Output adjusted, inventories are at a record high already.
Steel is still at the brink and, most importantly, Chinese average daily coal production hit 12.05mt in mid-November. New and uncapped mines in Shanxi, Shaanxi and Xinjiang and pumping out the stuff at records.
The Chinese power crunch is over and as thermal coal plus power prices crash back to earth so 120mt of steel recycling will resume and the glut in steel raw materials will explode 200mt for iron ore and 100mt for coking coal with inventories of everything already very high.
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.
