Mr Lennox said there was still no stabilisation in China’s growth and weakness in iron ore prices would not be helped by delays with Roy Hill’s first shipment of iron ore from Port Hedland.
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In a bad night for commodities, iron ore slipped to $US39.06 – a fresh decade-low for the nation’s most important commodity.
China said on Wednesday it would cut some import and export taxes next year to boost its ailing trade sector, raising concerns that cheaper Chinese products could exacerbate a global oversupply of basic materials such as steel and chemicals.
Final results for 2015 Chinese steel consumption is expected to drop for the first time since 1995, said the agency.
“The bearish sentiment in commodity markets is seeing losses accelerate”.
Iron ore has dropped more than 45 per cent this year, nearly what it lost in all of 2014, as global miners from Australia to Brazil kept boosting output while steel demand in China continued to shrink.
China’s refineries shipped a record amount of fuel products, aluminium processors sold their second-highest tonnage of product and steelmakers increased exports by 22 percent to 102 million tonnes in the January-November period, setting a new record, according to preliminary customs data.
Net exports of products from the world’s largest supplier are set to contract to 90 million metric tons from an estimated 98 million tons this year, Li Xinchuang, president at the institute, said in a briefing in Beijing. Though low-priced iron ore miners such as Vale have not scaled back production plans at current price levels, even these producers can not sustain current production levels should prices approach cash production costs.
It’s the main driver of steel demand in China, and with that much housing supply to be worked through, it’s very unlikely demand projections by the miners will be able to hold up. The mine is a significant new participant that will need to find a home for its production, although markets have been aware that Roy Hill’s supply is coming for many months now, he said.
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Country’s iron ore exports stood at 10.75 lakh tonnes in the April-October period of this fiscal, Parliament was informed today. Fat Prophets Resources analyst David Lennox said Australian energy producers were hurting as the USA dollar strengthened ahead of a forecast rate hike in the US.
