Has China buckled on Aussie coal? There are some signs that it has done so: Australian miners are increasingly optimistic they may be able to resume selling coal to China, after official data confirmed small volumes of Australian coal cleared the Asian superpower’s borders in October. China imported 2.78 million tonnes of Australian coal in
The ferrous complex was hit on Friday 26th of November as the relief rally stalled then got infected with NU. Futures and steel were hammered: The latest drip of data is all bad. Mysteel’s weekly indexes are crap: Mid-November CISA output was terrible: Capital Economics is forcing me to review my assessment of the usefulness
The ferrous complex remained bonkers on November 24, 2021 as spot popped the ton, paper calmed overnight and steel took off: Some of this is obviously the massively overblown hype around Chinese stimulus. But, equally important is probably the return of the energy crisis. Coking coal futures are continuing to fall: But, thermal coal has
The ferrous market jizzed in its pants on November 23, 2021 as paper rose, paper spent the day limit before sobering last night and steel firmed: The turn in Chinese stimulus that is underway is so far a lot more modest than the market reaction to it. It will remain that way so long as
The ferrous complex was strong on November 22, 2021 as spot jumped with paper but steel fell back: There’s much excitement about more Chinese stimulus but that’s just the usual Pavlovian dogs. At this juncture, there is nothing coming that fundamentally alters the oversupply of iron ore. What matters more is thermal coal prices. They
It’s looking good for the transitory inflationists as energy prices free fall around the world. The oil price has flamed out as the US and China combine to thwart Goldman Sachs with releases of strategic reserves. Europe’s COVID outbreak and the Chinese property bust are not helping: Even Goldman admits a surplus now looms in
Everything ferous launched on Friday, November 19. 2021 on a rumour of more stimulus: There is nothing to report beyond reports of a rumour so this just looks like more technical action. Mysteel’s weekly gauges of activity look no better than last week: My outlook is unchanged. $50 iron ore sooner rather than later.
More on the declining fortunes of Australia’s iron ore billionaires today. Gina Rinehart is basking in the glow of the last great iron ore boom: Roy Hill, in Western Australia’s Pilbara region and majority-owned by Mrs Rinehart’s Hancock Prospecting, on Friday will announce a $4.4bn net profit for the year to June 30, double the
The ferrous complex was weak on November 18, 2022 as spot, paper and steel fell: Seaborne coking coal futures have now joined the broadening ferrous crash: Readers will know that my base case is ongoing heavy price falls in everything ferrous as China resumes its shuttered 120mt of EAF steel production that was suspended owing
The DXY rocket flamed out last night as EUR rebounded: The AUD could not catch the thermal: Oil and gold did better: Base metals were mixed. They look very troubled by a rising DXY: Big miners are sick: EM stocks want to retest the lows: Junk did better: As yields calmed: Allowing, you guessed it,
The ferrous complex was stalled on November 17, 2021 a spot and aper eased and steel firmed: Not much in news today. The coking coal price joke is ebbing away: The crucial thermal coal price which has supported both coking coal and iron ore demand by removing 120mt of EAF steel output is still falling
Not stuffed at all. Ms Gina Rinhart, Clive Palmer and Dr Andrew Forrest are richer than Croesus. But there is a problem for their iron empires and it is this: China’s economy is slowing to the lows seen way back in 1990 — a price President Xi Jinping seems willing to pay to reduce its
The ferrous complex was mixed on November 16, 2021 as spot firmed and paper plus steel fell: CISA data for early November is out and picked up a little: However, that 3.5% rise was enough to lift inventories by 5% so the underlying market clearly cannot take it. How deep and where the output cuts
The Chinese energy crisis is over. Coal output is surging: The one thing that China has plenty of is coal and it’s digging it up at record pace. Inventories and demand are now approaching normal: This is crashing Chinese coal prices for both thermal at $120: And coking at $300: Seaborne prices for thermal coal
The ferrous complex was soft on November 15, 2021 as spot eased, paper firmed overnight and steel has not updated: The market continues to smoke crack. Chinese steel is an outright disaster: The pipeline ahead is even worse: And there is only one thing standing between iron ore and catastrophe. That is the thermal coal
The ferrous complex was hammered November 12, 2021 as spot and steel tumbled and paper held on overnight: Port inventories were up another 3mt plus last week to 150mt: 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
The ferrous complex popped on November 11, 2021 with spot and steel but paper flamed out overnight: The market is trying to get excited by yesterday’s wave of policy rumours. But, the truth is, they are policy calibration not a swing to broad stimulus so the downside case for Chinese construction is intact if marginally
More deflation yesterday in global energy markets and it can’t come soon enough. Thermal coal led the way: Coking coal bucked the trend: JKM sagged as well: Along with European gas: It’s still about Putin: The resumption of Russian gas flows “have calmed traders’ nerves and prices after a week of volatility,“ said Emily McClain,
The ferrous complex was pretty wild on November 10, 2021 as spot tumbled but steel surged and paper gained overnight: Here it is in black and white from Wall Street’s Goldman Sachs: 2021 has been a year of change in China, with policymakers continuing normalizing macro policies and introducing regulatory measures in numerous sectors. While
Every week the Goldman commodities team puts out the same note repackaged as new: Volatility and tighter spreads go hand-in-hand. As the global energy crisis continued to grip markets in October, first coal-to-gas then gas-to-oil switching contributed to broad tightness in energy markets, with spillover to non-energy markets. Stretched systems leave physical markets exposed to
It’s a strange old world. A few months ago, Fortescue Metals Group was falling like a stone with the iron ore price. But, since then, it has gone sideways even as the iron ore price has hit new lows and other majors have kept falling, most notably RIO: The 58% iron ore price, where FMG
It’s being led by China where thermal coal prices re-entered free fall yesterday: Significantly, this is happening despite the NDRC trying to slow it down which tells us that the market is capitulating. Seaborne thermal rolled and will catch up in due course: Coking coal appears to be breaking down as well. I have never
The ferrous complex was smoked on November 9, 2021 as spot fell, steel was smoked and paper burned overnight: Steel futures are in free fall again: My view is there another 1000 point fall in this before we even get serious. There is still a very good chance that we go much lower than that.
After a couple of weeks of things getting better for global energy, Russia has decided to make things worse again: In late October, the market rejoiced and nat gas prices puked (even as we warned this was just the latest joke the Kremlin was playing at gullible Europe’s expense) after news that Russian President Vladimir Putin had
The ferrous complex hung on for grim death on November 8, 2021 as spot firmed, paper was hit overnight and steel fell: CISA released its late October output numbers for major steel mills and it was, again, unbelievably bad, down nearly 8%: The year-on-year collapse is roughly 160mt per annum. From the peak it is
The global energy crisis was mixed Friday. Thermal coal prices were up: Chinese inventories fell a little last week as electricity usage returns: But it remains the case that the crisis is over: China’s daily coal output has risen by more than 1 million tons in recent weeks to 11.67 million tons and will likely
The ferrous complex was mixed on November 5, 2022 as spot hit a new low for the sell-off while steel dead cat bounced and took paper with it: This is all technical waffle. There is nothing to stop the entire ferrous complex from halving again from here. In fact, expect it to. Chinese demand seen
This is what happens when you get an artificial energy panic leading to draconian intervention to stabilise prices owing to politics: China’s daily coal output hit 11.7 million tonnes on November 3, close to the highest level this year, and output is expected to increase further as planned maintenance at coal mines gradually ends, the
The ferrous complex was weak on November 4, 2021 as paper fell more overnight and steel is in meltdown. Benchmark spot didn’t trade owing to a Singapore holiday: Steel is in meltdown: I see nothing to stop this. Chinese demand is falling faster than mills can cut output. There’s 120mt of EAF yet to return.
The ABS has just released trade data for September, which posted a $2.5 billion decline in Australia’s trade surplus on falling iron ore prices: Goods and services credits (exports) fell $3,081 million (6%) to $44,969 million: Whereas goods and services debits (imports) fell $586 million (2%) to $32,725 million driven by continued global supply chain
