Goldman doing god’s work on iron ore with a great note.
1. Iron ore’s surplus inflection means more downside. Despite iron ore being the most obvious commodity proxy for China’s continued contraction in early property activity – with close to 25% of global seaborne demand tied to that sector in particular – the market has remained relatively tight so far this year with visible inventories on a downward path.
Indeed benchmark iron ore prices, whilst off the local highs, have displayed resilience close to $100/t, a level which hardly prices any supply-side margin pressure.
