: The chart takes reasonable account of shut downs in Chinese mines. It is this that has led me to name this the "idiocy trade". Yet the trade is attracting new fans by the day. Motley Fool is the latest to slap a buy on Rio Tinto: The share price of Australia’s largest iron ore miner, Rio Tinto Limited (ASX: RIO)...
read more

Will iron ore rise on a Q4 restock?

dfgwr BofAML think so: Demand & Pricing: near-term strong Q4 restock upside We believe that near term, a Q4 seasonal restock should still support prices for  the rest of this year. Despite a gloomy longer-term price outlook, we still see  several reasons why mills may pick up seaborne inventory in the fourth quarter: 1) Inventories of 25 days are now closer to trough levels, and we believe  mill/trader destocking activity will naturally fade at lower prices here. 2) Chinese domestic production usually dips in Jan/Feb during CNY and the  Chinese winter, leading to restocking of imported...
read more

Real iron ore miner break evens

fght Here's the latest UBS chart on iron ore miner break evens. This is all-in costs and grade discounts:   The only one of surprise to me is Ferrexpo, which I thought was cheaper. Everyone to the left of FMG is dead f its left to market forces and FMG itself has one foot in the...
read more

Iron ore, rebar futures, miners jump

ghmjyu The rebound is upon us, seemingly, with Dalian and rebar futures both strongly up this morning 1% and 1.6% respectively. That has most miners riding the rebound, with FMG leading, back above $4. This is despite China's terrible weekend data and the Arrium rights issue plundering equity holders this morning. The juniors are mostly flat: The majors mostly up: The idiocy spreads widening: This rally is a perfect opportunity to sell out of the sector completely. Much worse is...
read more

Arrium slaughtered on rights issue (updated)

dhre Uh oh, iron ore carnage: Mining and steel group Arrium has launched a $754 million capital raising to repair its stretched balance sheet as the iron price plunge casts uncertainty over the company’s earnings. Arrium chairman Peter Smedley, who is stepping down this year to be replaced by Jerry Maycock, said the raising puts the company in a better position for “current markets”. ...The entitlement offer price of 48 cents per share represents a 26 per cent discount to Arrium’s closing share price on Friday. This business is going out the back door if Deutsche's estimate of $89 break even...
read more

Daily iron ore price update (bottom, but…)

men-s-flying-anvil-t-shirt_design Here are the iron ore charts for September 13, 2014: Paper markets stabilised and the spot/12 month contango is now fat and inviting for a turn. I'd normally be ready to call the bottom here despite port stocks rising another 100k tones on the week and rebar average still falling. The problem is China's dreadful data. The fixed asset investment, real estate and industrial production data out of the weekend was horrible, more horrible than markets have priced. Yet Chinese leaders have been very firm, even just last week, that they are satisfied with the growth outlook and redoubled...
read more

Iron ore futures, idiocy spreads, rebound

dgwr Iron ore appears to bottoming with Dalian futures up 5 point today, though rebar futures are still down marginally. Locally, the miners have a weak bounces underway. Here are the updated relative performance charts. For the juniors: And majors: With idiocy spreads poised to widen:   With the dollar set to fall, the miners could enjoy more short term...
read more

The hopes and dreams of a dying iron ore miner

imgres Today the AFR continues its quaint mini-series: the hopes and dreams of a dying iron ore miner. Starring in today's episode is Mount Gibson CEO Jim Beyer: Mount Gibson is less leveraged than small peers and had $520 million in cash as of June 30. It has been touted as a potential acquirer of rival Atlas Iron. ...“At $83 a tonne and 91c for foreign exchange that will be challenging the cash balance,” he said. While its Extension Hill mine remains profitable, Mount Gibson is spending up big to upgrade its Koolan Island operation off the northern Kimberley coast of Western Australia over...
read more

Roy Hill says it’s cheap enough

images From Gina's iron ore newsletter: Roy Hill Holdings chief executive Barry Fitzgerald says...the project’s break-even cost per tonne was “confidential information” but said the company was “comfortable with where it sat in the lower quartile of the cost curve”. “I am not worried – I do not stay awake at night thinking about the price of iron ore...We are a long-term project and we are not going to be in production for 12 months or at full capacity for three years so it is important to keep perspective. “My personal view is, and I think I share the view of the experts,...
read more

Fortescue cracks lower despite firmer markets

fghet An interesting turn of events in markets today with Chinese derivatives stabilising but some miners sliding on. AGO is sitting right on its 2014 low, ARI is in free fall and FMG has cracked below its 2014 floor, down 2% today. The majors are down marginally: And the idiocy spreads remain wide: Juniors are slowly converging at the point of extinction: Dalian iron ore futures and rebar futures opened...
read more

Aurizon foils BHP/RIO masterplan

images I am watching the West Pilbara development with equal parts amusement, incredulity and horror. From The Australian: Australia’s Aurizon revealed today that AMCI and Posco had signed up to the infrastructure agreement it has with Baosteel for the West Pilbara iron ore project in Western Australia. ...The companies are targeting first exports for 2017-2018. ...The first stage of the project involves development of a new deepwater port at Anketell and a 280km railway to support at least 40 million tonnes per annum throughput from eight mining areas. And much more from Chinese-owned juniors....
read more

Morgan Stanley upgrades Fortescue

margin Morgan Stanley slapped a short on FMG in late July which has worked quite well (it was $4.60 then versus $3.92 yesterday). Today they upgrade: Fortescue has slipped below our target price so we are upgrading our rating to EW. Our house view that the iron ore index price will recover, and if it does recover, FMG can continue to reduce debt and lift dividends. We also see upside potential in expansion and gas conversion. Price event is seasonal: Our Commodities team is of the view that the iron ore index price can rebound to the mid-US$90/t level. The current equity price has captured a...
read more

Daily iron ore price update (contango!)

anvil-200x200 Here are the iron ore charts for September 10, 2014:   Paper markets were very weak early but rebounded to be down modestly. Rebar futures closed flat. Physical is still plunging with spot at new record five year lows and rebar average still tumbling. That has opened up our first decent contango between spot and 12 month swap, a reliable indicators that the bottom is in sight. The idiocy trade remains firmly in control of iron ore shares. They were all down yesterday but there were no new lows. It's a reasonable bet that some short term rebound is in the offing. But should there...
read more

Pascometer burns red on iron ore

imgres Weeoo, weeoo, weeoo: It takes two graphs to put the current mini-panic over the iron ore price into perspective, to realise that Australian miners should eventually do quite nicely out of the present shakeout. That's with the obvious caveat that first they have to survive the rationalisation. Some won't. That's unfortunate for the marginal mines' owners and employees, but it's hardly surprising that the highest-cost producers fail when prices come off the boil. It's as normal in mining as drought is in farming. And from the overall Australian economic viewpoint, it doesn't matter. It's the...
read more

China opens, iron ore crashes, idiocy trade rolls on

io Yesterday's weak morning in iron ore equities was promptly followed by a surge of exuberance throughout the afternoon, erasing morning losses and closing iron ore equities up 1% for the most part. That idiocy trade has hit a wall again this morning, however, as Chinese markets gapped lower at the open with Dalian iron ore futures down 8 points to a new low at 581 and rebar futures poll-axed 2% to 2748. It must be said that the idiocy trade remains in control, with FMG down only 3% so far and the majors down 1% a piece, with no new lows yet. Here are the relative performance charts, for the juniors...
read more

How low can iron ore limbo?

imgres That is the question! Yesterday equities powered higher in the afternoon on hopes that the sell-off is over. A couple of charts from Morgan Stanley suggest it could run further yet: There is enough iron ore in stock for a few more weeks of destocking. My guess is we bottom in the high 70s and then slowly rebound to $90 into year-end before heading straight back down in...
read more

Goldman cuts iron ore forecast into the 70s

gs The big sell side bear just can't stop growling: The price decline has come sooner than expected We have consistently argued that, in an oversupplied iron ore market, low prices would be required to force the closure of marginal production both in China and overseas. Although sooner than anticipated, our expectations of lower prices have materialized, with the spot price down 38% ytd to US$84/t. The price decline has been dramatic, but a weak demand outlook in China and the structural nature of the surplus make a recovery unlikely. In our view, iron ore has already transitioned to an...
read more

Daily iron ore price update (Calderowned)

anvil-200x200 Here are the iron ore charts for September 9, 2014: Mixed paper markets with Dalian flat but Singapore 12 month swaps down. Still no spot/12 month contango signalling a turn. Most concerning, steel futures and physical prices are still tumbling and price weakness is starting to spread outwards from China to, well...everywhere, from Marketwatch: The health of China's steel sector may be poised for a less than robust immediate future, according to the latest Platts China Steel Sentiment Index (Platts CSSI), which showed a September reading of 45.88 out of a possible 100 points. This is...
read more

Who to trust when everyone is an iron ore expert

imgres Some years ago I opined that the lack of coverage of the iron ore market in the Australian press was an extraordinary oversight by the nation given it's huge importance. I argued that it should be on the front page of every paper, every day. Well, now it is. Be careful what you wish for! The sudden proliferation of iron ore experts is worthy of a post to help you determine who actually has some cred and who does not. On a daily basis you will see myriad stories at formerly oblivious newspapers quoting anyone in sight (with the exception of the terrible and shadowy MB of course). These stories...
read more

Chinese Autumn property sales season down 15%

images101-200x2001 Cross-posted from Investing in Chinese Stocks. Ifeng reports that real estate sales across 54 cities may have fallen 15% year on year during the Mid Autumn Festival holiday, based on a Centaline forecast extrapolated from Saturday sales...
read more
Page 1 of 4612345...102030...Last »