Commodities

3

Turkey to smash commodity prices

Vai Damien Booey at Credit Suisse: Europe goes “cold Turkey” We have just published an article explaining why we are concerned about contagion risks from Turkey (attached). We argue that Europe is going “cold Turkey” in two respects: 1.    The ECB has warned us about banks’ EUR exposure to Turkey. 2.    The ECB still plans to go ahead with

4

Daily iron ore price update (orgy)

Iron ore prices for August 13, 2018: The stimulus party rolls on, largely confined to futures markets. This is still not inconsistent with seasonal patterns, especially so since the Winter shutdowns bring forward demand. Rebar inventories are still falling at a decent clip even if well above last year. My outlook remains unchanged. Overnight Chinese

7

China is fantastically reliant upon Australia

We all know how it ends. Eventually China is overwhelmed by its own bad debt. The dreams of empire crumble to empty vestiges, wealth greys with demographics, dynamism sinks into the rentier bog and endless growth into secular stagnation. This is China’s destiny and Australia will suffer for it. But in the meantime we are

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Giant LNG pirate ship arrives to plunder Australia

Via the AFR: Shell’s groundbreaking Prelude floating LNG plant off Australia’s far northwest coast has gone “live” ahead of the start of production later this year, chief executive Ben van Beurden has confirmed. LNG and liquefied petroleum gas have both been introduced into the plant in preparation for commissioning and testing of processes and systems

0

Trade war slashes mining profits

Via UBS today: UBS View: Prices lowered modestly as trade wars escalate Trade tensions have escalated. Following the first round of new tariffs on two-way trade, the US has identified another US$200bn for a 10% tariff, potentially from September. Our China, US & ASEAN economists’ downgraded growth. Higher trade barriers equal lower trade volumes &

7

Samter: Embrace imported LNG or doom

Via the AFR: Only LNG imports can save the Australian government from a nightmare scenario of having to choose between breaking gas export contracts with Asian buyers or subjecting the east coast to real supply shortages, according to the respected energy analyst that sounded the alarm on the “slow train crash” looming in the market

11

Fortescue the “next Atlas”

Never a dull moment with Cliffs managing director Lourenco Goncalves: “The shift toward higher grade is there to stay, the shift toward pellets is there to stay, and BHP and Rio Tinto are on the path to become the next Fortescue, and Fortescue is already on the path to become the next Atlas,” said Mr Goncalves

4

Is the base metals crash the end of the cycle?

Via Moody’s: Base Metals Price Drop Suggests All Is Not Well Though it goes practically unmentioned, one of the more unexpected developments of late has been the stunning collapse of Moody’s industrial metals price index. In part, the industrial metals price index’s average of July-to-date is a deep 8.2% under its June 2018 average because

0

India squashes LNG shortage drivel

It’s all garbage: India’s renegotiated gas import deal with Russia’s Gazprom will save between Rs 8,500 crore and Rs 9,500 crore over the contract period ending 2040, Oil Minister Dharmendra Pradhan said today. State-owned gas utility GAIL India Ltd had in January taken advantage of the Russian company’s inability to deliver liquefied natural gas (LNG) from the