Commodities

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“Panic selling” crashes coking coal, Budget next

Goodbye Budget. Via Mining: The Australian export price of metallurgical coal (FOB hard coking coal Fastmarkets MB) used in steelmaking tanked 7% to $122.50 a tonne. That’s down almost $70 a tonne compared to the start of the year. Fastmarkets MB in a market report says the availability of ample cargoes of lower quality seaborne

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Daily iron ore price update (bash)

Texture from Reuters: Investors are cautious as prospects of China’s economy remain uncertain, a Shanghai-based trader said. Demand can be maintained at the current level but is unlikely to grow further, said the trader, adding that supply of iron ore is relatively sufficient now. The question is not underlying demand. It is weak. The question

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Daily iron ore price update (roll over)

Texture from Reuters: “Market will further evaluate the impact on steel products’ consumption and output from the coming National Day holiday,” Huatai Futures wrote in a note, adding that the underperformance of the newly launched iron ore futures contract based on new delivery rules also affected sentiment. That’s about it right now as Beijing seeks

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S&P: Carmageddon to roll on

Via S&P today: Global light vehicles sales fell by 6.4% in the year to June 30, 2019. Sales declined in all major markets with the exception of Central and Eastern Europe, which saw a slight pick-up of 0.5%. In light of current conditions, global auto manufacturers’ hopes for a sharp increase in sales in the

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Daily iron ore price update (ex-growth)

Texture from Clyde Russell: Is it time to challenge the conventional wisdom in iron ore and steel markets that poor Chinese economic data is actually good news because it means Beijing will ramp up stimulus spending, thereby boosting demand? The current thinking of ‘bad data equals good news’ was on display this week, with steel

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Daily iron ore price update (no stimulus)

Texture from Reuters: Monday’s data followed downbeat remarks by Chinese Premier Li Keqiang, saying it is “very difficult” for the domestic economy to grow at 6% rate or more because of the high base from which it was starting and the complicated international backdrop. The dismal industrial output figures raised the likelihood of further stimulus

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Daily iron ore price update (blow off)

Texture from Reuters: Financial markets in China are closed on Friday for the nation’s Mid-Autumn Festival. Amid declining iron ore seaborne arrivals, purchases of the material may pick up due to some restocking demand of steel mills ahead of the country’s National Day celebrations in early October, said Richard Lu, senior analyst at metals consultancy

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Daily iron ore price update (restock)

Texture from MySteel: China’s imported iron ore prices are likely to remain buoyant for the immediate future, thanks to additional procurements many steelmakers are undertaking ahead of the upcoming National Day Holiday over October 1-7, according to market sources on Wednesday. “Iron ore prices may remain relatively strong short-term, because there are still many mills

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Thermal coal crash deepens

The thermal coal crash driven by falling Chinese imports just keeps getting deeper, via the AFR: Billions of dollars worth of Australian coal projects are under threat as slumping prices render about 19 per cent of the world’s existing seaborne thermal coal supply loss-making. Adani’s Carmichael and Whitehaven’s Vickery mine projects were lucrative proposals in

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Daily iron ore price update (noise not signal)

Texture from Reuters: “The continued recovery from recent (supply) disruptions in Australia and Brazil showed in stronger iron ore imports,” an ANZ Research note said. China increased its iron ore imports in anticipation of stockpiling ahead of China’s National Day holidays in early October, it added. But the price volatility reflected lingering concerns about demand

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Daily iron ore price update (roll over)

Texture via Reuters: “Steel mills across China are ramping up their steel production as Tangshan sintering cuts kick in. This means firm demand for iron ore in the ferrous complex,” said Darren Toh, a data scientist with Singapore-based steel and iron ore analytics firm Tivlon Technologies. “The rebound in prices recently echoed robust demand in

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S11D booms

More iron ore: Exports from Brazilian mining giant Vale’s flagship S11D Carajás iron ore operation in the first eight months were worth US$2.92bn, up from  US$2.87bn in all 2018 Exports hit US$1.74bn in January-August 2018. Vale exported 44.7Mt of iron ore from the complex (pictured) in northern Pará state in January-August. The figure is up from 36.7Mt during the

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Daily iron ore price update (stimulus)

Texture from Sinocism on new stimulus measures: More policy support for the economy coming, certainly not like the flood-like stimulus of previous downturns, but drips of stimulus continue to dribble out. China to take targeted measures for steady economic growth – Xinhua Further steps will be taken to ensure the stability of employment, the financial

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Trade surplus retraces from record high

The Australian Bureau of Statistics (ABS) today released trade data for the month of July, with Australia’s trade surplus retracing to $7.3 billion from $8.0 billion in June: The next chart shows that Australia’s trade surplus is still running near record highs: In July, exports (credits) and imports (debits) both rose: In seasonally adjusted terms,

6

China builds Iranian oil gusher

Via the Petroleum Economist: Iran’s foreign minister Mohammad Zarif paid a visit to his Chinese counterpart Wang Li at the end of August to present a road map for the China-Iran comprehensive strategic partnership, signed in 2016. The updated agreement echoes many of the points contained in previous China-Iran accords, and already in the public

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Daily iron ore price update (boom, baby, boom)

Texture from Reuters: “Overall production curbs in Tangshan in September are on par with August, which are loose,” Huatai Futures said in a note, adding that output restrictions in Wuan, county-level city of the second-biggest steelmaking city of Handan, tightened slightly this month compared with August. “We believe that Chinese demand has further room to

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Daily iron ore price update (flame out)

Texture from Reuters: China’s biggest steelmaking city of Tangshan will carry out output restrictions on industrial firms for September and early October, to further strengthen improvement of its air quality, state media reported on Tuesday. More than 30 steel mills in Tangshan have been asked to cut operations throughout the month. From Sept. 1 to

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Australia’s terms-of-trade enjoys one last hurrah

Within today’s dump of balance of payments data that feeds into tomorrow’s June quarter national accounts release was the important news that Australia’s terms-of-trade rose another 1.5% in seasonally adjusted terms and by 2.2% in trends terms: Over the year, the terms-of-trade rose by 8.9% in seasonally adjusted terms and by 8.8% in trend terms.

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Commodity price index takes a dive

The RBA has released its commodity price index for August, which dived by 6.5% in SDR (currency weighted) terms – the key determinant of the terms-of-trade – and by 4.2% in Australian dollar terms: Preliminary estimates for August indicate that the index decreased by 6.5 per cent (on a monthly average basis) in SDR terms,

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Daily iron ore price update (dead cat screamer)

Bloomie has the trigger for the fun: China will maintain “reasonably ample” liquidity and “reasonable growth” in aggregate financing as it implements a prudent monetary policy, the State Council’s financial stability and development committee says at a conference chaired by Vice Premier Liu He. Various risks are “controllable” overall as the economy is stable and

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Daily iron ore price update (just because)

Texture from Reuters: Some steel mills were seen beefing up their iron ore stocks before the week ends as they expect production curbs in China’s top steelmaking city of Tangshan to be eased in September, and also to prepare for a possible buildup in steel demand. “Steel inventories are easing from the highs,” said Darren

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Daily iron ore price update (the crapening)

Texture from Reuters: Steel glut in China and seasonally weak domestic demand for the metal weighed on prices in recent weeks, including those of steelmaking raw materials. The slump in steel prices along with higher cost of raw materials — iron ore still trades above 2018 price levels despite its pullback from five-year highs —

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Daily iron ore price update (stimulus fever!)

Texture from Reuters: The glut and tepid demand for steel in top producer China have dragged prices of the construction and manufacturing material lower, putting strain on the profitability of mills. “We heard some of them are already making losses,” said Richard Lu, senior analyst at metals consultancy CRU Group’s Beijing office. “They have decided

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Daily iron ore price update (the crashening)

Texture from Reuters: There is still “a degree of scepticism regarding the likelihood of any concrete near-term progress” in the U.S.-China trade talks, ANZ Research said. The downbeat outlook for steel demand, along with anti-pollution production curbs in China, dragged prices of steelmaking raw materials lower, including iron ore. “Coupled with the slowing steel market,

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Are Fortescue dividends sustainable? Lol

Financial markets are really just large bucket shops so you can always predict what is coming at certain points of the cycle. For mining, the cycle peak is always marked by the “dividends are sustainable” pitch, via AFR: Fortescue Metals’ dividend policy is “definitely sustainable” says chief executive Elizabeth Gaines as the iron ore miner

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Daily iron ore price update (nothing good)

Texture from Reuters: China is willing to resolve its trade dispute with the United States through “calm” negotiations and resolutely opposes the escalation of the conflict, Vice Premier Liu He, who has been leading the talks with Washington, said on Monday. “The U.S.-China trade war has intensified, and aside from the direct impact of tariffs,