Texture from Reuters:
“The ferrous market is on the weakest front as steel mills are destocking for the end-of-year financial accounting,” said Darren Toh, data scientist with Singapore-based steel and iron data analytics company Tivlon Technologies.
Steel inventories in China stood at 8.9 million tonnes as of Nov.7, the lowest level since Jan.11, according to data compiled by MySteel consultancy.
Vale tried to help out:
Brazilian iron ore miner Vale (VALE3.SA) on Monday said it now expects sales of iron ore and pellets of between 307 million and 312 million tonnes in 2019, implying at least a 14.7% decline from a year earlier as it grapples with the aftermath of a deadly dam burst.
Vale has been compelled to halt production at various mines as it shuts down tailings dams that share the “upstream” structure that collapsed in Brumadinho in January, killing more than 250 people.
The miner had initially forecast 2019 sales at the midpoint of a range of 307 million to 332 million tonnes, before saying in October that it expected them to come between the lower end and the midpoint of the range.
The outlook change is due to “greater visibility on sales expected for the fourth quarter,” which should be between 83 million and 88 million tons, suggesting a drop of at least 9% from the year-ago period.
The company also said that for the first quarter, production and sales are expected to be between 70 million and 75 million tonnes, “due to seasonality, the gradual and safe return of operations and in line with margin over volume strategy.”
But nobody is listening. There’s oodles of ore and Chinese demand is hiccuping. To the charts:
There still plenty of steel and ore. But not demand.
We’re in free fall until Chinese steel mills are finished clearing the decks.