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Iron ore charts for October 26, 2016:
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Holy cow, Batman! Tianjin benchmark jumped 2% to $62.70. Chinese paper hit its highest level in 18 months. Singapore fell. Steel firmed but wildly out-paced by inputs. Physical coking coal rocketed 10% plus to $275. Thermal is wild.
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This has suddenly devolved into a major Chinese policy debacle in which it is delivering a big hit to its own terms of trade and price stability for no apparent reason. The odds of a sharp policy reversal to coal production restrictions have to be spiking with what are now historic coal price jumps. If you’re long beware. Short looks good!
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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.
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