Texture from the FT:
“Headwinds to Chinese demand are growing, with industrial output growth the weakest since 2002 and infrastructure investment growth weakening,” analysts at Numis wrote in a note. “Iron ore inventories are rising and mills’ profit margins are under pressure as falling steel prices wipe out the benefit of the drop in raw material costs.”
On Tuesday BHP, the world’s largest miner, which generates most of its earnings from iron ore, said it expected average benchmark prices would be lower over the next year, though they will probably remain above the company’s long-run marginal cost of production.
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