Full sell side iron ore wrap

Macquarie Bank called this rally and is still bullish:

We had expected spot iron-ore prices to keep rallying: Last week Macquarie’s Commodities team highlighted the increasing bullish sentiment for iron-ore, with some traders at the Metal Bulletin Beijing conference expecting iron-ore prices to test US$60/t. Feedback from Macquarie’s latest China Steel Demand Survey also showed some positive signs.

 Spot prices see biggest one day upward move: The spot TSI Index price soared an impressive 19% or US$10.20/t to US$62.60/t today. The move is the largest in percentage terms and is only equalled on a US$/t basis in 2011 when the price was ~US$130/t. The spot price move now leaves iron-ore trading ~30% and ~25% above our FY17 and FY18 forecasts respectively.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.