How oil will save the US/China relationship

From the IEA overnight: Oil production growth from the United States, Brazil, Canada and Norway can keep the world well supplied, more than meeting global oil demand growth through 2020, but more investment will be needed to boost output after that, according to the International Energy Agency’s latest annual report on oil markets. Over the


Daily iron ore price update (froth off)

Iron ore prices for March 5, 2018: Tianjin benchmark fell $2 to $75.65. Paper down more overnight. Steel is easing. Muted stuff really. Just blowing the recent froth off. Macquarie has some bullish reasoning: Virtually all of the producers we covered are in the money as prices are well above the seaborne marginal cost (SMC),


RBA commodity price index continues rebound

By Leith van Onselen The RBA has released its commodity price index for February, which increased another 1.8% in SDR (currency weighted) terms – the key determinant of the terms-of-trade – as well as by 3.8% in Australian dollar terms: Preliminary estimates for February indicate that the index increased by 1.8 per cent (on a


Daily iron ore price update (the top)

Iron ore prices for March 2, 2018: Tianjin benchmark got whacked -2.4% to $77.65. Paper fell further overnight. Steel fell. Two more charts to complete the picture. CISA steel mill output for early February lifted 1.6% to 1.78mt and is running at levels solidly above last year. But the huge spreads we saw between mid-2017


Even less gas for the LNG white elephants

Via The Australian: Gas buyers and sellers have cast doubt on the ability of Queensland’s vast coal seam gas fields to supply coming export and domestic demand in the wake of Origin Energy’s downgrade of reserves at its Ironbark coal seam gas project. EnergyAustralia energy boss Mark Collette said the fields, which underpinned development of


Daily iron ore price update (Samarco)

Iron ore prices for February 2018: Tianjin benchmark fell 65 cents to $78.90. Paper and steel are still firm. The China steel PMI fell to 49.5. There’ll be more noise ahead for that as Winter shutdowns pass but the trend is unmistakable. Vale results have thrown up some points. Samarco is till in the offing:


Daily iron ore price update (toppy)

Iron ore prices for February 27, 2018:   Tianjin benchmark was down 40 cents to $79.55. Paper stalled. Steel too. It’s tempting to call the top here given prices are way overheated, inventories crazy and the US dollar rising. But I’ll hold off. Weather is still a risk and the Q1 steel rebuild not yet


Tangshan steel cuts are marginal

Via Reuters: China’s top steelmaking city of Tangshan has proposed new restrictions on production once the current curbs expire in March in order to improve air quality, according to a draft document reviewed by Reuters. Under the proposal from the government dated February 12, the city’s mills will continue limiting production for 244 days between March 16


Daily iron ore price update (world steel)

Iron ore price charts for February 26, 2018: Tianjin benchmark rose 75 cents to $79.75. Steel was strong. Paper less so. No surprises here. Q1 is usually strong. We’re setting up a great short pushing towards mid-year. World Steel released output numbers for January: World crude steel production for the 64 countries reporting to the World


Iron ore miners hammered on weak results

Via UBS: Results below expectations, dividend small consolation Today’s result did not quite meet market expectations, which was largely due to oneoffs such as smelter maintenance at OD, a fire at WAIO, and write-offs at Escondida. Underlying EBITDA was US$11,238m (+14% y/y) vs UBSe US$11,838m & cons of US$11,593m. FCF of US$4.9bn beat UBS expectations


Labor makes perfect sense on Adani, wages

Lordy, some sense on Adani, via The Guardian: The shadow climate change minister, Mark Butler, has warned the development of the Galilee basin is not in Australia’s national interest, because it would displace mining and jobs in existing coal regions, and would not help the world meet its obligations under the Paris climate agreement. Butler


Previewing mining profits

Via UBS: February 2018 reporting season kicks off Reporting season kicked off with RIO on 07 Feb delivering a 69% growth in profit and returning 49% of cash generated to shareholders, setting the scene for what could be a cash bonanza for shareholders. Cash returns to be the focus of the major miners We expect


Great news: Korea declares war on Woodside

Via Reuters: South Korea’s Korea Gas Corp has entered court-administered arbitration with Australian joint venture North West Shelf Gas seeking to settle a dispute over a liquefied natural gas (LNG) contract that expired in 2016. A spokesman for the state-run Korean firm, known as KOGAS, confirmed an arbitration process was under way but declined to


Daily iron ore price update (discounts)

Iron ore price charts for February 13, 2018: Tianjin benchmark up $1.30 t0 $77.85. Paper too. Steel stuck. We’re range trading. CISA output fell 1.3% in late January. Not a great sign for demand. More on discounts today: Mt Gibson Iron has become the latest iron ore producer to describe the wide price gap between


The greatest gas shock is yet to come

But we’re getting a little taste of it now, via AFR: The unexpectedly tight liquefied natural gas market in Asia is complicating Australian regulatory efforts to prioritise the domestic market for east coast gas, helping drive up local prices for the fuel in January despite soft demand. Imports of LNG by Japan, the world’s biggest


Time to buy?

DXY lifted modestly Friday night: AUD rebounded with risk against DMs: Was mixed against EMs: Gold struggled: Oil was crushed: Base metals fell: Big miners lifted anyway: EM stocks rebounded: Junk didn’t: Treasuries were bid and the curve steepened: Same for bunds: European stocks were crushed. US too but then rebounded strongly into the close: The


US shale smashes Saudi aside

Bang! Here it is: More from John Kemp: U.S. crude oil production is set to increase by more than 1.2 million barrels per day in 2018 compared with 2017, according to the latest short-term forecasts from the U.S. Energy Information Administration. U.S. crude production will average almost 10.6 million barrels per day (bpd) this year


Daily iron ore update (noise)

Iron ore price for February 7, 2018: Tianjin benchmark jumped $1.50 to $77.50. Steel is stalled. Coking coal looks to be running out of rope. In news, Goa is out again: The Supreme Court today quashed the second renewal of iron ore mining leases given to 88 companies in Goa in 2015. The apex court


Scandal: Labor to stop coal welfare

Anyone would think that the Adani mine was viable, from The Australian: Labor frontbenchers have warned Bill Shorten that the opposition cannot be seen as “anti-coal” and urged him to shift the Adani debate away from “green” issues and on to public funding and alleged flaws in the approval process. Labor right-wing MPs have begun


Daily iron ore price update (data)

Iron ore price update for February 6, 2018: Tianjin benchmark was up 5 cents to $76. Steel is stable. Coking coal running on weather. Chinese port stocks were down 1.02mt last week but that could also be weather impacted. Port Hedland shipments fell in January to 41.1mt from 46.6mt in December, also likely owing to