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Iron Ore, The Iron Ore Industry
early birds
post Posted: May 19 2006, 11:49 PM
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In reply to: theflasherman on Friday 19/05/06 11:11pm

Hi flsher
the coal price jump from couple months ago was cost by Chinese Gov took drasick action. they shut down so many small coal mine and odered big one to slow down the work for the serious safety issue. too many poor buger been buried under collapsed mine during that time.
i think my translate is very poor. some missundertood for sure. "emergency meeting" been called only for one reason-------- how to fend off the price hike. there is plenty stock pile in their wearhouse far as i know. so the fight could get argly. my guess is price will be lifted but it'll be less than 18% and also they will buy much less than last year. only my guess though. don't think we'll see over 10% headline GDP growth at next few quarter again.

 
theflasherman
post Posted: May 19 2006, 11:11 PM
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Suti, yes, good observation. The mid-west hopefuls will not be too happy. Their projects are probably still viable but the returns might not be that earth shattering, especially when you consider that this might be the peak of the cycle.

Early Birds, thanks for that! I did quite a bit of work around the Aussie export coal market recently and spot prices rose substantially a couple of months ago coming out of Newcastle and Port Kembla. This suggested to me that their is big demand by the steel making industry. There are other sources of coal and iron ore in Indonesia, but the Indonesian product is generally very poor quality and may actually cost more in the long run. From my observations on the coal project, I think the Chinese are in a very tight spot at the moment. You don't call an "emergency" meeting unless there is an emergency IMO.





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[b]Later, Flash[/b]
 
suti
post Posted: May 19 2006, 11:00 PM
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what has skipped the press is that pellet prices have dropped 3%. this is not exactly good news for the magnetite projects that are in the 'thinking about it' stage especially since capital costs have increased heaps.

 
early birds
post Posted: May 19 2006, 07:59 PM
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In reply to: theflasherman on Friday 19/05/06 07:26pm

it says, four of the steal maker who sign the deal don't represent the major players like Acelor,....still haven't done deal with 3 major supplyer yet.

that four who sign the deal they are the only samll player on the field. they are not the one who can set banch marks.

16 of chinese steal maker having a emergency meeting right now......

they said---- as 40% of wolrd's iron ore user, they won't follow others....... they have the time and size on their side.....
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gees, you are killing me flasher. i'm not good at translate.

seems fight goes on.
i konw there is plenty Ore stock pile in Chinese wearhouse.
longer they drag on the argly it gets........ not good for both side.

 
theflasherman
post Posted: May 19 2006, 07:26 PM
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In reply to: early birds on Friday 19/05/06 09:23am

early birds

care to translate into English?

One point to note so far... BHP have not done any deals... I suspect they are holding out for some of the freight differential over Brazlian ore.



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[b]Later, Flash[/b]
 
early birds
post Posted: May 19 2006, 07:23 PM
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They are probably choking on their rice patties as we speak.
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hmmm............ is that so.

http://info.china.alibaba.com/news/detail/v6-d5704899.html

 


datum
post Posted: May 19 2006, 05:28 PM
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In reply to: jacsar on Friday 19/05/06 02:46am

gday jacsar, flash
The chinese have bought this on themselves, taking far to long to settle prices.
They having been talking down the demand for ironore/commodities to try & drive down the price.
yet there gdp is rising faster than ever at 10% or more.
A recent news report showed fixed asset investment up 27% from a year ago.
I think the chinese probably reduced negotiations to an infantile slanging match.
Now they are paying the price. They are probably choking on their rice patties as we speak.




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This is not a bottom draw stock. This is a stock you take to the grave with you.
 
jacsar
post Posted: May 19 2006, 01:46 AM
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In reply to: theflasherman on Friday 19/05/06 12:48am

The chinese who are normaly good students of history, have slipped up here and should look back to the '70's early '80's for a mirror image when the japanese were screwing the the producers because the mills had the upper hand, how the wheel of history turns ever so subtley.....cheers jacsar

 
theflasherman
post Posted: May 19 2006, 12:48 AM
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Looks like CVRD have done the same deal with Posco (Korean). Also RIO have done a deal with Japan at the same rate. The Chinese are slowly getting squeezed. It will be interesting to see if BHP and RIO can get any of the freight differential they were trying to get last year.



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[b]Later, Flash[/b]
 
theflasherman
post Posted: May 17 2006, 01:54 AM
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Nice....... should stem some decline in BHP & RIO

QUOTE
CVRD iron ore price rise seen paving way for Rio, BHP

Tuesday May 16, 2006, 1:40 pm

MELBOURNE, May 16 (Reuters) - Australian iron ore producers Rio Tinto Ltd./Plc (ASX: RIO) RIO.L and BHP Billiton Ltd./Plc. (ASX: BHP) BLT.L were likely to win iron ore price increases in line with a 19 percent rise secured by Brazil's CVRD, analysts said on Tuesday.

The rise would be above most market estimates, which one analyst said generally centred on a range of 10-15 percent.

CVRD RIO.NVALE5.SA, the world's leading exporter of iron ore said on Monday it had secured a 19 percent increase for 2006 in negotiations with Germany's biggest steel maker ThyssenKrupp A.G. TKAG.DE.

BHP Billiton and Rio Tinto both declined to comment on the deal by Companhia Vale do Rio Doce (CVRD) or the status of their own negotiations with Asian steel makers.

But analysts said historically a deal reached in one region would be quickly followed by equivalent agreements in the other.

"At this stage I would envisage that having got one settlement in Europe, it would be a way of forcing settlement in Asia at the same price," UBS analyst Glyn Lawcock said.

Iron ore producers achieved a 71.5 percent increase in iron ore prices last year, but steel makers have resisted further large price increases this year and talks on price settlements have extended past the April 1 start of the Japanese fiscal year.

China, which has overtaken Japan as the largest iron ore market, has been particularly vocal against another severe price hike.

"This year is a little bit different because you have a very strong and antagonistic buyer in the market and that is China," Daiwa Securities analyst Mark Pervan said.

"I the get the feeling that what will happen is that Japanese steel mills will probably follow pretty quickly at the same price and the Chinese will hold out as long as they can."

But Pervan said Chinese buyers were likely to also agree to a price increase close to the 19 percent set by CVRD.

"I think the iron ore producers will not be willing to concede much with the Chinese because it puts in jeopardy the whole pricing structure of the iron ore market," he said.

BHP Billiton shares eased 2.4 percent to A$29.93 and Rio Tinto shares fell 2.4 percent at A$82.18 in afternoon trade, after a tumble in metals prices, but analysts said the CVRD deal was limiting losses. ($1=A$1.32)




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[b]Later, Flash[/b]
 
 


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