Iron ore prices for October 39, 2020:
Spot up but paper down overnight. Steel has rallied in recent weeks so some pressure has come off the seasonal destocking.
Empties have rebounded strongly now:
The Chinese PMI was solid, driven, as usual, by construction:
I will have the more granular steel PMI data tomorrow.
So, we’re probably almost past the dangerous destocking period and looking into the new year restock. That said, all markets looks vulnerable to more weakness so I can’t see iron ore flying off, especially as Vale brings back the sales volumes.
We’ll need to see heavy La Nina rains in Brazil to give any new leg up in prices in Q1, which is a chance.
By Q2, I expect to be headed for $80 and in 2021, H2.