The ferrous complex was soft on May 25, 2022:
Chinese property sales are still down the drain:
The most pessimistic forecasters have these pegged at -20% for the full year and most are still well above that.
For every 1% that they are wrong, it equates to 4mt of steel or 6.4mt of iron ore.
For me, the base case is more like -30%. Base effects in the second half offer the greatest hope of no worse.
So, the most bearish forecasters are still optimistic to the tune of 40mt of steel and 65mt of iron ore in Chinese demand in the second half.
It’s no wonder that rebar is now falling at a pretty good clip:
While it does, so will iron ore, especially as supply lifts to meet volume targets.