Iron ore price

Viewing posts in the Iron ore price category

Iron ore miners firm on Glenrio delusion

fghe5 Ivan Glasenberg's illusory tilt at RIO has all major miners firming today with BHP up 1%, RIO is up an opium-addled 2% and FMG flat. After all, when he's done buying RIO, BHP and FMG will be next.  Here are the comparative indexes: The idiocy spreads are all widening now and the moron cross (BHP falling faster than RIO) is back in play: Apparently Mr Glasenberg's ambitions do not extend to the juniors: Not sure why. If he's good to his word then Mr Glasenberg's cutting of RIO production will save the juniors, right? Or maybe they'll rush into the volume gap with BHP, Vale, FMG,...
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The slow dawn of iron ore horror

021 From the AFR: Former Rio Tinto chief Tom Albanese says weak iron ore prices are here to stay for longer than expected and “volatility is the new normal”, as iron ore sank below $US70 a tonne overnight Tuesday for the first time in five years. ...“As long as there is a large amount of new supply you are going to have a much softer pricing world than people would have anticipated, for at least a couple of years.” He said the ditching of the benchmark pricing system in 2010 had transformed the market. ...“While it’s fun on the way up, it’s painful on the way down.” Yes, it is,...
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More Glenrio dreaming

images From Gina's mining newsletter: Bernstein’s ­London-based senior analyst, Paul Gait...told The Australian ­Financial Review that Glencore’s shock announcement it would shut down its Australian coal operations for three weeks is a strong indication that Mr Glasenberg will try again for Rio. Mr Glasenberg would be able to point to Glencore’s willingness to pull tonnes out of an oversupplied market in a direct challenge to Rio over its expansion in iron ore, Mr Gait said. “To me this coal announcement is clearly Ivan ­playing games,” he said. “It had the language of someone trying to...
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Daily iron ore price update (Highway to Hell)

anvil6-200x200 Find below the iron ore charts for November 26, 2015: As expected, Chinese iron ore bears are in total control. The paper conflagration is raging out of control with Dalian signalling $60 by May. Surely we'll sink into the $50s today. Physical is no match for the wild fire and benchmark plunged well past Qingdao to $68.60. Texture from Reuters: "We're seeing very slow trades for spot cargoes. I think some sellers are also holding back and getting reluctant to accept the low prices," said an iron ore trader in Shanghai. "Iron ore markets remain conflicted, with oversupply from...
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China plans profits-based tax for iron ore miners

imgres From Bloomie: Regulators are working on a plan to shift the current volume-based taxation to price-based, China Business News reports, citing Lei Pingxi, executive vice chairman of the China Metallurgical Mining Enterprise The reform may help ease mining company's tax burden amid falling iron ore prices. What a choking irony. It was Australia's giant iron ore miners that trashed the equivalent Australian tax, insisting that it would deter their expansion plans, and now the Chinese rivals they are trying to put out of business with that excess supply will be supported by a Chinese version. As...
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Iron ore crash resumes

liub Charlie Aitken had one good day but the iron ore crash returns today with RIO and BHP at the verge of new 2014 lows, down the better part of 2% and retracing much of yesterday's short squeeze. FMG is down 6%. Here are the comparative charts: The idiocy spreads are still widening: Juniors are still corpses: Dalian iron ore futures have slumped again, down 2.3% to new lows at 465, roughly $60. And there's more to come, I reckon. The following two charts from Morgan Stanley show that Chinese iron ore inventories remain abundant: Both "days of inventory" lines are a little...
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Glencore-Rio merger is pure fantasy

url From the AFR: Hedge funds including GLG Partners, DE Shaw & Co, and Pentwater Capital Management were told this month by a prominent London mining banker to prepare for an all-but-inevitable takeover of Rio Tinto by Glencore, according to people familiar with the meeting. Former JPMorgan Chase & Co. dealmaker Ian Hannam, who now runs a boutique advisory firm, convened representatives of more than 20 investors at Corrigan’s Mayfair restaurant in the British capital in mid-November to share his views on the potential deal, the people said, asking not to be identified discussing a private...
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Daily iron or price update (bear market fizzer!)

anvil6-200x200 Here are the iron ore charts for November 24, 2014:   This is a real fizzer of a bear market rally. Dalian six month futures barely budged, Singapore 12 month futures have crashed to new lows and physical hasn't moved at all (benchmark rose 20 cents to $70). Mining equities also rolled over in London, with both RIO and BHP down more than 2%. Rebar average only managed to slow its fall. Also hitting sentiment will be another rise in Chinese iron ore port stocks, by 550k tonnes on the week. There's still oodles of red dirt piled up over there. If I'm a Chinese buyer, this price action is a...
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Iron ore miner short squeeze disappoints

url I was hoping for better. RIO and BHP are up a lousy 3.5%, reversing just two days of losses. FMG is doing better, up 9.5% and reversing 3 days of losses and one third of the Aitken crash. Here are the comparative indexes: The idiocy spreads are all widening again: The juniors have given the PBOC one giant yawn as the dirt is shoveled over their caskets. ARI is up 5% and BCI 6% but that's about it: Dalian May futures have opened up 2.1%, also muted. Let's see if they get moving later in the...
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Sour China steel sentiment turns rancid

images From Mac Bank come the November Chinese steel sentiment survey taken during the APEC week. They're not happy: Demand stinks, especially property: More want less iron ore: Because China is swimming in the stuff: Pre rate cut,...
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How far will the iron ore short squeeze run?

images Charlie Aitken will probably be patting himself on the back today. On Friday morning he said buy iron ore: “Obviously, the most beaten up sector in Australian equities is pure play iron ore stocks,” says Bell Potter Executive Director Charlie Aitken. “Yet, from a trading perspective they should be bought. All I know is every time the AFR runs a front page article about how much less Andrew Forrest is worth on paper that it’s usually the short-term bottom in iron ore prices and a solid, tradeable rally in Fortescue(FMG) follows.” “If we get any stability, or dare I say it, actually a...
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Daily iron ore price update (sixties)

anvil6-200x200 Here are the iron ore charts for November 21, 2014: And so, paper continued to burn on Friday, even after the Chinese rate cut, Dalian recovered but not much. Singapore is clearly more hopeful. Benchmark spot fell faster than Qingdao and ended at a new low of $69.80. Rebar average is clearly headed back from whence it came. Reuters has texture: "We knew that this year was going to be the first year when iron ore was in oversupply and I think we're just living with the consequences of that," Goldman Sachs analyst Christian Lelong said. "Right now there is no hard floor for...
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Iron ore miners flog dead cat as Dalian heads for Hades

awfq3 Finally today some relief for the army of reckless tards that pile into iron ore every time it falls. The majors are both up 1% after yesterday's 3% shellacking that broke all sorts of technical levels and set them up for more pain, much more, in my view. FMG is also enjoying a 3% bounce but is still languishing far below the former support line and now resistance level at $2.92. And so, onto the comparative index charts: The majors are breaking down, however the idiocy spreads are trying but failing to close given the speed of the iron ore decline: But the juniors are showing no such...
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Daily iron ore price update (raising the dead)

anvil1-200x2001111 Here are the iron ore charts for November 20, 2014: It's been a long time between flying anvils but we have one today, finally. Paper markets are still awful with Dalian pricing in the range of $61 by May. Despite its turn, the 12 month swap spread to spot is still very wide and in the past a move to contango has been a very reliable guide to turns in the physical market. Rebar average is now catching down after its APEC head fake but, as you can see in the last chart, the spread from it to iron ore spot is now at its most narrow since the GFC and as a rough guide to steel mill...
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World Steel zero growth again

October 2014 From the World Steel Association: World crude steel production for the 65 countries reporting to the World Steel Association (worldsteel) was 137 million tonnes (Mt) in October 2014, the same compared to October 2013. China’s crude steel production for October 2014 was 67.5 Mt, a slight decrease of -0.3% compared to October 2013. Elsewhere in Asia, Japan produced 9.4 Mt of crude steel in October 2014, a decrease of -0.5% compared to October 2013. South Korea produced 6.2 Mt of crude steel in October 2014, up by 4.5% on October 2013. In the EU, Germany produced 3.5 Mt of crude steel in...
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There are no takeover targets in iron ore

538078 From  Bloomie, some people just don't get it:: Today's plunge in iron ore is creating tomorrow's acquisition targets. ...Among the most vulnerable are Western Australia's Atlas Iron, BC Iron and Gindalbie Metals, according to stock broker Fat Prophets. All three - valued at less than $US200 million ($232 million) after losing two thirds of their value this year, or more - are struggling with production costs that are too high for the current market. Private funds such as X2 Resources, which has raised as much as $US3.75 billion from investors, may be able to pick up bargains before an iron-ore...
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China makes it official: No more coal

lets_call_the_coal_thing_off From the AFR: China’s coal use will be permitted to grow by only 5 per cent over the next seven years after the world’s biggest polluter unveiled a cap on coal consumption for the first time. The State Council – China’s Cabinet – said the country’s annual coal use would be halted at 4.2 billion tonnes by 2020. Last year, China burned 4 billion tonnes of coal, with around 9 per cent being imported, according to the state-run China Daily. That's that,...
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Big miners break down as futures flat

2 The big miners took a pounding this morning as predicted with both BHP and RIO down 2% and at 2014 lows. FMG also sank as much as 5% before rebounding to be down just 1% now. Here are the comparative indexes: The idiocy spreads are now closing again for the majors: The junior's Ebola has no cure: Dalian May futures are up 1 point at...
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Kiwi billionaire throws money into iron ore pit

97 From Creamer's: New Zealand's billionaire Todd family stepped up bets on Australia's beleaguered iron oresector on Wednesday when iron ore prices slid to new five-year lows, boosting its stake in a company that aims to start producing in 2017. Todd Corp agreed to buy A$4.5-million ($3.9-million) in new shares that Flinders Mines Ltd is selling as part of a A$6.7 million raising to fund a final study for its Pilbara Iron Oreproject, Flinders Mines said on Wednesday. The A$1-billion project in Australia's richest iron ore belt aims to produce 25-million tonnes a year, which could make...
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The big iron ore miners are the next casualty

Series_24 From The Australian: Wes Campbell, senior portfolio manager JCP Investment Partners, has told clients that from a portfolio perspective, the investment manager was happy to maintain its exposure to the lowest-cost producers of iron ore that “stand to benefit from increased volume as they displace higher-cost producers’’. “We expect that once the iron ore price settles at or around our long-run forecast of $US67 a tonne, the market will then focus on the free cash generation of BHP and Rio.” Mental note: sell Wes Campbell. Markets will focus on free cash flow generation, yes, and what...
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Daily iron ore price update (smash, UPDATED)

anvil6-200x200 Find below the iron ore charts for November 19, 2014: Benchmark iron ore price also fell 2.9% to $70. With steel price now tumbling as well post APEC there is another reason for mills to keep destocking raw materials. For those looking for a market turn, paper usually turns up first and at this point it's not happening. Everything is chasing Dalian futures down, which are now pricing roughly $61 by May. Texture from Reuters: "We no longer expect a meaningful iron ore restock later in the year as steel mills in China are content to purchase iron ore at their convenience, either from the...
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Don’t you know a bust when you see it, Bloxo?

luyv One does wonder what it would take to turn that smile upside down. If we ever see $85 again it will be brief. The supply deluge has barely begun. Chinese demand is slowing very fast, with export growth preventing a calamity, which will also slow next year. We are effectively at "peak steel". The "great Australian rebalancing" is on the verge of the great Australian bust. A serious assessment might generate appropriate investor and policy...
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Comrade Campbell’s coal quango hit

dfsgrw From the SMH: Indian conglomerate Adani has been questioned by the National Stock Exchange of India over claims that the State Bank of India has extended it a $US1 billion ($1.1 billion) credit line to fund its mega coal project in Queensland. ...the NSE on Tuesday asked the company to clarify "in detail" a news report saying the company was lining up the loan with the State Bank, and whether it was aware of any information that should be disclosed under the exchange's listing laws. It comes as an Indian opposition party demanded the Reserve Bank of India intervene and question the "improper"...
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Iron ore miner smash as futures crash

xfgw Pain is turning to agony and near death for iron more miners today. As predicted, FMG has ruptured terminal support at $2.92 and is currently down 6%+ at $2.79, next stop $1.80 and restructuring. RIO is down sharply too at $58.63, still above its 2014 low, ridiculously. BHP is faring a little better. Here are the comparative indexes: The iron ore price is itself falling so fast that the idiocy spreads haven't closed much: The juniors continue their best impression of MH17: Dalian futures are down another 2% with May hitting 482 yuan, $61-$62 equivalent. There is also lot's of...
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The abyss opens under Fortescue

noah-russell-crowe-pre-618x400 We will surely see a break in terminal support today for Fortescue Metal's Group. After yesterday's hammering to a close of $2.97, two cents below the post GFC closing low, today we will rupture the terminal support line at $2.92: The next support is at $1.80. If get there, or anywhere near it, my view is that markets will be signalling a restructuring ahead for the new force in iron ore, and on that front the stress is also showing in the company's 2018 maturity debt. In the past month its bond prices have fallen sharply: And over the longer term are approaching levels last seen in...
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