Daily iron ore price update (steel squeeze)

Monday, 24 June 2019

Spot has not update but I believe it fell. Paper more. Steel is still stuck and is giving off a bearish signal. Last week’s rebar inventories climbed again and are now tracking materially above last year’s levels. Port stocks fell again, to 117.5mt, though the pace slowed.

Steel mills are overproducing, squeezing the last drops from the profitability cycle:

Doubtless this is due to orders from Beijing for forced output to offset the trade war but it can’t happen and profitability be sustained.

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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.