Iron ore’s scraptastrophe builds

Tuesday, 8 October 2019

Recently even BHP was bearish about it:

BHP stopped short of saying exactly when China would hit peak steel, choosing to say that it was plateauing and would peak sometime in the 2019-2025 timeframe. One Belt One Road (OBOR) was seen contributing to 1% pa growth in Chinese steel demand while domestically demand is flat. BHP estimated the scrap to steel ratio in China at 22% today, rising to somewhere between 33-60% over the long term.

That is one very big range. Today I put the ratio at 18.4%:

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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.