It's rallied more than 100% and the AUD is sub 75c still. Is $90 possible? $100?
I must say I am surprised by the rebound. And it would be fair for the bears to admit they were wrong. It doesn't help the cause to deny reality.
However, is anyone able to find out what percentage of global iron ore volume is trading at spot vs the volume trading at fixed contracts that were locked in when the price was $40?
I think that info is very important if we want to give meaning to the rebound of spot.
I must say I am surprised by the rebound. And it would be fair for the bears to admit they were wrong. It doesn't help the cause to deny reality.
However, is anyone able to find out what percentage of global iron ore volume is trading at spot vs the volume trading at fixed contracts that were locked in when the price was $40?
I think that info is very important if we want to give meaning to the rebound of spot.
The spot volume is substantial, most of the market I believe.
I must say I am surprised by the rebound. And it would be fair for the bears to admit they were wrong. It doesn't help the cause to deny reality.
However, is anyone able to find out what percentage of global iron ore volume is trading at spot vs the volume trading at fixed contracts that were locked in when the price was $40?
I think that info is very important if we want to give meaning to the rebound of spot.
What's this 'bears' bullshit?
Whenever you have an argument with someone, there comes a moment where you must ask yourself, whatever your political persuasion, 'am I the Nazi?'
I must say I am surprised by the rebound. And it would be fair for the bears to admit they were wrong. It doesn't help the cause to deny reality.
However, is anyone able to find out what percentage of global iron ore volume is trading at spot vs the volume trading at fixed contracts that were locked in when the price was $40?
I think that info is very important if we want to give meaning to the rebound of spot.
A minor bounce from an extreme low helped by the severe flooding of Chinese mines.
Just to understand the bigger picture for iron ore you should understand the following.
In 2014, worldwide steel consumption was around 1,500 million tonnes, of which half of this, or 750 million tonnes was consumed by china. In 2014, China mined 300 Million tonnes of iron ore. From Oct 2015 to Oct 2016, China mined 1,500 million tonnes of iron ore.
We can see in the below graph the rise of chinese iron ore mining. Surprising they seemed to forget about Australia when posting the numbers considering we are right up there.
Another thing to remember here is that there is a difference between iron ore consumption figures and iron ore production numbers, with the later being a fair bit more.
The article above came out yesterday. The opening comments are below.
An independent market analyst warns that the current iron ore price could fall just as sharply as it has risen this year.
Peter Strachan said while the price had doubled in 2016, reaching a high of $US80 a tonne this week, there is nothing fundamental holding it there.
"There is a bit of a speculative sort of bubble feel about this move," he said.
"Inventory at Chinese ports has been rising.
"It has risen about 30 million tonnes this year so far and the Chinese steel mills are still going strongly but they're certainly not increasing the output of steel in a way that would indicate the price rises that we've seen."
The article above came out yesterday. The opening comments are below.
An independent market analyst warns that the current iron ore price could fall just as sharply as it has risen this year.
Peter Strachan said while the price had doubled in 2016, reaching a high of $US80 a tonne this week, there is nothing fundamental holding it there.
"There is a bit of a speculative sort of bubble feel about this move," he said.
"Inventory at Chinese ports has been rising.
"It has risen about 30 million tonnes this year so far and the Chinese steel mills are still going strongly but they're certainly not increasing the output of steel in a way that would indicate the price rises that we've seen."
Suburbanites getting emotional about the iron ore price is as silly as the suburbanites swearing at the pokies machine when they've kept priming it for the big payout. Doesn't matter what the Joe Hockeys or media say. And the puppets simply amplify the silliness of emotional reactions.
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