Commodities

4

CBA: Iron ore to crash in 2021

Gareth Aird, head of Australian economics at CBA, has written a new note examining the outlook for Australian commodity prices in 2021. Aird sees commodity prices “remaining well supported in 2021” on the back of “momentum in the global economy”. This will keep Australia’s terms-of-trade elevated in 2021, thus supporting national income as mining profits

11

Commodities “super-cycle” turns Wall St ponzi scheme

The post-pandemic environment is deeply irrational. We’ve seen markets crash down and crash up. Autocracies charge into self-defeating abuse of all and sundry. Democracies give up entirely upon accountability. Riots at the Capitol. The “great reset” conspiracy theory. The normalisation of rape in the Australian Parliament House. Entire countries swept by death while others bunker

3

Australia’s trade surplus intact despite big fall in iron ore exports

The Australian Bureau of Statistics (ABS) has released preliminary trade data for the month of January, which revealed a goods trade surplus of $8.75 billion after a 9% fall in exports was offset by a 10% fall in imports: Exports of goods in January 2021 declined $3,047 million (-9%) to $32,126 million Imports of goods

15

Glasenberg: Pilbara killer is go

The recent Chinese trade war on itself via Australia has contributed to tremendous rises in the iron ore price. If it needed any further convincing, this has tipped the scale for the CCP’s long-held dream of creating a substantial African iron ore alternative.Departing Glencore chief executive Ivan Glasenberg, who knows a thing or two about

9

What happened at Fortescue?

Yesterday we got a little shock from Fortescue. It came in the form of the resignation of three key executives associated with its Iron Bridge expansion: OK then. Not much to add. I can only observe that the focus on culture and behaviour seems a little out of step with the cost overrun crisis. There

8

Iron ore boomsters turn delusional

I remain skeptical about the suddenly very fashionable commodities super-cycle thesis. Even more so as others lose their heads. Such as Chanticleer after yesterday’s BHP release: Mike Henry is a cautious type. [His] “fundamentally positive” outlook that could last as long as 30 years. He says two key drivers will underpin demand. The first is

30

What is green hydrogen?

Some more useful material from Global Mining Research: When you think of hydrogen, one of the things that we have at the back of our mind is the Hindenburg disaster, however the world has come a long way since 1937 (the Hindenburg was in fact supposed to use helium but there was a US export

0

UBS: BHP dividend boom a positive

Via Glynn Lawcock at UBS: ONE LINER NPAT miss but higher dividend a positive. KEY NUMBERS Underlying EBITDA of US$14,680m (+21% y/y) vs UBSe US$15,361m (Vuma cons US$14,689m). Underlying NPAT of US$6,036m (+16% y/y) vs UBSe US$6,640m (Vuma cons US$6,331m). Underlying EPS of US119.4cps (+16% y/y) vs UBSe US131cps (Vuma cons US125cps). DPS of US101.0cps

1

How high for oil?

How high for the oil recovery is always an important question given its implications for inflation. At the moment, the oil market has returned to its usual bullishness with all sorts of analysts forecasting a new supercycle: For me, this is deja vu all over again. There is no doubt that the oil market has

15

What is green steel?

Global Mining Research has a nice primer on the emergence of green steel. Green Steel – Why is it relevant? The production of steel is one of the most polluting industries from a CO2 perspective, representing in the order of 8% of global emissions. For the miners ESG reporting has never been as relevant and for

1

WA budget rides the iron ore boom

Western Australia’s Department of Treasury has upgraded its forecast for the state’s 2020-21 Budget surplus to $3.1 billion, compared with expectations in December of just $2.2 billion. The state’s improved fiscal position has been driven by continued strong demand for iron ore, with Treasury forecasting that the price of the steel input will average US

28

Silver market fleeces Reddit patsies

Via Societe General: The recent Reddit silver rally was triggered by a post in a Reddit forum thread called WallStreetBets calling for “the biggest short squeeze in the world”. At the time of writing, silver prices have retreated and paused after the initial resulting surge. This note is not intended to offer a prediction of