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Daily Iron Ore Price, Commodities and Precious Metals Update - October 2014
Topic Started: 3 Oct 2014, 10:08 AM (14,639 Views)
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CBA Commodities Daily Alert 28-Oct-14

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Nickel prices lift to over USD7/lb

Nickel prices rose the most in five months on concerns that China’s
nickel pig iron output will scale back at prices below USD7/lb, in line
with what we outlined in our recent nickel study. China’s nickel pig
iron sector accounts for ~20-25% of world nickel output. Other base
metals and crude oil benchmarks rose on demand hopes as US
consumer confidence climbed higher than expected in October. Iron
ore fell by 0.4% to USD79.22/t (CFR China).

Freeport-McMoRan has reported a fall in output at its Grasberg
copper and gold mine in Indonesia after a large percentage of openpit
miners did not return to work on safety concerns. This follows a
fatal accident on 27 September, and is despite authorities giving the
all clear for work to restart on 13 October. Union representatives for
miners at Grasberg have signalled intent to strike for 30 days
beginning on 6 November. Grasberg is the world’s third-largest
copper mine.

Member mills of the China Iron and Steel Association (CISA) –
typically between 80% and 85% of China’s total steel capacity –
produced an average of 1.76Mt/d of crude steel from 10-20 October,
down 2% from the previous ten days.

The former director of research at OPEC, Adnan Shihab-Eldin,
believes USD80/bbl is still high enough to encourage investment in
the oil and gas sector. He also believes that Brent crude oil prices
could average USD70-80/bbl for a while.

US coal miner, Arch Coal, still sees metallurgical coal markets in
oversupply. The company has maintained coal sales guidance of 5.7-
6.3Mt for this year.
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newjez
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deluded
29 Oct 2014, 11:25 AM
The average cost of iron ore should be very close to the cost of production of the most inefficient supplier. So, contrary to the delusional beliefs that prices will rise when marginal producers close, prices are actually going to drop as those marginal producers close. The more the marginal producers cut costs, the lower the iron ore price will go. They cannot win. This is why they are marginal, marginal in every single way imaginable. The marginal producer chases the delusion of a short-term price bubble and forgets that he is marginal on the longer term average. A lot of the fools watching him, make the same mistake.
I don't have to run faster than the lion. I just have to run faster than you.
Whenever you have an argument with someone, there comes a moment where you must ask yourself, whatever your political persuasion, 'am I the Nazi?'
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Quote:
 
Iron ore futures extend losses ahead of Chinese mill shutdowns

Tue Oct 28, 2014 10:50am IST
By Manolo Serapio Jr

SINGAPORE, Oct 28 (Reuters) - Iron ore futures fell for the
second session running on Tuesday amid plentiful supply and slow
demand ahead of temporary shutdowns or output cuts by Chinese
mills as Beijing strives to curb pollution during an APEC
meeting in Beijing next month.
Some steel mills in Hebei, China's top steel-producing
province, have been asked to reduce or suspend production during
the Asia-Pacific Economic Cooperation summit on Nov. 7-12 to
help improve air quality in the capital.
"We would expect modest steel production cuts for 2-3 weeks
as part of efforts to 'clean Beijing's air' for the APEC
meetings," Commonwealth Bank of Australia analyst Lachlan Shaw
said in a research note.
"This should reduce iron ore demand in the immediate term
and likely mute the expected seasonal restocking into China's
winter."
Iron ore for May delivery on the Dalian Commodity Exchange
was down nearly 1 percent at 523 yuan ($86) a tonne by
midday. The December iron ore contract on the Singapore Exchange
dropped 0.3 percent to $78.73 a tonne.
Iron ore for immediate delivery to China .IO62-CNI=SI
eased 0.3 percent to $79.60 a tonne on Monday, according to data
compiled by The Steel Index.
That was not far off the September trough of $77.50, which
was the lowest price for iron ore since 2009.
"There's plenty of available supply in the market so
nobody's in a hurry to look for a cargo or jump at an offer,"
said an iron ore trader in Shanghai.
"We are very cautious on taking any long-term contracts
right now because the market is very uncertain," said the
trader, adding his company had received a couple of offers from
suppliers in Australia and Brazil.
Iron ore has fallen 40 percent this year as big, low-cost
miners in Australia and Brazil mined record volumes of iron ore
to ship more to top market China, where steel demand was growing
at a slower rate.
Helping put a floor under iron ore prices was a sustained
fall in stocks of imported iron ore at China's ports as mills
sought out smaller cargoes, traders said.
Stockpiles of iron ore at China's major ports dropped by
850,000 tonnes from a week before to 107.05 million tonnes as of
Oct. 24 SH-TOT-IRONINV, data from industry consultancy
SteelHome showed. That was the lowest port inventory level since
March.

Read more: http://in.reuters.com/article/2014/10/28/markets-ironore-idINL4N0SN1SC20141028
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CBA Commodities Daily Alert 29-Oct-14

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US crude oil output at record weekly high

Base metals finished mostly higher on demand hopes after China’s
cabinet said it will support demand in six industries, including real
estate development. Gold futures fell as the appeal of the precious
metals as an inflation hedge softened after the US Federal Reserve
ended its bond-purchase program. Iron ore fell 0.2% to USD79.09/t
(CFR China).

The target for full production of the Indonesia Deepwater
Development (IDD) gas project has been delayed two years to 2020,
boosting the chances that Indonesia may become a net gas importer.

OPEC’s Secretary General, Abdalla El-Badri, estimates that at
current crude oil prices, as much as half of tight crude oil supply is
losing money. He also said OPEC will need to produce between
29mb/d and 30mb/d next year to meet world crude oil demand.
OPEC, which accounts for ~40% of world crude oil supply, currently
has a crude oil output target of 30mb/d.

The US Federal Reserve has ended its quantitative easing program of
asset purchases. The Fed says interest rates will stay near zero for a
"considerable period" but the language of the statement is more
‘hawkish’ (ie it suggests rates may rise earlier than originally
expected by economists). The Fed said "underutilization of labor
resources is gradually diminishing", as opposed to the previous
statement where it noted "there remains significant underutilization of
labor resources".
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Blondie girl
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19 Oct 2014, 08:27 PM
Asking which company's are making a profit is a stupid question? Is there some magic way that I can turn a profit without making more money than I spend?

I'm genuinely curious but it seems to have you all stumped which is surprising reading some of the big claims on here :?:
You are asking the very wrong people.

Read & get feedback from those who get it..
Beyond the forum.
Newjerk? can you try harder than dig up another person's blog. My first promo was with Billabong and my name in English is modified with a T, am Perth born but also lived in Sydney to make my $$
It's Absolutely Fabulous if it includes brilliant locations, & high calibre tenants..what more does one want? Understand the power of the two "P"" or be financially challenged
Even better when there is family who are property mad and one is born in some entitlements.....Understand that beautiful women are the exhibitionists we crave attention, whilst hot blooded men are the voyeurs ... A stunning woman can command and takes pleasure in being noticed. Seems not too many understand what it means to hold and own props and get threatened by those who do.
Banks are considered to be law abiding and & rather boring places yeah not true . A bank balance sheet will show capital is dwarfed by their liabilities this means when a portions of loans is falling its problems for the bank.
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newjez
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http://www.smh.com.au/business/mining-and-resources/iron-ore-to-hit-us70-per-tonne-morningstar-says-20141031-11eo43.html

You could be right Peter from perth.
Whenever you have an argument with someone, there comes a moment where you must ask yourself, whatever your political persuasion, 'am I the Nazi?'
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CBA Commodities Daily Alert 30-Oct-14

Posted Image

ConocoPhillips to reduce oil spending

ConocoPhillips, a major oil producer, has announced that it will
reduce spending in some emerging North American oil fields in
response to lower crude oil prices. The company still expects to
boost oil output by 5% a year despite the lower spending.

Precious metals led commodity prices mostly lower as the USD
strengthened after the US economy grew faster than expected in
3Q14. Gold futures fell below USD1,200/oz, a key support level in the
last couple of years. The USD lifted earlier this week when the US
Fed decided to end its bond purchasing program. Iron ore rose by
0.9% to USD79.82/t (CFR China).

Vale, the world’s largest iron ore producer, reported a surprise loss in
3Q14 due to a weaker Brazilian real boosting US-denominated debt
and weaker iron ore prices. The company’s exports of iron ore and
pellets fell by 6.6% y/y to 78.1Mt in 3Q14. Vale’s nickel sales
volumes rose by 15% to 71kt in the quarter.

According to All India Gems and Jewellery Trade Federation, India’s
gold imports likely fell from 95t in September to 50-60t in October
due to weaker demand post India’s Diwali festival. India’s gold
imports are expected to lift in November due to wedding season
demand.

Chinese research firm, Antaike, forecast China’s copper smelting and
refining capacity to lift 12% y/y to 6.25Mt and 8.2% y/y to 10.56Mt,
respectively, in 2015. The firm expects China’s refined copper
consumption to increase 6% to 9.24Mt in 2015 due to power
industry demand.
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TheTruth
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deluded
29 Oct 2014, 11:25 AM
The average cost of iron ore should be very close to the cost of production of the most inefficient supplier. So, contrary to the delusional beliefs that prices will rise when marginal producers close, prices are actually going to drop as those marginal producers close. The more the marginal producers cut costs, the lower the iron ore price will go. They cannot win. This is why they are marginal, marginal in every single way imaginable. The marginal producer chases the delusion of a short-term price bubble and forgets that he is marginal on the longer term average. A lot of the fools watching him, make the same mistake.
So taking out supply doesn't matter? What ever happened to supply and demand. I fear your nickname is the truth.
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newjez
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TheTruth
31 Oct 2014, 07:02 PM
So taking out supply doesn't matter? What ever happened to supply and demand. I fear your nickname is the truth.
Yes, supply does matter. But we are looking at oversupply. So it doesn't matter at the moment.
Whenever you have an argument with someone, there comes a moment where you must ask yourself, whatever your political persuasion, 'am I the Nazi?'
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TheTruth
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newjez
31 Oct 2014, 07:33 PM
Yes, supply does matter. But we are looking at oversupply. So it doesn't matter at the moment.
By how much is there over supply? Are stockpiles rising or falling?
Edited by TheTruth, 31 Oct 2014, 10:25 PM.
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