Here is the iron ore table for December 12,2013:
We have clearly hit “the wall”. The last few days of data have shown steel production falling away. From Reuters on Tuesday’s output figures:
Slower demand cut China’s daily average crude steel output by 3.3 percent from October to 2.029 million tonnes last month, government statistics showed on Tuesday.
And CISA yesterday:
According to new data from China’s iron and steel association Cisa, local steel production fell to a year-to-date low of 60.9Mt in November, down 4.2 Mt from October levels. Steel production in the first eleven months reached 712Mt, 55.9Mt higher than in the same period in 2012.
Back to Reuters:
I think once we reach above $140, it will go down very quickly because there’s a lot of available supply around,” the Shanghai trader said.
The restock should continue as we move towards the big Q1 steel inventory build and cyclone season but if supply has capped the rally at $140 then the market balance has shifted from last year.
That will be disappointing to some bullish forecasters and it does augur more price falls for next year as China slows and supply builds.
