China, Singapore iron ore futures fall; tight credit curbs buying
Monday, 16 June 2014 10:51 Posted by Shoaib-ur-Rehman Siddiqui E-mailPrintPDFViews: 13 imageSINGAPORE: Iron ore futures in China and Singapore dropped on Monday to the lowest since their launch last year, reflecting plentiful supply and tighter credit that has slowed purchases by Chinese mills despite a more than 30 percent plunge in spot prices this year. The weaker futures suggest spot iron ore prices could extend their drop to below $90 a tonne later in the day to touch a fresh low since September 2012. "Liquidity is a big issue at the moment because many banks are not willing to open letters of credit," said an iron ore trader in Shanghai. A probe into metal financing deals in China's Qingdao port has spurred caution among lenders, traders said, many of which have already been trimming their exposure to sectors plagued by overcapacity such as the steel sector. Iron ore for delivery in September on the Dalian Commodity Exchange fell to as low as 658 yuan ($110) a tonne, its weakest since the bourse introduced the contract in October. It was down 0.6 percent at 661 yuan by midday. The July iron ore contract on the Singapore Exchange dropped nearly 1 percent to $88.99 per tonne, its lowest since SGX launched the futures in April last year. Iron ore for immediate delivery to China <.IO62-CNI=SI> fell 0.7 percent to $90.90 a tonne on Friday, its lowest since Sept. 7, 2012, according to data compiler Steel Index. A break below the September 2012 trough of $86.70 will put spot iron ore closer to levels last seen in 2009. Down more than 32 percent so far this year, iron ore prices have been largely dragged down by increased supply as miners led by Vale, Rio Tinto and BHP Billiton boost output to sell more to top market China. But with the steep drop in iron ore prices potentially closing up to 80 million tonnes of domestic mine production in China, the top foreign miners stand to gain given their lower business costs, Wood Mackenzie analyst Andrew Hodge said. Rio Tinto breaks even at around $43 a tonne, while rival Australian miner BHP needs a $45 iron ore price to stay in the black. Vale's is higher at $75 a tonne due to the greater distance from Brazil to China. "Mills are buying in small lots and they keep on pushing prices down sharply," said an iron ore trader in Tianjin, adding a softer real estate market in China is also hurting demand for steel. The most-active October rebar contract on the Shanghai Futures Exchange touched a low of 3,009 yuan a tonne, its weakest since the exchange launched rebar futures in March 2009. That followed a further decline in spot steel prices in China over the weekend, with Tangshan billet falling 40 yuan to around 2,760 yuan per tonne, traders said. High inventories of iron ore stocks at Chinese ports have also pushed mills to do "short rounds of restocking rather than aggressive restocking as seen in previous years", investment bank ANZ said in a note. Copyright Reuters, 2014
Cock shot with a 12 gauge follow through to the balls.
Now thats got to hurt.
The July iron ore contract on the Singapore Exchange dropped nearly 1 percent to $88.99 per tonne
A break below the September 2012 trough of $86.70 will put spot iron ore closer to levels last seen in 2009.
Adjust this for inflation??? $60 per ton, hmmmm.
Peter
But how did Foxbat know??????
You do realize this will cause you pain by killing the domestic tourist trade. Unless there has been a new casino added to Margaret river, then you will see little SEA trade.
There may be a drop in the dollar, but not yet. I would say this will hurt you more than it will benefit.
So why do you sound so happy about it? I am over the moon, but my situation is different to yours.
Whenever you have an argument with someone, there comes a moment where you must ask yourself, whatever your political persuasion, 'am I the Nazi?'
You do realize this will cause you pain by killing the domestic tourist trade. Unless there has been a new casino added to Margaret river, then you will see little SEA trade.
There may be a drop in the dollar, but not yet. I would say this will hurt you more than it will benefit.
So why do you sound so happy about it? I am over the moon, but my situation is different to yours.
I never said it would not hurt the whole of Western Australia's economy.
Every bit of it.
As long as people are prepared for winter they may get cold from time to time, but they will survive.
His arse is worthless now Shaddow and Black Panther have put him on ignore.You forgot No Tool?
That "bear whisperer" bowed out long ago.
Must be shiiite when you can't even affoard to get the internet put on at your grandmothers housing.commission place.
Shit sorry, not 'no tool' - 'not fooled' wasnt it?
Seriously, does anyone actually know Timmy? I think we should find out if he has died before we bitch too much about him. Do any of the bulls or Alex know him? Seems strange he would just disappear. Send us a pm mate to let us know you are OK.
Whenever you have an argument with someone, there comes a moment where you must ask yourself, whatever your political persuasion, 'am I the Nazi?'
Seriously, does anyone actually know Timmy? I think we should find out if he has died before we bitch too much about him. Do any of the bulls or Alex know him? Seems strange he would just disappear. Send us a pm mate to let us know you are OK.
Lots of people arrive and then disappear from the forum, that's normal.
Actually I thought that Timmy was pretty close with his calls, and even this downturn doesn't mean he won't be right. We have seen these downturns before. If the interest rate is cut and the dollar falls the miners won't be suffering anywhere near as much as many people commenting here think. In fact the bigger ones are cashed up and they might take the opportunity to buy up some of the struggling mines while prices are low.
The big miners will surely survive - some of them have been in the business for more than a century and have weathered many storms (although Rio was touch and go for a while there). They know that resource demand is cyclical and are generally prepared for the downturn.
But the fact that they will pull through should not be equated with everything and everyone else being hunky-dory. Plenty of people I have spoken to in the industry seem to have some difficulty coming to terms with the fact that boom and bust means just that - boom and bust. I suppose that's understandable given that the astonishingly long run of this boom may have created the notion of the situation being "normal, certain and permanent - unchanging except in the direction of further improvement" as Keynes would have put it.
Regardless of what else may happen, the end of the titanic investment boom is coming. Sooner or later - and it present it's looking like sooner - the resource companies will no longer continue pumping vast sums into expanding output capacity at a blistering pace needed to feed the demands of an exponentially-growing giant and large numbers of very highly paid - for what they do - workers will no longer be required. The fact that a handful of Wall street fat cats are doing ok will be of no comfort to them and of little assistance to Australia unless those fat cats decide to re-invest that money here.
The big miners will surely survive - some of them have been in the business for more than a century and have weathered many storms (although Rio was touch and go for a while there). They know that resource demand is cyclical and are generally prepared for the downturn.
But the fact that they will pull through should not be equated with everything and everyone else being hunky-dory. Plenty of people I have spoken to in the industry seem to have some difficulty coming to terms with the fact that boom and bust means just that - boom and bust. I suppose that's understandable given that the astonishingly long run of this boom may have created the notion of the situation being "normal, certain and permanent - unchanging except in the direction of further improvement" as Keynes would have put it.
Regardless of what else may happen, the end of the titanic investment boom is coming. Sooner or later - and it present it's looking like sooner - the resource companies will no longer continue pumping vast sums into expanding output capacity at a blistering pace needed to feed the demands of an exponentially-growing giant and large numbers of very highly paid - for what they do - workers will no longer be required. The fact that a handful of Wall street fat cats are doing ok will be of no comfort to them and of little assistance to Australia unless those fat cats decide to re-invest that money here.
Seriously, does anyone actually know Timmy? I think we should find out if he has died before we bitch too much about him. Do any of the bulls or Alex know him? Seems strange he would just disappear. Send us a pm mate to let us know you are OK.
No, Timmy is not dead, just hiding from reality.
Let's just say, he socked me only a couple of days ago.
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