Find below the daily iron ore price update for July 7, 2013:
Looks like traders have got a hold of the price. No doubt stimulated by this from the WSJ:
China’s top economic planner Sunday said construction on major infrastructure projects has been speeded up and that efforts will continue to boost domestic demand and support economic growth this year.
“Since the beginning of this year…we have stepped up our efforts in preparing for key transport projects to ensure steady development of the transportation sector,” the National Development and Reform Commission said in a statement on its website.
It said it steadily pushed ahead with a railway project linking Nanjing in Jiangsu province and Hangzhou in Zhejiang province, and service began on July 1. A passenger service between Hangzhou and Changsha in Hunan province and rail projects in central and southern areas of Shanxi province are also under way. The construction of a bridge linking Hong Kong, Zhuhai and Macao is entering the middle phase.
Authorities have also put some soon-to-be-started projects on track for earlier construction, the statement said, including a new airport in Beijing, eight subway projects in cities such as Shenyang in Liaoning province and Wuhan in Hubei province. Construction on 10 other big projects is expected to begin in the second half of the year.
Beijing has moved to boost growth in the face of somewhat sluggish growth, while trying to steer away from large stimulus.
Let’s look at the charts. For spot and swap:
The move in the twelve month is supportive of further rises, though until it breaks out the rally is capped. Rebar average is also proving supportive:
Though gee, it’s hardly tearing it up is it?
I wouldn’t stand in front of a breakout like this but it still looks built on shaky foundations. Does it the mean the Q3 seasonal drop that most are expecting is off? Here’s the long term chart that would say “no”:
The fall can come later in the year and more to the point it has come every year four the past four. I still expect it though it’s looking increasingly unlikely to be severe. The odds are we’ll not see a great Q4 rebound either. Could be an unusually stable six months ahead in the $120-130 range.
