Iron ore prices for September 6, 2018: Spot jumped. Paper more. Steel too. Port inventories are falling at a good clip down to 149.2mt. The iron ore market used to so pure. Today it is all noise and no signal. It’s obvious that steel demand is falling away, that there’s plenty of inventory, that mills
Iron ore prices for September 5, 2018: Spot up. Paper up more. Steel easing. Pulling a Costanza again. The worse the emerging markets and commodities bust gets the more the iron ore market expects Chinese stimulus. Falls still ahead.
Iron ore price for September 4, 2018: Spot up. Paper up. Coking coal up. Steel up. CISA output for mid-August fell away to hit exactly the same level as last year. There is plenty of steel. Demand is clearly weakening. Dead cat bounce.
By Leith van Onselen 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 fell by 1.3% in seasonally adjusted terms but rose by 1.0% in trends terms: Over the year, the terms-of-trade rose by 2.1% in seasonally adjusted terms and
By Leith van Onselen The RBA has released its commodity price index for August, which increased 1.5% in SDR (currency weighted) terms – the key determinant of the terms-of-trade – as well as by 1.8% in Australian dollar terms: Preliminary estimates for August indicate that the index increased by 1.5 per cent (on a monthly
Iron ore prices for September 3, 2018: Spot was flat. Paper too. Coking coal futures are deflating. Steel is way too high given inventories are 1mt above last year and absolutely fine. The China steel PMI is still solid at 53.4 but fading. Prices are going to fall. The market is onto it with FMG
Iron ore price charts for August 31, 2018: Spot firmed. Paper fell. Steel is retracing. We’re into September and that is not good for iron ore: We may see the cycle distended a little by preparations for Winter shutdowns but I still think it will hold sway. Time to duck.
Iron ore prices for August 30, 2018: Spot flat. Paper jumped overnight but before Trump’s big bash. Steel has flamed out. The truth is out at Macquarie: The bank tracks Chinese imports via customs data and shipping information from exporters, and so far in 2018, iron ore imports appear to be flat year-on-year. That’s despite
Iron ore prices for August 29, 2018: Spot down. Paper down more overnight. Steel did OK yesterday. I still think the top is in here for the remainder of the year.
Via Platts: Open interest in iron ore futures traded on China’s Dalian Commodity Exchange has fallen below 1 million lots in August, after peaking in April above 2.6 million lots. Iron ore open interest stood at 975,722 lots last Thursday, a year-to-date low, and at 981,858 lots on Monday. One lot is 100 mt. The
Iron ore price for August 28, 2018: Spot flat. Paper too. Steel fading still. No change in outlook, down into Q4.
Interesting to note that the Fortescue share price is again in free fall: It’s not a very pretty chart with support around $3 and that’s about it. The culprit is discounts that just won’t narrow, via Platts: Australian miner Fortescue Metals Group has maintained the discount for term contracts for 58.3%-Fe Fortescue Blend fines and
Iron ore prices for August 27, 2018: Spot down. Paper down. Steel down. I think the top is in here. The price signal from steel does not need to be this high and we’re entering the seasonally weak period plus Chinese Winter shutdowns. World Steel is still booming though: World crude steel production for the
Terrific stuff here from Westpac’s Justin Smirk: •Demand for iron ore has been very robust this year but more importantly there has been the collapse in Chinese ore production in response to industry reforms as well as a soft patch in imports. The more rigorous implementation of environmental policies has hit iron ore miners hard.
Iron ore prices for August 24, 2018: Spot firmed. Paper was flat. Steel fell. Rebar inventories are still one million tonnes higher than last year yet steel prices are 30% higher. Doesn’t make sense to me given even if Winter shutdowns are a little longer they we already know that idle capacity can cope. I
Iron ore prices for August 24, 2018: Spot down. Paper too. Steel faded. Hard to know if the rally is cooked. September is very weak seasonally but Winter shutdowns have distorted even that. My guess is the top is in and the slide into Q4 has begun.
Iron ore prices for August 22, 2018: Spot did not trade. Paper fell. Steel rose to new highs. Nothing changed. Strong into Q4 correction.
Iron ore prices for August 21, 2018: Spot down. Paper down further. Steel and coking are crazy. CISA major steel mill output for early August rose 1.6% to 1.94mt per year. As you can see, steel output is falling away at a pretty good clip versus last year. Despite this, steel inventories are only falling very
Iron ore price update for August 20, 2018: Spot firming still. Paper was down overnight. Steel was crazy though inventories are still stable. Texture from Reuters: Prices in China for rebar construction steel on Monday hit their highest in nearly seven years, boosted by concerns over tight supply. Prices were buoyed by market chatter on
Iron ore prices for August 17, 2018: Tianjin spot still firming. Paper up overnight. Steel still strong. Port stocks are climbing again as stimulus hopes hold sway. No change to outlook. Firm until the Q4 correction.
Got some chart troubles today so here are the numbers: Tianjin benchmark spot: $66.90 (-15 cents) Dalian 6 month future: 494 Dalian 6 month coking coal 1266 Shanghai rebar futures 4122 No change to outlook. Firm headed into Q4 weakness.
Iron ore prices for August 15, 2018: Spot down. Paper caught contagion overnight. Steel is fine. At some stage in the next three months we’re going to see a goodly selloff. The question now is will that be a buying opportunity for 2019 as Chinese stimulus pours in or the beginning of the end for
Spot down. Paper down. Steel up. The last time steel was at these prices iron ore was trading at $180. Output is astonishing: Texture from Reuters: Mills in the world’s top steel producer churned out 81.24 million tonnes of crude steel last month, up 1.3 percent from June and 7.2 percent from the same month
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
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
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
Tianjin benchmark lifted 65 cents to $68.75. Paper fell overnight. Rebar inventories fell again last week but remains well above the lows of last year. CISA daily steel output is trending down solidly. Steel prices have clearly responded to easing Chinese monetary policy. But there is nothing here out of the ordinary yet in terms
Iron ore prices for July 28, 2018: Spot was up though paper fell overnight. Steel futures are in Nirvana. Rebar market tightened last week falling 1.8% to 4.88mt. Still solidly up on last year but tightening a little. We’re off to the races with Chinese stimulus and solid steel markets. I have no idea how
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
Via RBC: The Chinese economy has stayed resilient through the first months of 2018, but the combination of an expected cyclical slowdown, increasingly challenging monetary conditions and increasing risks of tariffs to the wider economy points to a slowdown in Chinese steel demand in the second half of the year. We see a near-term destocking
